Axcelerant Grabs $9 Million, SiteLite Near Funding
ThinkTank Launches Buy.com Offshoot; Irvine Sensors Gets Follow-on Arm Order
TECHNOLOGY by Andrew Simons
It still may be hard to pry open a venture capitalist’s wallet, but a couple of companies seem to have the right set of pliers.
SiteLite Inc., an Irvine startup that monitors and maintains systems for Internet businesses, plans to raise $10 million to $15 million in a second round of financing, according to Chief Executive Kumar Yamani.
And Irvine’s Axcelerant Inc., a provider of services for private networks on the Internet, recently raised $9 million in a second funding round.
Two years ago, such small venture deals might not have attracted much attention. But in a time when technology upstarts aren’t fetching the $40 million rounds they used to, the fundings are notable.
Many companies seeking money in the past year found investors unwilling to ante up, at least at terms acceptable to the companies themselves. That led several startups to seek smaller rounds to sustain themselves.
Others simply delayed funding. SiteLite originally had planned a $30 million round last year to fund expansion into Asia. But the company put off its fundraising due to the soft economy. With limited resources, the company began a limited Asian expansion, opening just a couple offices.
Axcelerant was able to find new investors to join up with the company’s earlier backers. Gemini Investors of Wellesley, Mass., led the round, which also included Chicago’s Baird Venture Partners and Los Angeles-based Riordan, Lewis & Haden, which has an Irvine office.
Axcelerant’s customers include Bristol-Myers Squibb Co. as well as Orange County chipmakers Broadcom Corp. and Conexant Systems Inc.
But times still are tough.
“It’s really the best of times and the worst of times,” said Tom Beaver, chief executive of 3DSP Corp., an Irvine startup chipmaker. “Two years ago anyone with a reasonable vision statement could get funding. In these tough times, you need a much more aired business that’s financially founded.”
3DSP is seeking $25 million. Another startup chip designer, Newport Beach-based Morpho Technologies Inc. recently closed $10 million in a second round.
Valence Semiconductor, an Irvine developer of networking chips, recently laid off an undisclosed number of workers and is searching for more funding.
ThinkTank Forms New Venture
Scott Blum may have moved halfway across the country, but the founder of incubator ThinkTank LLC has started a new company. United Commerce Service hosts Web sites geared for electronic commerce.
“With over six years of experience providing solutions to the e-commerce marketplace and $150 million invested in the development of its engine, UCS is poised to become the premier e-commerce outsource provider,” Blum said.
The venture is the newest one since Blum, a longtime OC businessman and resident, moved his family and ThinkTank to Jackson Hole, Wyo. Blum left most of his staff in Aliso Viejo.
The venture is the first one in some time for ThinkTank, which had stopped creating new companies to focus on getting the 10 it has up on their feet. The main reason for the hiatus is Blum’s desire to work on his best-known venture,Internet retailer Buy.com Inc.,which he bought back last year.
Oddly enough, United Commerce isn’t entirely separate from Buy,it runs the online retailer’s electronic operations.
“The precedent-setting technology that has powered Buy.com is now available to companies looking to benefit from the most successful online retailing engine available,” Blum said.
Irvine Sensors Lands Deal
Costa Mesa’s Irvine Sensors Corp. recently received a follow-on contract worth $949,000 from the Army for its stacked chip technology. The chips are set to be integrated into image processing modules aboard Army aircraft.
“For problems such as identifying a moving face in a crowd or intercepting an incoming missile, the speed at which this can be accomplished is critical,” said Irvine Sensors president John Carson. “We believe that the new contract will allow us to develop a stacked chip module based on our technology that can perform these operations at teraflop speed.”
Earlier this year, Irvine Sensors said it had delivered to the military a tiny video camera that takes pictures by capturing heat emission. The camera could be used for night vision weapons and small unmanned aircraft. The new camera was developed for use in a government program and now is being made available for production orders, principally for government use.
Both orders are part of a series of orders totaling $3.5 million.
Irvine Sensors has gone to great pains in noting its deals with the military just after the company’s highly anticipated Silicon Film subsidiary, which offered a canister that turned film cameras into digital ones, failed last year.
Irvine Sensors is seeking funding for another big idea,what it calls a “super router.” The router, a networking device, boosts Internet speeds by cryogenically freezing the electronic switches inside the router’s circuitry. The idea is that the colder electronic signals get, the faster they go. The company is seeking funding to produce the router.
