LB Investment announced on the 15th it will invest $10 million in Point2 Technology, a Korean-American AI datacenter cable startup based in San Jose, California. The investment comes despite concerns about overinvestment in the AI industry, reflecting confidence that the AI revolution's trajectory will not significantly change direction. Point2 Technology, founded in 2016 by former Marvell executive Sean Park and KAIST Professor Bae Hyun-min, develops e-tube interconnect technology for GPU-to-GPU data transmission in datacenters. NVIDIA's venture arm NVentures invested $76 million in the company's Series B round in April, marking the first time NVIDIA invested in a Korean-origin semiconductor startup.
Point2 Technology Develops E-Tube Interconnect for GPU Communication
Point2 Technology was founded in 2016 by Sean Park, former Chief Product Development Officer at Marvell, and Professor Bae Hyun-min of KAIST's Department of Electrical Engineering. The company's core technology is the e-tube interconnect system developed by Professor Bae, who currently serves as Director of KAIST's Startup Institute.
The e-tube technology transmits data between GPUs in datacenters by converting electrical signals from GPU chips into radio frequency (RF) signals, transmitting them through plastic tubes, then converting them back to electrical signals. According to Point2 Technology, the company has filed approximately 100 patents in major countries worldwide and registered over 80.
Traditional copper-based Direct Attach Cables (DAC) are inexpensive and reliable but limited in transmission capacity and distance to around 1 meter. Active Optical Cables (AOC) using light waves can transmit large volumes over 10+ meters but are expensive and generate significant heat. Point2 Technology claims e-tube fills the gap in the 1-10 meter range. The company's official materials state e-tube offers 10 times the transmission distance of copper, one-fifth the weight, and one-third the power consumption. The technology is priced at copper cable levels while delivering AOC-grade transmission volume and one-third of AOC's power consumption.
NVIDIA Invested $76 Million in Series B Funding Round
In April, NVIDIA's corporate venture capital arm NVentures and global automotive parts manufacturer Bosch invested $76 million in Point2 Technology's Series B round. This represented the first instance of NVIDIA investing in a Korean-origin semiconductor startup. The specific investment amounts by these companies are contractually confidential but described as substantial. British semiconductor design company ARM is also expected to participate.
LB Investment, which manages approximately 1.5 trillion won in assets and ranks in the top five Korean venture capital firms, leads the current Series B-2 round. The firm was established in 1996 as LG Venture Investment and separated from LG Group in 2000 when it became part of LB Group. Vice Chairman Koo Bon-cheon, grandson of late LG founder Koo In-hwoi, and CEO Park Ki-ho lead the company.
Company Targets IPO Before 2030 with $92 Million Series B-2 Round
The Series B-2 round closing this month is expected to raise a total of $92 million including LB Investment's $10 million contribution. LB Investment projects Point2 Technology will go public before 2030, after completing ongoing proof-of-concept (PoC) trials and securing production orders (PO).
Comparable publicly-traded companies already command high valuations. As of the local time close on the 13th, Credo Technology (CRDO) traded at $237 per share on Nasdaq with a market capitalization of $44.18 billion. Based on trailing twelve-month earnings per share (EPS) of $2.5, the price-to-earnings ratio (PER) stands at 94 times. Lumentum Holdings (LITE) traded at $768 per share with a market cap of $59.76 billion and a PER of 146 times based on EPS of $5.3.
CEO Park Ki-ho stated: "We have strengthened investments in deep tech sectors including AI core materials and components, physical AI, robotics, and generative AI, executing 140 billion won as lead investor in the first half of this year alone. We plan to strengthen leading investments in promising domestic and international deep tech companies in the second half as well." A lead investor determines key terms with the investment target company and plays a role in attracting other investors.
FAQ
What is Point2 Technology's e-tube interconnect technology?
E-tube is a datacenter interconnect technology that converts electrical signals from GPU chips into radio frequency (RF) signals, transmits them through plastic tubes, then converts them back to electrical signals. According to Point2 Technology, e-tube offers 10 times the transmission distance of copper cables, one-fifth the weight, and one-third the power consumption, while maintaining copper-level pricing and AOC-grade transmission capacity.
How much did NVIDIA invest in Point2 Technology?
NVIDIA's venture arm NVentures participated in Point2 Technology's Series B funding round in April, which raised $76 million total. The specific amount invested by NVentures is contractually confidential, but the company describes it as substantial. This marked the first time NVIDIA invested in a Korean-origin semiconductor startup.
