Calxeda just a closed a $55 million funding round for its ARM technology to cut data center power. The Austin, TX-based company will not only help the company scale up, but will also expand to new markets.
“In the time since we first met Calxeda, they have executed exceptionally well, and the market has begun to embrace disruptively power-efficient data center architectures,” Clark Jernigan, venture partner at Austin Ventures, one of the new investors, said in a statement.
In the past few years, the market for data center efficiency has gained momentum, as companies look for ways to slash energy costs while meeting their IT needs. Calxeda’s technology is centered on ARM chips, which are best known for their dominant role in the cell phone market.
ARM chips consume far less power than Intel chips and use nearly zero power when they’re in a sleep state. Of course, large chipmakers aren’t just sitting back as others get into the market. In March, Intel announced its latest green server, which is meant to be 50 percent more efficient than the previous line. Calxeda says it delivers as much as a ten-fold improvement on energy efficiency compared to today’s X86-based servers. Back in 2010, Calxeda also told Greentech Media that the chips cost about half as much to make compared to standard Intel-based servers.
But it’s about more than just the chip, said Vulcan Capital, a new investor along with Austin Ventures. “I am very impressed with the innovative approach and completeness of Calxeda’s vision,” said Steve Hall, managing director at Vulcan Capital, the other new investor in this round. “Calxeda thinks like a solutions company, aligning their technology to solve the bigger challenges."
The company is hardly alone in solving the problems of data center power consumption, which accounts for about 2 percent of the electricity used in the U.S. annually. There is a race for smaller, more efficient servers and chips, but there are also companies that are looking at how to cool the centers more efficiently, switch to DC power, achieve better power conversion or weather mapping inside data centers. Essentially, there’s more than one way to skin this cat. And there are a lot of different types of cats.
For servers that just pull up websites or handle simple queries, ultra-low-power processors from Calxeda or SeaMicro (which was purchased by Advanced Micro Devices) can do the job. Although that’s not all of the server market, it’s enough that there will be winners for those that can get a piece of the market. Intel estimates that there will be a 33 percent annual growth rate for the “internet of things” in coming years.
“This significant infusion of capital will accelerate the exciting trajectory we’ve been on for the past four years,” Calxeda co-founder and CEO Barry Evans said in a statement. “Businesses require a more efficient solution for the web, cloud, and big data. That is what Calxeda is now delivering, and this funding will enable us to go bigger and faster.”
The company has raised about $100 million since its inception in 2008 and will continue to grow its product line and partnerships this year. Besides the two new investors, Calxeda is also backed by ARM Holdings, Advanced Technology Investment Company, Battery Ventures, Flybridge Capital Partners, and Highland Capital Partners.