Iceotope Gets $26M to Build Better AI Data Center Cooling

UK-based Iceotope has closed a $26M Series B round to scale its liquid cooling tech for AI data centers, backed by Barclays Climate Ventures and Two Seas Capital.

A British cooling tech company just secured fresh capital to tackle one of AI’s most pressing physical problems: heat. Iceotope Group, based in Sheffield, England, has closed a $26 million Series B funding round. The investment was led by Two Seas Capital and Barclays Climate Ventures. Existing investors including Edinv, ABC Impact, Northern Gritstone, and the British Business Bank also participated in the round.

The company said the new capital will go toward product and engineering development, expanding its patent portfolio, and building out ecosystem partnerships. AI workloads are getting heavier. As a result, the hardware running them is getting hotter.

Next-generation GPU clusters and AI accelerators are pushing rack power densities toward 1 megawatt and beyond. Traditional air cooling and direct-to-chip liquid cooling are increasingly falling short at those levels. Furthermore, the global data center cooling market is projected to reach $40 billion to $45 billion by 2030, with liquid cooling alone accounting for $15 billion to $20 billion of that.

Founded in 2005 as a green computing research venture, Iceotope has since evolved into a specialist in precision liquid cooling. Its approach goes beyond direct-to-chip cooling.

Rather than just cooling processors, Iceotope uses a chassis-based design that cools every component in the rack including memory, storage, networking, and power delivery hardware. The company calls this a direct-to-everything approach.

Additionally, the system operates with near-silent noise levels and uses significantly less water than conventional methods. According to Iceotope, its technology can reduce energy use by up to 40% and water consumption by up to 96% compared to traditional air cooling.

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Iceotope currently holds 219 granted and pending patents tied to its liquid cooling technology, making it one of the more IP-heavy players in the space. Beyond hyperscale data centers, Iceotope says its systems are built for edge deployments computing infrastructure placed closer to where data is generated. This includes hospitals, factories, and telecom facilities.

These locations often operate in tighter physical spaces. They face strict limits on noise and water use. Standard cooling systems rarely work well in those conditions. In contrast, Iceotope’s chassis-based design is built to run reliably across all those environments, the company says.

Securing such high-caliber investors validates both our technology and our market timing. We’ve spent years developing a robust, differentiated IP portfolio and products purpose-built for AI infrastructure, and we’re ready to scale at precisely the moment the industry demands more advanced, sustainable cooling technology.
Simon Jesenko, CEO and CFO, Iceotope.

With AI adoption rapidly increasing globally, Iceotope’s liquid-cooling technology offers a timely and innovative solution to the mounting limitations of traditional cooling systems. Its approach not only meets the escalating demands of AI and high-performance computing but also materially advances datacenter sustainability.
Steven Poulter, Head of Barclays Climate Ventures.

This latest round brings Iceotope’s total disclosed funding to comfortably over $80 million. The company previously raised £30 million (approximately $38 million). As AI systems scale, so does the thermal challenge behind them. Iceotope is betting that liquid cooling is no longer a niche solution and that its two-decade head start gives it a meaningful edge.

Disclaimer: This news is based on publicly available information. NervNow has not independently verified any claims.

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