AmberWave lands $21M and strains industry maxim
Mass High Tech: The Journal of New England Technology - June 4, 2004
by Jeff Miller

Before executives at Salem, N.H.-based AmberWave Systems Corp. broke for the Memorial Day weekend, they capped off the week by adding $21 million to the company's coffers.

The D round of financing brings the total funds raised by AmberWave to $66 million.

"This is not an early-stage company, and it's commercially getting traction," said Marko Maschek, a director at 3i Corp., the British investment company that led the round. "So basically we wanted to finance this company to profitability with this round."

AmberWave has assembled a portfolio of about 100 patents - some granted, some pending - that cover the use of strained silicon technologies in the manufacture of semiconductors, Maschek said.

"With strained silicon," Maschek said, "you get the performance of next-generation 65-nanometer nodes, but with the 90-nanometer nodes. It pushes Moore's Law."

According to Moore's Law, the number of transistors on a chip will double every year or two, a prediction that has held remarkably true since Gordon Moore coined it in 1965.

But many in the industry fear that semiconductor development is approaching a level of miniaturization where the laws of physics won't allow any further progress (see Close-up on Page 14).

AmberWave's technology uses a combination of silicon and germanium to stretch the molecular structure of regular silicon. The result: better performance.

"Think of it as walking through a forest that's had some of the trees removed," said Bryan Lord, vice president of corporate development and administration at AmberWave. "We increase the mobility of electrons."

About six months ago, Lord said, AmberWave moved out of research and development and into commercialization of its technology. But AmberWave doesn't want to make products; instead, it wants to license its intellectual property to established wafer and chip manufacturers.

"We're in the very early stages of commercialization," Lord said. "I don't want to overstate it. We'd be wildly successful and a public company if you could purchase devices on the open market that have strained silicon in it. We're not there yet, but we are realizing royalty from licensing."

In December, AmberWave licensed its proprietary planarization technology for bulk strained silicon wafer production to Sumitomo Mitsubishi Silicon Corp., which will use the technology to reduce surface roughness in the manufacture of high-quality strained silicon wafers. Financial terms of the deal were not released.

The round was competitive, Lord said, though neither he nor Maschek would comment on AmberWave's valuation.

Previous investors in AmberWave - Adams Capital Management, Arch Ventures, Telesoft Partners and The Hillman Companies - also participated in the recent financing.

About AmberWave Systems
Founded in 1998, AmberWave Systems has become a leader in the research, development and licensing of advanced technologies for semiconductor manufacturing. By funding and guiding university research, AmberWave Systems is bringing new technology developments to fruition through patents and technology licensing. In conjunction with its university research projects, AmberWave Systems conducts its own research, development and limited manufacturing in its semiconductor fabrication facility in Salem, New Hampshire. In addition, AmberWave Systems collaborates with other technology focused companies to further expand and develop its research. For more information about the company, please visit its Web site at www.amberwave.com.