Phaidra Raises $12M to Strengthen Data Center Infrastructure and Solve AI Challenges

Machine Learning

The rapid rise of high-performance GPUs driven by AI is creating a looming energy and innovation crisis as data centers cannot provide enough power to meet computing demands. Phaidra uses AI and reinforcement learning to help data centers scale computing by optimizing cooling systems and reducing energy costs, which can account for up to 50% of operational costs.

Phaidra is an AI-based control system that helps mission-critical facilities: Data Centres Today we announced that we will be improving energy efficiency and increasing our computing infrastructure. $12 million The new funding, led by Index Ventures, brings total capital raised to $60.5 millionThe new funding will enable Phaedra to accelerate the expansion of its autonomous control systems, which use reinforcement learning to optimize datacenter power usage and improve reliability. The announcement comes at a time when rapid AI innovation relies on the expansion of computing. This, combined with a shortage of power and skilled labor needed to support mission-critical facilities like datacenters, has contributed to a global crisis in which AI innovation is limited by a lack of computing infrastructure.

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The data center industry, which is the backbone of AI, is growing rapidly. In the United States, which accounts for 40% of the global data center market, demand is expected to reach 35GW by 2030, up from 17GW in 2022. However, data centers are extremely energy intensive, consuming 10 to 50 times more energy per floor area than a typical commercial office building. As resource-hungry GPU-dependent AI models proliferate, the existing market is struggling to meet demand. Northern VirginiaIn the United States, the world's largest data center market, only 0.2% of grid capacity is available. IrelandBy 2026, data centers are predicted to account for 32% of the country’s electricity consumption. Without significant improvements in data center infrastructure and efficiency, the world simply does not have enough spare power to support AI’s current growth trajectory.

“We talk about AI and increasing computing power, but we ignore the core of the problem, which is electricity,” he said. Martin Mignon“Without enough energy, there is no AI,” said Phaidra, a partner at Index Ventures. “The more time we spent researching this problem, the more clear it became to us how important it was to invest in solutions that address the downstream impacts of growing compute power. Phaidra is a perfect example of the right team and the right product being in the right place at a special time.”

Phaidra's AI controls platform transforms industrial facilities into intelligent, self-learning systems that combine the precision of manual methods with the scalability and efficiency that AI provides. It seamlessly integrates into existing building management systems to capture real-time data, which then feeds cloud-based reinforcement learning agents that automatically change settings on individual components to optimize overall system performance. And unlike traditional control systems that degrade over time and require periodic manual programming updates, Phaidra automatically learns and improves over time. Phaidra's early customers have realized millions of dollars in cost savings through improved efficiency and increased power availability for revenue-generating services.

Phaidra's founding team is the rare breed that combines specialized engineering know-how with world-class AI research credentials. Jim Gao Inspired by a documentary about AlphaGo, Gao explored how machine learning techniques could be applied to improve the efficiency of Google's data centers. His enthusiasm caught the eye of Vedavias Panneershelvam, current CTO of Phidra, who worked as a lead research engineer on AlphaGo. The two worked together at DeepMind to develop an AI-powered solution that reduced the amount of energy needed to cool Google's data centers by 30%. After publishing their findings, Gao and Panneershelvam were approached by an industrial control systems engineer. Katie Hoffmanled innovation projects at Trane Technologies and later joined Phaidra as its third co-founder and COO.

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“The data center industry is already growing rapidly and is reaching a tipping point due to the surging demand for AI,” he said. Jim Gao“Every data center operator knows they need efficiencies to meet this growing demand,” said Mike, co-founder and CEO of Phaidra. “At Phaidra, we're on a mission to revolutionize the way data centers are managed with an AI-powered control system that not only adapts in real time, but continuously learns and improves. The result is massive cost savings and increased revenue that drives further growth.”

Phaidra's team of approximately 100 people currently includes top software engineers and researchers from Google, DeepMind, Meta and Amazon, as well as experts from leading engineering companies such as Trane and Johnson Controls. As Phaidra continues its mission to enable data centers around the world to optimize energy use, the new funding will support continued investments in research and development, implementation and customer success, as well as the expansion of go-to-market activities.

“In meeting the team and speaking with customers, it's clear that Phaedra is uniquely positioned to tackle this issue head-on.” Martin MignonPhaidra, a partner at Index Ventures, said: “Phaidra is the first startup with the expertise and AI research capabilities to actually deliver on the promise of autonomous control, not to mention the impressive performance and results it has already demonstrated. We are excited to see Phaidra take the next step as a company, delivering solutions that are critical not only to the growth and sustainability of data centers, but also to AI development, the tech industry and the world at large.”

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