Which investors focus on cloud infrastructure?

This blog post has been written by the person who has mapped the cloud infrastructure market in a clean and beautiful presentation

Cloud infrastructure has become the battleground for the world's largest investment flows, with mega-rounds exceeding $6 billion becoming the new normal.

The sector witnessed unprecedented funding volumes in 2024, with average deal sizes jumping from $133 million to $407 million per round. Major players like Andreessen Horowitz and Thrive Capital are leading billion-dollar rounds, while specialized funds emerge to capture emerging opportunities in edge computing and sovereign cloud infrastructure.

And if you need to understand this market in 30 minutes with the latest information, you can download our quick market pitch.

Who are the top investors actively funding cloud infrastructure startups in 2024 and 2025?

The cloud infrastructure investment landscape is dominated by three distinct categories of investors, each bringing different strategic advantages and capital depths.

Traditional venture capital firms lead the charge, with Andreessen Horowitz spearheading mega-rounds including xAI's $6 billion Series C and Databricks' $10 billion late-stage round. Thrive Capital co-leads multiple billion-dollar deals, including OpenAI's $6.6 billion convertible debt round. Lightspeed Venture Partners maintains active involvement across seed through growth stages, while Greylock Partners deployed $50.3 billion into cloud sector companies in 2021 and continues aggressive expansion.

Corporate strategic investors provide both capital and ecosystem advantages. Microsoft's M12 venture fund leads edge computing investments like Armada's $40 million round, while Amazon Web Services commits over $100 billion in AI and cloud infrastructure expansion for 2025. Google Cloud announces strategic investments including a $5 billion commitment to Singapore's cloud infrastructure development. These corporate arms offer portfolio companies immediate access to enterprise customers and technical integration opportunities.

Specialized infrastructure funds emerge as key players targeting specific cloud infrastructure segments. Menlo Ventures operates a dedicated infrastructure focus investing in foundational AI and cloud technologies. Global Ventures led PoliCloud's €7.5 million round for sovereign cloud infrastructure, while Swish Ventures raised $60 million specifically targeting cybersecurity and cloud infrastructure startups. Category Ventures manages a $160 million fund exclusively for AI, infrastructure, and developer tools.

Need a clear, elegant overview of a market? Browse our structured slide decks for a quick, visual deep dive.

Which cloud infrastructure startups have they backed, and what exactly do these startups offer?

The largest funding rounds reveal investor preferences for AI-powered platforms and specialized infrastructure solutions.

If you want fresh and clear data on this market, you can download our latest market pitch deck here

How much capital has each investor committed per deal, and under what terms or valuation stages?

Investment amounts vary dramatically across different stages, with mega-rounds becoming increasingly common for late-stage cloud infrastructure companies.

Seed stage investments typically range from $2-10 million with valuations between $10-50 million. Early-stage cloud infrastructure startups often use SAFE notes with valuation caps ranging from $10-100 million and discount rates of 15-25%. Series A rounds span $10-50 million with valuations reaching $50-200 million, while Series B and beyond see $50 million+ rounds with valuations exceeding $200 million.

Late-stage growth rounds dominate the current landscape, with 11 companies raising at least $1 billion each in 2024. The average funding round size jumped from $133 million in 2023 to $407 million in 2024, representing a 206% increase year-over-year. Mega-rounds above $1 billion typically involve multiple investors, with lead investors contributing $100-500 million and strategic co-investors adding $50-200 million each.

Investment structures show clear evolution patterns. Early-stage startups universally adopt SAFE notes over traditional convertible notes, offering simplified terms and founder-friendly structures. Growth-stage companies favor traditional preferred stock with liquidation preferences moving toward 1x non-participating terms. Revenue-based financing emerges as an alternative for SaaS companies with predictable revenue streams, allowing growth capital without equity dilution.

