Observed Signal · Feb 18, 2026 · Funding · Source: TechCrunch · Impact: 3/5 · Sentiment: Positive
Heron Power Secures $140M to Revolutionize Energy Transformers
Heron Power, founded by former Tesla executive Drew Baglino, raised $140 million in a Series B to scale production of its solid-state transformers for data centers and the power grid. The round was led by Andreessen Horowitz’s American Dynamism Fund and Breakthrough Energy Ventures, with participation from several other investors. Heron’s Heron Link units are modular solid-state transformers that can handle 5 megawatts each, convert medium voltage to 800 volts to match Nvidia reference rack designs, include fast-swap modules and short-duration lithium-ion batteries that provide about 30 seconds of power. The company plans a factory to produce 40 gigawatts of Heron Link annually, aims for pilot production in early 2027, and to ramp production over the subsequent two years.
Significant funding for a company developing modular solid-state transformers could accelerate deployment of next-generation power infrastructure for data centers and the grid; factory plans (40 GW/year) and compatibility with high-voltage data center designs make this relevant to energy and data center operators, but it is not a major platform policy or market-wide mandate.
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Key Takeaways & Evidence Grounding
- Heron Power raised $140 million in a Series B funding round.
- The Series B was led by Andreessen Horowitz’s American Dynamism Fund and Breakthrough Energy Ventures, with participation from Capricorn Investment Group, Energy Impact Partners, Gigascale Capital, and Valor Atreides AI Fund.
- Heron Power's product, Heron Link solid-state transformers, are modular, handle 5 megawatts each, convert medium voltage to 800-volt outputs compatible with Nvidia reference rack designs, and include lithium-ion batteries that provide approximately 30 seconds of power.
- Heron Power plans to build a factory capable of producing 40 gigawatts of Heron Link transformers annually, with pilot production targeted for early 2027 and scaling over the following two years.
- Drew Baglino is the founder and CEO of Heron Power and is a former Tesla executive who led powertrain and energy groups at Tesla.
Connected Companies & Entities
4 Entities mappedRelated Market Signals & Shifts
Recent verified developments and strategic activity across this market segment.
Startup Hyperscale Power Disrupts 140-Year-Old Transformer Technology
TechCrunch reports that Hyperscale Power, a startup developing high-frequency solid-state transformers (SSTs) for data centers, raised a €5 million seed round led by World Fund and Vsquared Ventures to build a prototype. The article situates Hyperscale within a rapidly growing SST market that has seen roughly $280 million in recent startup funding and notes competitors such as Amperesand, DG Matrix and Heron Power (backed by Andreessen Horowitz). Hyperscale co-founders Daniel Rothmund and Sami Pettersson claim the company can reduce SST size further by operating at much higher switching frequencies (tens of kilohertz). Rothmund — who researched SSTs during a PhD at ETH Zürich and built a 99.1% efficient device — argues SSTs are becoming necessary as AI-driven server racks push power density toward hundreds of kilowatts and beyond.
DG Matrix Secures $60M to Revolutionize Data Center Power
DG Matrix, a startup building solid-state transformers for data centers, raised $60 million in a Series A led by Engine Ventures with participation from ABB, Cerberus Ventures, Chevron Technology Ventures, Clean Energy Ventures, Fine Structure Ventures, Helios Climate Ventures, MCJ, and Piedmont Capital. DG Matrix’s Interport device, described as a power “router,” can handle up to 2.4 megawatts and integrate power from multiple sources (for example combining solar and grid-scale batteries) to feed high-density server racks. The company says Interport can replace bulky legacy power conversion equipment and uninterruptible power supplies, improving efficiency (claimed 95–98% vs. legacy 82–90%) and reducing space requirements. DG Matrix has a deal to supply Interport to Exowatt, plans initial customer deployments in June 2026, and aims to expand into building power, EV fleet charging, and micro/mini-grid applications.
Ex-SpaceX Engineers Raise $50M to Revolutionize Data Centers
Three former SpaceX engineers — Travis Brashears, Cameron Robinson and Serena Grown-Haeberli — founded Mesh Optical Technologies, a Los Angeles startup that raised $50 million in a Series A led by Thrive Capital. Mesh plans to mass-produce optical transceivers for data centers (targeting a production rate of 1,000 units per day within the year) to serve high-performance GPU clusters used for large AI model training and inference. The company aims to build supply chains outside China and qualify for bulk orders in 2027–2028. Mesh’s design removes a power-hungry component that its founders say could cut GPU-cluster power use by 3–5%. Investors frame the company as addressing interconnect bottlenecks and national-security risks tied to reliance on Chinese suppliers.
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