Nebius, a new player in the AI cloud infrastructure space, has officially debuted on the Nasdaq stock exchange under the ticker symbol NBIS. The company's unusual journey to its initial public offering (IPO) has been marked by a lack of fanfare, with no roadshows, ceremonies, or publicity. This is because Nebius is an unusual beast: a public company that has been operating as a startup in every sense of the word.

Nebius has its roots in Yandex N.V., the Dutch holding company of Russian internet giant Yandex. In May 2011, Yandex N.V. went public, but its fortunes took a dramatic turn in 2022 when Russia's invasion of Ukraine led to sanctions being imposed on Russian-affiliated companies. As a result, Nasdaq halted trading in Yandex N.V. shares, and the company was eventually delisted. However, Yandex successfully appealed the decision, citing its restructuring efforts, which took an additional 16 months to complete.

Part of this restructuring involved offloading all Russian assets, which were the primary source of business value. What remained under Yandex N.V.'s ownership was a diverse assortment of infrastructure and business units located outside of Russia. This divestment concluded in July, with Yandex N.V. changing its name to Nebius AI, an AI cloud platform with its own Finnish data center.

The new business is spearheaded by Arkady Volozh, the Russian Yandex co-founder and former CEO who was removed from a European sanctions list in March after publicly condemning Russia's assault on Ukraine. Nebius sells GPUs (graphical processing units) "as-a-service" to companies requiring "compute" – processing power and resources to execute computational tasks such as running algorithms and machine learning models. Last month, the company launched a holistic cloud computing platform designed for the "full machine learning lifecycle," spanning data processing, training, fine-tuning, and inference.

With the restructuring complete, and Volozh free to run the show from the company's new headquarters in the Netherlands, Nasdaq gave the green light for Nebius to recommence trading last month. The situation is unprecedented, with a public company whose trading was put on pause, only to resume nearly three years later under a new name and entirely different business proposition.

In many ways, it would have made sense for Nebius to delist and grow with private capital, the traditional startup route. However, as Volozh explained to TechCrunch, building infrastructure is capital-intensive, and the easiest and cheapest way to access capital in the hot AI cloud infrastructure space is via the public markets. But there was never any certainty on how the public markets would respond to this strange new entity.

A month into its relaunch, Nebius has enjoyed a somewhat tepid re-entry to public life; it's significantly down on its $18 billion market cap before trading halted in February 2022, which was to be expected, and it has since yo-yoed between $3.5 billion and $4.75 billion, with some signs that it is starting to settle.

Nebius competes with the usual hyperscaler cloud behemoths, though its more direct rivals are other alternative cloud startups such as CoreWeave, which has raised a significant amount of cash this year. With CoreWeave expanding from the U.S. into Europe, Nebius is moving in the opposite direction, announcing plans to extend its presence to the U.S. with a new GPU cluster in Kansas City scheduled to go live in early 2025.

The company has also opened "customer hubs" in San Francisco and Dallas, with plans for a third in New York by the end of the year. While the cloud infrastructure business is its bread and butter (accounting for two-thirds of its revenue, as per its first earnings report last month), there's a triumvirate of additional businesses under the Nebius Group umbrella.

This includes an autonomous vehicle company called Avride, based in Texas; a Swiss-based generative AI and LLM company called Toloka; and edtech platform TripleTen, located in Wyoming. Avride descends from the international division of Yandex's self-driving unit, which spun out of a joint venture with Uber in 2020.

Yandex was an early trailblazer in Russia, with Volozh noting that the company had been on the cusp of beating Waymo to launch the first fully autonomous cars on public roads, before the war put the kibosh on plans. The team that had been working on Yandex's autonomous vehicle project transitioned over to Avride, a new brand it launched last year, eventually moving to Austin via Tel Aviv.

Last month, Avride announced a significant multi-year partnership with Uber, which saw Avride's sidewalk food delivery robots land on Uber Eats starting in Austin, though the partnership will also bring Avride's self-driving cars to the Uber platform later.

While Yandex had sufficiently deep pockets to fund autonomous vehicle projects, Nebius doesn't – it has a couple billion dollars in the bank from its Russian divestment, and it's laser-focused on building its cloud infrastructure business. And this is why Volozh says that Avride will need to find additional partners in the longer term.

Toloka, meanwhile, is a platform that specializes in data labeling and quality control for large language models (LLMs) and related AI systems – it's much like Scale AI, which was most recently valued at more than $13 billion. Toloka has clear synergies with Nebius's core infrastructure business, but the customers aren't the same. Nebius works largely with generative AI startups seeking compute, whereas Toloka works with bigger companies such as Amazon and Hugging Face that want to improve their LLMs.

Both Toloka and Avride could eventually follow a similar path to that of ClickHouse, creators of the eponymous open-source database management system that spun out of Yandex in 2021. While the commercial ClickHouse entity secured big-name backers such as Index Ventures, Benchmark Capital, and Coatue, Nebius has retained a minority stake.

TripleTen, on the other hand, is something of an outlier in the Nebius group of businesses, in that it's pretty much a direct-to-consumer product that offers online coding bootcamps for those wishing to transition into the technology sector. One idea Nebius is dabbling with is to position itself as a provider of a "full stack of services" to AI companies, from data centers and GPU infrastructure, to education.

For now, TripleTen is breaking even, and Volozh acknowledges that it's not going to be the big revenue driver that its infrastructure business is – but it has the potential to provide meaningful income and will remain part of the Nebius Group.

"Nebius is a billion-dollar scale business," Volozh said. "TripleTen – it's a nice model, but it's maybe a tens or hundreds-of-millions of dollars business. It's not a billion-dollar business."

As for the core Nebius AI cloud business, the company already has its fully owned data center facility in Finland, with plans to triple its capacity to 75 megawatts. In tandem, the company is building out additional sites at co-location facilities, a move designed to not only increase its capacity but also to reduce latency by bringing the processing closer to its customers. In addition to the Kansas location announced this week, Nebius had already unveiled a new GPU cluster in Paris that goes online this month.

Further down the line, Nebius plans to build more of its own data centers, both in Europe and the U.S., but given the time it takes, it's quicker to plug the gap with co-location facilities, which is why it's forging ahead with a hybrid approach.

"It's more efficient if we build it ourselves, but to build means a year and a half or two years — it's a long process, and we can't wait," Volozh said. "That's why we have these co-locations in Paris and Kansas City."