Talk about surging AI valuations.
AI chip start-up Etched said in a blog post earlier this month it had raised $700 million in a Series D financing round at a $21 billion valuation. The fundraising came only a month after the company scooped up $300 million in a Series C financing, which had valued the company at $10.3 billion.
Just this past December, Etched raised $500 million at a $5 billion valuation, meaning the company more than doubled its valuation in a month and better than quadrupled it in eight months. Not too shabby, even by current AI mania standards.
Several early investors are sitting on potentially huge paper gains.
In announcing the December fundraise, Etched named a number of investors, including VentureTech Alliance, Jane Street Capital, Hudson River Trading, Ribbit Capital, and Stripes.
Another early investor is Two Sigma Ventures, the venture capital arm of quant hedge fund giant Two Sigma. Peter Thiel and legendary hedge fund manager Stanley Druckenmiller were among a handful of angel investors, according to an earlier report from Briefs Finance.
Meanwhile, Tiger Global Management, the Tiger Cub headed by Chase Coleman, was one of a select group of participants in the most recent Series D financing.
On its website, Etched says it is building a new category of AI hardware called frontier inference clusters: “We co-design chips, racks, software, and manufacturing methods so frontier models can run with best-in-class throughput, latency, cost, and power efficiency for both prefill and decode workloads,” it explains.
The company was founded in 2022 by Harvard dropouts Gavin Uberti, Robert Wachen, and Chris Zhu[WM(1] . According to Briefs Finance, they all earned Thiel Fellowships, which back young inventors who skip higher education to start companies.
In 2023, Etched nearly ran out of money. But in the ensuing three years, it clearly caught the attention of the VC set.
The latest financing was led by quantitative trading firm Jane Street — Etched’s first customer — after it tested the company’s hardware. In a blog post, Etched quoted its longtime investor: “We tested the chip and are pleased with the early results. Etched’s unique approach to inference delivers the precision we will need to support our most demanding workloads. We’re excited to now have our own rack running in our data center.”
Said Gavin Uberti, Etched’s CEO, in a press release: “We’ve felt the urgency to get our hardware into customers’ hands and run real workloads since day one. Jane Street putting this cluster into production is proof of what we’ve built. Now we’re sprinting on scaling production for the rest of our customers.”
According to the announcement, Etched has secured more than $1 billion in customer contracts in addition to Jane Street’s deployment.
[WM(1]I added the third founder, Zhu
