Irvine-based networking chipmaker ClariPhy Inc. has raised $14 million in a round of venture funding led by Europe’s Nokia Siemens Networks.
The company plans to use the funding to ramp up sales of its chips, which help speed the flow of data in servers, switches and other networking equipment.
The round brings ClariPhy’s total funding raised to an estimated $50 million.
Lead investor Nokia Siemens Networks is a Netherlands-based venture of Germany’s Siemens AG and Finland’s Nokia Corp.
Nokia Siemens makes wireless and other networking gear. It’s looking to ClariPhy’s chips to help meet growing demand for network capacity spurred by digital TV, smartphones, cloud computing and other uses.
ClariPhy makes chips that allow for the transfer of data at speeds of 40 gigabits or 100 gigabits per second, an emerging market. The company also makes chips that handle data at 10 gigabits per second, the current standard.
The chips convert analog signals to digital in optical networks, which use pulses of light to transmit data.
ClariPhy’s existing investors also took part in the funding. They include Norwest Venture Partners and Allegis Capital LLC, both of Palo Alto.
San Jose-based Oclaro Inc., a maker of electronics in optical networks, also is an investor, as are some undisclosed networking companies.
Strategic Move
ClariPhy moved to Orange County from Santa Clara in 2004.
The company moved here to be among the county’s contingent of networking chipmakers, including Broadcom Corp. of Irvine and Mindspeed Technologies Inc. of Newport Beach.
“We really liked the venture community and the business community down there,” cofounder and Chief Executive Paul Voois told the Business Journal in 2004.
Voois has a master’s and a doctorate in electrical engineering from Stanford University. He started the company with Norm Swenson, whom he met at graduate school
Swenson is ClariPhy’s chief technology officer.
John Cioffi, a Stanford electrical engineering professor who taught Voois and Swenson, is a ClariPhy director.
Voois formerly was chief executive of 8×8 Inc., another Silicon Valley startup previously known as Netergy Networks Inc.
In 2001, Voois made headlines after resigning from Netergy. He and a group of engineers left the company in protest of a move to sell the company’s software operations, which eventually became the core Internet telephony business of 8×8.
Unfolding Market
ClariPhy is going after an unfolding market for networking gear that is looking to keep up with the rapid growth in demand for video, music, photos and other data.
Gear makers going after 100-gigabit networking include Cisco Systems Inc., Huawei Technologies Co. and Nortel Networks Corp.
Last year, Cisco paid $100 million for a rival of ClariPhy’s, San Jose’s CoreOptics Inc. The deal raised questions about supplies of chips for 100-gigabit networks.
Nokia Siemens had planned to use chips from CoreOptics in its networking gear. The investment in ClariPhy is seen as a way to guarantee chip supplies for Nokia Siemens.
ClariPhy’s other rivals include PMC-Sierra Inc. of Sunnyvale.
In 2010, ClariPhy raised $24 million from investors.
