Nvidia and Alphabet’s CapitalG in talks to back storage startup Vast Data at $30B valuation amid AI boom

The AI gold rush isn’t just boosting model builders—it’s fueling the companies powering their infrastructure. Vast Data, a storage startup quietly powering the compute-heavy demands of AI giants, is reportedly in talks to raise billions in new funding that could push its valuation to as high as $30 billion, according to Reuters, citing two sources familiar with the matter.

Vast Data Set to Raise Billions in Funding at $30B Valuation With Backing From Nvidia and Alphabet’s CapitalG

Alphabet’s growth-stage investment arm, CapitalG, and existing backer Nvidia are reportedly in discussions to join the round, which may close within weeks. If finalized, the raise could make Vast Data one of the most valuable startups building the infrastructure behind the current wave of AI development.

“CapitalG and existing backer Nvidia are in discussions to participate in the round, which could close in the next few weeks,” Reuters reported, citing sources who requested anonymity to speak on private matters.

We first covered Vast Data when the New York-based storage startup landed $83 million in Series D funding from Tiger Global in a round that tripled its valuation in just a year—pushing it to $3.7 billion and securing its spot in the unicorn club.

Founded in Israel in 2016 and now headquartered in New York, Vast Data has carved out a niche in building software-defined storage tech optimized for AI workloads. Its flash-based architecture is engineered to move massive volumes of data between GPUs without the bottlenecks of older storage systems—helping clients like Elon Musk’s xAI and CoreWeave run compute-intensive models more efficiently.

Vast isn’t new to the spotlight, but this round would mark a dramatic leap from its last valuation of $9.1 billion in 2023. The company has raised around $380 million to date, but sources say this new deal would involve billions more from tech giants, venture capital firms, and private equity players eager to secure a foothold in the infrastructure race behind artificial intelligence.

Its CEO, Renen Hallak, has said Vast is already free cash flow positive, pulling in $200 million in annual recurring revenue (ARR) by January 2025. A separate source familiar with its financials said ARR is projected to triple to $600 million next year, thanks to a strong pipeline of enterprise demand.

CapitalG and Nvidia declined to comment. Vast Data did not respond to requests for comment.

Originally founded by Hallak alongside Jeff Denworth and Shachar Fienblit, Vast Data claims its platform can deliver real-time performance to all data and eliminate the need for hard drives altogether. In a blog post, the company even said its mission is to “direct an extinction event” for traditional storage technologies.

Vast’s growing role in the AI supply chain has also made it a target of interest for M&A bankers, particularly given Nvidia’s appetite for acquiring companies that extend its reach beyond GPUs. Nvidia’s previous acquisitions, including Mellanox in 2020 and more recently AI optimization platform Run:ai, show a clear pattern of vertically integrating its stack to dominate every layer of AI compute.

While Vast has floated the possibility of an IPO, no filing is imminent. Still, industry insiders see the appointment of Shopify’s former CFO Amy Shapero last year as a move that signals the company’s long-term ambitions.

With Nvidia, CapitalG, and a potential $30 billion valuation in the mix, Vast Data is quickly becoming one of the most-watched players building the foundations for AI’s future.