By Stephen Nellis
SAN FRANCISCO, Sept 10 (Reuters) – Ayar Labs, a Silicon Valley startup developing a way to link AI chips directly together with optical connections, on Thursday said it has raised an additional $150 million.
The fresh capital is an extension of a series E $500 million funding round the company announced in March. Ayar, which has backing from chip giants Nvidia, Advanced Micro Devices and MediaTek is developing co-packaged optics, a technology that can link AI chips together with fiber optical cables and avoid the overheating issues that arise when linking those chips with shorter copper cables.
Ayar and others in the chip industry are racing to get the optical technology to market as early as 2028. Ayar CEO Mark Wade said the additional funding has helped it open a chip design center in Bengaluru, India, and will help prepare its products by the end of next year.
“We build the optical chip, and our optical chip gets fed into our customer’s product,” Wade told Reuters. “If my customers’ products are looking to ramp in the 2028-2029 time frame, we have to have all of our stuff qualified for volume production by the end of the 2027 time frame.”
Taiwanese cloud data center equipment maker Wiwynn Corp joined Ayar’s backers, bringing Ayar’s total raised this year to $650 million.
At the same time Ayar Labs extended its series E round, Antero Peak Group at Artisan Partners led a secondary share purchase of $225 million from early employees and investors that valued Ayar at more than $5 billion. Sequoia Global Equities, ARK Invest, and Greycroft took part in that transaction.
“From our perspective, the AI infrastructure and optical interconnect industry is at a major inflection point, with optical scale-up solutions poised to ramp through the end of the decade,” Chris Smith, founding portfolio manager of the Antero Peak Group at Artisan Partners, said in a statement.
(Reporting by Stephen Nellis in San Francisco; editing by Lincoln Feast.)
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