Hyperscale Power raises €5M to shrink data center transformers

Hyperscale Power has raised a €5 million seed round to develop its solid-state transformer technology. The funding round was led by World Fund and Vsquared Ventures. The startup is developing solid-state transformers—electronic power conversion devices that replace traditional iron-core transformers—to address the physical constraints of data center infrastructure.

Over the past couple of years, the market for solid-state transformers has expanded as data center power demands skyrocket, suggesting the technology could be having its moment. Traditional iron-core transformer technology is 140-year-old, and its physical size is becoming a bottleneck. Startups specializing in solid-state transformers have raised $280 million in the last few months, with total competitor funding in the market now reaching over $330 million, according to PitchBook.

Key players in this landscape include:

• Amperesand, which is backed by investor Temasek.
• DG Matrix, which counts ABB as an investor.
• Heron Power, founded by Drew Baglino and backed by Andreessen Horowitz.

This funding surge is driven by the requirements of server racks, the physical housing for data center computing equipment. While the latest server racks from Nvidia consume more than 100 kilowatts of power, future server racks are expected to require 1 megawatt—an amount of power that can support up to 1,000 homes. At this scale, traditional power-conversion equipment would balloon to more than twice the size of the server racks themselves.

Hyperscale Power aims to build a system that will be smaller than existing systems. Co-founder and CEO Daniel Rothmund, who previously designed a 99.1% efficient solid-state transformer during his time at ETH Zürich, founded the company alongside Sami Pettersson. Rothmund stated that the company has not seen any system as small as its planned system will be, noting that the arrival of solid-state transformers is a matter of when, not if. He warns that a lack of these devices will hinder industry growth. “It will actually slow down the progress in scaling up data centers if you don’t have solid-state transformers ready quite soon,” Rothmund said.

Why it matters

As data center power demand skyrockets and server racks increase in power density, solid-state transformers are becoming a necessity to prevent scaling bottlenecks.