Jane Street is one of several proprietary trading firms that have backed Etched. Hudson River Trading, Jump Trading and Two Sigma have also invested in the company. Their involvement puts firms whose businesses depend heavily on computing performance among the financial backers of Etched's inference technology.
Etched is building hardware specifically around AI inference, with its system separating two distinct parts of the workload. For the prefill phase, when a model processes incoming information, the company developed a chip that operates at low voltage. Etched says this approach allows more transistors to be packed into the design while managing the heat constraints associated with high-end hardware.
The company has taken a different approach to decode, the stage when a model produces output tokens. Etched uses what it calls cluster-scale memory, which is designed to let multiple chips access a shared pool of memory with low latency.
The current system also represents a departure from the idea behind Etched when the company was founded. Its original approach centered on implementing a single model architecture directly in silicon. Etched now says its hardware can support a wider range of AI architectures. That includes Mixture of Experts models such as DeepSeek and Qwen, as well as non-transformer architectures including Mamba. The change gives Etched a broader target than its original model-specific hardware strategy.
The company has already accumulated more than $1 billion in contracts as of June, although its first customer rack has only now been delivered. Etched also produced its first chip on TSMC's N4P manufacturing process successfully on its initial attempt.
The new capital is intended to support the next stage of production. Etched says it will use the funding for factories, supply chains and software for operating fleets of its systems as it works toward gigawatt-scale deployments.
The speed of Etched's valuation increases has been particularly pronounced. After reaching $5 billion in December, the company was valued at $10.3 billion following its July Series C before reaching $21 billion 26 days later.
That latest valuation is arriving at an early point in Etched's commercial rollout, with its first rack now in the hands of a customer. The $700 million round gives the company additional capital to expand manufacturing and infrastructure as it moves beyond that initial delivery and works to fulfill its contracted business.
This analysis is based on reporting from TNW.
Image courtesy of Etched.
This article was generated with AI assistance and reviewed for accuracy and quality.
