Chip startup Vertical Semiconductor has raised $11 million in a seed funding round to support the development of its vertical GaN (gallium nitride) transistors.

The round was led by Playground Global, with additional investment from JIMCO Technology Ventures, Milemark Capital, and Shin-Etsu Chemical.

Co-founded by Josh Perozek, Cynthia Liao, and Tomas Palacios in 2024, Vertical Semiconductor is an MIT spin-out based on research undertaken by MIT’s Palacios Group – a ‘world-leading’ GaN research lab.

GaN is a wide-bandgap material and can handle higher amounts of power than silicon, meaning GaN-based chips can be more efficient and durable than their silicon counterparts. Vertical says it has developed a “scalable transistor platform” out of the material that enables “direct, high-efficiency power conversion” to improve performance in AI data centers.

Having already demonstrated its technology on eight-inch wafers using standard silicon CMOS semiconductor manufacturing methods, Vertical says it is now ready for real-world deployment for devices from 100 volts to 1.2kV.

A prototype is currently in development, with the startup planning to begin early sampling of its packaged devices by the end of the year, with a fully integrated solution targeted for 2026.

“The pace of AI is not only limited by algorithms. The most significant bottleneck in AI hardware is how fast we can deliver power to the silicon,” said Liao, CEO and co-founder. “We’re not just improving efficiency, we’re enabling the next wave of innovation by rewriting how electricity is delivered in data centers at scale.”