Drew Perkins has been inventing computer network tech and building startups since the dawn of the internet age.
Now he’s back as a co-founder and CEO of AI networking startup Eridu that’s officially coming out of stealth on Tuesday with an oversubscribed $200 million Series A round. The round was led by Socratic Partners, renowned VC John Doerr, Matter Venture Partners, and others. Eridu has now raised a total of $230 million, the company said.
Perkins began his career in the 1980s, and helped create the Point-to-Point Protocol (PPP) that became a key part of TCP/IP, the protocol upon which the internet relies. In 1999, the optical switch company he co-founded, Lightera Networks, was sold to Ciena for over $500 million. Next was Infinera, which IPO’d and was later sold to Nokia for $2.3 billion in 2025. He also co-founded Gainspeed (also sold to Nokia) and, most recently, the AR startup Mojo Vision.
But after OpenAI released ChatGPT, Perkins had an epiphany. In February 2023, Perkins and OpenAI CEO Sam Altman were speaking at a small conference. They got to chatting, and “Sam told me that what enabled AI and ChatGPT was just enormous amounts of compute. At which time, I think he meant 4,000 GPUs, but now we’re talking about millions of GPUs,” Perkins told TechCrunch.
He realized from that conversation that the bottleneck to progress won’t just be access to more chips; it will be the methods the chips use to communicate with one another across their systems.
“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.”
By late 2023, Perkins had met his co-founder, Omar Hassen, whose roots are in networking chip design for the big industry players like Broadcom and Marvell. In 2024, they founded Eridu.
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They began to rethink computer networking from scratch starting with the silicon, meaning new chips designed for AI that integrate more networking functionality.
Eridu will eventually sell complete systems that take the spot in an AI data center that a classic network gear provider, like Arista Networks, takes in a classic data center. These systems will replace many tiered optical connections with on-chip communications.
Today, when more networking is needed, more boxes are added, which increases the number of hops each data bit may have to travel and increases latency – which contributes to that delay between typing in a prompt and getting a reply.
Eridu is working on a switch that puts more functions on the chip itself. “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,” Perkins said.
“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 added.
The founders made a few calls to VCs who Perkins has known over the years and landed Wen Hsieh as a key investor. Hsieh is the founding managing partner of Matter Venture Partners and previously helped lead Kleiner Perkins’ China investing group.
Hsieh told Doerr about Eridu, after which the legendary former Kleiner Perkins investor (who had backed one of Perkins’ previous startups) also wanted in. That set off a VC frenzy.
“My phone has been ringing off the hook,” Perkins said. “It’s been a fun time raising money for this venture … we’re very oversubscribed.”
Perkins would not comment on valuation except to say that it is comparable to others raising this much in a Series A round and that he feels it’s not too low, nor too high. He wants his 100 or so current employees to do well on their stock options. He also declined to comment on whether the startup had achieved unicorn status (valued at over $1 billion).
Needless to say, if Eridu can deliver on its promise to create a new kind of AI-friendly networking chip and system, it will be in the middle of the largest data center build-out in history.
And, unlike a vibe-coded product built by a 20-something college dropout, Eridu’s founders have something increasingly rare in Silicon Valley these days: deep experience. All of that bodes well for the company’s future.
Other leads in the round include Hudson River Trading and Capricorn Investment Group, with participation by SBVA, MediaTek, Bosch Ventures, TDK Ventures, Eclipse and VentureTech Alliance (an investing vehicle of chip fab giant TSMC), among others.
