Hard Krypton Exclusive | Veteran from a Listed Storage Company Leads Team to Develop AI Supercomputing Equipment, with Annual Revenue Reaching Tens of Millions
Yingke learned that Huahong Digital Technology, a computing power infrastructure enterprise, recently completed a Pre-A round of financing worth tens of millions. The leading investor is Wuzhong Financial Holding. This financing will mainly be used for the ecological construction of AI application development and computing power implementation, the further expansion of factory production capacity, and the construction and promotion of bases.
Huahong Digital Technology was founded in 2021. Its headquarters was initially located in Beijing and later moved to Suzhou. It focuses on the research and development of all-liquid-cooled edge-side supercomputers and is an integrated platform that combines all-liquid-cooled heat dissipation and IT computing power.
Its founder, Luo Hua, once served as a director and deputy general manager of Tongyou Technology (300302) and was among the top 10 major shareholders. He was in charge of product and sales work at Tongyou Technology and has nearly 20 years of experience in the data storage and high-performance computing industries. Co-founder Ling Ming has led the research and development and design of many liquid-cooled servers and workstations in the industry and has obtained orders for liquid-cooled products from customers such as SAIC and a national supercomputing center.
With the large-scale application of large model lightweight technology, the AI era of everyone having access to computing power has arrived. The AI inference load is accelerating its migration from the cloud to the edge side. It is estimated that the scale of China's edge-side AI market will reach 866.1 billion yuan in 2026, and the demand for AI inference computing will be 4 to 5 times that of training. The scale of the edge computing market is expected to grow from over 95 billion yuan in 2024 to over 130 billion yuan in 2026, with a CAGR of about 21.7%. The high-performance computing equipment track on the edge side is gradually entering a period of explosive development.
Traditional edge-side computing power equipment faces significant "gaps": Traditional air-cooled equipment experiences hardware frequency reduction and unstable performance due to heat dissipation bottlenecks, and the full-load noise usually exceeds 100dB, making it unsuitable for office or laboratory environments; Traditional liquid-cooled solutions often have fragmented systems and lack top-level design, facing operation and maintenance challenges such as blockages and leaks.
Luo Hua, who had been deeply involved in the data storage enterprise for more than a decade, spotted the opportunity. In his view, against the backdrop of the explosion of AI computing power, traditional air-cooled equipment will become a thing of the past, and although liquid-cooled equipment has many difficulties, it is an inevitable trend.
Based on this judgment, Luo Hua spent two years building a factory and establishing a supply chain. "At that time, many people didn't understand and said that I hadn't even made my product yet, so why was I spending so much money and time building a factory?" Luo Hua believes that this is a necessary step for subsequent development, as there was no mature and complete industrial chain in China at that time. Now, he has achieved self-research across the entire link.
The core technological barrier of Huahong Digital Technology lies in its self-developed "Frozen Core" split liquid-cooled system. This system includes an innovative integrated flux-free cold plate and cold head, low thermal resistance thermal conductive materials, and a self-developed micro water pump with 20,000 revolutions, forming a completely closed-loop liquid-cooled system. This interdisciplinary and anti-traditional heat dissipation system has advanced Huahong Digital Technology's all-liquid-cooled all-in-one machine compared with traditional solutions. The overall computing power has increased by 55%, the heat flux processing capacity has increased by 271%, and the full-load noise of the equipment can be controlled below 45dB in a silent state. With the same calculation example, the same hardware configuration, and the same testing method, the training time of air-cooled servers in the computer room is about 39 hours, while that of Huahong's all-liquid-cooled super-intelligent fusion all-in-one machine is about 28 hours, with an efficiency increase of 39%.
Regarding the sales channels, Huahong Digital Technology's strategy is also relatively clear. It divides its business structure into several parts. One is responsible for direct sales to large customers, with a focus on the To G and large customer models, mainly targeting scientific research institutions, universities, and television stations. The second is to establish strategic cooperation and become strategic partners with several large domestic enterprises and AI companies to jointly promote AI software and hardware collaborative solutions. In addition, Huahong Digital Technology will also focus on domestic e-commerce and overseas channels this year, targeting the global high-end market.
Next, Huahong Digital Technology will build the first all-liquid-cooled AI intelligent core island in China in Suzhou, where hundreds of machines will be deployed, and six experience areas will be divided, including game science, AIGC, AI scientific computing, AI simulation, AI training, and AI agents. Through the coordination of the Suzhou experience center and online and offline sales, an O2O new retail and experience model with online and offline interaction will be formed.
The following is an excerpt from Yingke's interview with founder Luo Hua:
Yingke: Why did you decide to do liquid cooling early on?
Luo Hua: I worked in data storage at Tongyou Technology for nearly 19 years. The company went public in 2012, and I was a shareholder. At the end of August 2020, I felt that the AI track was an opportunity and wanted to find a new starting point. Since I had a hardware background, I didn't choose large models or applications but instead chose the AI infrastructure computing power track.
