Tensorwave Secures $100M Funding for AMD-Powered Cloud Expansion

TensorWave Secures $100 Million to Expand Data Center Infrastructure

TensorWave, a data center provider specializing in facilities built with AMD hardware, has successfully raised $100 million in a new funding round. This investment will be used to accelerate the expansion of its data center infrastructure.

Funding Details and Investors

The funding round was spearheaded by Magnetar and AMD Ventures. This brings the total capital raised by the company to $146.7 million, as reported by Crunchbase. Additional participants in this round included Maverick Silicon, Nexus Venture Partners, and Prosperity7.

Challenges in the Data Center Market

Current conditions present challenges for data center projects. Increases in tariffs on components like server racks and chips could lead to a 5% to 15% rise in overall data center construction costs, according to an analysis from TD Cowen.

Investor caution is also growing regarding potential overcapacity, especially with the proliferation of affordable AI services. Reportedly, excess capacity is contributing to delays in OpenAI’s planned $500-billion Stargate data center project.

TensorWave’s Growth and Performance

Despite these market concerns, TensorWave reports no slowdown in business activity. The company is projected to achieve a run-rate revenue exceeding $100 million by year-end. This represents a substantial 20x increase compared to the previous year, according to CEO Darrick Horton.

Focus on AMD Hardware

While Nvidia is a dominant hardware vendor for AI model training and deployment, TensorWave strategically adopted AMD early on. This decision aims to deliver cloud services at more competitive price points.

Recently, TensorWave deployed a dedicated training cluster featuring approximately 8,000 AMD Instinct MI325X GPUs. The newly acquired capital will facilitate the growth of this cluster, alongside expanding the company’s workforce and supporting overall operational development, stated Horton.

Team Expansion

Currently, TensorWave employs around 40 individuals. The company anticipates increasing its headcount to over 100 employees before the end of the year.

Vision for the Future

“This $100 million funding propels TensorWave’s mission to democratize access to cutting-edge AI compute,” Horton explained. “Our 8,192 Instinct MI325X GPU cluster is merely the initial step as we solidify our position as the leading AMD-powered provider in the rapidly evolving AI infrastructure market.”

AMD Adoption Across the Industry

Several other data center providers are also investing in AMD’s AI chips. These include startups like Lamini and Nscale, as well as established cloud providers such as Azure and Oracle.

Founding Team Background

TensorWave was co-founded in 2023 by Darrick Horton, Jeff Tatarchuk, and Piotr Tomasik. Tatarchuk previously founded cloud vendor VMAccel with Horton and oversaw the sale of Lets Rolo to digital identity firm Lifekey.

Horton also co-founded crypto mining company VaultMiner Technologies, the parent company of VMAccel. Tomasik co-launched influencer marketing platform Influential and served as a co-founder of Lets Rolo.