The global data center market is entering a new phase of structural transformation. As artificial intelligence (AI) and next-generation cloud computing accelerate, the demand for reliable, high-density power infrastructure has never been greater.
Global power demand from data centers could rise by up to 165% by 2030[1], compared with 2023 levels. This growth is not just about scale, it’s also about resilience. AI clusters and advanced compute environments require power systems that are exponentially more reliable and energy-dense than traditional enterprise IT.
Recognizing this inflection point, Advent recently invested in LayerZero Power Systems, a leading provider of mission-critical power management and distribution equipment for data centers.
Abhishek Chauhan and Arting Chang from Advent’s Industrial team in Boston explore the strategic rationale behind the investment and how Advent plans to support LayerZero’s next phase of growth.
The AI inflection point: investing in ultra-reliability
Founded more than two decades ago by engineers Milind Bhanoo and Jim Galm, LayerZero designs and manufactures highly specialized equipment, such as static transfer switches and power distribution units, that protect the high-value assets powering the world’s most data-intensive operations, from hyperscale cloud providers to semiconductor manufacturers.
“LayerZero’s products serve as the last line of defense for mission-critical applications,” explains Arting. “Their software-enabled monitoring and robust hardware design ensure reliability in environments where even a momentary power interruption can have high cost of failure. As AI adoption accelerates, the cost of downtime is soaring. Ultra-reliable power is no longer a commodity, it’s a strategic necessity.”
Investing at an inflection point
“For Advent, timing was critical,” says Abhishek. “AI and cloud computing have fundamentally changed the power density requirements of data centers.”
Traditional server racks typically operate at seven to 10 kilowatts, while AI-driven racks can now demand 50 to 180 kilowatts. This dramatic increase means that power delivery has become one of the sector’s most urgent bottlenecks.
“LayerZero had spent two decades perfecting high-density, ultra-reliable solutions,” Abhishek adds. “As the market accelerated, its technology was uniquely positioned to meet that demand.” As the market moves toward higher-density power environments, it directly enters LayerZero’s established area of expertise.
“I believe LayerZero represents American entrepreneurialism at its best. With Annette and our team’s support, we are focused on building one of the leading players in digital infrastructure.”
Abhishek Chauhan
Director, Advent
A strategic thesis for energy transition
Arting comments that “LayerZero was an opportunity where several of Advent’s core principles for value creation in industrial technology came together.”
- Addressing a structural need: LayerZero is closing a critical gap in the market. As compute density increases, the need for specialized power management has outpaced many legacy providers’ capabilities.
- A differentiated, pure-play leader: With around 95% of its business tied to data centers, LayerZero is a focused, scaled leader known for quality and reliability in high-density power environments.
- Founder-led with strong potential: Having been privately owned since inception, the company presents clear opportunities to expand capacity, institutionalize operations, and diversify its customer base.
The investment builds on Advent’s thematic sourcing in the data center ecosystem. “Our AI and machine learning sourcing cell identified power management as a critical sub-sector in 2024,” says Abhishek. “This proactive work allowed us to build early relationships with the founders and key advisors.”
A key differentiator in the process was the involvement of Annette Clayton, former Chief Executive Officer of Schneider Electric North America, Advent Operating Partner, and new Chair of LayerZero. “Annette’s experience in scaling businesses, in particular in the power management space, gave us differentiated insight and credibility,” Abhishek remarks.
A clear roadmap for scaling and professionalization
With Advent’s investment, LayerZero will implement a focused roadmap designed to support hyperscale growth and operational excellence, including:
- Expanding production capacity: Increasing throughput through operational enhancements and facility expansion.
- Institutionalizing for scale: Strengthening finance, IT, HR, and systems to support sustainable growth and meet institutional customer requirements.
- Growing with existing and new customers: Leveraging the Board and Advent’s network to build strong strategic relationships with existing customers and new leading colocation providers and hyperscalers.
- Investing in product adjacencies: Building on the company’s core capabilities through services and product innovation to accelerate growth.
Looking ahead
“I believe LayerZero represents American entrepreneurialism at its best,” says Abhishek. “With Annette and our team’s support, we are focused on building one of the leading players in digital infrastructure.”
As AI drives the next wave of global digital demand, Advent’s investment in LayerZero underscores its conviction in the industrial foundation of the data economy, where reliability, scalability, and innovation are essential to powering global progress.
[1] Goldman Sachs Research, Feb 2025
