Blackstone Invests $1.2B in India’s Neysa for AI Infrastructure
▼ Summary
– Neysa, an Indian AI infrastructure startup, has secured up to $600 million in primary equity from Blackstone and co-investors, with Blackstone taking a majority stake.
– The company operates as a “neo-cloud,” providing customized, GPU-first infrastructure with dedicated support for enterprises, government agencies, and AI developers in India.
– The investment addresses surging global demand for AI compute and India’s specific need for local capacity, with Blackstone estimating the country’s GPU count could scale from under 60,000 to over two million.
– Neysa plans to use the capital to deploy large-scale GPU clusters and expand from its current ~1,200 GPUs, targeting over 20,000 and aiming to more than triple its capacity and revenue next year.
– This deal aligns with Blackstone’s global strategy of investing in data center and AI infrastructure, having previously backed similar providers like CoreWeave and QTS.
A major investment from global private equity leader Blackstone is set to accelerate India’s domestic artificial intelligence infrastructure. The firm, alongside co-investors Teachers’ Venture Growth, TVS Capital, 360 ONE Assets, and Nexus Venture Partners, has committed up to $600 million in primary equity to Mumbai-based startup Neysa, granting Blackstone a majority stake. This substantial equity infusion is complemented by plans for an additional $600 million in debt financing, marking a dramatic scale-up from the company’s previous $50 million in funding. The capital is earmarked for a rapid expansion of GPU capacity, addressing a critical shortage in specialized computing power needed for AI development.
The global surge in AI has created intense demand for the chips and data center space required to train complex models. A new class of providers, often called “neo-clouds,” has emerged to fill this gap by offering dedicated, readily available GPU resources. These platforms often provide faster deployment and more tailored services than large, traditional cloud providers, which is particularly appealing to enterprises, government bodies, and AI labs with specific needs around data regulation, performance latency, or customization.
Neysa operates squarely in this high-growth segment, positioning itself as a GPU-first infrastructure provider for the Indian market. The company focuses on delivering customized solutions and hands-on support, a service model it says differentiates it from larger hyperscale competitors. “Many clients require extensive guidance and expect round-the-clock support with rapid response times. These are the services we excel at providing, which aren’t always a priority for the major cloud platforms,” explained Neysa’s co-founder and CEO, Sharad Sanghi.
The investment thesis is underpinned by the vast growth potential for AI compute within India. Ganesh Mani, a senior managing director at Blackstone Private Equity, highlighted the current market scale and its trajectory. He estimates that India currently has fewer than 60,000 GPUs deployed, a figure Blackstone projects could skyrocket nearly thirtyfold to surpass two million in the coming years. This explosive growth is expected to be fueled by government initiatives, enterprises in regulated sectors like finance and healthcare that must keep data onshore, and a burgeoning community of domestic AI developers. Furthermore, global AI labs with massive Indian user bases are increasingly seeking local compute capacity to reduce latency and comply with data sovereignty requirements.
This move aligns with Blackstone’s strategic focus on data center and AI infrastructure assets worldwide. The firm’s portfolio includes large-scale platforms like QTS and AirTrunk, as well as specialized AI infrastructure companies such as CoreWeave in the United States and Firmus in Australia. Neysa represents a targeted bet on India’s specific and rapidly unfolding opportunity.
Neysa’s business involves developing and operating GPU-based infrastructure that allows enterprises, research institutions, and public sector clients to train, fine-tune, and run AI models locally. The startup currently has approximately 1,200 GPUs operational and has ambitious plans for scaling. It aims to deploy over 20,000 GPUs over time as customer demand intensifies. “The demand pipeline indicates we will more than triple our capacity next year,” Sanghi noted. “Several advanced discussions are underway, which could accelerate this timeline significantly. We could see this expansion materialize within the next nine months.”
According to Sanghi, the new capital will primarily fund the deployment of large-scale GPU clusters, encompassing compute, networking, and storage systems. A smaller portion will be allocated to research and development and to enhancing Neysa’s proprietary software platforms for workload orchestration, system observability, and security.
Founded in 2023, Neysa employs 110 people across offices in Mumbai, Bengaluru, and Chennai. With the accelerating demand for AI workloads, the company aims to more than triple its revenue in the coming year and harbors ambitions to expand its operations beyond India in the future.
(Source: TechCrunch)
