Nebius, the publicly-traded European AI infrastructure company formerly known as Yandex N.V., has secured a substantial $700 million in financing to power its expansion into the US market. This significant investment will enable the company to accelerate its growth plans, which include establishing a robust presence in the American AI infrastructure landscape.

The financing round, which included "dozens of very well-known investors," according to Nebius CEO Arkady Volozh, saw participation from notable investors such as GPU giant Nvidia, Silicon Valley VC firm Accel, and investment management firm Orbis. While the full list of investors will be disclosed in the company's SEC filing, the involvement of these prominent players underscores the confidence in Nebius's vision and growth potential.

This development comes on the heels of Nebius's return to the Nasdaq stock exchange after a nearly three-year hiatus, imposed due to sanctions against Russian-affiliated companies. The Netherlands-based business, formerly the holding company of Yandex, "the Google of Russia," has undergone an extensive divestment process and emerged as Nebius in July, with plans to offer a "full stack" infrastructure for AI companies spanning data centers, GPU, and related services.

Nebius is adopting a hybrid approach to growing its footprint, involving a mix of co-location facilities (shared data centers) and its own "greenfield" sites built from scratch. This capital-intensive effort requires significant investment, which is why the company is raising additional funding via a private placement. Nebius competes with the usual cloud hyperscalers, as well as well-financed private players such as CoreWeave, which also counts Nvidia as an investor.

In terms of its expansion plans, Nebius recently announced a new GPU cluster at a co-location site in Kansas City and added a co-location site in Paris to its roster. The company is also planning to triple the capacity of its fully-owned data center in Finland. With this new financing, Nebius is poised to accelerate its growth and establish a strong presence in the US market.

Notably, Nebius had previously set aside a portion of its $2.2 billion in cash reserves for a buy-back program, allowing existing investors to exit. However, with the company's shares hovering around the $21 mark, existing shareholders have had ample opportunity to sell their shares on the public market at well over the buy-back agreement price. As a result, Nebius has deemed the offer "no longer warranted," freeing up additional capital for the company's expansion efforts.

Looking ahead, Nebius CEO Arkady Volozh emphasized the need for further capital infusion to support the company's ambitious growth plans. "Of course, we will have some revenues that will help, but we will need more capital to build quicker," Volozh stated. "It's very capital intensive. Technology and capital are two components of this business — I don't worry about the technology (side), and the capital, I think, we will be able to raise." With around $3 billion at its disposal, Nebius is well-positioned to drive its growth strategy forward, although Volozh acknowledged that this amount is still relatively low compared to the capital required to build infrastructure at scale.

As part of its investment, Accel partner Matt Weigand will join Nebius's board of directors, initially with observer status until he's formally elected at the company's AGM in 2025. This move underscores the confidence of investors in Nebius's vision and growth potential, as the company embarks on an exciting new chapter in its journey.