Blackstone Makes Another Massive Big Tech Investment With $300 Million Buy In Of AI Data Company

Private equity giant Blackstone has been making aggressive moves in the AI sector for several years and that trend will continue in 2025. According to the Wall Street Journal, Blackstone is making a $300 million investment in tech company DDN. This tech outfit, based in Chatsworth, California, specializes in software that performs deep data dives into AI functions to improve AI's performance and efficiency.

 Renowned computer scientists Alex Bouzari and Paul Bloch founded DDN in 1998. The company designed software to efficiently manage data for research groups and government agencies performing high-level advanced simulations. Its original target customers were pharmaceutical companies, drugmakers and the aerospace industry, all of whom depend on data to simulate the outcomes of experiments, beta tests and product rollouts.

Don't Miss:

• If there was a new fund backed by Jeff Bezos offering a 7-9% target yield with monthly dividends would you invest in it?
• Maker of the $60,000 foldable home has 3 factory buildings, 600+ houses built, and big plans to solve housing — you can become an investor for $0.80 per share today.

DDN software's ability to gather and manage large quantities of data makes it an ideal component in AI applications and the company has begun gearing its operations toward that purpose. According to the Wall Street Journal, DDN components can be found in the "Colossus" supercomputer that Elon Musk's xAI company is currently building at its Memphis, Tennessee, factory.

 Elon Musk recently told the Wall Street Journal that the scope of the Colossus project is so ambitious that its construction will require 200,000 of Nvidia's most advanced computer chips. Given how much data Nvidia's CPUs and GPUs can process, it makes sense that data management software like DDN's would also be a mission-critical component of projects like Colossus.

See Also: Commercial real estate has historically outperformed the stock market, and this platform allows individuals to invest in commercial real estate with as little as $5,000 offering a 12% target yield with a bonus 1% return boost today!

That also explains why a company like Blackstone would be interested in a partnership with DDN. However, the Wall Street Journal says that only a small number of companies worldwide offer similar software to DDN and it's almost a guarantee that Musk's Colossus supercomputer is one of many under construction or on the drawing board for the world's leading tech and AI companies.

DDN is not publicly traded, so it's difficult to pinpoint how much equity Blackstone purchased with its $300 million cash infusion. However, the Wall Street Journal estimates DDN's value at around $5 billion, putting Blackstone's ownership stake in the 6% range. Blackstone's $300 million investment could become a massive profit if DDN goes public and there is speculation this partnership may be laying the foundation for an IPO.

Trending: CEO of Integris gathered a team of senior investment managers who have $34.22 billion in combined owned and managed assets in the West Coast — here’s how to invest in their private credit fund that targets 12% annual interest rate.

Even if DDN stays private, this deal represents another big-money partnership between Blackstone and Big Tech. In September 2024, Blackstone announced its acquisition of AirTrunk, an Asia-based data center outfit, for $16 billion. That deal followed a $7 billion partnership between Blackstone and Digital Realty Trust in 2023.

 These strategic deals put Blackstone in the unique position of being a data center operator and an equity partner in a company that designs software to help data centers run more efficiently. Blackstone's recent acquisitions deepen the partnership between private equity and Big Tech as they collaborate to make AI stronger, smarter and faster. 

Interest Rates Are Falling, But These Yields Aren't Going Anywhere

Lower interest rates mean some investments won't yield what they did in months past, but you don't have to lose those gains. Certain private market real estate investments are giving retail investors the opportunity to capitalize on these high-yield opportunities.

Arrived Home's Private Credit Fund’s has historically paid an annualized dividend yield of 8.1%*, which provides access to a pool of short-term loans backed by residential real estate. The best part? Unlike other private credit funds, this one has a minimum investment of only $100. 

Looking for fractional real estate investment opportunities? The Benzinga Real Estate Screener features the latest offerings.