Following Huawei's post-investment support, Yisheng New Materials has raised nearly 100 million yuan in financing from Yuanhe Puhua and other institutions, thermal control materials are riding the AI boom | 36Kr Exclusive

Source: Enterprise

This article contains approximately 3200 words, with a recommended reading time of 7 minutes

Author: Ou Xue

Editor: Yuan Silai

Hard Krypton learned that Harbin Yisheng Advanced Materials Technology Co., Ltd. (hereinafter referred to as "Yisheng New Materials") has announced the completion of its A3 round financing of nearly 100 million yuan. This round is jointly led by Yuanhe Puhua and Changjiang Innovation, with follow-on investments from CIC Securities Investment, Bongsun under Jiangsu High-Tech Investment, Fengyuan Capital, and Yinbai Investment, and additional investment from Xinchuang Fund under Zhongguancun Qihang, an existing shareholder. The proceeds from this round of financing will be mainly used for hardware equipment investment and high-end talent recruitment.

Founded on September 18, 2024, Yisheng New Materials is a high-tech enterprise focusing on the R&D and production of high-end metal matrix composites, with its core technology supported by the National-Local Joint Engineering Laboratory for Metal Matrix Composites of Harbin Institute of Technology.

Founder Wu Gaohui is an academician of the Asia Pacific Academy of Materials and enjoys the special government allowance of the State Council. For more than 40 years, he has been focusing on the high-quality preparation technology of metal matrix composites, and in 1982, he personally developed China's first metal matrix composite. He established the National-Local Joint Engineering Laboratory for Metal Matrix Composites of Harbin Institute of Technology, which has developed more than 20 off-the-shelf products covering structural and functional metal matrix composites. In 2012, his team successfully developed diamond-aluminum composites for the first time in China and applied them in batches to satellite spacecraft, making it the earliest team in China to realize the engineering application of diamond composites.

At present, AI is reshaping the thermal control material track. Wu Gaohui told Hard Krypton bluntly: "The development of AI technology strongly depends on computing power, and the biggest obstacle to the development of computing power is thermal control materials."

For example, the power consumption of a single NVIDIA GPU chip has reached 3000W, and will reach 7000W in the future. For every 2℃ increase in chip temperature, the reliability will decrease by 10%, and the service life will decrease exponentially when the long-term operating temperature is higher than 80℃. The thermal conductivity of traditional tungsten-copper and molybdenum-copper materials is only just over 200W/(m·K), which is no longer capable of handling kilowatt-level power devices.

Since the fourth-generation thermal control materials (diamond/aluminum, diamond/copper composites) achieved the breakthrough of "ultra-high thermal conductivity + matched thermal expansion + lightweight" for the first time, these materials have gradually become a must-have option for heat dissipation of AI computing power.

Yisheng New Materials' products are mainly focused on heat dissipation of high-power chips, forming a full-chain thermal control solution for high-power electronic devices from chip heat sinks to packaging shells, and then to cooling modules of integrated liquid cooling systems.

Among them, core products include diamond/aluminum and diamond/copper composites, with thermal conductivity of 550-750W/(m·K) and 750-980W/(m·K) respectively, and their comprehensive performance is ahead of international competitors such as Japan's Sumitomo Electric Industries.

Core product matrix (Source: Enterprise)

But the most core barrier of Yisheng New Materials is not in the laboratory, but in the engineering end. It is widely recognized in the industry that the engineering difficulty of diamond-copper composites lies in "forming". Because very hard diamonds are embedded in the very soft copper matrix, the diamond particles will be "dug out" from the matrix during mechanical cutting, which cannot meet the forming accuracy, and the tools will also be severely damaged.

Yisheng New Materials has invented a unique near-net-shape technology, which can realize one-time precision forming of complex components without secondary processing. Wu Gaohui said that the company produced complex parts of optical modules at one time several years ago. "This is our unique technology and also our deepest moat."

At the manufacturing end, the self-developed liquid pressure infiltration technology and equipment adopted by Yisheng New Materials is different from the mainstream powder metallurgy route in the industry. It is a method of infiltrating liquid metal into the gaps of the diamond preform under pressure, solving the problems of density, interface reaction and other difficulties. The company's current annual production capacity has reached more than 10 million pieces.

In terms of application, Yisheng New Materials complies with the objective development law of material engineering, and has taken a two-wheel drive route of "military industry first, civilian use following". Aerospace and national defense is still the company's core basic market. Its products have been used in more than 20 satellites. It is currently the only entity in China that can provide a series of aerospace-grade diamond/aluminum composite products, covering core scenarios such as radar T/R modules, high-power devices, and missile-borne computers.

In the "Development Roadmap of China's Metal Matrix Composites" presided over by Wu Gaohui ten years ago, there was a judgment on the application of the civilian market. Now it seems that the outbreak of the civilian market is several years earlier than expected. The company has now started layout in new energy vehicles, AI computing centers, high-power chips, 5G/6G communications, optical modules and other fields.

The following is an excerpt of the conversation between Hard Krypton and Wu Gaohui, founder of Yisheng Advanced Materials (edited):

Hard Krypton: The thermal control material track has rarely been paid attention to in the past. Why has it suddenly become popular in recent years?

Wu Gaohui: In the past, gallium arsenide chips had low power consumption, and traditional materials could cope with it. Now high-power devices begin to use gallium nitride chips, and the heat generation increases by 3 to 5 times. The higher the integration, the greater the heat generation. A single NVIDIA chip can reach 3000 watts in an area as large as a fingernail, generating extremely high heat. For every 1℃ increase in chip temperature, the reliability decreases by 5%. If the heat cannot be controlled, the computing power cannot be improved, which is determined by physical laws.

