Blackstone finalizes $50-75M structured deal in Neysa, values AI cloud startup at $300 million

Blackstone Confirms Milestone-Linked Investment in Neysa, Values Startup at $300 million: Reports | AIM

The deal involves Blackstone investing $50-75 million in an initial tranche for a significant minority holding. US alternative asset manager Blackstone has finalised a structured investment deal with Mumbai-based AI cloud infrastructure startup Neysa. The transaction could enable the firm to eventually acquire a controlling stake, The Economic Times reported. The deal involves Blackstone investing $50-75 million in an initial tranche for a significant minority holding, with contractual rights to increase its stake to a majority if Neysa meets specific business milestones, according to the report. The transaction values Neysa at around $300 million, though the exact equity being acquired in the first phase was not disclosed. The investment is expected to be among the largest fundraises by an AI company in India and marks a strategic move for Blackstone, which is increasingly bullish on data centres and AI-led infrastructure globally. The firm already has exposure to Indian data centres through Lumina CloudInfra, its joint venture with Panchshil Realty. Unlike conventional venture capital rounds, the investment has been structured as a milestone-linked, control-oriented deal, reflecting the heavy capital requirements and long investment cycles associated with AI infrastructure businesses. Neysa's existing investors include Z47 (formerly Matrix Partners India), Nexus Venture Partners, Blume Ventures and Japanese telecommunications holding company NTT. The company has raised about $50 million across two rounds so far and was last valued at $120-130 million. The report added that SoftBank had also held talks for a potential growth investment, but it is not part of the current transaction. Founded in 2023 by entrepreneur Sharad Sanghi and former Netmagic executive Anindya Das, Neysa provides GPU-led cloud compute capacity and software platforms that enable enterprises, startups and government clients to build, deploy and manage large-scale artificial intelligence applications. India's data centre sector is projected to attract more than $50 billion in investments over the next five to seven years, driven by global hyperscalers and large domestic conglomerates, alongside policy support from the Centre and several state governments.

Blackstone finalises structured investment deal in AI cloud startup Neysa

US firm Blackstone has finalised a structured investment in Mumbai-based AI cloud startup Neysa, initially putting in $50-75 million. The deal allows Blackstone to increase its stake to a controlling position if certain business milestones are met. Neysa was was last valued at $120-130 million, and has raised $50 million in funding across two rounds till now. US alternative asset manager Blackstone has inked a structured investment deal with Neysa that could pave the way for a majority stake in the Mumbai-based cloud infrastructure startup, said people familiar with the matter. The transaction entails Blackstone investing $50-75 million in the first tranche for a significant stake, with terms that allow it to raise its holding to a controlling position on Neysa meeting certain agreed business milestones, the people said on condition of anonymity. The deal valued Neysa at around $300 million, the people said. They didn't disclose the size of stake Blackstone would get in the initial stage. The funding will be among the largest in an AI company based in India and significant for Blackstone, among the biggest realty owners and operators globally. "Neysa has signed the deal with Blackstone for what looks like a multi-layered structured transaction," said a person privy to the talks. "The backing of Blackstone will give the AI startup an advantage as it looks to close contracts with clients..." Neysa's existing investors include Z47 (previously Matrix Partners India), Nexus Venture Partners, Blume Ventures, and Japanese tech conglomerate NTT. It has raised $50 million in funding across two rounds so far and was last valued at $120-130 million. Unlike traditional venture capital rounds, Blackstone's investment has been structured as a milestone-linked, control deal, reflecting the capital-intensive nature of AI infrastructure and the need for long-term funding. Masayoshi Son's SoftBank was also in talks with Neysa for a growth investment cheque, said people familiar with the matter but the Japanese investor is not among the participants in the latest round. Blackstone did not respond to ET's queries. Responding to a query, a spokesperson for Neysa said, "The details currently being shared are materially and substantially inaccurate and are very far from the facts". ET reported on December 3 that Silicon Valley VC fund Lightspeed Venture Partners had also joined for a stake in Neysa as the sector gears up for exposure to AI-focused cloud infrastructure platforms emerging from India. Neysa is the second venture by Sanghi, who founded Netmagic, one of India's oldest data centre services companies. Launched in 2023 by Sanghi and former senior Netmagic executive Anindya Das, Neysa offers compute power and software tools to build, run and manage artificial intelligence (AI) applications to businesses ranging from large enterprises to startups and even government clients. The company operates in the GPU (graphics processing units)- led cloud and AI infrastructure segment, offering enterprises compute capacity to deploy large-scale artificial intelligence work. In a recent interview to ET, Sanghi said AI adoption is expected to move decisively from pilot projects to production environments in 2026, as enterprises gain confidence in use cases and look to scale deployment across core operations. Blackstone's data centre play Blackstone's investment in Neysa will mark its entry into AI-focused data centre operations in India, said one of the persons cited above. Once the deal is completed, the business will be set up as a new data centre platform for the PE firm led by Sanghi. Blackstone, which has been bullish on the AI and data centre space globally, currently has a joint venture in India with Panchshil Realty -- Lumina Cloudinfra -- which is building physical infrastructure for data centres. This investment is a part of the private equity firm's real estate portfolio. Blackstone manages about $50 billion worth of assets in India. In October, during an investor call, Blackstone's vice-chairman and chief financial officer Michael Chae had listed data centres as one of the firm's three "highest-conviction sectors" along with logistics and rental housing. These three sectors comprise around 75% of Blackstone's global equity portfolio, Chae said at the time. News agency Bloomberg had first reported about Blackstone and SoftBank holding talks to invest in Neysa. The so-called hyperscalers (cloud providers) and Indian conglomerates are expected to invest a combined more than $50 billion in India's data centre sector over the next five to seven years. These include commitments from multinationals such as Google, Amazon Web Services, Microsoft Azure, and Meta, along with Indian groups including Adani, Bharti Airtel, Reliance Industries, Tata Consultancy Services, and Larsen & Toubro. The government's National Data Centre Policy has proposed a 20-year tax holiday if operators meet key milestones related to capacity addition, energy usage, and job creation. It also provides for the categorisation of data centres as 'essential services', and the creation of data centre economic zones. The policy, which is still in the draft stage, is expected to drive demand once implemented. States such as Karnataka, Uttar Pradesh, Odisha, and Tamil Nadu, have also started rolling out their own policies.