AI Storage Platform Vast Data Aimed for $25B Valuation in New Round, Sources Say

Vast Data, a company specializing in AI-friendly data storage solutions, is reportedly seeking to raise a new funding round that could value the company at approximately $25 billion, according to sources familiar with the deal. This marks a significant increase from its previous valuation.

Earlier this year, Vast Data was aiming for this substantial valuation, which would represent a considerable leap from the $9 billion Series E valuation the company achieved in December 2023. This potential increase reflects the growing demand for AI-optimized data storage solutions.

While the deal is not yet finalized, and terms, including the valuation, remain subject to change, the sources indicated that the requested valuation was perceived as high, even considering the company’s impressive growth. Despite this, numerous venture capital firms are reportedly interested in and closely monitoring Vast Data’s progress.

Vast Data has not yet responded to requests for comment regarding the funding round.

The company provides data management software combined with unified CPU, GPU, and data hardware from vendors like Supermicro, HPE, and Cisco. Unlike traditional data storage systems that rely on tiered storage solutions, Vast Data aims to eliminate these tiers, particularly focusing on flash storage.

The rise of AI has significantly benefited Vast Data’s business. Their platform unifies structured, semi-structured, and unstructured data in a single location, which accelerates data retrieval and reduces the costs associated with model training and inference. This unified approach is highly valuable for organizations leveraging AI technologies.

Vast Data’s customer base includes major enterprises such as Pixar, ServiceNow, and xAI, as well as next-generation AI cloud providers like CoreWeave and Lambda, which utilize Vast’s technology to provide storage capabilities to their end users. These partnerships highlight the company’s growing influence in the AI infrastructure landscape.

Vast Data’s annual recurring revenue (ARR) was reported at $200 million when it completed its Series E funding round approximately 18 months ago. Renen Hallak, Vast’s CEO and co-founder, mentioned in a podcast last May that the company has experienced year-over-year growth of 2.5x to 3x. Additionally, the company has maintained a positive free cash flow for the past four years, indicating strong financial health.

In the data storage market, Vast Data competes with established players such as Pure Storage, which has a market capitalization of nearly $17 billion, and Weka, which recently raised $140 million at a $1.6 billion valuation. Vast Data is also expanding its capabilities by developing a database architecture to compete with offerings from companies like Databricks.

Prior to its current funding efforts, Vast Data had raised a total of $381 million from investors, including Fidelity Management & Research Company, NEA, BOND Capital, and Drive Capital. These investments have fueled the company’s growth and innovation in the AI data storage space.