As data centers work to meet artificial intelligence’s insatiable need for power, the whirring machines that make up computers, wires and suctioning cooling systems radiate copious amounts of heat.

In countries like Finland and Sweden, that heat is redirected to powering towns, allowing residents to run hot water or turn on their heater for free. That’s Karman Industries’ goal locally, according to Chief Executive David Tearse.

The energy startup, based in Signal Hill, announced on Wednesday its solution to capturing and redistributing heat produced by data centers, along with a $20 million series A funding round. The round was led by Riot Ventures, a Venice-based venture capital firm, bringing Karman’s total funding to $30 million.

For now, it’s opting to work closely with rapidly developing data centers.

“You typically see this play over time and time again in history, where there’s a big problem with an industry with a lot of capital and they look for innovative solutions,” Tearse said. “They solve it, but then that technology has an expansive impact outside of that core industry.”

Updates to the heat pump

Cooling technology has long been a necessary part of computing infrastructure. Early data centers from cloud giants like Amazon.com’s AWS and Microsoft Corp.’s Azure used air cooling methods. As data centers grew, cooling technology evolved to include liquid-based cooling, chillers, and dry coolers.

But many legacy cooling solutions on the market were geared towards universities and hospitals – not the insurmountable heat baking in data centers geared towards artificial intelligence. As a result, data centers have had to add several units of cooling infrastructure to an already sprawling site.

Karman Industries’ heat processing unit aims to package that sprawl into a more compact heat management platform that shrinks the physical footprint of data centers between 60% and 80%, the company said.The heat processing unit was engineered using several core technologies from other industries: turbomachinery to lift heat and cool systems, used in rockets to pump fuel; permanent-magnet motors commonly found in electric vehicles; and advanced manufacturing techniques to efficiently build the product. Its modular design aims to make installation easier on any data center site.

“We applied an aerospace systems-engineering approach to data center thermodynamics,” CJ Kalra, co-founder and chief technology officer of Karman Industries, said in a statement. 

In the neighborhood

Though heat derived from data centers has the potential to power homes, factories and businesses, Tearse acknowledges that, right now, “data centers have the vibe of ‘not in my backyard’ from a lot of communities.”

Indeed, several communities have mobilized to keep data center construction out of their neighborhoods, citing pollution, resource and water depletion, an uptick in utility costs and the limited economic benefits to the area.

“I say, what if we flipped that narrative?” Tearse said. “What if we actually build houses around (data centers) and then your utilities are free? We’re actually supplying heating to those homes or supplying electricity to those homes.”

In El Segundo, with its manufacturing plants, the city has tinkered with ways to use heat generated by data centers to warm a municipal pool.

“We’ve flirted with our existing data centers on how to be efficient with their cooling. We have a large swimming pool that’s next to one,” said Chris Pimentel, the mayor of El Segundo. “We try to be pretty creative when it comes to engineering.”