CoreWeave reportedly seeks to leverage trillions in insurance companies’ capital to fund the purchase of Nvidia’s chips, according to CoreWeave’s Chief Development Officer (CDO), and in doing so would give life insurers an increasing amount of responsibility for AI’s debts.
‘All the money in the world’
Brannin McBee, who works as the CDO at CoreWeave and is one of the company’s co-founders, defined the goal in no uncertain terms. “If we can get our chip-backed debt to become investment grade and eventually the whole company to become investment grade, then we’ll be able to borrow from insurance companies where the money is unlimited, like all the money that is in the insurance tranche,” he said in a report.
That sounds like a tall order for a company started by mining crypto. McBee and two co-founders, Michael Intrator and Brian Venturo, have been building CoreWeave back up from a startup into an artificial intelligence cloud computing business, one of the “neoclouds” leasing out clusters of Nvidia GPUs to AI research labs and major tech firms. Currently, the company has more than 1.5 gigawatts of active power and is aiming for 8GW by the end of 2030.
This is what made CoreWeave become an outstanding borrower, raising over $35 billion this year alone through chip-backed debt, junk bonds, convertible bonds, and equity issuance. The debts and lease agreements total some $52 billion as of June 30.
The loans that opened the door
The innovation that McBee emphasizes again and again is the $8.5 billion delayed draw term loan that CoreWeave structured in March, carrying a rating of A3 by Moody’s and A (low) by DBRS.
In its announcement on March 31, CoreWeave claimed this was the first investment-grade loan arranged on the back of high-performance computing hardware and a customer contract. In this particular case, the agreement was with Meta.
In 2023, McBee closed his first such loan for $2.3 billion led by Blackstone, backed by Nvidia GPUs and an offtake agreement with Microsoft, priced at an effective rate of about 15%, which is not cheap, but it was innovative. Since then, CoreWeave has done five more deals, raising roughly $27 billion in total.
All of that does not have the highest credit quality. A $3.1 billion facility that closed in May 2026 was supported by two borrowers who had non-investment-grade ratings and earned a Ba2 rating from Moody’s and a BB+ rating from Fitch and priced at SOFR + 4.50%, according to a filing by CoreWeave.
An August loan worth $2.6 billion had the same ratings and was priced at SOFR + 5.50%. Those low-quality loans are precisely what McBee thinks that insurers won’t be willing to touch now. “I do think it’ll get there,” he stated.
Where the collateral sits, and who eats a downturn
The structures are designed to contain risk. The chips are held in a subsidiary, McBee explained, and all of the money earned pays for interest, principal, and operating expenses first, with about 20 cents left for the parent company. CoreWeave has described the structure as similar to financing the building of a power plant on a project basis.
The weak link in the chain, however, is the tenure. The August financing lasts approximately five years, while the typical customer contract is three, meaning the banks are making loans assuming that the contracts will be renewed or that the capacity will be re-leased. “The ratings on the debt reflect ‘the strength of the collateral and structural protections’,” said CoreWeave.
Not so much, according to Jordan Chalfin, a credit analyst at CreditSights, who was worried about borrowing rates increasing if others emulate CoreWeave’s business plan. “If there’s an overbuild, why would [customers] renew their contract with CoreWeave?” he asked.
CoreWeave’s unsecured bonds have already been dumped to return almost 15%. According to analysts who were surveyed by Visible Alpha, negative free cash flows are expected to amount to approximately $25 billion for this year, $28 billion for 2027, and $18 billion for 2028.
McBee claims that CoreWeave will be “incredibly cash-flow positive” if it stops constructing.
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