The pitch sounds almost too simple: What if data centers could stop hemorrhaging water into the atmosphere every time they cool their servers?
Sydney-based Enaxiom thinks it has an answer. On May 5, the company secured US$1.8 million in seed funding—roughly A$2.5 million—to commercialize HydroCool, a closed-loop cooling system engineered for the kind of high-density AI infrastructure that's fast becoming the industry standard. The round, led by Epic Angels with backing from Black Nova, Antler, Impact Ventures, Waterpoint Capital, and both Sydney and Brisbane Angels, brings Enaxiom's total capital to US$2.7 million since launching in 2023.
It's a modest raise by venture standards, but the problem it targets is anything but small.
When Cooling Becomes a Resource Crisis
Data centers have always been energy-intensive. Now they're becoming water hogs, too. A mid-sized facility can drain 300,000 gallons of water daily; the largest operations push past 5 million gallons, according to analysis from Brookings published last November. That water evaporates into the air, cooling servers but disappearing in the process—a one-way trip that's proving unsustainable as both electricity demand and water scarcity intensify.
The International Energy Agency projects global data center electricity consumption will hit 945 terawatt-hours by 2030. Cooling systems account for anywhere from 7% to over 30% of that load, depending on the facility. For operators wrestling with rack densities north of 100 kilowatts—standard territory for AI training clusters—traditional cooling towers and chillers are showing their limits.
Enaxiom's wager is that the industry needs a fundamentally different approach at what engineers call the heat-rejection layer, the part of the system where waste heat finally leaves the building. HydroCool slots in downstream of coolant distribution units, designed to work with liquid-cooled architectures that are replacing air-based systems in cutting-edge data centers.
The Technology Behind the Promise
Here's where it gets technical. HydroCool uses non-potable water—think industrial wastewater or saline sources—as an evaporative medium. The twist: instead of letting that water escape, the system claims to capture and recycle it in a closed loop.
Bijan Rahimi, Enaxiom's co-founder and CTO, holds a PhD in mechanical engineering from the University of Western Australia. He's listed as inventor on a PCT patent (WO/2026/018187) published in January 2026, which details shell-and-tube heat exchangers paired with falling film evaporators. The company says the system is optimized for warm-water loops operating around 45°C, compatible with both immersion cooling and direct-to-chip methods.
Enaxiom has built and tested a 40-kilowatt pilot unit and commissioned an independent technical review. But as of early May, no independent performance verification has been published—a gap that potential customers will likely want filled as the company scales.
From Pilot to Production
The fresh capital will fund three things: ramping up commercial deployments, growing the team beyond its current six or so employees, and cracking into the US market.
The company is transitioning from its 40 kW prototype to 200 kW modular systems, with multi-megawatt installations on the roadmap. CEO Antonia (Tia) Collings has steered Enaxiom through Australia's EnergyLab Climate Solutions Accelerator, which selected the startup for its 2024 cohort and invested via its partner fund, Impact Ventures. Enaxiom also holds a spot in NVIDIA's Inception program, a detail the company was careful to mention in its funding announcement.
The timing might be fortuitous. In March, industrial water giant Ecolab moved to acquire liquid cooling specialist CoolIT Systems, a deal that signaled growing strategic interest in next-generation thermal management. Enaxiom now finds itself in a market where operators are hunting—urgently, in some cases—for solutions that satisfy both the unforgiving physics of high-density heat loads and the tightening regulatory constraints on water and energy.
Whether a seed-stage startup from Sydney can carve out meaningful share in that landscape remains an open question. But with AI infrastructure buildouts accelerating and resource pressures mounting, companies like Enaxiom are betting that the industry can't afford to keep cooling the old way much longer.
