Sand 9 Gets $8M for Nano MEMs

Sand 9, a Boston University spinoff, has received $8 million in a Series A round from Flybridge Capital Partners and General Catalyst Partners. An early-stage investment in a fabless chip company is notable, simply because there are fewer of them than ever. While the firm isn’t making a true semiconductor, it is using the chip manufacturing process to make its nano-mechanical resonator, a component that can both filter and stabilize multiple frequencies on one piece of tiny machinery.

The Sand 9 resonator can replace several components used in making a wireless devices from a cell phone to a headset. Rather than requiring a separate device for each radio found in a communications device, each Sand 9 component can work with multiple frequencies and radios. That means fewer parts and a smaller potential form factor. It sounds like a smart bet, but the real test will be if it works.

Matt Crowley, VP of business development with Sand 9, was cagey about when the firm would have devices to sample, but did say the company should be able to get to product on the $8 million round and the $2 million seed round it raised when it formed in 2007. He added that the Series A round should last through the next two years, and will primarily be used to add engineering staff and get the product out the door.

That’s serious capital efficiency for a fabless company. Crowley said the key is using older semiconductor fabrication tools and plants to build the resonator. So while it’s hard to find a Series A for a processor startup these days, entrepreneurs turning to MEMs or older process technologies are still raking in investment dollars.

Could Climate Change Lead to Computing Change?

I wrote about an effort us use millions of specialized embedded processors to build an energy-efficient (relatively) supercomputer that could run at speeds of up to 200 petaflops over at Earth2Tech. The Department of Energy’s Lawrence Berkeley National Laboratory has signed a partnership with chip maker Tensilica to research building such a computer, but after chatting with Chris Rowan, Tensilica’s CEO, I wonder if more specialized computing tasks in the data center might be farmed out to highly customizable — but lower-powered — chips.

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Worried by iPhone, Mobile Cos Turn To Synaptics

The LG Secret launched today with a touch screen powered by Synaptics touch capacitors, a technology whose star has risen in the consumer devices universe in the wake of the iPhone. The iPhone uses a grid layout of capacitive sensors to enable multi-finger gestures, something that wouldn’t be possible with resistive sensors. Sensing capacitors are one of the many ways electronics companies can create touch-sensitive controls, but they’re expensive and obviously require skin-to-device contact in order to work.

Prior generations of touch screens have used resistive sensors, which rather than relying on the human body to affect a charge to make them work, rely on pressure. One big drawback of such a system is poor screen clarity, but they can be used with a finger or a stylus and traditionally they were cheaper than other sensors. The price advantage of resistive sensors, however, is dwindling, and companies such as Synaptics and Cypress Semiconductor are now poised to grow along with the market for capacitive sensing technologies. According to Synaptics, which reported earnings last week, touch phones grew to comprise 10 percent of its $79 million in sales in its most recent quarter.

Other chip firms are taking note. In February, Atmel Corp. agreed to acquire Quantum Research Group, a developer of capacitive sensing intellectual property, for $88 million in cash and up to an additional $42 million if certain contingencies are met. Chip research firm iSuppli predicts that global shipment revenue for leading touch-screen technologies will increase to $4.4 billion by 2012, up from $2.4 billion in 2006, but that includes resistive infrared and other touch technologies as well.

RIP Microprocessor Startups

I’ve been talking about the enormous amount of cash it takes to create any kind of chip company and expressing doubts about the number of startups we will see getting financial backing to create truly innovative ideas in semiconductors. Analyst Linley Gwennap apparently feels the same way, because he looked at the sale of P.A. Semi to Apple and the recent sale of Montalvo to Sun (likely for less than the $73 million it raised) and concludes:

“The Apple deal will double the $126 million invested in P.A. Semi, a positive return but modest by VC standards. With the possible exception of RMI (which predates Dobberpuhl’s company), we expect P.A. Semi will be the last processor startup to generate a positive exit after such sizable funding. Montalvo will probably be the last processor startup to even raise that kind of money. Microprocessors have become a big-boy game; newcomers need not apply.”

