Israeli networking company DriveNets raised $410 million in a Series D round at a valuation of $8.5 billion. Total investment in the company since its founding now stands at roughly $1 billion.

DriveNets builds networking solutions for AI infrastructure - specifically the Ethernet fabric layer that connects thousands of processors inside AI data centers. The technology uses standard hardware combined with proprietary software that enables high-performance scaling across massive compute clusters.

The company says it's cash-flow positive with more than $1 billion in orders and project backlog. It's also exploring a potential secondary transaction later this year.

The round was led by Bessemer Venture Partners and Atreides Management, with AMD joining as a strategic investor alongside existing backers Pitango and D1 Capital Partners.

DriveNets was founded by Ido Susan and Hillel Kobrinsky. Susan previously founded Intucell, which Cisco acquired in 2013 for $475 million after raising just $6 million. Last July AT&T bought shares from DriveNets employees and investors for $650 million - the telecom giant has been a major customer, deploying DriveNets' Network Cloud across its core network.

The less visible part of the AI infrastructure stack - networking between GPUs, not the GPUs themselves - is turning into a massive market. As clusters scale to tens of thousands of accelerators, how fast data moves between them becomes the bottleneck, not compute power alone.