Astute Onloads $15M

Storage chip startup plans to add sales and engineers with its new funding haul

March 23, 2004

2 Min Read
Network Computing logo

Astute Networks Inc., both a pioneer and survivor among IP storage chip vendors, picked up $15 million in funding today, which it plans to use to increase sales and develop its next-generation chip.

New investor ComVentures led Astutes C funding round, which also included previous investors U.S. Venture Partners, BA Venture Partners, Windward Ventures, and Dali Hook Partners. ComVentures founder Clifford Higgerson joins Astute’s board of directors. Astute has raised a total of $37.8 million since it was formed in 2000.

Astute’s VP of strategic marketing John Siann says the startup will increase its headcount of 42 by about 15 percent, with new hires in sales/marketing and engineering. Astute, which has sold its TCP offload engine (TOE) chip primarily through OEMs, will add direct sales. The engineering hires will help develop a new chip that Siann expects to launch next year.

Siann also says Astute’s management hopes the current round of funding will take the company through to profitability, although that’s still a ways off. “Our current target is to be profitable in late ’05,” Siann says. “Our goal is to work with this [money] to take us to profitability.”

Astute has two products. Its Pericles TOE terminates TCP as well as storage-specific protocols such as iSCSI. The device is programmable, allowing customers to run their own applications software for product differentiation. Siann says the chip, launched in late 2002, is generating revenue. Last December, Astute announced a family of iSCSI accelerators that are still in the customer evaluation stage. Siann says Astute will release iSCSI target and initiator software for the accelerators, which the company calls the SuperHBA protocol accelerator.Even with revenue and new funding, Astute is swimming in treacherous waters. Trebia Networks, which joined Astute and Agilent Technologies Inc. (NYSE: A) in shipping silicon for building IP SANs in October of 2002, went belly-up last August (see Vendors Chip Into IP Storage and Trebia Croaks). A market for iSCSI accelerators is beginning to develop, but analysts also foresee a consolidation of the market (see Alacritech Initiates iSCSI Race and Report: Fibre Channel's Outbound). The field includes Alacritech Inc., iReady Corp., Silverback Systems Inc, iVivity Inc., and iStor Networks Inc.

Established players such as Adaptec Inc. (Nasdaq: ADPT - message board), QLogic Corp. (Nasdaq: QLGC - message board), LSI Logic Corp. (NYSE: LSI - message board), and Intel Corp. (Nasdaq: INTC - message board) have accelerator chips of their own.

— Dave Raffo, Senior Editor, Byte and Switch

Stay informed! Sign up to get expert advice and insight delivered direct to your inbox

You May Also Like

More Insights