Valuation multiples reflect strong market confidence, with revenue multiples ranging from 15-30x for high-growth cloud infrastructure companies. AI-focused infrastructure startups command premium valuations, often exceeding 40x revenue multiples due to massive market opportunity and technical barriers to entry.

Are major tech corporations like Amazon, Microsoft, or Google investing directly or through their venture arms?

Major technology corporations deploy multiple investment strategies combining direct corporate development with dedicated venture capital arms.

Amazon Web Services operates both direct strategic investments and the AWS Ventures initiative. The company commits over $100 billion in AI and cloud infrastructure expansion for 2025, including direct partnerships and equity investments in complementary startups. AWS provides up to $350,000 in cloud credits for AI-first startups through structured programs, creating customer acquisition alongside potential investment opportunities.

Microsoft leverages M12, its dedicated venture fund, for strategic cloud infrastructure investments while maintaining direct corporate development activities. M12 led Armada's $40 million round focusing on edge computing infrastructure, demonstrating focus on technologies complementing Azure's capabilities. Microsoft's dual approach includes equity investments through M12 and strategic partnerships through Azure's ecosystem programs.

Google Cloud combines direct infrastructure investments with strategic venture activities. The company announces major commitments including $5 billion for Singapore's cloud infrastructure development and strategic partnerships with emerging cloud startups. Google's approach emphasizes geographic expansion and regulatory compliance, particularly in sovereign cloud requirements across European and Asian markets.

These corporate strategies serve multiple objectives beyond financial returns. Strategic investments provide early access to emerging technologies, potential acquisition targets, and ecosystem expansion opportunities. Corporate venture arms also influence technical standards and integration approaches, creating competitive advantages in rapidly evolving cloud infrastructure markets.

Which geographies are currently attracting the most investor interest in cloud infrastructure?

Investment flows concentrate in three primary regions, each driven by distinct market dynamics and regulatory requirements.

The United States dominates global cloud infrastructure investment with over $25 billion deployed in 2024. Silicon Valley and the San Francisco Bay Area maintain leadership positions, while Seattle and Austin emerge as secondary hubs driven by talent availability and lower operational costs. The US market benefits from mature venture capital ecosystems, enterprise customer concentration, and regulatory frameworks supporting innovation.

Europe experiences rapid growth driven by data sovereignty requirements and GDPR compliance mandates. The European Union allocates €1.2 billion in funding for cloud and edge computing infrastructure across member states. France leads sovereign cloud initiatives with PoliCloud raising €7.5 million, while Germany attracts significant enterprise cloud adoption investments. The UK sees substantial activity with NexGen Cloud securing €41 million for sovereign AI infrastructure development.

Asia-Pacific markets show explosive growth driven by digital transformation and government digitalization initiatives. Singapore becomes a regional hub with major investments from AWS ($12 billion), Google ($5 billion), and Microsoft. China's Alibaba commits $52.4 billion in AI and cloud infrastructure over three years, while India attracts growing international investment in cloud infrastructure supporting its expanding digital economy.

Regional investment patterns reflect local regulatory requirements and market maturity. European investors prioritize data sovereignty and privacy compliance, Asian markets focus on scale and government digitalization, while US investments emphasize technological innovation and global market expansion.

What's the total amount raised by cloud infrastructure startups globally in 2024 and year-to-date in 2025?

Global cloud infrastructure funding reached unprecedented levels in 2024, with total investment volumes exceeding historical records across all categories.

Total cloud infrastructure services spending reached $330 billion in 2024, representing 20% growth from 2023 levels. GenAI infrastructure investment specifically totaled nearly $26 billion, up from $6.86 billion in 2023, demonstrating 279% year-over-year growth. The surge reflects massive demand for AI-optimized computing infrastructure and specialized hardware requirements.

Global cloud spending for Q1 2025 reached $90.9 billion, showing 21% year-over-year increase and indicating sustained momentum entering 2025. This quarterly figure suggests annual 2025 spending could exceed $400 billion globally across all cloud infrastructure categories. Early 2025 data shows continued acceleration in enterprise cloud adoption and infrastructure modernization spending.

