Optical interconnect startup reaches $1bn unicorn status

US startup Ayar Labs has raised $155m to scale its optical interconnect technology with a valuation of over $1bn.

The funding for Ayar Labs, which also has a UK design centre, brings the total raised to $370m and comes from AMD, Intel and Nvidia as well as the Advent Global Opportunities and Light Street Capital funds.

• Ayar Labs raises $130m for optical chiplets
• Celestial AI buys Rockley Photonics patents
• Developing terabit optical interconnect

Ayar is one of startups including Lightmatter and Celestial AI using optical interconnects to address the AI bottleneck of data movement and says its in-package optical I/O is standards-based, commercial-ready, and optimized for AI training and inference.

Other new strategic and financial investors participating in the round include 3M Ventures and Autopilot. They join existing investors such as Applied Ventures, Axial Partners, Boardman Bay Capital Management, GlobalFoundries, IAG Capital Partners, Lockheed Martin Ventures, Playground Global, and VentureTech Alliance.

“The leading GPU providers – AMD and Nvidia – and semiconductor foundries – GlobalFoundries, Intel Foundry, and TSMC – combined with the backing of Advent, Light Street, and our other investors underscores the potential of our optical I/O technology to redefine the future of AI infrastructure,” said Mark Wade, CEO and co-founder of Ayar Labs. “We are incredibly fortunate to have the backing of Light Street’s deep expertise in technology-specific investments as well as Advent’s robust private and growth equity background in this funding round.”

“We believe optical I/O is on the cusp of revolutionizing the future of AI infrastructure, and we recognize the significant growth potential of in-package optical interconnects,” said Jordan Katz, partner at Advent Global Opportunities, who will be joining Ayar Labs’ Board of Directors. “Our deep research into the interconnect market revealed that Ayar Labs is led by a world-class team, has industry-leading technology, and exciting engagements with Tier 1 customers. We believe that supporting Ayar Labs and its groundbreaking technology will offer transformative benefits to AI systems.”

“Intel Capital has long recognized the importance of pioneering new interconnect technologies to improve compute efficiency and performance,” said Srini Ananth, managing director at Intel Capital. “We have been dedicated to supporting Ayar Labs’ continued growth and are proud to reaffirm our commitment to its optical I/O solutions that aim to disrupt the AI industry.”

“As an early investor and collaborator, Applied Ventures looks forward to continue working with Ayar Labs to advance energy-efficient computing using photonics-based optical interconnects,” said Anand Kamannavar, global head of Applied Ventures and board observer of Ayar Labs. “Ayar Labs plays a key role in helping solve the critical challenge of moving vast amounts of data efficiently across chips and data center systems.”

“3M is excited to invest in Ayar Labs and our opportunities to collaborate,” said Mark Copman, senior vice president, 3M New Growth Ventures. “This partnership reinforces 3M’s commitment to advancing data center and next-gen solutions for AI infrastructure using 3M’s leading material science expertise.”