Data Centers? In Space?! Startup Raises $250 Million
The startup Starcloud raised $250 million to expand plans for AI-powered data centers in space with backing from Nvidia.
Startup Starcloud has secured an additional $250 million in funding to develop AI data centers in space, bringing its total funding to $450 million and a valuation of $2.3 billion. The Washington-based company aims to create an orbital computing network to handle AI workloads and potentially more demanding computing tasks currently managed by Earth-based data centers.
Investors include AI chipmaker Nvidia, networking technology giant Cisco, venture capital firm Benchmark, and EQT. Supporters argue that space-based data centers could alleviate concerns about AI's energy demands, but experts caution that orbital computing is far from proven, with major hurdles such as cooling systems yet to be solved.
Starcloud has already flown an Nvidia H100 chip into orbit and is building a manufacturing facility in Washington to produce satellites for its 88,000-satellite fleet, which would provide 20 gigawatts of computing capacity. CEO Philip Johnston highlighted the importance of SpaceX's Starship rocket in reducing the cost of launching heavy payloads into orbit.
While orbital data centers are experimental, supporters view them as a potential answer to the growing concerns about AI infrastructure's impact on local power grids, water usage, and noise.
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