Forecasted growth projections indicate 19% cloud spending growth for 2025, with total market size expected to reach $723.4 billion by year-end. These projections incorporate both infrastructure-as-a-service spending and direct startup investment flows. Private investment into cloud infrastructure startups represents approximately 15-20% of total market spending, suggesting $100+ billion in direct startup funding availability for 2025.

Regional distribution shows US markets capturing 45-50% of global investment flows, European markets representing 25-30%, and Asia-Pacific accounting for 20-25% of total cloud infrastructure startup funding.

If you want to build or invest on this market, you can download our latest market pitch deck here

What R&D or technological breakthroughs in cloud infrastructure are getting the most investor attention?

Four technological categories dominate current investor interest, each addressing fundamental shifts in computing architecture and regulatory requirements.

AI infrastructure and GPU computing attracts the largest investment volumes, with specialized chips and AI accelerators becoming critical bottlenecks for AI deployment. Edge AI computing and inference optimization represent emerging opportunities as companies seek to reduce latency and improve real-time processing capabilities. CoreWeave's massive funding rounds demonstrate investor confidence in GPU-optimized cloud infrastructure, while xAI's $6 billion raise highlights demand for AI-specific computing platforms.

Edge computing infrastructure receives over $6 billion in investment during 2024, driven by 5G deployment and IoT expansion requirements. Key investments include EdgeConneX ($1.9 billion) and Cologix ($1.5 billion), focusing on bringing computing resources closer to data sources. This technology addresses latency requirements for autonomous vehicles, industrial IoT, and real-time analytics applications that cannot tolerate cloud round-trip delays.

Sovereign and distributed cloud technologies gain momentum due to European GDPR requirements and data sovereignty regulations. PoliCloud and Cubbit lead this space with significant funding, addressing growing demand for data residency compliance and reduced dependence on US-based cloud providers. This trend accelerates across European and Asian markets as governments implement stricter data localization requirements.

Security and orchestration platforms attract substantial investment as cloud-native security becomes paramount for enterprise adoption. Container and Kubernetes security platforms address complex multi-cloud environments, while zero-trust architecture implementations provide comprehensive security frameworks for distributed cloud deployments.

Wondering who's shaping this fast-moving industry? Our slides map out the top players and challengers in seconds.

Are there specific verticals within cloud infrastructure that are getting more funding than others?

Three distinct verticals within cloud infrastructure demonstrate disproportionate funding attraction based on market demand and technical complexity.

• Edge Computing - $6+ billion invested globally in 2024, focusing on AI-ready infrastructure, 5G integration, and industrial IoT applications. Major deals include EdgeConneX and Cologix partnerships with telecommunications providers.
• Data Security and Privacy - Driven by regulatory requirements and enterprise security concerns, with focus on encryption, data sovereignty, and compliance tools. European GDPR compliance creates significant market opportunities for specialized solutions.
• Container Orchestration and DevOps - Kubernetes-native platforms attract substantial funding due to developer productivity demands and automated operations requirements. Integration with CI/CD pipelines and GitOps workflows drives enterprise adoption.

Edge computing leads funding volumes due to fundamental infrastructure requirements for 5G deployment and autonomous systems. Investors recognize edge computing as essential infrastructure for next-generation applications requiring ultra-low latency processing. The vertical benefits from telecommunications company partnerships and government digitalization initiatives across multiple countries.

Data security and privacy technologies show strong growth driven by regulatory compliance requirements rather than purely technical innovation. European markets particularly drive investment in this vertical as organizations seek GDPR-compliant alternatives to US-based cloud providers. The regulatory foundation creates sustainable competitive advantages and predictable revenue streams.

Container orchestration attracts developer-focused investment as enterprises modernize application deployment processes. This vertical shows high customer lifetime value due to switching costs and integration complexity, making it attractive for long-term value creation strategies.

