Poolside scales back $2B AI data center after delays and funding woes
AI start-up Poolside has scaled back its ambitious Horizon project after facing delays and funding challenges. Originally planned as a 2-gigawatt data centre complex in Texas, the scheme has now been split into two phases. The company also restructured itself into two separate businesses to attract different investors. Poolside was founded in early 2023 by Jason Warner and Eiso Kant. The company raised $500 million in 2024 to develop AI tools for coding automation. It later expanded into data centre infrastructure, acquiring a 500,000-acre site in Texas's Permian Basin with potential for over 10 gigawatts of power.
The Horizon project initially aimed to deploy 32,000 NVIDIA H100 GPUs by mid-2025 in partnership with CoreWeave. However, delays in bringing the first cluster online led to the partnership's collapse. Poolside then doubled its GPU target to 64,000, adding a second cluster using CoreWeave's GB200 NVL72 systems, with completion now expected by early 2026.
Funding struggles have also hit the project. A $2 billion round, backed by Nvidia, stalled as investors questioned Poolside's AI capabilities. Talks with Google for 400 megawatts of capacity fell through, though the company remains in discussions with other cloud providers. To regain momentum, Poolside plans to release an API by the end of April, hoping to revive funding talks with Nvidia and venture capital firms.
In response to financial pressures, Poolside split into two companies: one focused on infrastructure (PIC) and the other on model development. This move aims to appeal to different investor groups. The firm still plans to develop 2.5 gigawatts of solar and wind power on the Texas site and is searching for a new partner to help finance chip purchases and energy needs. The Horizon project now moves forward in two stages, with the expanded GPU deployment delayed until early 2026. Poolside continues to seek funding and partnerships to support its infrastructure and AI development goals. The company's next steps depend on securing investor confidence and operational progress in the coming months.
