Eridu, an artificial intelligence networking startup founded by veteran technology entrepreneur Drew Perkins, said Tuesday it has emerged from stealth with a $200 million Series A funding round aimed at developing new networking systems designed for large-scale AI computing.
The oversubscribed round was led by Socratic Partners, John Doerr, and Matter Venture Partners. The company said it has now raised a total of $230 million since its founding.
Perkins, who co-founded the company and serves as chief executive, said the startup is focused on redesigning networking hardware to handle the rapidly growing number of graphics processing units used in AI systems.
Founder’s Background In Internet And Networking Technology
Perkins has worked in networking technology since the early days of the internet.
In the 1980s, he helped develop the Point-to-Point Protocol, a networking technology that became part of the TCP/IP system used by the internet.
He later co-founded optical networking company Lightera Networks, which was acquired by Ciena in 1999 for more than $500 million.
Another company he co-founded, Infinera, went public and was later acquired by Nokia for $2.3 billion in 2025.
Perkins also co-founded Gainspeed, which was acquired by Nokia, and augmented reality company Mojo Vision.
Conversation With Sam Altman Prompted New Idea
Perkins said the idea for Eridu emerged after a conversation with OpenAI chief executive Sam Altman in February 2023.
Both were speaking at a conference when they discussed the infrastructure requirements behind systems such as ChatGPT.
“Sam told me that what enabled AI and ChatGPT was just enormous amounts of compute,” Perkins said.
He recalled that the discussion referenced thousands of GPUs, but said current AI systems now involve far larger clusters.
“At which time, I think he meant 4,000 GPUs, but now we’re talking about millions of GPUs,” he said.
That discussion led Perkins to focus on networking systems that allow large numbers of chips to communicate efficiently.
“What we needed to do in the networking sector, in the networking industry, was come up with a brand-new way of thinking about how you build networks and build network equipment, network chips, and the entire thing,” he said.
Designing Networking Hardware For AI Data Centers
Perkins later partnered with co-founder Omar Hassen, who previously worked on networking chip design at companies including Broadcom and Marvell.
The two founded Eridu in 2024.
The company is developing networking technology beginning at the silicon level, designing chips that integrate networking functions directly into hardware.
Eridu’s long-term plan is to build full networking systems designed specifically for AI data centers.
These systems would take the role currently filled by network hardware vendors such as Arista Networks in traditional data centers.
The company aims to reduce the number of optical connections used in AI infrastructure by shifting more communication functions onto chips.
Reducing Latency And Energy Use
Current data center networking systems add additional hardware components as demand increases.
Each additional device introduces more steps for data to travel, which increases latency.
Perkins said Eridu is developing switches that integrate more networking functionality directly onto chips.
“So now I’m saving a ton of power, I’m saving a ton of cost, and then my network is much more reliable because the optics are the least reliable part of the network,” he said.
He added that improvements in AI computing hardware are currently outpacing advances in networking technology.
“GPU compute and memory bandwidth are improving by roughly 10x per year, while data center switches from Broadcom, Marvell, Cisco, etc. are still only improving 2–3x every 2–3 years,” Perkins said.
Strong Investor Interest In The Startup
Perkins said the company initially contacted venture capital firms he had previously worked with.
Among the early investors was Wen Hsieh, founding managing partner of Matter Venture Partners and a former leader of Kleiner Perkins’ China investment group.
Hsieh later introduced the company to venture capitalist John Doerr, who had previously invested in one of Perkins’ earlier startups.
Following those introductions, Perkins said investor interest in the company increased significantly.
“My phone has been ringing off the hook,” he said. “It’s been a fun time raising money for this venture … we’re very oversubscribed.”
Perkins declined to disclose the company’s valuation.
He said the valuation is comparable to other startups raising similarly large Series A rounds.
He also declined to confirm whether the company has reached a valuation above $1 billion.
The company currently employs about 100 people.
Additional Investors In The Funding Round
Additional participants in the funding round include Hudson River Trading and Capricorn Investment Group.
Other investors include SBVA, MediaTek, Bosch Ventures, TDK Ventures, Eclipse, and VentureTech Alliance, an investment vehicle associated with semiconductor manufacturer TSMC.
Featured image credits: Hanwha Data Centers
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