On Monday, July 24, the Plano City Council voted unanimously to approve a tax rebate agreement for cloud-computing provider CoreWeave's expansion into Plano. The agreement, which calls for CoreWeave to invest a minimum of $800mm per year in building improvements for the next two years, set the stage for CoreWeave to announce their expansion officially on the 25th. The 454,000+ SF facility, located at 1000 Coit Road, will be the company's first major investment in The Lone Star State.
CoreWeave has been busy: they recently raised $432mm in a Series B funding round and opened a data center in NYC that will serve over 20mm people. Michael Intrator, CEO and Co-founder of CoreWeave, explained his company's Texas investment:
We are pleased to partner with Plano and the local community to open this cutting-edge data center and create new jobs. The 450,000 square foot facility will help meet the unprecedented demand for high-performance cloud solutions for artificial intelligence, machine learning, pixel streaming and other emerging technologies that CoreWeave is uniquely positioned to deliver.
24/7 security and dedicated cooling towers with generators -- multifamily developers, take notes.Source: 1000Coit.com
North Texas' diverse economy, relatively inexpensive energy, and strong research universities were almost certainly a major consideration for their expansion to The Metroplex. Cynics among us will be sure to point toward the tax rebates as a driving factor -- DFW-area local governments have found much success engaging in competition with other municipalities for investment. However, even the most jaded investor cannot deny the positive externalities associated with $1.6bn in investments driving high-skilled jobs in a flourishing industry. John B. Muns, Mayor of Plano, certainly seems to feel good about the deal:
With the demand for machine learning, AI and visual effects/rendering sharply rising, we are thrilled to partner with CoreWeave as the company invests in its first data center in Texas, capable of high-computing solutions for such specialized needs.
There is no doubt that a data center isn't as sexy and eye-catching as a pre-revenue AI startup garnering VC valuations in the 9-figures. Great investments often aren't sexy. Data centers are highly adaptable for different uses and have utility at any point in a market cycle (as long as computers don't go out of style -- someone hand me my slide-rule).
Investment at such a grand scale should be on investors' radar. Jobs within the data-center itself should, through a network effect*, drive growth within the surrounding community. Additionally, the size of the CoreWeave's investment, which implies they are in for the long-haul, should bolster valuations within the area as investors can feel more confident about the area's future.
