Etched eyes $40B–$50B valuation in new funding round
Original: Etched fields funding offers at $40B+ valuation, sources say
Why This Matters
Rapid valuation doubling signals serious VC conviction in non-Nvidia AI chip bets.
Just two months after raising $700M at a $21B valuation, AI chip startup Etched is reviewing new investment offers ranging from $40B to $50B, per sources familiar with the talks.
Etched, the four-year-old AI chip startup, is fielding unsolicited investment offers at valuations more than double its last round. According to sources, top-tier investors are bidding at roughly $40B while lesser-known backers are pitching as high as $50B. Talks are early and no deal is confirmed. The company declined to comment.
The valuation jumps have been steep and fast: a $300M round at $10.3B led by Sequoia in July, followed by a $700M round at $21B in September — both essentially tranches of a single financing push. If Etched raises a similar amount again, sources say it could have up to 3.5 years of runway.
The interest stems from Etched's focus on hardware for AI inference — the compute that runs every time a user submits a prompt. The company claims its custom chips process tokens faster and at lower cost than Nvidia's. Quant trading firm Jane Street, which led the last round, is also a paying customer that took early delivery of a system. Etched reported $1B in customer orders as of July, after test chip production at a TSMC facility. Around 15% of its 400-person staff previously worked at Nvidia. The company also runs a 10-megawatt data center in Silicon Valley and a Taiwan facility near TSMC.