By Hamza Faisal

British AI cloud provider Nscale has secured $3.36 billion in financing structured as convertible notes, in one of the largest private capital raises of the year and a clear signal of how much money the artificial intelligence data centre boom now demands. The company announced the round on Friday, just one week after filing its IPO paperwork with the US Securities and Exchange Commission.

The round was led by hedge fund Third Point and includes a mix of new and existing investors, with Goldman Sachs acting as placement agent. Of the total, $2.36 billion is available to the company immediately, while the remaining $1 billion will come from existing investor Nvidia and is scheduled to arrive in mid-November. The notes will convert into equity shares once the initial public offering is completed.

A $35 Billion Bet on AI Infrastructure

Nscale filed its S-1 registration statement on September 18 and is aiming for a listing on the New York Stock Exchange under the ticker NSCL. The Financial Times has reported that the company is targeting a valuation of up to $35 billion, while Bloomberg reported that it is seeking to raise $3 billion in the offering itself.
That target would more than double the $14.6 billion valuation Nscale carried after its $2 billion Series C round earlier this year, which was led by Aker ASA and 8090 Industries. The company was founded in 2024 by Josh Payne as a spin-out of Arkon Energy, an Australian cryptocurrency mining firm, and has moved aggressively into the neocloud market — cloud providers that sell raw computing power to AI companies.

Growth at a Staggering Cost

The IPO filing reveals the economics of the neocloud race in sharp detail. Nscale reported revenue of $140.6 million for the six months ending June 30, up from just $10.4 million in the same period a year earlier — but net losses widened to $1.02 billion from $369 million over the same stretch. The company says it now controls more than 10 gigawatts of power capacity and claims over $103 billion worth of contracts in its filing.
Nscale is developing several large data centre campuses, including sites in Norway and West Virginia, and already operates facilities in Portugal and Texas. It competes with a crowded field of AI infrastructure providers including CoreWeave, Nebius, Lambda and Crusoe. Its board includes former Meta executives Sheryl Sandberg and Nick Clegg, alongside former OpenAI executive Fidji Simo.
The size of the convertible raise underscores a broader industry trend: building the physical infrastructure for AI has become a capital-intensive arms race, and even companies with billion-dollar losses are finding investors willing to fund their expansion ahead of public listings.