How Vultr Picked up $333M, with AMD Participating

Cloud and AI infrastructure services provider Vultr has raised $333 million on a valuation of $3.5 billion, further highlighting the strength of the red-hot market segment Vultr's helped to establish.

Vultr’s investors include AMD Ventures, the investment arm of Advanced Micro Devices (AMD), whose chips, along with those of rival NVIDIA, are offered as the basis of Vultr’s AI services. The other lead investor is LuminArx Capital Management.

This tranche is the first that Vultr has taken since its founding in 2014 by David Aninowsky, who remains executive chairman. According to its press release, the company has been self-funded for over a decade.

An Escalating Market

Vultr is competing in a high-growth segment. The market leader, CoreWeave, reportedly plans to go public next year at a valuation of $23 billion and has raised $12.7 billion over the past 18 months from debt and equity financing. Also in the market is Lambda Labs, which has raised $820 million so far in 2024 and earlier this year was reportedly seeking another $800 million to cover the cost of more high-end NVIDIA GPUs. And these are just two examples of a growing phalanx of companies with “AI factories” that offer cloud access for enterprise use.

The exponential growth of the AI service providers points to demand for alternatives to AI services from the cloud hyperscalers such as AWS, Microsoft Azure, and Google Cloud. Those companies reportedly charge substantially more for GPU instances than the independent GPU service providers. These providers also claim to have better performance, less complex systems, simpler usage terms, and better customer service than the hyperscalers.

AMD in the Spotlight

AMD’s investment in Vultr is significant. Making headway with companies such as Vultr could streamline AMD’s ability to compete effectively against the market behemoth NVIDIA while showcasing AMD’s capabilities to enterprise customers.

AMD has reportedly been angling to strengthen its position with Vultr, building on a collaboration announced in September 2024. According to that deal, Vultr will offer AMD Instinct MI300X accelerators and ROCm open-source software for new service offerings. And last week Vultr announced it is expanding a cloud datacenter in Chicago with AMD MI300X GPUs, Ethernet adapters from Broadcom, and networking gear from Juniper Networks.

All of this isn’t to say that Vultr is crowding out NVIDIA GPU services: The service provider offers a broad menu of NVIDIA product choices. But its recent close ties to AMD indicate Vultr isn’t putting all of its AI eggs in one basket. “Innovation thrives in an open ecosystem,” said J.J. Kardwell, CEO of Vultr, in the September press release on the partnership with AMD. “The future of enterprise AI workloads is in open environments that allow for flexibility, scalability, and security.”

More Vultr Background

Vultr is headquartered in West Palm Beach, Florida. It has 161 employees, per LinkedIn, which shows 71% growth in hiring over the past two years.

In partnership with the leading datacenter service providers worldwide, the company now hosts services in 32 locations in 18 countries. Besides its GPU cloud services, it offers cloud compute; bare metal; file, block, and object storage (this last in part through collaboration with Wasabi); CDN; database; Kubernetes; serverless; and more. All told, Vultr claims to have launched over 45 million cloud servers.

Vultr also offers cloud computing solutions tailored to fit specific industries, including financial services, healthcare and life sciences, manufacturing and energy, media and entertainment, retail, and telecommunications.

Futuriom Take: Vultr’s latest funding speaks to the momentum in the market for AI services based on GPU hardware from AMD and NVIDIA. AMD’s investment shows the chip vendor’s intent to make inroads in this particular segment.