Syntiant Corp. in Irvine has scored an additional $55 million in new funding, pushing the total investment in the chip technology company past $100 million in just five years of operation.
The latest round of funding is expected to help the company expedite production deployments, while ensuring the firm has the financial backing to continue to expand operations as it approaches profitability in the not-too-distant future, according to officials.
“This will actually get us several years and should bring us close to break-even—if not through the break-even point,” Chief Executive Kurt Busch told the Business Journal on March 28, shortly after the announcement of what the company is calling a “C1” funding round.
Busch said the break-even point should come “sometime toward the end of next year” for the artificial intelligence chip company, which says it counts “more than 50 current customer engagements.”
“We have built a strong customer pipeline that represents the leading suppliers, from earbuds to automobiles and most everything in between,” according to the Syntiant CEO.
Always On
Syntiant’s low-power chips respond to voice and speech commands and can wake up a device or have it perform a specific function. The company has also expanded its products to include sensor and image recognition, as well as other uses.
As a result, the tiny processors allow battery-powered devices to hear, speak, see and detect various sound, motion and light impulses in a wide range of consumer areas such as earbuds, wearables, smartphones, smart speakers, laptops, automobiles and other IoT consumer and industrial areas.
The chips, which use a tiny amount of energy when compared to current semiconductor standards, took on even greater importance during the pandemic with consumers increasingly insisting on touch-free devices.
They are smaller than a tiny fraction of a penny, and are designed for what are called “always-on” battery-powered devices to enable hands-free functions.
The products make “edge AI accessible to any battery-powered device,” according to Busch, a Business Journal Innovator of the Year Award recipient in 2020.
Producing at Scale
Syntiant says it has shipped more than 20 million of what it calls “Neural Decision Processors” to date, and expects global market demand for the edge AI products it makes for device manufacturers to continue rising.
“We have researched dozens of edge AI chip companies, and Syntiant is the first we have seen to develop a software-centric turnkey solution that is already being deployed at scale,” said Jay Chong, partner at New York’s Millennium Technology Value Partners, which along with Renesas Electronics Corp. and Mirae Asset Capital are among five new investors in the latest funding round.
Existing investors also participated in the latest fund raise, the company said.
A valuation for the company wasn’t disclosed at the time of the $55 million funding round, though Busch said “it was a good multiple step-up from the last round, but we have not disclosed it.”
“Our plan is IPO,” according to the CEO. “Future financings will be based on the market situation at the time.”
The company’s last big funding round was in 2020, when it raised $35 million. Applied Ventures LLC and M12, the venture fund of Microsoft, were that Series C round’s larger backers.
Local Cluster
Syntiant is just one name on the long roster of chipmakers based in Orange County or maintaining major presences here.
The local sector includes longstanding heavyweights such as Broadcom Inc. (Nasdaq: AVGO) and Skyworks Solutions Inc. (Nasdaq: SWKS), each with substantial operations in Irvine, as well as upstarts like Aliso Viejo’s auto-focused Indie Semiconductor Inc. (Nasdaq: INDI), which went public last year.
Apple Inc. is also reportedly interested in setting up a wireless chip-making division in Irvine, though specifics haven’t been disclosed.
The Syntiant funding deal is the latest big haul for a local tech company this year.
Another Irvine firm whose work is similar in nature to those chipmakers, electric switch developer Menlo Microsystems Inc., raised $150 million in March in part to expand its manufacturing capabilities. That’s the largest funding round for a local tech company this year.
Industry Challenges
Syntiant currently counts close to 100 employees, with an increase of 10% to 20% planned, according to Busch. It is currently looking to hire numerous engineering-related positions, according to its website.
While Syntiant has raised sufficient capital to grow the business and doesn’t see any near-term direct competitors, it is affected by supply chain issues facing companies across the world, according to the CEO.
“The semiconductor industry as a whole is certainly having its challenges of supply constraints,” Busch said.
He added: “Most chip companies, including ourselves, would be able to ship a lot more products if there was not a supply constraint.”
He expects supply issues to loosen up in the second half of this year.
