In the spirit of David and the bone-crushing giant Goliath, ARM has gotten itself a Smooth-Stone to hurl at Intel, hoping to at least put out its eye.

Smooth-Stone is a little Austin, Texas start-up that got organized in January of 2008, apparently on a nickel from ARM and a couple of other angels like the former head of Intel’s Communications Infrastructure Group Howard Bubb. It means to turn the ARM chip, loved by cell phone makers, into the kind of low-cost, ultra-low-power, high-performance server chip capable of the density that hyper-scale cloud players and huge web server farm would fancy.

Of course the ambitious project – which intends to “completely remove power consumption as an issue for the data center” – could sink like a stone but a syndicate of six investors has enough confidence that the start-up will successfully execute the last mile that it’s put a $48 million A round in the joint.

Besides ARM, its backers include AMD’s savior, Abu Dhabi’s own sheik-owned Advanced Technology Investment Company (ATIC), now the senior partner in Globalfoundries; Texas Instruments, Sun’s erstwhile Sparc maker; and VCs Battery Ventures, Flybridge Capital Partners and Highland Capital Partners.

The money is earmarked for “final development and market delivery” of the chips, a project that could take a few years. Smooth-Stone’s first deliverable – and judging from the investors it presumably means to have a second source – is supposed to resolve the data center’s issues with energy, cooling, space and CO2 pollution.

Other start-ups are trying to do the same thing. Department of Energy-backed SeaMicro is leveraging Intel’s little Atom chip for the purpose, Google acquisition Agnilux the ARM chip and Quanta-backed Tilera the Mips chip.

Marvell itself means to have a quad-core ARM-based server chip out later this year.

Smooth-Stone founders include CEO Barry Evans, who ran Intel’s DEC-derived ARM-based Xscale unit even after it was sold to Marvell Technology Group and VP of software engineering Larry Wikelius, who was VP, server and storage strategic alliances at Opteron-based server start-up Newisys later sold to Sanmina-SCI. Software is of course the ARM’s problem, but it’s solvable.

Smooth-Stone’s widgetry will run on the Linux kernel.