ZutaCore raises $100M Series C at $600M valuation
What's the deal? ZutaCore, an Israeli startup that builds waterless liquid cooling systems for AI data centres, has closed US$64.7M Series C round at US$388.2M valuation. Samsung VenturesDealroom has a profile for this one. Try Dealroom →, Mitsubishi ElectricDealroom has a profile for this one. Try Dealroom →, and CarrierDealroom has a profile for this one. Try Dealroom → led the investment, bringing the company's total funding to roughly $200M since its 2016 founding.
The capital will fund global commercialisation, sales expansion, and efforts to meet surging demand for AI and high-performance computing infrastructure. ZutaCore is headquartered commercially in San Jose but runs its R&D and manufacturing from the Sapirim Industrial Park near Sderot in southern Israel.
Why now? AI's explosive growth has created a heat crisis in data centres. Power consumption per server rack has leapt from about 10 kilowatts in conventional setups to over 100 kilowatts in advanced AI deployments — and most of that energy becomes heat that must be removed.
Traditional air cooling can't keep up. The liquid-cooling market has split into two camps: water-based systems, which face efficiency limits and sustainability concerns, and waterless alternatives like ZutaCore's. Its flagship HyperCool technology circulates a non-conductive, non-flammable dielectric liquid directly across processors. The liquid boils on contact, absorbing heat through a phase-change process — no water required.
The company says it has deployed at more than 75 sites across North America, Europe, and Asia, and maintains partnerships with major semiconductor and computing firms.
What could go wrong? ZutaCore faces a crowded and fast-moving competitive landscape. Water-based cooling providers are well established, and new entrants are racing to capture the same AI infrastructure boom. Scaling manufacturing from a single facility in southern Israel — a region directly affected by the October 7 attacks — adds geopolitical and supply-chain risk.
The signal: ZutaCore's backer list — Samsung Ventures, Mitsubishi Electric, Carrier, DaikinDealroom has a profile for this one. Try Dealroom →, and Mitsubishi Heavy IndustriesDealroom has a profile for this one. Try Dealroom → — is composed entirely of corporate investors that manufacture and outfit data centre infrastructure, not traditional venture capital firms. That pattern suggests waterless liquid cooling is being pulled into supply chains by the incumbents that will need to deploy it at scale, a stronger demand signal than a purely financial bet. With Dealroom classifying ZutaCore at the "breakout" growth stage, the $600M valuation marks a company transitioning from proving its technology to racing to meet orders as AI rack densities outpace what air and water-based systems can handle.
Read more: Calcalist
