The Pulse
Nscale Is in Talks to Raise $3.5 Billion Before Possible U.S. IPO, Reuters Reports
Reuters reported that Nscale is discussing a pre-IPO financing package involving convertible notes and potential Nvidia funding, while a separate Nscale-Figure compute agreement carries an initial $3.5 billion commitment.
AI.info Team ·
Reuters reported on September 4 that London-based AI infrastructure provider Nscale is in talks with potential investors to raise about $3.5 billion in financing before a possible U.S. initial public offering. Bloomberg News first reported the discussions, according to Reuters.
The potential fundraising has not been confirmed by Nscale. Reuters, citing a source familiar with the matter, reported that the company intends to sell as much as $1.5 billion in convertible notes to a group of investors and aims to secure about $2 billion from Nvidia. Discussions over the potential investors and the size of the investment are continuing and could change, the source said.
Goldman Sachs is working on the fundraising, Reuters reported, and New York-based hedge fund Third Point is set to lead the convertible-note investment. Nscale and Goldman Sachs declined to comment to Reuters. Third Point and Nvidia did not immediately respond to Reuters requests for comment.
Figure Agreement Is a Separate $3.5 Billion Compute Commitment
One day earlier, on September 3, Nscale announced a multi-year strategic partnership with humanoid-robotics company Figure. That commercial agreement includes an initial commitment of $3.5 billion of compute, with the stated intent to scale the commitment to more than $6 billion.
The companies said they are targeting initial deployment in the second half of 2027 at Barstow, Texas, using the Nvidia Vera Rubin platform and potentially up to 100,000 Nvidia GPUs. Nscale said it is also making a strategic investment in Figure and that the partnership is intended to support the next generation of Figure’s Helix models and humanoid robotics.
“We’re excited to partner with Figure as physical intelligence becomes AI's next frontier,” said Josh Payne, CEO and Founder of Nscale. “We've seen incredible growth with inference and agentic AI and Figure is pushing the boundaries of AI even further. We're proud to be enabling the future of AI robotics together.”
The Figure announcement is separate from the reported pre-IPO financing talks. It does not confirm that Nscale has agreed to raise $3.5 billion, nor does it establish the terms, participants or timing of any prospective fundraising.
Convertible Notes and a Possible IPO
Reuters reported that the proposed convertible notes are being offered at a double-digit discount to Nscale’s eventual IPO price. According to the source, the discount would be adjusted up to a $30 billion valuation; above that level, the conversion price would remain unchanged.
Convertible notes are debt instruments that can convert into equity under defined terms. In the reported Nscale discussions, they would allow investors to provide financing before a listing while retaining the possibility of receiving shares later.
The company was valued at $14.6 billion in March after raising $2 billion in a Series C round, Reuters reported. Nscale, founded in 2024, owns and operates data centers, graphics-processing units and software intended to provide large-scale AI computing capacity.
Reuters also reported last month that Anthropic had signed a six-year, $45 billion agreement to rent AI computing capacity from Nscale’s West Virginia data-center campus. The reported financing discussions would therefore come as Nscale pursues capital for its data-center and GPU operations ahead of a possible public offering.
For now, the $3.5 billion financing package remains under discussion, based on Reuters’ reporting. Nscale has not announced a completed transaction or confirmed the reported financing structure.