Comet Cloud pursues small businesses as GPU cloud providers shift focus to enterprise

The GPU cloud sector has been dominated by large enterprises capable of committing to multiyear contracts for limited accelerator capacity. However, as the industry's focus transitions from AI model training to inference workloads, alternative cloud providers see an opening to capture demand from a much wider market segment.

Shifting priorities among AI startups toward burst capacity—temporary spikes in computing resources—have created new market dynamics. Comet Cloud Inc. has identified small and midsize businesses as its primary target, a segment that hyperscalers have effectively excluded from GPU allocation, according to Thomas Kato, the company's founder and chief executive officer.

Major cloud providers previously offered GPU capacity on flexible hourly, daily or weekly terms. "You go to [Amazon Web Services] now; they want a multiyear contract from you. They're picking who they're taking," Kato said. "To the small and medium businesses, they're not even coming up on that scope at all to be able to have that AI. Really that's our focus."

Kato shared his perspective during an exclusive interview with theCUBE Research's Dave Vellante at the Dell Technologies New York Symposium, part of SiliconANGLE Media's livestreaming coverage of the event.

Small businesses emerge as the next GPU cloud customer

Comet Cloud's entry into AI infrastructure originated from the payments sector. Kato's background in credit card processing led him to Bitcoin mining, which he recognized as fundamentally an electricity arbitrage—a cost dynamic equally central to AI infrastructure. The company now provides dedicated clusters rather than shared resources, targeting customers like medical practices and legal firms requiring data isolation.

"What we do is we put together clusters and we're giving clusters to a whole company. All their information, all their security, everything is within that cluster. There's no one else tied or connected to it," he said.

Currently, Comet Cloud furnishes bare metal infrastructure to partners including Andromeda, a compute marketplace that recently standardized storage across more than 50 GPU providers using Weka NeuralMesh. The company intends to expand up the software stack and convert its facilities into token factories, according to Kato. Pricing represents a critical competitive advantage, particularly for Nvidia Corp.'s B300 systems.

"[Hyperscalers are] going to probably charge you $15, $20 an hour, maybe more. You're going to come to someone like us and it's down to $4 an hour. The difference is it's astronomical," he said.

Cost considerations become increasingly important as inference becomes the dominant workload. Kato anticipates small businesses will require tokens for routine operations including marketing and customer service. Leveraging its network of payments merchants and affiliates—including one connected to 50,000 oncology offices—Comet Cloud can deliver third-party AI software alongside the necessary compute resources to small businesses. He noted that most of these businesses currently use only consumer chatbots for AI functionality.

"As everyone's developing these [AI tools], it's going to make them more efficient, more profitable … When that's developed and we can offer to them, that's where it's really going to change everything," Kato added.

Scaling this capacity requires power, GPU availability and substantial capital. Comet Cloud has secured contracts for 300 acres on the West Coast and is establishing a partnership with Dell Technologies Inc., whose AI Factory division has reached a critical growth phase. Financing represents a significant obstacle: deploying a single 48-rack cluster of Nvidia's next-generation Vera Rubin systems requires between $1 billion to $1.2 billion in contracted revenue to obtain financing, according to Kato. These financial constraints will determine the scalability of a GPU cloud service targeting small businesses.

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"We need the price of tokens to go so low that everybody could afford to use it for their businesses and use those tokens," he said. "That's where we should end up."