Palo Alto-based startup CScale has officially exited stealth mode, securing $145 million in a Series C funding round. The investment was co-led by Atreides Management, Valor Equity Partners, and Premji Invest. Existing investor Sutter Hill Ventures also participated, joined by Maverick Silicon. Notably, Nvidia and Intel Capital have come on board as the company’s first strategic investors, bringing CScale’s total funding to $188 million.
The company is focused on developing optical interconnect technology designed for gigawatt-scale AI data centers. As AI clusters expand across numerous racks, traditional electrical connections struggle with bandwidth, latency, and energy demands. CScale’s architecture aims to link large numbers of accelerators, allowing them to function as a single, tightly integrated computing system while maintaining operational continuity.
A core challenge addressed by CScale is the inevitability of component failures in massive data centers. While individual optical links may rarely fail, the sheer scale of modern clusters makes such events frequent. The startup is building an integrated light engine designed to contain optical failures, ensuring that the broader computing system remains operational even when individual components experience issues.
The company is led by CEO Martin Lund, who previously managed the switching business at Broadcom and held leadership roles at Microsoft, Cadence, and Cisco. CTO and co-founder Sanjai Kohli brings extensive experience in communications technology, having co-founded SiRF and Inovi, the latter of which was acquired by Facebook in 2014. The team is positioning its technology as a critical component for future AI infrastructure.
