Etched announced Tuesday that it had raised another $700 million at a $21 billion valuation in a funding round led by Jane Street. The round also included Kleiner Perkins, Sequoia, Andreessen Horowitz and Tiger Global, among others.
According to TechCrunch, the company was valued at just $5 billion in December. It raised $300 million in a Series C round at a $10.3 billion valuation in July. The latest funding round more than doubled its valuation to $21 billion in just over a month. Etched delivers its AI technology as full systems it calls “frontier inference clusters.”
Co-founder and COO Robert Wachen revealed that investors are enthusiastic about Etched because it has designed two new components from scratch to speed up inference — the computing process that happens after a user submits a prompt.
READ: How 3 Harvard dropouts ‘Etched’ a $20 billion company in just 4 months (August 19, 2026)
“Inference is built in two stages,” Wachen said, “prefill and decode.” In the mathematically and compute-intensive “prefill phase,” the system must understand the prompt, including context. In the memory-intensive “decode” phase, the system generates output tokens, meaning the actual answer the user sees.
Etched created a prefill chip that operates at low voltage, allowing it to pack in more transistors without the typical heat problems of other high-end AI chips. It can, therefore, process more tokens faster. It also created a new type of memory and an interconnect for the decode process that the company calls cluster-scale memory.
“It allows many chips to connect together and use a shared memory pool at a very, very fast, low latency,” Wachen said.
According to previous reports, Etched was founded by three Harvard dropouts – Gavin Uberti, Chris Zhu and Robert Wachen – who in a matter of four months moved from an idea on paper to working silicon, a fully integrated computing system, a major customer and more than $1 billion in orders.
READ: Nvidia rival Etched secures $1 billion in AI chip system orders (July 1, 2026)
“Etched has impressive technology and serious customer interest, but semiconductor history is littered with brilliant chips that never became great businesses,” said Michael Ashley Schulman, partner at Cerity Partners.
“The market is fighting to estimate the size of the opportunity, the scarcity of a proven alternative to Nvidia, and a billion dollars in customer contracts (but with barely any trailing financials to evaluate),” Schulman added.
Jane Street said in the blog post announcing the new round: “We tested the chip and are pleased with the early results. Etched’s unique approach to inference delivers the precision we will need to support our most demanding workloads. We’re excited to now have our own rack running in our datacenter.”