At that time, I predicted that in the future, everyone would need computing power, and the AI computing power on the edge side would explode. At the same time, I tracked the development paths of chips from AMD, Intel, and NVIDIA and predicted that after the arrival of the computing power era, the power consumption of chips would become increasingly large, and traditional air-cooled heat dissipation would have difficulty solving the problems of edge-side computing power products. At that time, large enterprises mainly focused on large air-cooled servers in computer rooms and data centers. I believe that the edge side of AI will change traditional computing products just as mobile Internet changed mobile phones and tablets back then, so I decided to engage in edge-side liquid cooling business four years ago.
Yingke: Where are the difficulties in liquid cooling, and how has Huahong Digital Technology overcome them?
Luo Hua: Liquid cooling is very difficult because it is an interdisciplinary and complex system that spans materials science, mechanical engineering, etc. Moreover, there was no complete industrial chain for our products in China at that time, let alone unified standards. The core liquid cooling system consists of several parts: cold plates, cold radiators, pipes, water pumps, liquids, and sealing kits.
Its difficulties lie in: First, it has high requirements for precision manufacturing. The cooling cold plate is a traditional precision manufacturing product. Fluid mechanics simulation must be used to find the heat source and customize the cold plate, with an accuracy of up to 0.01 silk, and it is impossible to use molds. Second, the supply chain is cross-border and isolated. Those who understand precision manufacturing don't understand IT, and most of those who make cold radiators are from the air-conditioning industry and cannot provide such small heat exchange cold radiators. Third, there are problems with chemical reactions and blockages. The circulating temperature remains at 40 degrees all year round. Ordinary rubber tubes contain sulfides, and after long-term flushing, impurities will be generated, blocking the micro-channel circulation. The liquid needs to be chemically synthesized, and an active agent must be added to ensure that no chemical reactions occur and no scale is produced.
Large enterprises are reluctant to do it because of the complex supply chain, lack of standards, and their disdain for the small scale in the early stage. To open up the industrial chain, I built a factory in Jiangsu two years ago and decided to conduct self-research. In two years, we completed the comprehensive self-research of chassis design, structural design, air duct design, cold plates, cold radiators, liquids, and water pumps. Through precision manufacturing, we opened up the path for flexible customization and achieved an annual production capacity of 5,000 units.
Yingke: What are our core advantages?
Luo Hua: We have created a new species, breaking the boundaries of traditional servers, workstations, and PCs, and redefining liquid-cooled edge-side computing power products. Large enterprises don't do this. Currently, in China and even globally, we are the only company with an all-liquid-cooled super-intelligent fusion product line on the edge side.
There are several main selling points and core advantages of our products. First, it has fast performance. By reducing the temperature of the CPU and GPU, we can improve the system performance by at least 30.5% compared with traditional air-cooled products. Second, it has extremely quiet operation. High-performance computing equipment makes a lot of noise without a computer room, but the noise of our product is basically below 35 decibels, allowing customers to conduct AI research directly in an office environment or a small and medium-sized computer room without a dedicated computer room. Third, it reduces energy consumption. The machine has very low heat dissipation requirements and does not require a large number of air conditioners and standard computer rooms. Fourth, it is small in size and highly secure. Our machine is the smallest in the all-liquid-cooled field globally, with a minimum volume of 2.7L, smaller than air-cooled machines. It can be carried around and used as soon as it is plugged in. At the same time, it meets the needs of scientific research and the local deployment of core data, ensuring data security within the domain. Finally, the appearance of our product is positioned in the Chinese retro style, integrating technology and art, especially with the mortise and tenon structure design.
Yingke: How are the current implementation scenarios?
Luo Hua: Our product line covers ToG, ToB, and ToC. In the past two years, we have already had six or seven dozen sample customers. This includes edge-side desktop products of AI inference companies, AI development, AI for Science, AI simulation, data collection and data simulation for embodied intelligence, game science, and media publicity. In June, we will also release a 9-liter all-liquid-cooled AI mini-host product to enter the C-end game science, AI development, and content creator markets.
Views of the investor:
Wuzhong Financial Holding said: Huahong Digital Technology occupies a unique ecological niche in the high-growth track of "all-liquid-cooled + edge-side high-performance computing power." It is neither a simple liquid-cooled component supplier nor a traditional computing power complete machine supplier. Instead, it tries to establish a new brand category with liquid cooling as the fulcrum, which is worthy of key attention. The track is in a strategic window period where three forces - "AI application sinking + liquid cooling technology generation change + policy-mandated energy efficiency" - converge. The company enters the market with a complete product form of "all-liquid-cooled + super-intelligent fusion," providing not subsystems or components but an all-liquid-cooled all-in-one machine that can be used right out of the box. This product definition forms a differentiated competition with industry giants.
The company's technology is not a single heat dissipation solution but an interdisciplinary full-stack self-developed engineering system. The product matrix forms a complete four-level product system of "components - kits - complete machines - solutions." Its core differentiated value lies in defining a new computing power deployment paradigm, which does not require a computer room, has extremely quiet operation, is plug-and-play, and has extremely high energy efficiency. This product definition accurately solves the "environment - performance" conflict in the high-density computing power deployment on the edge side. Traditional air-cooled workstations cannot meet the high-density computing power demand, while data center-level servers cannot be deployed in edge-side scenarios. The company has created a new category between the two. It has obtained ecological recognition from leading chip manufacturers, which is extremely rare among domestic start-up hardware enterprises and also forms a solid foundation for brand premium.