Which investors are making repeat investments or leading multiple rounds in this sector?

Several investors demonstrate consistent sector focus through multiple large-scale investments and repeat commitments to cloud infrastructure companies.

Andreessen Horowitz leads the most aggressive repeat investment strategy, participating in major rounds for Databricks ($10 billion), xAI ($6 billion), and multiple other cloud infrastructure companies throughout 2024. Their approach focuses on late-stage mega-rounds where they can deploy $100-500 million per investment, creating significant portfolio exposure to cloud infrastructure leaders.

Thrive Capital consistently co-leads billion-dollar cloud infrastructure deals, including OpenAI's $6.6 billion round and Databricks' $10 billion raise. Their strategy emphasizes partnering with other top-tier VCs to participate in the largest available opportunities. Thrive Capital's repeat investments demonstrate confidence in continued sector expansion and their ability to access premium deal flow.

Microsoft maintains dual investment approaches through both M12 venture fund activities and direct strategic partnerships. M12 leads edge computing investments like Armada's $40 million round while Microsoft corporate development pursues larger strategic investments and acquisitions. This multi-faceted approach provides comprehensive sector coverage across different stages and deal sizes.

Nvidia emerges as a strategic repeat investor in AI infrastructure companies, participating in xAI's funding round alongside traditional VCs. Their strategic investments provide portfolio companies with access to cutting-edge GPU technology and technical expertise, creating competitive advantages beyond pure capital provision.

If you need to-the-point data on this market, you can download our latest market pitch deck here

Are traditional VC firms leading the deals, or are private equity, sovereign wealth, and strategic funds taking over?

The investment landscape shows clear stage-based division of responsibilities, with different investor types dominating specific funding stages and deal characteristics.

Traditional VC firms continue leading early to growth-stage rounds, typically ranging from $1-100 million in cloud infrastructure investments. Seed rounds ($1-10 million) and Series A/B rounds ($10-100 million) remain dominated by specialized venture capital firms with sector expertise and network advantages. These firms provide crucial technical guidance, customer introductions, and operational support during critical scaling phases.

Private equity and growth funds increasingly dominate later-stage investments, particularly growth rounds exceeding $50 million and buyouts of mature cloud infrastructure companies. Blackrock, Fidelity, and Morgan Stanley participate in mega-rounds like xAI's $6 billion Series C, bringing institutional capital allocation capabilities and public market preparation expertise. These investors focus on companies approaching IPO readiness or requiring significant capital for global expansion.

Sovereign wealth funds expand their cloud infrastructure allocations, particularly MENA sovereign wealth funds increasing strategic technology investments. These funds focus on infrastructure investments supporting national digitalization objectives and technology sovereignty requirements. European sovereign funds particularly target data sovereignty and regulatory compliance technologies supporting regional independence from US-based cloud providers.

Strategic corporate funds drive ecosystem-specific investments, with Amazon, Microsoft, and Google investing to build comprehensive technology platforms. Traditional enterprises create dedicated venture arms for cloud transformation initiatives, seeking competitive advantages through early access to emerging technologies and potential acquisition targets.

What trends are we seeing in the structure of investments — convertible notes, SAFE, equity, revenue-based financing?

Investment structure preferences show clear evolution toward founder-friendly instruments for early-stage investments while maintaining traditional equity structures for growth-stage rounds.

SAFE notes achieve universal adoption among early-stage startups, with 100% of seed-stage cloud infrastructure companies choosing SAFEs over traditional convertible notes. This shift reflects simplified legal processes, reduced negotiation complexity, and founder-friendly terms including flexible conversion triggers. Typical SAFE structures include valuation caps ranging from $10-50 million for seed stage and discount rates of 15-25% for subsequent equity rounds.

