Etched fields funding offers at $40B+ valuation, sources say
Just a couple of months after its last big raise, the AI chip startup is already being plied with investment offers at double or more its current value, sources tell TechCrunch.
Etched, an AI chip startup, is receiving investment offers worth $40 billion or more, according to sources familiar with the company. The startup raised $700 million at a $21 billion valuation just a few months ago, but now investors are interested in acquiring it at double or even triple that value. Etched is currently reviewing incoming bids ranging from $40 billion from top-tier investors to $50 billion from lesser-known backers.
These fundraising talks are still in their early stages, and the terms of any potential deal could change.
The AI chip startup is pursuing a particularly expensive segment of the AI industry by building full AI hardware systems powered by its own proprietary chips. If it raises the maximum amount of its last round, Etched could have as much as 3.5 years of runway. The startup's co-founders and COO, Robert Wachen, believes that its design of two new components can speed up inference, the computing process that happens after a user submits a prompt, making its chips more efficient and cost-effective compared to Nvidia's.
Jane Street, a quant trading firm, is one of Etched's customers who took delivery of an early system and is a significant reason behind the investor interest. The startup has secured $1 billion in customer orders, including the one from Jane Street, following the manufacturing of its test chip at a TSMC factory. Etched's impressive workforce, with roughly 15% of its 400 employees having previously worked at Nvidia, also adds to its allure for investors.
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