In 2016, three New York commodities traders — Michael Intrator, Brian Venturo and Brannin McBee — fell in love with cryptocurrencies. They were using Bitcoin to bet on pool games and fantasy football and were captivated by its wild swings in price.
They soon decided to create more digital currencies through a process called “mining,” which requires a lot of computing power. So they logged on to Amazon and ordered two Nvidia graphics processing units, or GPUs, powerful chips that can run calculations and analyze enormous amounts of data. They then stockpiled the components, filling up a garage and a warehouse.
In 2017, Mr. Intrator, Mr. Venturo and Mr. McBee started the company Atlantic Crypto to mine cryptocurrencies. When crypto prices cratered two years later, they renamed the business CoreWeave and raised money to buy as many GPUs from distressed crypto miners as possible. Their bet: that the chips would eventually feed the development of artificial intelligence, whose creation also requires substantial computing power.
They were right. When OpenAI released the ChatGPT chatbot in 2022 and unleashed an A.I. frenzy, the demand for computing power exploded — and CoreWeave was in the sweet spot.
“We assumed this was going to happen,” Mr. Intrator, 55, CoreWeave’s chief executive, said in a 2023 interview with The New York Times. “We were well positioned for this transition.”
CoreWeave is now set to find out whether it is in the sweet spot again — this time with Wall Street. This month, the tech company filed paperwork for a public listing. If its initial public offering of stock goes as planned, it will be the first prominent A.I. start-up to reach the stock market. And it would test investor appetite at a time when the market has slipped into a correction, which could delay an offering.
Perhaps most important, CoreWeave’s I.P.O. would give investors a direct taste of the A.I. boom. Unlike tech giants such as Nvidia and Google, which have many businesses, CoreWeave is known in industry parlance as a “pure A.I. play” because it has focused solely on A.I. chips and sells processing capacity to clients that want to build A.I. tools.
“It would be the first really big tech I.P.O. to hit the markets this year and one that fits squarely into the A.I. narrative that everyone seems to want a piece of,” said Brianne Lynch, the head of market insight at EquityZen, which helps private companies and their employees sell their stock.
While CoreWeave is based far from Silicon Valley in Livingston, N.J., it has tech industry bona fides. Nvidia owns around 4 percent of the start-up and supplies most of its chips. Last week, CoreWeave also announced a deal to sell computing power to OpenAI worth up to $12 billion. As part of the agreement, OpenAI will take a $350 million stake in CoreWeave when it goes public.
The young company, which has raised $2.3 billion in venture capital and was last valued in the private markets at $19 billion, is expected to go public this month at a valuation of about $35 billion, Ms. Lynch said.
CoreWeave has been growing rapidly, with revenue reaching $1.9 billion last year, compared with $229 million a year earlier, according to its financial filings. But it lost $863 million last year after spending nearly $1 billion to finance the building of new data centers, large facilities that house its A.I. chips.
If CoreWeave’s public offering goes well, other tech companies could be motivated to follow, potentially leading to an “I.P.O. parade,” said Mark Klein, the chief executive of SuRo Capital, a venture capital firm that has invested in CoreWeave. The company aims to raise about $4 billion in its public offering, he added.
CoreWeave declined to comment ahead of its I.P.O., and Nvidia declined to comment on its investment in the start-up. OpenAI also declined to comment.
Mr. Intrator and Mr. Venturo, who is 40, met in 2006 at a New York hedge fund, Natsource, where they both worked. They later created a hedge fund together before founding CoreWeave in 2017 alongside Mr. McBee, now 39. Mr. Intrator became chief executive, Mr. McBee became chief strategy officer and Mr. Venturo chief technology officer.
The three men soon amassed Nvidia chips to mine cryptocurrencies. For a time, Mr. Intrator, Mr. Venturo and Mr. McBee stockpiled the chips in a downtown Manhattan office, but they became worried that the intense heat from the components might burn down their building. So they moved the chips to Mr. Venturo’s grandfather’s garage in New Jersey, and then to a warehouse.
By 2018, CoreWeave was pitching investors on a plan to diversify from crypto and into high-end graphics, which need GPUs to render images, said Nic Carter, who invested in the company that year and now runs the crypto investment firm Castle Island Ventures.
“They had this whole plan to go to visual-effects conferences and hand out free credits,” he said. “They were going to become the data center of choice for hobbyists and animation and movies.”
Mr. Intrator, Mr. Venturo and Mr. McBee approached the business by “trading GPUs like commodities” and betting that they could repurpose the chips at the exact moment that crypto mining became unprofitable, Mr. Carter said.
Until then, CoreWeave had to be scrappy. Unable to raise much venture capital, Mr. Intrator kept the start-up alive by gathering money from family offices and wealthy commodities traders he and his co-founders were friends with.
“This company could have easily gone out of business many times,” Mr. Carter said.
CoreWeave’s big break came in 2021 when the hedge fund Magnetar invested $50 million. Then OpenAI released ChatGPT, shocking people with how the chatbot could answer questions, generate essays and compose love poems.
Demand for CoreWeave’s computing power skyrocketed. In the first five months of 2023, the company signed contracts with A.I. research labs and other customers totaling $7 billion, Mr. Intrator said in the interview that year.
That April, Nvidia invested $100 million in CoreWeave at a $2 billion valuation, on top of another $200 million from Magnetar. CoreWeave needed to build more data centers, so that August, it secured $2.3 billion in debt financing, using its chips as collateral. By last year, its valuation had risen to $19 billion.
The company now has 32 data centers in the United States and Europe, according to its prospectus, and about 800 employees.
Last year, Mr. Venturo became the company’s chief strategy officer and Mr. McBee the chief development officer. Along with Mr. Intrator, they have each sold more than $150 million of their CoreWeave stock, according to the company’s prospectus.
Together, Mr. Intrator, Mr. Venturo and Mr. McBee own 30 percent of the company, with a special class of shares giving them around 80 percent of the voting power. CoreWeave’s single largest shareholder is Magnetar, which has about a 25 percent stake.
CoreWeave faces stiff competition from Amazon, Microsoft and Google, which also provide computing power. And its business is heavily dependent on a single customer — Microsoft, which generated 60 percent of CoreWeave’s revenue last year.
On a December podcast, Satya Nadella, Microsoft’s chief executive, called the company’s contract with CoreWeave a “one-time thing,” spurred by a scarcity of A.I. chips after ChatGPT’s release. Most of those contracts end in 2029, and Microsoft has invested billions of dollars building its own data centers.
(The Times has sued OpenAI and Microsoft, accusing them of copyright infringement of news content related to A.I. systems. OpenAI and Microsoft have denied those claims.)
Last week, CoreWeave said it had agreed to buy Weights & Biases, an A.I. software start-up that helps companies manage A.I. tools, which could help diversify its customer base.
Even with CoreWeave on the cusp of a Wall Street debut, Mr. Carter said his conversations with Mr. Venturo and Mr. McBee revolved around the same topics as before: sports betting and crypto.
“They’re still traders at heart,” Mr. Carter said.
