MIT spinout Vertical Semiconductor lands $73M CHIPS grant for AI power chips
What's the deal? Vertical Semiconductor has signed a letter of intent with the US Department of CommerceDealroom has a profile for this one. Try Dealroom → for up to $73 million in federal incentives under the CHIPS and Science Act. The funding, routed through the department's CHIPS Research and Development Office, would accelerate R&D of vertical gallium nitride (GaN) power transistors.
What's the endgame? The MIT spinout builds vertical GaN FinFET technology to boost efficiency and power density in systems for AI data centers. Its project aims to demonstrate a first-of-its-kind 2.5-MW AI rack designed to cut energy losses by 30% and shrink physical footprint by 50%.
Why now? Power has become a key constraint on AI infrastructure, with industry attention turning to higher-voltage architectures where GaN devices can reduce conversion losses. "Power is the most significant bottleneck in the build-out of AI infrastructure," said chief executive officer and co-founder Cynthia Liao.
The award is part of a broader federal push: the Commerce Department announced $389 million in planned R&D awards to four companies developing domestic power-semiconductor technology. The technology was originally invented with support from the Department of Energy's Advanced Research Projects Agency–Energy.
What could go wrong? The $73 million is a proposed award under a letter of intent, not finalized funding. The grant's status means the money and commercialization milestones are not yet assured.
The signal: The package ranks among the largest grant rounds in US AI, sitting in the 99th percentile of 1,720 comparable deals. It reflects Washington's bid to secure domestic supply chains for the power infrastructure behind AI compute.
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Image credit: Vertical Semiconductor
