LiquidStack specializes in liquid cooling for data centers.
CARROLLTON, Texas — This article was originally published by our content partners at the Dallas Business Journal. You can read the original article here.
A Carrollton-based company that specializes in liquid cooling for data centers has added $20 million in funding, which leaders plan to use for expansion.
LiquidStack Inc. secured the new capital from New York-based Tiger Global Management LLC. The money is actually considered part of LiquidStack's series B round, first announced in March 2023, boosting its total size to $35 million, CEO Joe Capes said.
Tiger Global is a prominent investment firm with tens of billions in assets under management and lots of experience in technology and artificial intelligence. Capes noted the due diligence process went smoothly, given the company’s knowledge on the liquid cooling industry.
"We're excited about the raise, but we're also excited how the process went and who we’re partnering with,” he said, adding LiquidStack aligns well with Tiger Global’s strategic investments in AI.
Formerly based outside of Boston, LiquidStack relocated to North Texas in March to meet heightened demand for liquid cooling services driven in part by the data center boom tied to generative AI. The technology has become pervasive and has huge power needs.
"Without a doubt the biggest driver for the increase in demand is related to generative AI," Capes said. "It's our view ... that artificial intelligence is going to become integrated across business applications, information technology services and even society as a whole."
But data centers can no longer rely on traditional air cooling services, Capes said. LiquidStack produces a two-phase cooling system that's also used to make semiconductors and other hardware.
In addition to scaling up the manufacturing and supply chain side of the business, Capes said the funding will have a "positive impact on hiring." The Carrollton facility can accommodate around 100 people. In March, the company said it planned to potentially triple its manufacturing team by the end of the year.
With more hires on the horizon, LiquidStack will likely lease additional space near its 20,000-square-foot HQ. Capes said he is looking to expand the facility’s footprint by approximately 50% to 75%.
"There's some interesting options in the immediate office park and nearby," he said. "We really wouldn't want to be more than 3 to 5 miles from the existing facility."
When looking at relocation options, LiquidStack leaders chose Dallas-Fort Worth primarily for its talent pool as well as its proximity to amenities and housing. So far, that's working out perfectly.
"The quality of the employees that we've been able to hire, and just the access to engineering and world class manufacturing talent has been superb," Capes said. "We're happy with the choice that we made."
Right now, LiquidStack is a privately held company in a relatively niche market. But as the market continues to scale, the company would be open to launching an initial public offering or an M&A exit, Capes said.
"This is a market that's moving really quickly, and speed to market and timing and level of support is really critical to our customers, and these are areas that I think we excel in," he said.
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