ZutaCore, an Israeli firm specializing in sophisticated direct-to-chip liquid cooling systems for AI processors in data centers, has successfully finalized a Series C funding round, raising $100 million. The round was spearheaded by prominent global industrial and technology entities, including Mitsubishi Electric, Carrier, and Samsung Electronics via its investment division, Samsung Ventures.
This recent funding elevates ZutaCore's total financial backing to around $200 million since its inception. The newly acquired capital is intended to enhance the company's global commercialization strategies, broaden its sales network, and satisfy the surging demand for AI and high-performance computing (HPC) infrastructure.
The rapid expansion of AI technologies is revolutionizing data center designs and presenting significant cooling challenges. Conventional air-cooling solutions are increasingly inadequate for managing the substantial heat produced by modern AI servers. Power usage for server racks has skyrocketed from approximately 10 kilowatts in traditional setups to over 100 kilowatts in cutting-edge AI applications, with most of this energy ultimately converting to heat that needs to be efficiently dissipated.
In the liquid-cooling market, two primary strategies currently exist. One involves pumping water through pipes close to the processors, but this method encounters efficiency issues and raises water consumption concerns. ZutaCore has developed an alternative method utilizing a unique two-phase cooling mechanism that eliminates the need for water.
The company’s leading innovation, HyperCool, circulates a distinct dielectric liquid that is non-conductive and non-flammable, directly over the processor. As this liquid absorbs heat, it vaporizes, effectively transferring thermal energy through the phase-change process. ZutaCore asserts that this system reduces the risk of electrical shorts and is well-suited for high-density AI environments.
According to ZutaCore, its cooling technology can be seamlessly integrated into advanced AI servers and can function in conjunction with existing cooling systems within large-scale data centers operating at capacities in the tens or even hundreds of megawatts. Additionally, the technology aims to boost energy efficiency and potentially harness waste heat, contributing to sustainability initiatives.
To foster further development and implementation of its solutions, ZutaCore has established one of the world’s most sophisticated thermal simulation and testing facilities at its R&D center in Sderot. This advanced 2-megawatt facility allows for testing cooling performance and system reliability under actual operating conditions prior to client deployment.
ZutaCore’s solutions are already operational in over 75 locations spanning North America, Europe, and Asia, and the company maintains collaborations with leading semiconductor and computing firms.
Mitsubishi Electric and Samsung Electronics join a robust group of investors that includes Carrier, Mitsubishi Heavy Industries, Daikin, and the Israeli shipping company Zim.
At the helm of ZutaCore is Erez Freibach, who founded the company in 2016 after returning to Israel from Silicon Valley. Freibach established ZutaCore with three primary objectives: to innovate sustainable technologies, to generate advanced high-technology jobs in southern Israel, and to create quality employment opportunities within the Gaza border area.
The company's R&D and manufacturing operations are anchored in the Sapirim Industrial Park near Sderot, while its commercial headquarters are situated in San Jose, California, with additional offices in Europe, India, and Taiwan.
Reflecting on the impact of the events following the October 7 attacks, Freibach noted, “When the attacks occurred, I was in Silicon Valley celebrating my 60th birthday. By October 9, it became evident that our employees were dispersed across the country due to evacuations. Thankfully, we had no casualties, even though some employees faced direct threats. It was then that I felt it was time to return to Israel, and within a day and a half, I was back.”
Upon his return, the company focused on supporting its displaced employees and restoring operations at its facility in Sderot.
Currently valued at nearly $600 million, according to Freibach, ZutaCore's aim is to build a sustainable business rather than seek a rapid sale. "The AI cooling and energy infrastructure market is one of the most vital technology sectors today," he remarked. "We have established advanced offices and labs in Sderot, and we are committed to maintaining our core development and manufacturing activities here."
ZutaCore employs around 140 individuals across the globe, including approximately 100 in Israel, and plans to expand its team by adding about 50 more employees worldwide, with around 40 of those roles based at its Israeli development center. The recruitment will target engineers, physicists, systems specialists, and software developers.
In conjunction with this growth, ZutaCore has bolstered its executive team by making several key appointments, including Yaniv Reinhold as Chief Financial Officer, Sarah Warshavsky Oberman as Chief People Officer, Yoni Nir as Head of Research and Development, and Sharon Shafran as Chief Operating Officer.
