CoreWeave Inc. went public on the Nasdaq this year and has a market capitalization of more than US$70-billion.Brendan McDermid/Reuters
U.S. company CoreWeave Inc. CRWV-Q will operate a data centre opening next month in Cambridge, Ont., where Canadian artificial-intelligence company Cohere Inc. will be a customer.
Cohere, which was last valued at US$5.5-billion, builds large language models and generative AI tools for business customers. The federal government announced in December it would give up to $240-million to the company for its computer processing needs, or compute, in industry jargon.
The funding stems from a $2-billion spending package Ottawa created last year to help Canadian companies access the computing infrastructure necessary to build and run AI models and to encourage companies to develop more data centres here.
The government said when it announced the funding to Cohere that it helped incentivize the construction of a new multibillion-dollar AI data centre in Canada that would have capacity for other companies as well.
“By bringing cutting-edge compute to Canadian soil, we’re creating a foundation that will empower more Canadian researchers, startups and enterprises to compete globally,” Cohere co-founder and chief executive officer Aidan Gomez said in a statement on Wednesday.
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The data centre in Cambridge, which is slated to be fully operational in August, was owned by BlackBerry Inc. BB-T until 2017, and French company OVHcloud is currently a tenant in the building. A zoning application submitted last July to the City of Cambridge shows the property owner intended to convert the warehouse portion of the building into a new data centre.
Real estate ownership records link the property to TowerBrook Capital Partners, a private equity firm with offices in New York and London. TowerBrook has partnered with U.S. data centre company Related Digital on the facility, according to a source familiar with the matter.
The Globe and Mail is not identifying the source because they are not authorized to talk publicly. TowerBrook and Related Digital declined to comment.
Related Digital said earlier this year that it is developing a 64-megawatt data centre expansion project in Ontario.
When the government announced the funding for Cohere in a press release last year, it did not note that the data centre infrastructure would be operated by CoreWeave. The funding arrangement has been criticized by some industry observers because public dollars ultimately flow to an American company.
Evan Solomon, Minister of AI and Digital Innovation, defended the arrangement in an interview last week.
“What I don’t want to do is a purity test on sovereignty. The main thing is keeping a company that’s Canadian headquartered in Canada,” he said.
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Cohere, which was founded in 2019 by Mr. Gomez, Nick Frosst and Ivan Zhang, has been championed by the federal government. Mr. Gomez met recently with Prime Minister Mark Carney, who wants to use AI to increase government productivity and efficiency.
CoreWeave did not immediately reply to a request for comment. The company went public on the Nasdaq this year and has a market capitalization of more than US$70-billion.
Demand for data centres is booming thanks to generative AI, and access to this infrastructure is seen as a competitive advantage. A number of countries, including Canada, also see it as a matter of economic security.
Telecommunications firms Telus Corp. T-T and BCE Inc. BCE-T are getting into the market, too. Telus has plans to convert two of its data centres to handle AI, while BCE said in May it will open six facilities in British Columbia.