By Adetuberu Oluwanifesimi Anthonia
Etched, a San Francisco-based artificial intelligence startup, announced on Tuesday that it has secured $120 million in Series A funding. The company intends to utilize these funds to further develop its specialized AI processor, designed to optimize the performance of specific AI models, such as those employed by OpenAI’s ChatGPT and Google’s Gemini. Currently, Nvidia dominates the market for server AI chips, holding approximately 80% market share, according to estimates. While Nvidia’s general-purpose AI chips offer versatility, they can consume more energy than specialized processors tailored for specific tasks. As the largest U.S. company by market value, Nvidia’s dominance in the AI chip market presents an opportunity for Etched to innovate and differentiate itself in the industry.
Etched, a pioneering Al startup, has announced the successful completion of its Series A funding round, garnering support from esteemed investors such as Peter Thiel, former CEO of PayPal, and Amjad Masad, CEO of Replit. The company’s engineering team is diligently designing its inaugural chip, tailored to excel in Al inference computing, which enables the generation of content and responses. Notably, this chip is specifically optimized to run transformer-based Al models, a technology gaining widespread adoption. CEO Gavin Uberti acknowledged the potential risks and opportunities, stating, “Our company’s success is closely tied to the continued relevance of transformers. While this presents a degree of uncertainty, we are confident in the vast potential of this technology and our ability to capitalize on it, potentially becoming one of the most influential companies in the industry.”
Etched has established a strategic partnership with Taiwan Semiconductor Manufacturing Co.
(TSMC), a leading global semiconductor foundry, to manufacture its specialized Al chips. The company has secured $120 million in Series A funding, which will be utilized to cover the significant costs associated with transforming its designs into physical chips, a process known as “taping out” in the industry.
This critical step enables the transition from design to production. While the company’s current valuation remains undisclosed, its previous seed funding round in March 2023 valued the business at $34 million, with investors providing $5.4 million in capital. This significant increase in funding demonstrates the growing confidence in Etched’s innovative approach to Al chip development.
Etched, a startup with a team of 35 individuals, was co-founded by Gavin Uberti and Chris Zhu. The company has made significant strides in the development of specialized Al chips, and its innovative approach has garnered attention from investors and industry experts alike.