Etched considers offers valuing it at $40–50 billion — TechCrunch
AI chip startup Etched is considering new investment offers that value the company between $40 billion and $50 billion. TechCrunch reports, citing sources familiar with the situation. According to the publication, offers from major investors imply a valuation of about $40 billion, while lesser-known potential investors are prepared to value the company at $50 billion.
The talks are at an early stage, so the terms of potential funding may still change. Etched declined to comment on the information about the new offers.
New round after $700 million
Two months ago, Etched raised $700 million at a valuation of $21 billion. If the company raises an amount comparable to its latest round, it could provide it with a financial runway of around three and a half years, a TechCrunch source said.
Developing complex AI systems based on proprietary chips requires significant spending. In July, the startup announced that it had raised $300 million at a $10.3 billion valuation in a round led by Sequoia. In September, the company reported a $700 million round at a $21 billion valuation.
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Chips to accelerate inference
Etched is working on inference hardware — the computational process that takes place after a user sends a request to an AI system. Co-founder and chief operating officer Robert Wachen previously said the company had designed two new components to accelerate this process.
The company says its chips can process more tokens faster and more cheaply than Nvidia products. Quantitative trading firm Jane Street, which led Etched's latest investment round, also became a customer of the startup and received an early system. In July, Etched said it already had $1 billion in customer orders, including from Jane Street.
Etched also operates a 10-megawatt data center in Silicon Valley and has established a facility in Taiwan to coordinate manufacturing near TSMC. According to The Wall Street Journal, about 15% of the company's 400 employees previously worked at Nvidia.
