Hyperscale Power Targets Data Center Efficiency Upgrade

The traditional iron-core transformer, a cornerstone of electrical grids for over 140 years, is facing an existential challenge. As AI-driven data centers demand unprecedented levels of electricity, the bulky, legacy hardware is increasingly viewed as a bottleneck, prompting a surge of innovation in the solid-state transformer sector.

Hyperscale Power is the latest entrant to join this race, recently securing €5 million in seed funding. Led by World Fund and Vsquared Ventures, the capital will be used to develop a prototype aimed at shrinking power-conversion equipment significantly, according to the company.

Solving the Data Center Density Crisis

Modern server racks, particularly those housing high-performance hardware like Nvidia’s latest units, are pushing power consumption to new heights. With current racks exceeding 100 kilowatts and future projections reaching 1 megawatt—a capacity sufficient to power roughly 1,000 homes—the physical footprint of traditional transformers has become a critical issue.

“It’s more than twice as large as the server racks itself,” noted Daniel Rothmund, co-founder and CEO of Hyperscale Power, regarding the current state of power-conversion gear. He argues that without the adoption of solid-state technology, the expansion of data centers will face significant physical and operational delays.

A Competitive Landscape

The market for solid-state transformers has matured rapidly. Startups in this space have collectively raised over $330 million, with notable competitors including:

• Amperesand: Incubated by a Temasek early-stage fund.
• DG Matrix: Backed by industrial conglomerate ABB.
• Heron Power: Founded by former Tesla executive Drew Baglino and supported by Andreessen Horowitz.

The Technical Edge

While solid-state transformers are inherently more compact than their iron-core predecessors, Hyperscale Power aims to differentiate itself by operating at significantly higher frequencies. By stepping power up into the tens of kilohertz range before converting the voltage and stepping it back down, the company believes it can achieve a level of miniaturization currently unseen in the industry.

This technical approach draws on the background of the company’s leadership. Rothmund, who co-founded the venture alongside Sami Pettersson, previously designed a solid-state transformer with 99.1% efficiency during his doctoral studies at ETH Zürich. For the team, the transition to this new technology is no longer a matter of feasibility, but of timing.

“It’s not a question if solid-state transformers will come, it’s a question when they will come,” Rothmund said.