Chip startup Calxeda received a hefty $55 million in funding on Tuesday, as its strategy to slash data center costs with low-power, ARM-based processors continues to catch the eye of investors.

The Austin, Texas-based Calxeda said it received the funding from Austin Ventures and Vulcan Capital, in addition to some of its existing investors, which include ARM, Advanced Technology Investment, Battery Ventures, Flybridge Capital Partners and Highland Capital Partners.

Calxeda, which first hit the scene in 2008, said the $55 million in funding will help fuel its development of ARM-based processors that can help data centers more efficiently handle the influx of data pouring into them from movements like cloud computing and online media.

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"This significant infusion of capital will accelerate the exciting trajectory we’ve been on for the past four years," said Calxeda co-founder and CEO Barry Evans in a statement. "Businesses require a more efficient solution for the Web, Cloud, and Big Data. That is what Calxeda is now delivering and this funding will enable us to go bigger and faster."

According to Calxeda, its ARM-based server processors deliver as much as a tenfold improvement in energy efficiency compared to x86-based servers, such as those powered by chips from Intel and AMD. These gains in efficiency stem from Calxeda's use of chip architectures from U.K.-based chip licensor ARM, whose processors are primarily used in mobile devices like smartphones and tablets.

Calxeda debuted its first-ever ARM-based server-on-a-chip processor last November, which it dubbed as the industry's first server processor to consumes as little as 1.5 watts of power. Calxeda said the new SoC will usher in a completely new generation of low-power servers, optimized to handle the increased workloads of "big data" applications.

Major OEMs including HP and Dell have already embraced Calxeda's strategy of using ARM-based processors in servers to cut down on data center costs. HP announced its Project Moonshot initiative last November, aimed at exploring the sharing of storage, power and cooling resources across a landscape of servers running Calxeda's ARM-based chips.

Dell is also exploring the benefits of ARM in the data center through a similar initiative, whereby it's providing experimental ARM-based servers to customers interested in developing and testing applications compatible with the technology.

PUBLISHED OCT. 9, 2012