Etched Raises $700 Million as Valuation Jumps to $21 Billion
AI-chip startup Etched has raised $700 million at a $21 billion valuation, more than doubling its valuation in less than a month as investors pour capital into companies trying to challenge Nvidia in the fast-growing market for artificial-intelligence inference hardware.
The latest round was led by quantitative trading firm Jane Street, with participation from Kleiner Perkins, Sequoia Capital, Andreessen Horowitz, Tiger Global, Bain Capital Ventures, Neo and Blackstone.
Etched was valued at about $10.3 billion in a $300 million funding round announced in July. Its new $21 billion valuation therefore represents an unusually rapid jump for a semiconductor company whose first commercial hardware is only now beginning to reach customers.
Founded in 2022 and based in San Jose, California, Etched is developing specialised hardware for AI inference — the process through which trained AI models generate responses when users interact with them.
Rather than building a general-purpose graphics processor similar to Nvidia’s GPUs, Etched is designing its systems specifically around the computational demands of modern AI models. The company says that tighter specialisation can deliver higher throughput and greater power efficiency for increasingly large inference workloads.
Etched says its first silicon has returned from TSMC’s N4P manufacturing process and is now being validated inside rack-scale systems with customers. The company also says it has secured more than $1 billion in customer demand. Those figures are company-reported and have not been independently audited.
Jane Street is particularly important to the story because it is not only leading the funding round.
