TL;DR

Blackstone is considering leading fresh funding for Factory, the Nvidia-backed startup whose autonomous “droids” write software for Nvidia itself, along with EY and Morgan Stanley. City AM reports the round would value the San Francisco company above $3.5bn (£2.6bn). Neither party would comment.

The valuation ladder is the part worth reading closely. Factory was worth $300m last September on a $50m raise, with Nvidia and JP Morgan among the backers. Blackstone came in at its Series C in April at $1.5bn, alongside Sequoia, Khosla Ventures and London’s 20VC. Four months on, the figure has more than doubled again — a company founded in 2023 marked up elevenfold inside a year.

Its founders, who met as Princeton students, are pitching directly against Anthropic in autonomous coding. Matan Grinberg’s line after the April round was that “anything that can be done on a computer, can be done with a Droid”. He also said revenue had doubled every month over the half-year to April — the number underpinning the mark-up, and the one nobody outside the cap table can verify.

The UK connection is real but modest. Factory opened its first office outside the US in London in March, has since added Sydney, and counts 20VC among its investors. British engineering talent is being hired into a company whose value is being set in New York and San Francisco.

For Blackstone the deal fits a stated pattern. Operating chief Rodney Zemmel identified corporate automation through AI agents as one of six priorities in May, alongside software engineering and content creation. The firm has simultaneously been buying the infrastructure underneath — it is the largest private data centre owner globally, and within two months has announced roughly $30bn for facilities in Japan plus $5bn for a data infrastructure venture with Google. Owning both the picks and the prospectors is a deliberate position.

UK readers should hold this next to the week’s other funding signals. Index Ventures closed a $2bn AI fund yesterday and capital plainly remains available for AI companies with credible revenue growth. What it is not doing is flowing evenly — a British firm raising at these multiples would be extraordinary, while a San Francisco company doing it in its third round inside a year barely registers as unusual.

Looking Forward

Watch whether the round closes at the reported figure. Three raises in eleven months at steeply rising prices is either conviction about autonomous coding or a market that has stopped applying friction, and the difference will be visible in Factory’s next revenue disclosure.