Chip startup Efficient Computer raises $97 million at $650 million valuation 

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(Corrects headline and paragraphs 1 and 9 to reflect that Efficient Computer raised $97 million, not $100 million)

By Stephen Nellis

SAN FRANCISCO, Sept 29 : Efficient Computer, a chip startup spun out of Carnegie Mellon University, on Tuesday said it has raised $97 million in additional funding, bringing its valuation to $650 million.

Efficient is developing chips with what is known as data flow architectures that can be both faster and 10 to 100 times more energy-efficient than the architectures used by Intel Corp or Nvidia Corp.

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Data-flow chips have bounced around academic literature for decades without commercial traction, largely because they are difficult for software developers to program for the wide variety of tasks that can be handled by chips from Intel or Nvidia. But booming demand for computing has spurred a new wave of interest in data-flow chips.

Pittsburgh, Pennsylvania-based Efficient says it started from scratch in academic labs to develop both the hardware and software tools to make the data-flow approach suitable as a general purpose processor. While Efficient plans to eventually make large chips that can be used in data centers, the first chips that is shipping are aimed at drones and small robots.

While those chips are tiny, cramming AI features into those battery-powered devices means the chips need to handle a greater variety of tasks than in the past.

"We sort of thread the needle where we're easy to program, fast, and efficient," CEO Brandon Lucia said in an interview. "When you build an AI system, the system ends up doing a lot more than two little nano-optimized AI algorithms."

Efficient did not disclose its revenues, but Andrew Marks, partner at TQ Ventures, which led the funding round, said the new cash will go toward increasing shipments through next year. 

"Plenty of chip startups have great architecture. Very few get silicon into customers' hands," Marks said.

With the new capital, Efficient has raised $173 million to date. In addition to TQ Ventures, the funding round included participation from Eclipse, Union Square Ventures, Giant Ventures, Triatomic Capital, TO Capital, TF Capital, Mana Ventures, Toyota Ventures, Overmatch and Borderless.

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