Rival Nvidia AI chip Engraved issued a progress report on Tuesday after TSMC successfully manufactured its chip earlier this year. THE says the startup has already booked $1 billion in contract orders for its product: complete systems powered by these chips.
Etched is currently in the process of testing this first product with customers. It calls these systems “border inference clusters,” packages that include the chips along with custom-designed racks and software, all built to help border models run inferences faster, cheaper and with better power efficiency than competitors, Etched claims. (The bottom line is what happens when a user submits a prompt — it’s currently the biggest bottleneck and cost center for AI companies trying to serve customers at scale, which is exactly why investors are paying attention to anyone who promises to solve it.)
Founded in 2022, Etched also revealed that it has raised a total of $800 million to date. The most recent installment was a $500 million windfall round that closed in December at a $5 billion post-cash valuation, the company said.
The startup has also attracted a notable group of investors, including VentureTech Alliance, Jane Street, Hudson River Trading, Two Sigma, Ribbit Capital and Stripes, who led the $500 million round. It has also secured angel investment from AI heavyweights including Andrej Karpathy, Geoffrey Hinton, Fei-Fei Li, Arthur Mensch and Scott Wu. The cap also includes billionaires Stanley Druckenmiller and Peter Thiel.
Although the startup’s press release framed Tuesday’s announcement that Etched was “coming out of stealth,” the co-founders—CEO Gavin Uberti (pictured above) and president Robert Wachen—talk to TechCrunch about their plans for chips from 2024. Both dropped out of Harvard and became Thiel Fellows at UbertierC.
By 2024, Etched was already on investors’ radar, having raised more than $125 million. But at Patrick O’Shaughnessy’s “Invest like the bestpodcast, the founders said that in 2023, they tried to attract investor interest — even with a 30-page memo arguing that artificial intelligence would eventually need specialized chips, not just general-purpose GPUs. Every major investor they pitched passed.
Today’s funding environment looks like a different planet in comparison. Investors are chasing anything related to artificial intelligence, especially chip technology that speeds up inference. Competitor Cerebras had its first IPO of the year, while AI chipmaker Groq just raised $650 million. Superscalers Amazon, Google, and Microsoft all make their own AI chips. Even OpenAI just announced its first custom chip, made by Broadcom.
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