Vast Data raises $1 billion at $30 billion valuation
EXCLUSIVE: The Israeli-founded AI infrastructure company becomes the country’s most valuable private tech firm following the sale of Wiz.
The largest private equity funding round in Israeli high-tech to date has closed, giving startup Vast Data a valuation of $30 billion.
The valuation makes Vast the most valuable private high-tech company in Israel, approaching the $32 billion valuation achieved by Wiz in its sale to Google, which is also expected to close this week.
The company raised $1 billion in the round, but more than $500 million of that amount will not go into the company’s coffers. Instead, it will go to the bank accounts of early investors and employees who are selling part of their holdings. These are unusually large liquidity amounts, considering that Vast currently employs about 1,100 people, roughly a third of them in Israel.
Shares sold by employees and early investors were priced at about a 15% discount to the valuation, as is customary in transactions of this type. The new valuation represents a more than threefold increase from the $9.1 billion valuation in the company’s previous funding round in 2023, which also took place during wartime in Israel. Vast Data declined to comment on the report.
Vast was founded in 2016 by Renen Hallak, who serves as CEO and lives in the United States, together with Shachar Fienblit, who leads development and operations in Israel.
The company is headquartered in the U.S., while its Israeli development center operates from offices at the Tel Aviv Expo complex, with an additional center opened in Haifa in 2021.
Since its founding and until the current round, Vast has raised nearly $400 million. Its investors include Nvidia, Tiger Global, Goldman Sachs, Fidelity, General Atlantic, D1 Capital Partners (DTC), NEA, BOND, Next47, Greenfield, and the Israeli venture capital firm 83North.
Vast has developed a data storage and retrieval platform that has become a critical component of modern AI infrastructure.
Just last week, the company announced an expanded collaboration with Nvidia, a long-time investor. The announcement included a personal video from Jensen Huang, Nvidia’s founder and CEO, who explained that without Vast’s technology, even the fastest AI processors can face severe data bottlenecks.
Vast’s software acts as a kind of operating system for AI data infrastructure, enabling organizations to fully utilize the capabilities of powerful processors by ensuring rapid access to massive datasets.
Beyond computing power and energy consumption, data itself is the most important resource for artificial intelligence. The ability to store it efficiently and retrieve it instantly is what ultimately determines the performance of AI systems.
Vast’s platform also allows organizations to store and retrieve unstructured data, such as emails, customer communications, multimedia files, and PDF documents, essentially the “messy” information that accumulates within organizations and forms their real knowledge base.
The company’s key innovation, which was considered bold when it was founded in 2016, was the use of flash memory for large-scale enterprise data storage.
Flash memory was traditionally viewed as too expensive for enterprise storage and was mostly used for small, high-priority data layers. Vast developed technology that dramatically improves the efficiency and compression of flash storage, enabling organizations to store far more data on these systems while lowering overall costs.
In its early years, Vast’s products were mainly used as part of enterprises’ transition to the cloud. But since the explosion of AI applications, demand for the company’s technology has surged dramatically.
By 2023, Vast had already reached an annual recurring revenue (ARR) run rate of $200 million. The company had promised to triple revenue each year, and according to estimates, by the end of 2025 its ARR had reached about $2 billion.
Vast’s contracts typically run for five to seven years, and the company’s solutions are considered highly “sticky.” Once organizations adopt its storage platform, switching to another system is difficult, resulting in very low customer churn.
Customers include some of the world’s largest banks, the animation studio Pixar, Elon Musk’s AI company xAI, and major cloud infrastructure providers. One particularly important partner is the American cloud computing company CoreWeave.
