Astera Labs, a Fabless Chip Startup, Nabs $50M at a $950M valuation to remove Bottlenecks in high-Bandwidth cloud Applications

Astera Labs, a Fabless Chip Startup, Nabs $50M at a $950M valuation to remove Bottlenecks in high-Bandwidth cloud Applications

More businesses are migrating to cloud-based architectures, which means they’re taking on more applications (because they can) and, as a result, more sophisticated workloads and storage requirements. Even more, complexity is added by machine learning and other artificial intelligence applications. Now, a firm that has developed technology to make that process go faster and more efficiently is announcing a round of funding to meet the changing demands of those businesses. Astera Labs, a fabless semiconductor company that develops connectivity solutions to alleviate bottlenecks in high-bandwidth applications and better allocate resources around enterprise data, has raised $50 million in funding.

According to the company, Series C will value the company at $950 million post-money.

Fidelity Management and Research are leading the round, which also includes new backers Atreides Management and Valor Equity Partners, as well as prior investors Avigdor Willenz Group, GlobalLink1 Capital, Intel Capital, Sutter Hill Ventures, and VentureTech Alliance. Intel (which made its first investment in 2020) is a strategic sponsor in this case, which means it is a financial investor as well as a major consumer.

The chip giant is collaborating with the startup to develop PCI Express and CXL (Computer Express Link) technology and products to “increase bandwidth, performance, and resource availability in next generation server and storage infrastructure,” according to Sanjay Gajendra, Astera’s chief business officer. These will be critical for constructing AI-based systems based on Intel’s processors, as AI use cases are a core aspect of Intel’s next-generation growth plan, he said, adding that Aries Smart Retimers for PCIe are also incorporated in several Intel reference designs and commercial platforms. TSMC, Wistron, Samsung Electronics, and Western Digital are among the other partners and customers.

Astera, situated in Santa Clara, had previously only raised $35 million in three years, demonstrating its efficiency as a company and the fact that it has been generating strong sales.

In a statement, Astera Labs CEO Jitendra Mohan said, “We are excited to join forces with Fidelity, Atreides, and Valor to consolidate our leadership position in intelligent cloud connectivity solutions and launch Astera Labs into the next development phase of our company.”

We will swiftly develop our global operations with this investment and enhanced collaboration with our manufacturing partners to meet unprecedented customer demand and launch many new product lines to answer the industry’s most critical connection challenges.”

More precisely, this latest fundraising round follows what has been a relatively robust era for the company in the aftermath of the COVID-19 outbreak and the shift in cloud migrations that it prompted among organizations.