BlackRock, one of the world’s largest asset management groups, together with tech giant Microsoft, plans to launch a $30 billion AI (artificial intelligence) infrastructure fund.
GAIIP: a major step in AI investment
On September 17, local time, Microsoft and BlackRock and other companies announced a partnership in AI investment, will join forces to invest in data centers and other infrastructure to support AI. The strategic partnership, called the Global AI Infrastructure Investment Partnership (GAIIP), aims to become the world’s largest AI investment fund, aiming to attract $30 billion in private equity investment, including debt financing. The partnership aims to become the largest AI investment fund in the world, attracting $30 billion in private equity investment, with a total future investment potential of $100 billion, including debt financing.
Global Infrastructure Partners (GIP), a private equity fund manager soon to be acquired by BlackRock, and MGX, an investment firm backed by the government of Abu Dhabi, are also partners in the fund, which is described as GAIIP will support open architecture and a broad ecosystem, with infrastructure investments, including energy projects, being deployed primarily in the U.S., with a portion of the funds being deployed in its partner countries.
Key players and strategic goals
The investment vehicle is designed to address the staggering power and digital infrastructure needs of AI products, which are expected to face serious capacity bottlenecks in the coming years, the FT noted.AI computing power requires far more power than previous technological innovations and puts a strain on existing energy infrastructure.
Future of AI infrastructure and economic impact
On the day of the 17th, shares of Microsoft (Nasdaq: MSFT) rose 0.24% to close at $435.15 per share, with a total market capitalization of $3.23 trillion. BlackRock (NYSE: BLK) rose 1.04% to close at $904.52 per share, with a total market capitalization of $134 billion.
In response to the financing, Microsoft Chairman and CEO Satya Nadella said, “We are committed to ensuring that AI drives innovation and growth across all sectors of the economy. GAIIP will help us realize this vision as we bring together financial and industry leaders to build the infrastructure of the future and sustainably way to power it.”
Larry Fink, Chairman and CEO of BlackRock, said, “Mobilizing private capital to build AI infrastructure, such as data centers and power, will unlock trillions of dollars in long-term investment opportunities. Data centers are the cornerstone of the digital economy, and these investments will help drive economic growth, create jobs and drive AI technology innovation.”
This partnership shows that Wall Street still holds great investment interest and confidence in the AI sector. In addition, AI chip leader NVIDIA will provide support to GAIIP, including its expertise in AI data centers and AI factories, in order to jointly build the AI ecosystem.
Jen-Hsun Huang, CEO of NVIDIA, said, “Accelerated computing and generative AI are driving the growing demand for AI infrastructure in the next industrial revolution. NVIDIA will leverage its expertise as a full-stack computing platform to support GAIIP and its portfolio companies in designing and integrating AI factories to drive industry innovation.”
The International Energy Agency previously projected that global data centers could use more than 1,000 terawatt-hours of electricity by 2026, more than double the amount used in 2022.
Just a week ago, on September 12 local time, the White House made an announcement that it would create an AI Data Center Infrastructure Working Group to coordinate policies across government, which will be led by the National Economic Council, the National Security Council, and the White House Office of the Deputy Chief of Staff. At the same time, the U.S. Department of Energy will create an AI Data Center Engagement Team to leverage a variety of programs to support the development of AI data centers.On the day of the 12th, a group of U.S. tech industry executives, including Nvidia CEO Jen-Hsun Huang and OpenAI CEO Sam Altman, came to the White House to meet with senior Biden administration officials and other industry leaders.
