Olix, a London-based developer of photonic processors for AI inference, has raised $312 million in Series B funding led by Fundomo with participation from Arm and Reed Hastings. The company builds specialized hardware infrastructure using light-based circuits to lower the cost and increase the speed of AI inference, bypassing limitations of general-purpose chips.
Europe's Largest Chip Round Signals Inference Shift
The timing comes amid surging demand for specialized inference hardware. Lightmatter raised $850M at a $4.4B valuation in its October 2024 Series D, while Ayar Labs secured $872M at a $3.75B valuation in its March 2026 Series E. Olix's approach integrates SRAM architecture with photonics to avoid HBM and advanced packaging bottlenecks that constrain other designs.
Inference Costs Drive Architecture Innovation
AI inference now represents the dominant compute demand as deployed models scale. The photonic AI chip market stands at $3.14B in 2026 and is projected to reach $20B by 2035. Current solutions relying on general-purpose GPUs face rising total cost of ownership and supply constraints in high-bandwidth memory.
Specialized Silicon for Token Production
Olix's OTPU optical tensor processing unit and DX-1 decode accelerator form its "token factory" architecture. Models are unrolled across racks using specialized silicon connected by optical networks, rather than forcing all operations onto a single chip. This rack-scale co-design targets higher throughput per watt for the decode stage where models reason and produce tokens.
As Stevan Boljevic noted in the company's manifesto:
"Building ever stronger one-chip-for-everything solutions can deliver short term improvements to the pareto frontier but will never produce a pareto optimal inference system that delivers a transformational step change in inference cost & performance."
Strategic Backers Validate Photonic Thesis
Fundomo led the round as part of its focus on state-scale computing systems, with Arm providing strategic validation of the architecture. Hudson River Trading and Reed Hastings also participated. Existing investors Hummingbird Ventures, Plural, and Crane increased commitments, signaling continued conviction from early backers.
Photonics Market Expands Amid Consolidation
The silicon photonics market is projected to grow from $2.16B in 2024 to $9.65B by 2030. Recent consolidation includes Marvell's $3.25B acquisition of Celestial AI in February 2026 and Nvidia's $20B acquisition of Groq's inference IP in December 2024. Olix's $3.3B valuation reflects investor bets on architectures that sidestep supply-constrained components.
What's Next
Olix plans first customer shipments in 2027 after completing design later this year. The company is hiring across London, Bristol, Austin, Toronto, and San Francisco to scale its team beyond 140 staff.