AI chip co Xsight Labs raising $300m

The golden touch of semiconductor entrepreneur Avigdor Willenz has not deserted him. Kiryat Gat-based Xsight Labs, in which Willenz was a founding investor and serves as chairperson, is raising $300 million at a valuation of $2.5 billion, following its success in signing up several new customers, the most prominent of them being Starlink, a subsidiary of SpaceX, newly floated on Nasdaq.

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This represents a positive turnaround for the company, which in recent years has suffered from changes in its management and rounds of layoffs, surviving mainly on a large investment round in March 2021, in which it was valued at $500 million.

According to industry sources, the round is led by investors long associated with Willenz: Fidelity, and investment fund Atreides Management owned by Gavin Baker, one of the first investors in SpaceX and an old friend of Willenz. The two funds are also invested in another growing but more secretive company of Willenz, semiconductor company Element Labs, recently reported on for the first time by “Globes”.

Xsight Labs specializes in network chips designed to accelerate cloud and AI processing in data centers, and thus partly competes with Mellanox, which was acquired by Nvidia seven years ago. It is distinguished from its competitors in that it develops switches that can be fully programmed by its customers, generally cloud providers or neo-cloud companies, enabling it to offer more efficient language model processing than Nvidia’s graphics processors. This is at a time when its customers are not looking for the strongest processing power but for processing of tokens (units of data processed by AI models) with the lowest usage of electricity and at the lowest price.

The company has signed an agreement for the supply of network chips for Starlink’s next generation of satellites, as part of SpaceX owner Elon Musk’s vision of severs into space, where there are no limitations on energy for operating AI servers but there are heat conduction constraints.

No response was forthcoming from the company.

Published by Globes, Israel business news – en.globes.co.il – on June 17, 2026.

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