Kandou AI raises $225M from SoftBank to wire up AI data centres with copper

What's the deal? Kandou AI, a Swiss chip connectivity startup founded in 2011 as an EPFLDealroom has a profile for this one. Try Dealroom → spin-off, has raised $225 million from investors including SoftBankDealroom has a profile for this one. Try Dealroom →, Maverick SiliconDealroom has a profile for this one. Try Dealroom →, SynopsysDealroom has a profile for this one. Try Dealroom →, Cadence Design SystemsDealroom has a profile for this one. Try Dealroom →, and Alchip. The round values the company at $400 million.

Under chief executive officer Srujan LingaDealroom has a profile for this one. Try Dealroom → — a former Goldman Sachs managing director who took over in 2025 — Kandou AI has pivoted from consumer electronics to AI infrastructure. The company makes high-performance connectivity chips that link GPUs inside data centres, aiming to help companies build AI systems more cheaply.

Why now? As AI models grow larger, companies need ever more GPUs working in concert. Connecting those processors to each other and to memory has become a major bottleneck — and a business opportunity.

Kandou AI's bet is on copper-based connections, which are cheaper than the fibre-optic cables most of the industry favours. "People tend to believe that copper is dead," Linga told Bloomberg. Kandou AI disagrees, claiming its technology can push far more data through copper than conventional wisdom suggests.

The company says it has already worked with several hyperscalers and signed a memorandum of understanding to supply chips to one, though it declined to name the customer. It holds over 350 patents and has had silicon in production since 2021, when it shipped USB and PCIe retimer chips.

What could go wrong? Kandou AI is, by its own chief executive's admission, "an outsider coming into this space." The AI connectivity market is dominated by established players, and the semiconductor industry is notoriously risk-averse — customers prefer proven suppliers over newcomers. Convincing hyperscalers to adopt copper-based links over fibre optics will require overwhelming proof that the technology works at scale.

The broader political environment adds uncertainty. Former president Joe Biden's Chips and Science Act, which Linga helped build through its Chips for America programme, faces criticism from President Donald Trump, who prefers tariffs over subsidies to boost US semiconductor production.

The signal: This round reflects a broader trend: as AI infrastructure spending accelerates, investors are looking beyond the GPU makers themselves to the connective tissue that holds data centres together. Interconnect technology — the plumbing of AI — is emerging as a critical and investable layer of the stack.

Kandou AI's pivot also illustrates a pattern in deeptech: companies born from academic research finding new life as AI reshapes demand. What started as an EPFL lab project focused on chip-to-chip signalling is now positioned at the centre of a multi-trillion-dollar infrastructure buildout.

Sources:
Bloomberg
Top 100 Startups Swiss
GlobeNewsWire

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