Owl Ventures leads $10M Series A in Cloudforce as regulated AI demand accelerates
Cloudforce has secured new funding led by Owl Ventures as institutions across higher education, healthcare, and government look for practical ways to deploy generative AI without compromising data, compliance, or cost control.
Cloudforce, a Maryland-based AI infrastructure company focused on regulated sectors, has closed a $10 million Series A funding round led by Owl Ventures, with strategic participation from M12, Microsoft’s venture fund.
The deal was confirmed this week after Owl Ventures took to LinkedIn to outline its investment rationale and Cloudforce announced the funding separately.
The round strengthens Cloudforce’s position as institutions move beyond experimentation and begin deploying generative AI at scale under strict regulatory requirements across education, healthcare, and the public sector.
Funding follows growing institutional use of private AI environments
Cloudforce builds and deploys nebulaONE, a private AI platform designed for higher education, healthcare, and government organizations. Built on Microsoft Azure, the platform allows institutions to deploy multiple large language models within their own cloud environments while maintaining control over data, security, and compliance.
According to Cloudforce, nebulaONE is now used by more than three million users across ninety institutions globally, including the University of Oxford, UCLA, University of Maryland, and London Business School. The company reports ongoing weekly deployments to new organizations as demand increases for controlled AI access beyond consumer tools.
The Series A funding follows Cloudforce’s expansion into healthcare after completing HIPAA certification and securing its first customers in the sector.
Investors point to infrastructure, not point solutions
In a LinkedIn post announcing the investment, Owl Ventures Investor Lyman Missimer explained that initial skepticism shifted once the company’s product direction and adoption became clear.
Missimer wrote, “When Andrew Solomon and I first met Husein Sharaf, I was a bit skeptical; it's tough to fit an Azure migration services business into the venture lens. But when he laid out the vision for the nebulaONE product and showed me their recent traction, it became obvious that not only were they onto something big, but Husein had the special stuff to create a multi-billion dollar company one day.”
Owl Ventures led the round alongside M12, Microsoft’s venture fund, reinforcing Cloudforce’s close alignment with Microsoft’s cloud and enterprise ecosystem.
Microsoft-backed model targets compliance-heavy sectors
Cloudforce’s platform allows institutions to deploy models from providers including OpenAI, Anthropic, and Meta while keeping data inside private cloud tenants. The company positions this approach as a response to concerns around data sovereignty, FERPA, HIPAA, and GDPR compliance that have slowed AI adoption in regulated environments.
Michael Stewart, Managing Partner at M12, comments, “Cloudforce has demonstrated an exceptional ability to leverage the Microsoft Azure ecosystem to solve last-mile delivery challenges for enterprise AI. Their nebulaONE platform transforms powerful raw models into secure, compliant, and deployable business assets for the public sector.”
Cloudforce says the new funding will be used to support hiring, expand sector-specific AI agents, and grow deployments across education, healthcare, and government throughout 2026.
Husein Sharaf, Founder and CEO at Cloudforce, says, “We are building the infrastructure that will power the next decade of discovery, and at a cost no other platform can offer.”
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