Iceotope secures $26 million as AI rack densities exceed the capabilities of air cooling.

      Barclays Climate Ventures and Two Seas Capital took the lead on Iceotope’s Series B funding, which totaled $26 million. The British precision-liquid-cooling company aims to enhance its product range and expand its patent portfolio as increasing rack power densities driven by AI hardware exceed the capabilities of air cooling. Existing investors—including ABC Impact, Northern Gritstone, Edinv, and British Patient Capital—also participated in this round.

      The timing of Iceotope's strategy is as crucial as the technology itself. With next-generation Nvidia accelerator platforms pushing per-rack power densities to and beyond 1 MW, traditional cooling methods like air cooling and direct-to-chip liquid loops are unable to dissipate heat quickly enough to maintain sustainable temperatures for silicon components.

      Iceotope utilizes a chassis-based precision liquid cooling system that replaces air with a dielectric fluid circulated around server components within a sealed chassis. This method eliminates traditional elements such as fans, hot aisles, and water-intensive cooling towers that have been staples in data center architecture for decades.

      The market dynamics underpinning this funding round are particularly noteworthy. Iceotope referenced projections from SemiAnalysis, which forecast that the number of liquid-cooled AI accelerators will grow from approximately 3 GW today to 40 GW within two years—a more than tenfold increase. This growth will be driven by hyperscaler and colocation operators who must transition to liquid cooling to support AI workloads that traditional architectures cannot accommodate.

      The trend is also evident among operators: Nvidia-backed Firmus is constructing modular, fully liquid-cooled AI factories in Australia to accommodate 36,000 GB300 Grace Blackwell chips, partially funded by a $10 billion debt facility from Blackstone.

      Iceotope’s market position is bolstered by a patent portfolio consisting of 219 granted and pending patents and its pioneering role in chassis-level liquid cooling, which it has been developing since 2005. The company's current offerings include KUL BOX, designed for edge and AI deployments constrained by space and noise, and KUL AI for high-density racks in new AI data centers.

      The technology operates nearly silently and utilizes minimal water, addressing growing concerns related to data center water usage in various regions, including the US Southwest, Ireland, and the Netherlands.

      “Having such esteemed investors validates our technology and market timing,” stated Simon Jesenko, Iceotope’s CEO and CFO. “After years of developing a strong, differentiated IP portfolio and products tailored for AI infrastructure, we are poised to scale just as the industry requires more advanced and sustainable cooling solutions. The potential for growth, both directly with customers and through our partner ecosystem, is significant.”

      Barclays Climate Ventures emphasized its involvement in terms of climate policy. “As AI adoption accelerates globally, Iceotope’s liquid-cooling technology presents a timely and innovative response to the challenges posed by traditional cooling systems,” said Steven Poulter, head of Barclays Climate Ventures. “This approach not only meets the rising demands of AI and high-performance computing but also significantly enhances datacenter sustainability.”

      The competitive landscape is becoming increasingly crowded, with companies like LiquidStack, Submer, JetCool, GRC, and Asperitas all focusing on aspects of the liquid-cooling market. Major hyperscalers, including Amazon, Microsoft, Google, and Meta, are exploring internal cooling architecture solutions alongside their external suppliers.

      Iceotope’s edge lies in its chassis-level strategy and comprehensive patent portfolio, positioning it as more deployable than open-bath immersion and more thermally effective than direct-to-chip cold-plate systems. It possesses the second-largest IP portfolio in precision cooling, surpassed only by Equinix.

      Previously, Iceotope secured £30 million ($38 million) in 2022, led by ABC Impact, and with this Series B funding, its total disclosed funding has now surpassed $80 million. The newly acquired capital will primarily support product development, engineering, patent extensions, and ecosystem partnerships, rather than significantly increasing headcount, which the company plans to grow steadily through 2025 and 2026.