Solarflare Grabs $26M

Silicon specialist clinches funding, plots product roadmap and IPO

June 18, 2008

3 Min Read
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Silicon startup Solarflare has clinched $26 million in Series C funding to support its 10Gbase-T efforts and a possible 2010 IPO.

The round, which included Oak Investment Partners, Foundation Capital, Accel Partners, and Amadeus Capital Partners, brings Solarflares total funding to $126 million.

Solarflare has been offering a 10Gbase-T transceiver for almost two years. That product is already shipping in a network interface card from Dell. The cash influx will be used primarily to develop this technology, according to Russell Stern, the Solarflare CEO.

“This is for the next generation,” he says. “We’re sampling now and we will be in full production by the fourth quarter.”

With component vendors ramping up their efforts around 10Gbase-T, Solarflare is building a low-power version of its 10Xpress transceiver, according to the exec.“Before, it was 11.7 watts; the new version is about 5.5 watts,” he explains. “We’re not announcing any of the new customers for it, [but] there are a number of companies that are designing for it today and will release products by the fourth quarter and early 2009.”

At least one analyst feels that low-power transceivers such as this are crucial to the long-term success of 10GBase-T.

“11.7 Watts is not practical,” says Bob Wheeler, senior analyst at the Linley Group. “It’s a good proof of technology, but it’s not viable for high volume products – imagine having 48 of these 12-watt chips cooking away in a 1U switch.”

The 10GBase-T spec, ratified by the IEEE in 2006, requires devices like NICs to support links up to 50 meters on standard Category 6 copper cabling and up to 100 meters on what's called Category 6a, a version of copper cabling augmented with wider diameters and other features to support faster data rates.

Solarflare’s Stern acknowledges that his company has had to pull in big bucks from the VC community, but explains that the vendor is in a unique position following its 2006 acquisition of controller specialist Level 5.“It’s certainly an indicator of how difficult the technologies that we’re developing are - you have to remember that it’s kind of two different startups,” he says. “So, you’re funding for two development projects; one is controller technology and the other is transceiver.”

The Irvine, Calif.-based vendor also faces a stiff challenge from local rival Broadcom, which has recently been busy building its own 10Gbase-T products. Another startup, Aquantia, also demo’d a low-power 10Gbase-T PHY at Interop earlier this year, which it will offer in the third quarter.

Despite all this competition, Solarflare’s Stern told Byte and Switch that there is ample room for multiple vendors in the 10Gbase-T space.

“If you look at the latest 10Gbase-T [NIC] from Dell, you will find our PHY and Broadcom’s controller,” he says. “It’s strange bed-fellows, but it’s all about co-opetition.”

Solarflare is also eyeing other product areas it claims will give it an edge, such as the LAN-on-motherboard technology that is used within servers.“That technology only exists at 1Gbase-T,” says Stern. “Our goal is to have that exist at 10Gbase-T – we will put out products next year that do just that.”

Even longer term, Solarflare is looking at a possible public offering, despite the current scarcity of storage IPOs .

“We continue to raise money well ahead of our needs and we will continue to do that as we drive towards our IPO,” he says. “It’s always hard to tell [when that will happen] with the way the markets are going right now, but our goal is by early 2010.”

Despite Stern’s ambitions, Linley Group analyst Wheeler feels that startups in the 10Gbase-T space are unlikely to take the IPO plunge anytime soon.

”The market has a long way to go before it would drive an IPO for any of these guys,” he says.Have a comment on this story? Please click "Discuss" below. If you'd like to contact Byte and Switch's editors directly, send us a message.

  • Accel Partners

  • Amadeus Capital Partners Ltd.

  • Aquantia Corp.

  • Broadcom Corp. (Nasdaq: BRCM)

  • Dell Inc. (Nasdaq: DELL)

  • Foundation Capital

  • The Linley Group

  • Oak Investment Partners

  • Solarflare Communications Inc.

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