Revenue-based financing emerges as an alternative for SaaS and cloud service companies with predictable recurring revenue streams. This structure allows growth capital without equity dilution, particularly attractive for companies seeking expansion capital while maintaining founder control. Revenue-based financing typically requires 2-8% of monthly recurring revenue over 3-5 year terms, providing capital efficiency for specific growth initiatives.

Traditional equity rounds remain standard for Series A and beyond, with preferred stock structures providing investor governance rights and board representation. Liquidation preferences trend toward 1x non-participating terms, while anti-dilution provisions standardize on weighted average approaches. Board composition increasingly requires investor representation, particularly for rounds exceeding $25 million.

Convertible debt instruments maintain relevance for bridge financing and strategic investor participation. Corporate strategic investors often prefer convertible structures providing option value without immediate valuation decisions, allowing flexibility for future acquisition or partnership strategies.

Looking for the latest market trends? We break them down in sharp, digestible presentations you can skim or share.

What's the expected funding climate for cloud infrastructure in 2026, based on current deal flow and macro conditions?

The 2026 funding climate shows strong fundamentals despite potential macroeconomic headwinds, with sustained investor interest driven by structural technology trends and enterprise spending patterns.

Positive market indicators support continued strong investment activity through 2026. Cloud infrastructure spending forecasts reach $805 billion by 2028, while public cloud markets project exceeding $1 trillion by 2026. Enterprise IT spending continues shifting toward cloud solutions, with 45% of enterprise IT budgets allocated to cloud services by 2026. These structural trends provide sustainable foundation for continued startup investment despite potential cyclical fluctuations.

Technology drivers create sustained investment opportunities across multiple cloud infrastructure categories. AI infrastructure demands require continued massive capital deployment for GPU computing, edge inference, and specialized hardware development. Edge computing growth driven by 5G deployment and IoT expansion creates geographic infrastructure investment requirements. Sovereign cloud requirements in Europe and Asia drive regional investment preferences and regulatory compliance technology development.

Potential challenges include higher interest rates impacting venture capital fund availability and increased investor selectivity focusing on profitable growth metrics. Competition for quality deals continues driving up valuations, potentially creating unsustainable pricing for lower-quality opportunities. Geopolitical factors including data sovereignty requirements and trade policy impacts may affect cross-border technology investments.

Expected funding focus areas for 2026 include AI infrastructure with continued massive investment, edge computing geographic expansion, sovereign cloud technologies addressing European and Asian regulatory requirements, sustainability initiatives targeting green cloud infrastructure, and security platforms providing zero-trust and cloud-native protection. Investment volume projections suggest 15-20% annual growth with increased selectivity toward companies demonstrating clear paths to profitability and strong unit economics.

Conclusion

Sources

1. MicroVentures - The Largest Funding Rounds of 2024
2. NFX Signal - Top Cloud Infrastructure Seed Investors
3. Greylock Partners - VC Funding for the Cloud
4. EarlyNode - Best VC Firms Investing in Cloud Networking
5. Papermark - Cloud Investors Guide
6. Menlo Ventures - Infrastructure Focus
7. EU-Startups - PoliCloud Raises €7.5 Million
8. Everything Startups - New Funds December 2024
9. CNBC - Tech Megacaps AI Spending 2025
10. Google Cloud for Startups
11. STL Partners - Edge Computing News 2024
12. TS2 Space - Major Tech Developments 2025
13. LinkedIn - Cloud Infrastructure Best Practices
14. Founders Network - VC Investment Landscape 2024
15. RCR Wireless - Major AI Infrastructure
16. Primo Capital - Cubbit Raises $12.5M
17. S&P Global - GenAI Funding Record 2024
18. RBC - SAFEs and Convertible Notes
19. WaveUp - What is SAFE Note
20. Carta - Convertible Securities
21. EU-Startups - NexGen Cloud €41 Million
22. Canalys - Worldwide Cloud Service Q4 2024
23. CRN - Cloud Earnings Q4 2024