Etched Fields Bids Up to $50 Billion as AI Chip Race Intensifies
AI-generated image · Bay Street Wire
The startup is reviewing new investment offers that would more than double its September valuation of $21 billion.
AI chip startup Etched is currently reviewing investment offers that value the company between $40 billion and $50 billion, as TechCrunch first reported. The bids, which come from a mix of top-tier investors and lesser-known backers, arrive only months after the company raised $700 million at a $21 billion valuation in September.
Etched is pursuing a capital-intensive strategy, developing full AI hardware systems powered by proprietary chips. Co-founder and COO Robert Wachen told TechCrunch that the company's focus on speeding up inference—the process occurring after a user submits a prompt—has driven investor enthusiasm. Etched claims its processors can handle more tokens faster and at a lower cost than those from Nvidia. This speed advantage attracted quant trading firm Jane Street, which led the September funding round and is an early customer. Etched reported in July that it had secured $1 billion in customer orders.
Beyond the hardware, the company has focused on scaling its infrastructure and talent. The Wall Street Journal reports that approximately 15% of Etched's 400-person workforce consists of former Nvidia engineers. The startup also operates a 10-megawatt data center in Silicon Valley and a production coordination facility in Taiwan near TSMC, where it manufactured its test chip this summer.
Founded by Harvard dropouts Gavin Uberti, Chris Zhu, and Robert Wachen, Etched has seen a rapid escalation in valuation. In July, the company announced a $300 million round led by Sequoia at a $10.3 billion valuation. A source told TechCrunch that if Etched raises a sum comparable to its previous round, it could secure up to 3.5 years of runway.