Hyperscale Power, a Zurich-based developer of rack-scale solid-state transformers, has raised €5M ($5.7M) in seed funding co-led by World Fund and Vsquared Ventures. The startup's 3.3MW units convert medium-voltage 13.8kV AC to 800V DC at 98.5% efficiency while occupying 10x less space than traditional transformers. The proceeds will support prototype building, lab expansion in Zürich, and team growth from 2-10 to 15 employees.
SST Funding Accelerates Amid AI Boom
The round follows a flurry of investments in solid-state transformer startups. Heron Power raised $140M Series B in February 2026 to scale manufacturing, while DG Matrix secured $60M Series A the same month for smarter data center power routing. Hyperscale Power's rack-scale focus targets density constraints that these larger players also address but with European precision engineering roots.
AI Racks Strain Legacy Transformers
AI data centers now demand up to 1MW per rack, equivalent to power needs of entire buildings. Traditional transformers, bulky and with 18-24 month lead times, cannot fit into tight hyperscale footprints or match rising efficiency needs. Meta's planned 5GW Hyperion facility, consuming power like five nuclear plants, exemplifies the scale where space and delivery delays halt expansion.
Rack-Scale SSTs Shrink Power Gear
Hyperscale Power's solid-state transformers operate at tens of kHz for a fraction of the size and weight of incumbents. They use 90% less material, cut lead times to months, and enable direct renewables integration into DC buses. This contrasts with competitors like DG Matrix's intelligent hubs or Heron Power's grid-scale builds by prioritizing ultra-compact, modular 3.3MW rack units for AI hyperscalers.
As Daniel Rothmund, co-founder and CEO, told TechCrunch:
"We haven’t seen something that is as small as our system will be."
Climate Funds Back Efficiency Leap
World Fund, focused on decarbonization, and deep-tech specialist Vsquared Ventures co-led the round. Their investment signals conviction in SSTs' 2% efficiency gains translating to millions of tonnes of CO2 avoided at gigawatt scales. Selection for the Ignite Next accelerator adds strategic validation from Swiss deep tech programs.
SST Market Grows to $378M by 2031
The solid-state transformer market stands at $205M in 2026, projected to reach $378M by 2031 at 13% CAGR, per Mordor Intelligence. Data center transformers alone form a $10.24B TAM growing at 10% CAGR. Recent $200M+ in competitor funding underscores the shift to SSTs as AI drives DC distribution and 1MW rack demands.
Ex-ABB Experts Drive SST Revival
Co-founders Daniel Rothmund (CEO) and Sami Pettersson (CTO) bring 12+ and 20+ years from ABB as Principal Scientists. Rothmund's ETH Zürich PhD featured a 99.1% efficient medium-voltage SST prototype, while Pettersson led R&D in data centers, EV charging, and renewables. Their track record positions Hyperscale Power as Europe's SST specialist amid US-heavy competition.
Prototype Push and Team Expansion
Funds enable prototype acceleration, Zürich lab setup, and hiring senior power electronics and mechanical engineers. Participation in Ignite Next supports 2026 commercialization for AI data centers, EV fast-charging, and renewables projects.