As we all know, China is the country with the most rapid development of AI technology in the world. The foundation of AI depends on computing power, and the demand for thermal control materials for computing power equipment has suddenly exploded. And this trend is rigid, so it is not that we caught the windfall, but that we always keep pace with the times.

Hard Krypton: There are many players making diamond composites in the industry at present. What is your core barrier?

Wu Gaohui: The barrier is not in the material formula, but in the engineering capability and product reliability. Relying on the platform of Harbin Institute of Technology, we have formed more than 20 industrializable composite varieties, and the total number of products of foreign enterprises that can be found in the literature is only about 10, which is our advantage in the material system.

But the more core part is the accumulation at the engineering end. From interface regulation to near-net-shape forming, from equipment automation to batch consistency, every link has more than ten years of know-how. We have realized one-time precision forming of complex components, and the equipment and processes are all solidified in the system. However, we are also very clear that under the huge temptation of the market, more than a dozen domestic diamond-copper enterprises have emerged in a year, and the technology is developing rapidly. Our leading position is only temporary, and continuous iteration and upgrading are required to maintain the leadership in this field.

Hard Krypton: From aerospace to AI computing centers, what are the differences between the logics of these two markets?

Wu Gaohui: For the aerospace industry, "reliability comes first". Products have to go through the most stringent assessment, with small volume but extremely high threshold. It took us more than ten years of hard work to become the only entity in China that can provide a series of aerospace-grade diamond/aluminum composite products.

For AI computing centers, "performance and cost are equally important", with very large volume, requiring fast delivery and controllable cost, which is a short board for people like us who come from university scientific research. What we need to do is to transfer the aerospace-level technical capabilities to the civilian market, learn to swim in the industrial ocean, and reduce costs through capacity expansion and process optimization. New energy vehicles and liquid cooling products are already in small-batch sample testing, and the results are very good. The military and civilian markets, one sets a benchmark and the other expands scale, are complementary two-wheel drive.

Views of Investors:

CIC Securities Investment said: With the continuous explosion of AI computing power demand, efficient heat dissipation has become a key bottleneck restricting the upgrading of computing power infrastructure. Diamond, with its thermal conductivity far exceeding that of traditional metal materials and excellent physical properties, is becoming the core direction of the next generation of heat dissipation technology.

CIC Securities Investment has long focused on industrial investment opportunities for key materials in the semiconductor industry. We are optimistic about the accelerating trend of diamond composites from technical verification to large-scale commercial application, and highly recognize the technical accumulation of Yisheng team in diamond material R&D and industrialization implementation. We look forward to the company seizing the opportunity of AI heat dissipation upgrading to provide core material support for the construction of computing power infrastructure.

Yuanhe Puhua said: The power consumption of AI computing power is rising exponentially, and traditional copper-based heat dissipation materials are approaching the physical limit. Relying on Professor Wu Gaohui's 40 years of accumulation in metal matrix composites, Yisheng New Materials has realized the full-chain breakthrough from interface regulation to net-shape forming of complex components in the field of metal matrix composites, and has verified the technical maturity and engineering capability at the client end. Yuanhe Puhua will continue to lay out the semiconductor thermal management track, support Yisheng New Materials to expand production, improve efficiency and expand customers, and promote the large-scale application of domestic high-end thermal management materials in scenarios such as AI chip packaging and data centers.

Fengyuan Capital believes: Facing the thermal management challenge of 1400W+ for AI chips, traditional heat dissipation has reached the physical limit, and diamond-copper composites have ushered in an inflection point of industrialization, with its application scenarios accelerating the transition from military aerospace to the hundred-billion-level AI computing power infrastructure. Relying on the core process advantages of top expert Professor Wu Gaohui, Yisheng New Materials has formed scarce dual barriers in technology and business. Fengyuan Capital is long-term optimistic about the huge potential of Yisheng to leverage high commercial value with solid technical strength.

Bongsun Capital said: When chip power consumption soars and both air cooling and liquid cooling heat dissipation reach the physical boundary, the real bottleneck falls on the "proximal heat conduction" on the chip surface. Diamond/copper and diamond/aluminum are scarce materials to reinforce this link. Relying on the more than 40 years of accumulation of Professor Wu Gaohui's team from Harbin Institute of Technology, Yisheng holds internationally pioneering technologies such as gas pressure infiltration and interface regulation, filling the gap in the localization of high-end thermal control materials, which makes it firmly occupy the strategic throat at the material end in the high-boom tracks of AI computing power and commercial aerospace. We are firmly optimistic about Yisheng, which has built an insurmountable domestic barrier at the micron-level interface between chips and radiators.

Xinchuang Fund under Zhongguancun Qihang Investment, an existing shareholder, said: As an early investor of Yisheng New Materials, Zhongguancun Qihang firmly increased its investment in this round, which is based on continuous tracking of industry trends and company development, and the core judgment at the time of the first investment has been fully verified.

Since the beginning of this year, the industrial trend of fourth-generation thermal management materials such as diamond/copper moving from the "high tower" of aerospace and military industry to multiple hundred-billion-level civilian markets such as AI computing power and optical modules has been strongly confirmed, and is accelerating from being an "optional option" to a "must-have option". Our initial investment logic is not only valid, but also more rigid than expected.

What made us decide to make additional investment is the amazing execution capability and engineering implementation speed demonstrated by Yisheng team: from aerospace-level reliability to civilian-level optimization, and ten-million-level mass production, the verification progress of large customers in high-boom tracks exceeded expectations. With solid industrialization progress, Yisheng team has proved that it is not only a top scientific research team, but also a platform-based material enterprise with scarce engineering barriers. Xinchuang Fund will continue to deeply accompany Yisheng, provide full-life cycle empowerment services, and build a global leading enterprise in the metal matrix composite industry.