Nivida is invested in some of the largest neoclouds and sells GPUs to these businesses.
Venture investors have never invested more in AI neocloud companies, according to PitchBook data. It’s still not enough, according to Nvidia CEO Jensen Huang.
Global VC investment in AI neoclouds—companies that sell remote access to GPUs for AI workloads—has reached $6.6 billion across 58 deals so far this year. That’s more money and deals than any prior year and 51% above last year’s total of $4.4 billion.
In an interview with CNBC, Huang said that “the demand for neoclouds is off the chart,” but that “the demand of the capital is much greater” than availability.
Much of the AI neocloud sector is being funded by VC mega-rounds and by borrowing to bankroll chips.
“Working capital could be debt,” said David Yakobovitch, general partner at DataPower Capital, an investor in Nscale and Together AI. “It doesn’t necessarily mean equity.”
London-based Nscale, for example, raised a $2 billion Series C in March—nearly a third of 2026’s AI neocloud total funding— at a $14.6 billion valuation. In February, it also secured a $1.4 billion debt facility secured by its GPUs. The company filed to go public in September.
Other mega-rounds include Together AI, which raised an $800 million Series C in July at an $8.3 billion valuation. Its previous valuation was $3.3 billion in February of 2025.
Nvidia itself has been investing heavily in the AI neocloud space. It is among the investors in Nscale and Together AI. It also sells the GPUs that neoclouds are raising money to buy.
“Jensen has a lot of skin in the game,” Yakobovitch said.
Public markets remain unconvinced about the need to funnel ever more capital into the AI buildout.
The shares of CoreWeave and Nebius have slid on worries that this spending will take too long to pay off.
Yakobovitch expects a wave of consolidation in the AI neocloud space, particularly among companies that don’t own their infrastructure.
“I think companies with the war chests, the incumbents like Meta, Google, Amazon, and Microsoft will buy some of these neoclouds,” he said. “It’ll be at big discounts, though.”
https://pitchbook.com/news/articles/neoclouds-secure-record-funds-as-nvidias-huang-says-more-investment-required?shem=aimgspe,
