Nvidia (NASDAQ:NVDA) rival AI chip startup Etched is reportedly in talks to raise funds at roughly a $20 billion valuation, quadrupling its prior mark.
Existing backer Jane Street is spearheading the new financing, The Wall Street Journal reported on Friday, citing sources. Separately, Etched is raising a round led by Sequoia Capital at a $10 billion valuation. Neither deal has closed, and terms may still shift.
Etched did not immediately respond to Benzinga‘s request for comment.
Back-to-Back Funding Rounds
The two funding rounds reflect a growing trend among AI startups, which are raising capital at sharply different valuations within weeks. Strong investor demand, limited access to top-tier deals, and fear of missing out on the next big AI winner are pushing some backers to pay up quickly, allowing companies to return for follow-on rounds at steeply higher prices.
San Jose-based Etched builds chips for AI inference, running trained models, rather than general-purpose GPUs like Nvidia’s. Its website cites roughly $1 billion in customer interest, though large-scale deliveries haven’t started.
Growing Competition
Cerebras Systems (NASDAQ:CBRS) and privately held companies including Groq, SambaNova Systems and the UK’s Fractile are also seeking to capitalize on growing demand for AI inference chips.
Founded in 2022 by Harvard dropouts Gavin Uberti, Chris Zhu and Robert Wachen, Etched counts Peter Thiel and Ribbit Capital among early backers.
Disclaimer: This content was partially produced with the help of AI tools and was reviewed and published by Benzinga editors.
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