CScale launches with $188M to build optical scale-up interconnects for AI data centers

About three quarters of the capital came from a recently closed Series C round. Atreides Management, Valor Equity Partners and Premji Invest co-led the round. Nvidia Corp. and Intel Capital were among other backers that joined the funds.

CScale was founded in 2023 by electrical engineer Sanjai Kohli, who previously founded SiRF Technologies Inc., an early supplier of GPS chips for vehicle navigation systems. Kohli is CScale’s chief technology officer. The company’s CEO is Martin Lund, a long-time data center executive who earlier led Cisco Systems Inc.’s chip engineering group and Broadcom Inc.’s switch business.

CScale’s interconnect technology is designed to link together the accelerators that make up an artificial intelligence cluster. According to the company, its hardware is optimized to power large scale-up cluster configurations, which can provide better performance than current designs.

An AI data center is split into infrastructure units called scale-up domains. Today, a scale-up domain is usually a single server rack. The chips in the rack effectively function as one large computer. Adding more processing capacity requires companies to deploy additional scale-up domains. Data moves slower between different scale-up domains than between accelerators in the same scale-up domain.

In March, Nvidia revealed that it is working to remove that bottleneck. The chipmaker is developing hardware that will make it possible to replace multiple compact scale-up domains with one large scale-up domain. Such a setup will enable data to move faster between accelerators, which should boost AI workloads’ performance. CScale says its technology can link together thousands of accelerators across dozens of racks. It will move data between chips via optical links, which are significantly faster than traditional copper wiring.

A malfunction in one of the optical links that powers a scale-up cluster can disrupt many other components. CScale says its interconnect is capable of “containing” such failures, which increases cluster uptime. The company did not specify how it achieves that reliability boost. According to a job posting, CScale plans to ship its technology as part of a system-on-chip that will feature an onboard central processing unit. The CPU might be needed to run network automation software. CScale describes its product as an “integrated light engine.”

“As scale-up systems move toward gigawatt-class deployments, interconnect bandwidth means nothing without system reliability,” said Atreides Management managing partner and chief investment officer Gavin Baker. “Every optical failure is a compute failure. At this scale, failures are not hypothetical—they are inevitable. CScale is designing reliable scale-up optics for next-generation AI factories.”

CScale will use its new funding to enhance its technology and accelerate commercialization initiatives.