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Tuesday, May 24, 2022

UST Founder Sajan Pillai Launches New Chip Venture

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Sajan Pillai, the Orange County entrepreneur known for founding IT services company UST and turning the Aliso Viejo firm into a global powerhouse and one of OC’s largest private tech firms, has embarked on a new chip venture to reduce dependence on China.

His business accelerator McLaren Strategic Ventures, based in Irvine, has launched Atlas Silicon, an artificial intelligence, customized chip design venture for what are called application-specific integrated circuit or ASIC chips.

They are customized for a particular use, rather than intended for general-purpose use.

As Pillai told the Business Journal last month, with ASICs, “we’re basically putting software on the chips.”

“This chip design is 90% software,” Pillai said. “That’s why the chips are so intelligent.”

Pillai said production could start in July 2023.

He expects to put in $10 million to $20 million from his family office into the chip venture and then possibly reach out for external capital in about a year.

McLaren Strategic Ventures said March 23 it is keen on making additional heavy investments in the sector, and is targeting business worth $300 million by 2025.

Pillai founded and built UST—previously UST Global—into a $1.4 billion revenue tech service giant with 25,000 employees across the globe, including a large base in India. UST provides tech services to large corporations, including many Fortune 500 companies in industries like banking, insurance and telecom.

He stepped down as the UST chief executive in 2019, after which he started McLaren as well as Season Two Ventures, a venture capital firm with offices both in India and California.

Leaving China

The Atlas Silicon venture believes its ASIC chips can help solve the microchip shortage crisis plaguing numerous industries, perhaps none more than the automobile industry.

An ASIC chip is designed to boost performance because the desired feature is specifically designed and highly customized to deliver superior performance in specific applications, officials say.

For example, ASICS chips are used in satellites, cellphones, digital watches, digital voice recorders and autonomous vehicles.

Pillai’s venture aims to help companies looking to reduce their reliance on chips from China.

He said the foundries producing the chips production “can be in the U.S. It can be in Europe. It can be other parts of Asia. Anywhere but China. We could use Taiwan but not China. We will most likely be using U.S. foundries or European foundries.”

His company will cover design, manufacturing and production.

“Atlas Silicon will do all three,” according to Pillai.

He said the overall idea is that “you don’t have to depend on China.”

Contracts Already

Pillai said the new venture already has multi-millions of dollars in contracts lined up for Atlas Silicon.

“It’s launched already,” Pillai said. “By June 15, we’ll have 50 top engineers.”

“Demand is so high, and we are right at the right time,” he said.

The company said it has “launched an aggressive recruitment drive to onboard 100 ASIC engineers in India and is discussing with the country’s topmost technology institutions to hire promising freshers to expand the bench strength further.”

$200M SPAC

McLaren said March 23 it had raised $200 million, through sponsorship of a related Special Purpose Acquisition Company, or SPAC, called McLaren Technology Acquisition Corp.

The SPAC is now looking for a suitable business merger to take public via a reverse merger.

The company told the SEC in a filing dated April 14 that it may “pursue a business combination target in any business or industry” but is focusing on companies in the banking, financial services and insurance sectors that leverage artificial intelligence, machine learning, digital, technology, and fintech. 

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Kevin Costelloe
Kevin Costelloe
Tech reporter at Orange County Business Journal

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