Nvidia is seeking to transform artificial intelligence computing into a new investable asset class, partnering with six major asset managers to mobilise more than $500 billion in third-party capital for AI infrastructure.
The chipmaker on Monday announced memorandums of understanding with Apollo Global Management, Blackstone, BlackRock, Brookfield Asset Management, Goldman Sachs and KKR to establish financing platforms for its customers.
Executives from the seven companies discussed the initiative in a rare joint interview with CNBC, outlining plans to provide financing for hyperscalers, frontier AI laboratories and enterprises seeking to expand data centres and acquire Nvidia hardware.
The initiative could mark a significant shift in how the rapidly expanding AI infrastructure sector is financed, as institutional credit, insurance funds and private capital are brought in to fund data centres and Nvidia-powered computing infrastructure.
Nvidia Chief Executive Officer Jensen Huang said the initiative represents a fundamental change in how technology hardware is viewed by financial markets.
“This is really the first time that technology chips have become an investable asset class,” Huang said.
According to Huang, Nvidia’s chips can be treated as revenue-generating, long-lived and transferable assets, allowing lenders to assess computing infrastructure in much the same way they evaluate other forms of productive infrastructure.
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“Fundamentally, what’s different about this industry and this way of doing computing is that the computer is now part of the infrastructure, like electricity, like the internet,” he said.
The financing model challenges the traditional perception of graphics processing units (GPUs) as rapidly depreciating technology hardware, instead positioning AI computing capacity as long-term infrastructure that can support debt financing.
However, the model could face questions over the ability of AI chips to retain their value as Nvidia and other chipmakers introduce newer generations of increasingly powerful processors.
The initiative comes as technology companies accelerate spending on AI infrastructure, with major cloud providers and other hyperscalers expected to commit hundreds of billions of dollars to data centres, chips and related equipment.
The scale of the investment has also raised concerns among investors over whether AI spending will generate sufficient returns.
Rating agencies, including Moody’s, have warned that surging capital expenditure is putting pressure on the free cash flow of major technology companies and could increase their reliance on debt.
Wall Street embraces AI as financeable asset
Executives from the participating financial institutions said the rapid growth in demand for AI computing has created an opportunity to establish a new market for financing AI infrastructure.
Goldman Sachs Chief Executive Officer David Solomon described the initiative as part of a historic investment cycle in artificial intelligence.
“We’re in a pivotal moment of a historic AI investment cycle,” Solomon said.
Solomon disclosed that Huang approached the Wall Street firms with the idea of developing the financing structure.
Blackstone President Jon Gray said AI computing could eventually be financed in a manner similar to residential property, with lenders assessing the underlying asset and its ability to generate revenue.
Gray said demand for AI computing was significantly exceeding supply, adding that AI usage across Blackstone’s portfolio companies had increased sevenfold this year.
BlackRock Chief Executive Officer Larry Fink described the initiative as the beginning of a new phase of financial engineering, comparing its potential significance with the development of mortgage-backed securities in the 1970s.
Fink said some capital had already been raised for the initiative but indicated that BlackRock intended to raise significantly more.
“We need to raise this money as fast as possible and put this to work,” Fink said, arguing that expanding AI infrastructure was critical to maintaining US leadership in artificial intelligence.
The partnership brings together Nvidia’s dominant position in AI computing with the financing capacity of some of the world’s largest asset managers, potentially creating a new pool of capital dedicated to funding the infrastructure underpinning the global AI boom.
