AI Data Company DDN Gets Blackstone Backing

 

"Blackstone is investing in a company that helps organizations more efficiently store and analyze large amounts of data, executives from both companies said.

It is the private-equity firm's latest bet on a business that supports the growth of artificial intelligence.

Blackstone is investing $300 million into DDN. The investment, the first outside funding for the Chatsworth, Calif.-based company, values DDN at $5 billion.

Founded in 1998 by computer scientists Alex Bouzari and Paul Bloch, DDN is one of a handful of companies that sell computing equipment and software to manage and glean information from data when AI models are being trained and rolled out.

It got its start managing data to enable computing efforts for government agencies and research organizations, including complex simulations for drug development and National Aeronautics and Space Administration missions. Its customer base has shifted as more companies look for ways to use AI.

DDN's platform helps companies make AI more cost-effective, according to Bouzari, the company's chief executive.

He said DDN plans to use Blackstone's investment to sharply expand the AI data company's business-customer base.

DDN's products are used in some of the biggest deployments of AI infrastructure. Among these is the Colossus supercomputer being built by Elon Musk's xAI in Memphis, Tenn., which the tech mogul has said is being scaled up to include 200,000 of Nvidia's advanced AI chips.

While it has been operating largely behind the scenes, DDN is a significant competitor and could be a candidate for an initial public offering in the next few years, according to people familiar with the matter.

Blackstone has been playing the AI boom by investing in data centers and companies that support chip makers. It bought data-center operator QTS in 2021, and in 2023 signed a deal with Digital Realty to develop $7 billion in data centers. Blackstone in September announced a deal to buy Asian data-center operator AirTrunk for $16 billion." [1]

1. AI Data Company DDN Gets Blackstone Backing. Gottfried, Miriam; Fitch, Asa.  Wall Street Journal, Eastern edition; New York, N.Y.. 10 Jan 2025: B1.