Three industrial giants bet $100M on the startup that solves AI heat problem

Three industrial giants placed the same bet on the same cooling startup on the same day. That is the sentence Mitsubishi Electric, Carrier, and Samsung Ventures collectively decided was worth acting on: ZutaCore, an Israeli-founded firm now headquartered in Foster City, California, raised a $100 million Series C on June 2, valuing the company at roughly $600 million, according to Calcalist. Goldman Sachs arranged the deal.

The technology ZutaCore sells is the solution to a problem NVIDIA accidentally created. The Blackwell B200 GPU, the chip powering the current wave of AI training runs, draws more power than most household appliances — and next-generation processors are rated to exceed 4,000 watts each, ZutaCore's press release says. At that power density, air cooling collapses. Something has to manage the heat or the chip throttles itself into uselessness.

ZutaCore's HyperCool system uses a waterless two-phase dielectric fluid — a non-conductive liquid that boils on contact with the chip surface, carrying heat away as vapor before condensing and cycling back. No water touches the electronics. That distinction matters: water and high-voltage server racks have a hazardous relationship, and large data centers are increasingly reluctant to introduce large quantities of either near their highest-density compute.

The simultaneous backing from three strategic investors signals how seriously industrial incumbents are taking the cooling bottleneck. Carrier, the HVAC giant spun off from United Technologies, already operates data center cooling infrastructure under its Carrier Ventures division. Mitsubishi Electric builds power and thermal management systems at scale. Samsung Ventures sits inside the conglomerate that manufactures the chips ZutaCore's system is designed to keep running. None of the three commented for this article.

The market ZutaCore is pitching into is not small. The global data center liquid cooling market is projected to grow from $4.07 billion in 2026 to $27.65 billion by 2033, a 31.5% annual growth rate, according to MarketsandMarkets. Hyperscale facilities — the warehouse-scale data centers operated by cloud providers — represent 76.4% of that market. The math is straightforward: if the chip market is genuinely headed toward $400 billion in annual revenue by 2027, as AMD CEO Lisa Su has forecast, someone has to build the infrastructure that keeps those chips running.

ZutaCore's HyperCool ranks seventh in direct-to-chip cooling capability, according to Data Centre Magazine. The company says it has more than 75 deployments across the Americas, Europe, and Asia, and has raised approximately $200 million in total funding since founding.

The geography of the cooling problem adds another layer. Traditional water-based cooling requires thousands of gallons daily per megawatt, making large data center buildouts difficult or impossible in water-scarce regions. Phoenix, the Nevada desert, and parts of the Middle East have historically been constrained by that math. Waterless two-phase dielectric cooling removes that variable: ZutaCore's system consumes no water at the chip level, which means the constraint shifts from hydrology to power availability alone. That re-draws the map for where hyperscale AI infrastructure can be sited, and who controls the cooling at those sites matters for the same reason siting matters.

The valuation, however, prices the company as a growth story, not a mature infrastructure play. Based on figures reported by GetLatka, ZutaCore's annualized recurring revenue was roughly $42.8 million in 2025, which would put the Series C valuation at roughly 14 times revenue. The 75 deployments are self-reported, not independently audited. Whether that multiple survives depends entirely on whether the company can convert the cooling bottleneck into a durable revenue line before incumbents catch up. Large HVAC and thermal management players including Trane, Schneider Electric, and Vertiv have existing data center cooling businesses. Hyperscalers including Google and Microsoft are investing in proprietary thermal management R&D. The bet embedded in the $600 million valuation is that ZutaCore captures enough of the AI-specific cooling market before those two counterforces consolidate it.

The bottleneck is real. "Power is the ultimate constraint here," DataBank CEO Raul Martynek told Fierce Network. "There is still not enough awareness around that dynamic." A single high-density AI chip can now draw more power than an entire household. Physics did the rest. Whether ZutaCore — or any cooling company — can turn that heat problem into the infrastructure layer that makes the AI buildout possible is the bet three industrial giants just paid to find out.

What to watch next: whether tier-one cloud providers publish cooling infrastructure deployment numbers that go beyond ZutaCore's own count, and whether the $600 million valuation attracts competitive pressure from larger HVAC and thermal management players already moving into the market.