Nexthop AI officially launched today with an impressive $110 million in combined seed and Series A funding, aiming to reshape the landscape of artificial intelligence infrastructure for the world’s largest cloud providers. The funding round was led by Lightspeed Ventures, with participation from Kleiner Perkins, WestBridge Capital, Battery Ventures, and Emergent Ventures.
The startup, founded to meet the growing demands of hyperscale AI computing, specializes in building custom networking solutions for large-scale cloud operators. Nexthop’s approach combines bespoke hardware and software designed to integrate seamlessly with clients’ existing cloud environments.
Chief Executive Anshul Sadana explained that as the AI boom accelerates, hyperscale data centers can no longer rely on off-the-shelf solutions. Instead, they face a “build versus buy” dilemma, driven by the complex needs of massive AI workloads. Nexthop’s solution is to co-develop infrastructure alongside clients, offering tailored networking hardware, operating systems, and interconnect components that align directly with customer specifications.
Energy efficiency is a key focus. As AI adoption surges, power demands in data centers have exploded. What was once a “large” facility consuming 30 megawatts a decade ago is now dwarfed by hyperscaler campuses requiring hundreds of megawatts. Sadana noted that even a 1% gain in efficiency can save 100 megawatts—a level of power that recently would have supported the largest data center on earth.
To support such optimization, Nexthop leverages open-source software like SONiC (Software for Open Networking in the Cloud), enabling interoperability and the flexibility needed to scale advanced AI systems. This open approach allows hyperscalers to maintain full control over their hardware ecosystems while remaining agile in a rapidly evolving market.
Nexthop’s collaborative model aims to provide clients with a strategic advantage, giving them the ability to build out GPU clusters, storage arrays, and networking systems to precise needs, thereby accelerating time-to-market for AI innovations.
With the new funding, Nexthop plans to scale its engineering team and expand its portfolio of products, positioning itself at the forefront of AI-driven cloud infrastructure development.
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