As the last big microprocessor startup standing, Raza Microelectronics (RMI) was the brainchild of Atiq Raza, who formed a company that was later bought by AMD and turned into one of the company’s core microprocessors. RMI has raised more than $120 million to build communications and networking processors. I don’t want to believe it’s the end of startups trying their hand against the likes of AMD or Intel, but until we come to a breakthrough in materials, ways to reduce the IP hurdles or the cost of masks and design, entrepreneurial chip engineers will have to focus on power managment and cooling, MEMS and RF.

Is 4G Via Satellite Destined to Fail?

Last Friday, four executives of satellite holding company TerreStar Networks suddenly resigned, leaving just three people behind to fill the void. I don’t expect this lack of management to last for too long, but until TerreStar calls me back with details, I’m betting that the change in management signals a change in TerreStar’s strategy in that it’s no longer looking for a larger partner to help it build and finance a combined 4G satellite and terrestrial network, but is preparing to move ahead alone.

TerreStar is the new name of a former pager company called Motient. In 2004 Motient scored the regulatory jackpot when, despite protests from the cellular carriers, the Federal Communications Commission approved plans for an ancillary terrestrial component (ATC) network. Since then, it has found itself tangled up in a web of financial transactions designed to maximize the value of its two bands of satellite spectrum.

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Samsung Says Thin Is In

The memory business is a volatile one, driven by consumer demand for products like MP3 players and rapid obsolescence. That’s why the gradual move of solid-state storage drives based on NAND flash memory into the PC is so interesting. Now that those drives are bigger, at 64GB and soon 128GB, memory makers can flatten out some of the volatility seen in the consumer market by putting them into corporate laptops where demand is less influenced by economic cycles.

Most solid-state memory for PCs ends up in rugged or sexy high-end laptops such as the new MacBook Air, which is offered with either an 80GB hard drive or a 64GB SSD, and the Lenovo x300, which comes with a 64GB solid-state drive made by Samsung. The lack of moving parts makes a solid-state drive much more durable for rugged machines and the smaller size of flash drives means they can allow for thinner, lighter laptops.

In addition to revealing that its solid-state drive was in the x300, Samsung has unveiled a traditional 500GB hard drive that contains three disks crammed into a 9.5 mm-high drive. Andy Higginbotham (no relation), director of hard drive sales and marketing at Samsung, says this gives Samsung a leg upon density as the competition can only fit two disks in that space.

And if a user pops two of these in a notebook, he added, suddenly they’re walking around with a terabyte of storage (that could store 120 hours of HD video or 320,000 images). In a laptop. Think about how much confidential data someone could store on it, only to have stolen out of their car. It boggles the mind.

Picture This: You are Here.

Skyhook Wireless said today it will provide its Wi-Fi-based location awareness technology for users of Locr software who want to automatically add geographic information to their photos. Although fun, like many location-based services that have been long promised and poorly delivered, it’s certainly not the type of killer application destined to drive the market forward.

However, Skyhook’s technology, which consists of software already embedded on the device (such as the iPhone) adds a missing component to the location conundrum. Skyhook maps the location of Wi-Fi hotspots and uses them to triangulate a cell phone’s location. It works well indoors and in urban areas where Wi-Fi hotspots are dense. But it’s not going to help much if you’re in the middle of a field somewhere.

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Is Chip Consolidation Looming Large?

Earlier this month, Qualcomm and LSI Logic went on a nano-based shopping spree. LSI spent $4 billion and snapped up Agere Systems, a company that shared DNA with AT&T, Lucent Technologies and Bell Labs. Qualcomm, which is well known for its CDMA and W-CDMA technologies, snapped up Airgo and a division of RF Micro Devices.

With chip sector growth falling into single digits, industry insiders are predicting frenzied deal making, whether it is through mergers and acquisitions. Many are betting on leveraged buyouts. EE Times, the one true bible of the chip business says that companies that specialize in analog chips or FPGA chips could be taking a private road out of the public markets.
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