Liquid cooling startup LiquidStack secures $20M in a Tiger Global-led funding round as AI’s energy demands skyrocket

As artificial intelligence continues its rapid adoption across various sectors, the growing energy demand to sustain AI systems is putting immense strain on data centers. From training complex machine learning models to running intricate algorithms, AI-driven workloads are consuming energy at unprecedented levels, making efficient cooling solutions more essential than ever.

This is where LiquidStack, a startup specializing in liquid cooling for data centers, steps in. With a fresh $20 million in funding led by Tiger Global, LiquidStack is tackling the critical challenge of managing data center cooling as AI pushes energy consumption to new heights. Liquid cooling, which offers greater efficiency and environmental benefits compared to traditional air-based systems, is increasingly being viewed as a necessary innovation to meet the surging demands of AI.

This latest investment brings LiquidStack’s total Series B funding to $35 million. The company plans to use the new funds to expand manufacturing, scale its cooling product line, and enhance both its commercial and research operations.

The need for more effective thermal management in data centers has intensified, especially as high-performance computing and AI continue to drive up power and cooling requirements. Industry research from Dell’Oro Group estimates that liquid cooling for data centers will become mainstream this year, with the market expected to grow to $15 billion over the next five years.

“AI is at the forefront of every industry’s agenda, and data centers are now turning to liquid cooling to help hyperscalers and global enterprises harness AI’s potential,” said Wahid Nawabi, Chairman of the Board at LiquidStack. “As a company with both hybrid and full-scale liquid cooling solutions, we are positioned to lead the next phase of data center infrastructure evolution.”

Founded in 2013 by Joe Capes and Kar-Wing Lau, LiquidStack offers a cutting-edge lineup of liquid cooling products that cater to the unique demands of advanced computing, including AI and high-performance computing (HPC).

The company’s solutions include the CDW-1MW, part of its coolant distribution unit (CDU) lineup, which boasts 1,350kW of cooling capacity and certifications from ETL, CSA, and CE. The product is tailored for high-performance AI applications and comes fully tested to meet the rigorous demands of modern data centers.

Additionally, LiquidStack offers single-phase immersion cooling technology designed for efficient heat transfer, ideal for retrofitting data centers and use in modular containers.

Manufactured in LiquidStack’s state-of-the-art facility in Carrollton, Texas, which opened in March 2024, the company is expanding its roadmap for direct-to-chip cooling to keep pace with the thermal requirements of evolving GPU and CPU chips. LiquidStack also plans to further develop its single and two-phase cooling solutions, providing flexibility for data centers that require comprehensive cooling strategies.

“Liquid cooling is at a critical turning point, and Tiger Global’s support validates the unique advantages of LiquidStack’s technology,” said Joe Capes, CEO of LiquidStack. “This funding allows us to continue delivering high-quality liquid cooling solutions that meet the evolving needs of our customers.”

As a pioneer in sustainable liquid cooling since 2012, LiquidStack remains at the forefront of enabling scalable, energy-efficient data centers for a wide range of sectors, including hyperscale, colocation, enterprise, edge, and blockchain.

With products like the DataTank™, EdgeTank™, CryptoTank™, and MicroModular™ systems, LiquidStack is driving innovation in computing while supporting environmental sustainability.

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