Optalysys, a photonic computing company, has raised £23 million in a Series A extension round.
The round was led by Northern Gritstone with participation from imec.xpand, Lingotto Horizon, and the UK government’s National Security Strategic Investment Fund (NSSIF).
The investment will be used to accelerate the commercialisation of Optalysys’ proprietary photonic chips and support expansion into the US.
Leeds-based Optalysys initially raised £21m in Series A funding in 2023 while former Arm CTO Dipesh Patel was appointed chair of its board last year.
As AI and cloud workloads continue to grow exponentially, conventional electronic computing is reaching its physical limits. Optalysys’ approach integrates data movement and processing on a single chip, combining silicon photonics with digital technologies to deliver immense computational power whilst reducing carbon footprint.
The company is developing a programmable, high-density layer designed to run compute-intensive workloads, including GenAI and post-quantum algorithms, forming a foundation for next-generation cloud infrastructure.
One key application is fully homomorphic encryption (FHE), which allows data to be processed securely while remaining encrypted — an increasingly important capability for secure cloud and enterprise computing.
Early forms of FHE technology are being used in digital form in Optalysys’ LightLocker Node servers launched last year — the world’s first dedicated hardware solution designed for encrypted blockchain applications.
“We are at a defining moment in the evolution of computing. Photonic computing opens up fundamentally new capabilities, allowing data to be moved and processed with far greater speed and efficiency,” said Dr Nick New, CEO and co-founder of Optalysys.
“This investment validates both the scale of the opportunity ahead and our ability to execute against it. It allows us to expand into new markets and take an important step towards making photonic computing a mainstream part of cloud infrastructure.”
Robert Todd, CTO and co-founder, added: “Recent acquisitions in the semiconductor industry have highlighted the role that photonics can play in addressing the limits of electronic computing, particularly in processing capability and power consumption, resulting from the demands of training and running even larger AI models.
“Optalysys’ approach uniquely combines data movement and compute within the same package. Expanding to the US is an exciting and natural next step for us, so that we can tap into its strong photonics ecosystem and the immense talent located in Silicon Valley.”
Duncan Johnson, CEO of Northern Gritstone, said: “Optalysys is scaling towards global success.
“The company is building technology for the next generation of computing and has the team, technology and commercial traction that we, as investors, want. We’re excited to support the team as they continue to commercialise their technology and deliver real-world impact across multiple industries.”