Nscale raises $3.36B in convertible financing ahead of its US IPO

Nscale, a British AI cloud company, has raised $3.36 billion in convertible financing ahead of the initial public offering it plans for later this year. The company announced the raise on Friday, September 25.

"This marks a milestone for Nscale as we continue scaling our full-stack AI infrastructure to meet unprecedented global demand," said Josh Payne, founder and CEO of Nscale. "With the backing of these world-class investors, we are strongly positioned to accelerate our data center buildouts globally."

How the financing is structured

The round is led by hedge fund Third Point. Of the $3.36 billion, $2.36 billion is available to the company at closing, while an additional $1 billion committed by existing investor NVIDIA is expected in mid-November.

The notes convert automatically into ordinary shares once the IPO completes, with NVIDIA receiving non-voting shares. Apollo-managed funds, Citadel, Hudson Bay Capital and the Abu Dhabi Investment Council also joined the financing. Goldman Sachs & Co. LLC acted as placement agent.

The IPO

Nscale filed its IPO paperwork last week. The Financial Times reported that the company is expected to be valued at $35 billion on the NYSE, while Bloomberg said it is seeking to raise about $3 billion in the offering.

Nscale was spun out of Australian crypto mining company Arkon Energy two years ago. According to its IPO filing, its total contracted value now exceeds $103 billion. The company is building several large data center campuses, including in Norway and West Virginia.

Why it matters

Nscale belongs to the fast-growing neocloud category: providers that rent out GPU clusters and sell AI cloud capacity. Its best-known peers are CoreWeave and Nebius. Data centers at this scale require tens of billions of dollars, so companies raise debt and convertible notes long before they list.

Investors are also watching customer concentration. According to the Financial Times and other outlets, Nscale's IPO filing showed that a single customer accounted for 73% of its $33 million in 2025 revenue, and reporting linked that customer to a subsidiary of ByteDance. In the first half of 2026 the share fell to 52%, and the company expects it to drop below 20% as large contracts with Microsoft and Anthropic ramp up.