Data infrastructure company VAST Data has raised a substantial new round of funding from investors including Fidelity Investments, valuing the startup at over $9 billion.
The seven-year-old company, which provides software and storage solutions to facilitate AI applications, plans to use a portion of the new capital to buy back stock from existing shareholders, according to people familiar with the matter. While the precise amount raised was not disclosed, the new shares were priced significantly higher than previous rounds.
VAST Data did not necessarily require new funding for operations, as CEO and co-founder Renen Hallack stated the company has largely left previous capital unspent. However, the new round does speak to surging investor appetite for picks-and-shovels plays in the red-hot AI sector amid the rise of generative AI.
With customers including Pixar, Verizon, and high-frequency trading firms, VAST expects over $100 million in revenue for 2023 - more than triple 2022's sales tally. The new valuation and strong top-line growth point to the market potential for Vast's offerings facilitating data infrastructure for AI systems.
The fresh backing from top-tier investment firms such as Fidelity also serves as a vote of confidence in VAST's strategy. Large mutual funds have become increasingly active in late-stage startup funding rounds, aiming to gain early exposure to tomorrow's public market tech leaders.
Previous prominent VAST Data backers include NEA, Norwest Venture Partners, 83North and General Atlantic. The latest raise suggests investor enthusiasm remains substantial as Vast Data continues scaling up its data and analytics infrastructure business in the AI computing mega-trend.