Etched raises $700M at $21B valuation led by Jane Street after AI hardware deployment

Etched, a startup focused on AI inference hardware, announced a $700 million funding round that doubled its valuation to $21 billion in a month. The round was led by Jane Street, a quantitative trading firm, which had previously tested and deployed Etched’s AI inference cluster in its own data center.

Etched’s systems are designed to accelerate the two critical phases of AI inference: prefill and decode. The prefill phase processes user prompts, while the decode phase generates the output tokens. Etched claims its custom prefill chip operates at low voltage, enabling higher transistor density without overheating, and its cluster-scale memory interconnect allows multiple chips to share a fast, low-latency memory pool.

The company’s valuation jumped from $10.3 billion in July to $21 billion in August, following the deployment by Jane Street. Etched’s original intent was to design chips tailored to specific models, but it now states its systems can run any frontier model.

Investors in the round include Kleiner Perkins, Sequoia Capital, Andreessen Horowitz, Peter Thiel, Tiger Global, Bain Capital Ventures, Neo, Stripes, Primary, Positive Sum, Diffusion, Argo, and Blackstone.