Peter Thiel is leading investment in an ocean data center powered by waves—and the startup is reportedly worth $1 billion

As hyperscalers like Alphabet look to the skies as the next frontier of data centers, Peter Thiel is looking to the seas. Panthalassa, a U.S.-based start up betting on ocean waves to power a fleet of floating data centers, announced $140 million in funding earlier this month led by Thiel. The funding pushes Panthalassa’s valuation close to $1 billion, the Financial Times reported, citing a person familiar with the terms of the deal. Panthalassa didn’t immediately respond to Fortune’s request for comment. “The future demands more compute than we can imagine,” Thiel said in a statement announcing the funding. “Extra-terrestrial solutions are no longer science fiction. Panthalassa has opened the ocean frontier.” Surging AI demand in the U.S. has hit snags with an aging and beleaguered grid system vulnerable to extreme weather. Energy analytics firm Wood Mackenzie noted in a report earlier this year that data center development has slowed down due to limited electricity capacity growth. Bottlenecked by energy infrastructure from as far back as World War II, tech companies are looking for extraterrestrial arenas to build out data centers without taxing available resources. Panthalassa, sharing the name with the superocean that once surrounded the supercontinent of Pangaea, has designed “nodes” that sit on top of the ocean, with nearly 280-foot-long steel structures extending below the surface. The sphere at the top of the node bobs in the water, with the attached tube oscillating water within it, spinning turbines inside the structure that generate electricity. The structure also holds a hermetically sealed, or airtight, AI server that is cooled by surrounding seawater. The company spent years designing Ocean-1 and Ocean-2 prototypes, beginning in 2021, and plans to deploy its most recent Ocean-3 system in the northern Pacific Ocean this year, with commercial deployment to follow in 2027, according to the company. “There are three sources of energy on the planet with ten