Oct
29
2020
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More chip industry action as Marvell is acquiring Inphi for $10B

It’s been quite a time for chip industry consolidation, and today Marvell joined the acquisition parade when it announced it is acquiring Inphi in a combination of stock and cash valued at approximately $10 billion, according to the company.

Marvell CEO Matt Murphy believes that by adding Inphi, a chip maker that helps connect internal servers in cloud data centers, and then between data centers, using fiber cabling, it will complement Marvell’s copper-based chip portfolio and give it an edge in developing more future-looking use cases where Inphi shines.

“Our acquisition of Inphi will fuel Marvell’s leadership in the cloud and extend our 5G position over the next decade,” Murphy said in a statement.

In the classic buy versus build calculus, this acquisition uses the company’s cash to push it in new directions without having to build all this new technology. “This highly complementary transaction expands Marvell’s addressable market, strengthens customer base and accelerates Marvell’s leadership in hyperscale cloud data centers and 5G wireless infrastructure,” the company said in a statement.

It’s been a busy time for the chip industry as multiple players are combining, hoping for a similar kind of lift that Marvell sees with this deal. In fact, today’s announcement comes in the same week AMD announced it was acquiring Xilinx for $35 billion and follows Nvidia acquiring ARM for $40 billion last month. The three deals combined come to a whopping $85 billion.

There appears to be prevailing wisdom in the industry that by combining forces and using the power of the checkbook, these companies can do more together than they can by themselves.

Certainly Marvell and Inphi are suggesting that. As they highlighted, their combined enterprise value will be more than $40 billion, with hundreds of millions of dollars in market potential. All of this of course depends on how well these combined entities work together, and we won’t know that for some time.

For what it’s worth, the stock market appears unimpressed with the deal, with Marvell’s stock down more than 7% in early trading — but Inphi stock is being bolstered in a big way by the announcement, up almost 23% this morning so far.

The deal, which has been approved by both companies’ boards, is expected to close by the second half of 2021, subject to shareholder and regulatory approval.

Oct
19
2020
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Intel agrees to sell its NAND business to SK Hynix for $9 billion

SK Hynix, one of the world’s largest chip makers, announced today it will pay $9 billion for Intel’s flash memory business. Intel said it will use proceeds from the deal to focus on artificial intelligence, 5G and edge computing.

“For Intel, this transaction will allow us to to further prioritize our investments in differentiated technology where we can play a bigger role in the success of our customers and deliver attractive returns to our stockholders,” said Intel chief executive officer Bob Swan in the announcement.

The Wall Street Journal first reported earlier this week that the two companies were nearing an agreement, which will turn SK Hynix into one of the world’s largest NAND memory makers, second only to Samsung Electronics.

The deal with SK Hynix is the latest one Intel has made so it can double down on developing technology for 5G network infrastructure. Last year, Intel sold the majority of its modem business to Apple for about $1 billion, with Swan saying that the time that the deal would allow Intel to “[put] our full effort into 5G where it most closely aligns with the needs of our global customer base.”

Once the deal is approved and closes, Seoul-based SK Hynix will take over Intel’s NAND SSD and NAND component and wafer businesses, and its NAND foundry in Dalian, China. Intel will hold onto its Optane business, which makes SSD memory modules. The companies said regulatory approval is expected by late 2021, and a final closing of all assets, including Intel’s NAND-related intellectual property, will take place in March 2025.

Until the final closing takes places, Intel will continue to manufacture NAND wafers at the Dalian foundry and retain all IP related to the manufacturing and design of its NAND flash wafers.

As the Wall Street Journal noted, the Dalian facility is Intel’s only major foundry in China, which means selling it to SK Hynix will dramatically reduce its presence there as the United States government puts trade restrictions on Chinese technology.

In the announcement, Intel said it plans to use proceeds from the sale to “advance its long-term growth priorities, including artificial intelligence, 5G networking and the intelligent, autonomous edge.”

During the six-month period ending on June 27, 2020, NAND business represented about $2.8 billion of revenue for its Non-volatile Memory Solutions Group (NSG), and contributed about $600 million to the division’s operating income. According to the Wall Street Journal, this made up the majority of Intel’s total memory sales during that period, which was about $3 billion.

SK Hynix CEO Seok-Hee Lee said the deal will allow the South Korean company to “optimize our business structure, expanding our innovative portfolio in the NAND flash market segment, which will be comparable with what we achieved in DRAM.”

Sep
24
2020
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NUVIA raises $240M from Mithril to make climate-ready enterprise chips

Climate change is on everyone’s minds these days, what with the outer Bay Area on fire, orange skies above San Francisco, and a hurricane season that is bearing down on the East Coast with alacrity (and that’s just the United States in the past two weeks).

A major — and growing — source of those emissions is data centers, the cloud infrastructure that powers most of our devices and experiences. That’s led to some novel ideas, such as Microsoft’s underwater data center Project Natick, which just came back to the surface for testing a bit more than a week ago.

Yet, for all the fun experiments, there is a bit more of an obvious solution: just make the chips more energy efficient.

That’s the thesis of NUVIA, which was founded by three ex-Apple chip designers who led the design of the “A” series chip line for the company’s iPhones and iPads for years. Those chips are wicked fast within a very tight energy envelope, and NUVIA’s premise is essentially what happens when you take those sorts of energy constraints (and the experience of its chip design team) and apply them to the data center.

We did a deep profile of the company last year when it announced its $53 million Series A, so definitely read that to understand the founding story and the company’s mission. Now about one year later, it’s coming back to us with news of a whole bunch of more funding.

NUVIA announced today that it has closed on a $240 million Series B round led by Mithril Capital, with a bunch of others involved listed below.

Since we last chatted with the company, we now have a bit more detail of what it’s working on. It has two products under development, a system-on-chip (SoC) unit dubbed “Orion” and a CPU core dubbed “Phoenix.” The company previewed a bit of Phoenix’s performance last month, although as with most chip companies, it is almost certainly too early to make any long-term predictions about how the technology will settle in with existing and future chips coming to the market.

NUVIA’s view is that chips are limited to about 250-300 watts of power given the cooling and power constraints of most data centers. As more cores become common pre chip, each core is going to have to make do with less power availability while maintaining performance. NUVIA’s tech is trying to solve that problem, lowering total cost of ownership for data center operators while also improving overall energy efficiency.

There’s a lot more work to be done of course, so expect to see more product announcements and previews from the company as it gets its technology further finalized. With $240 million more dollars in the bank though, it certainly has the resources to make some progress.

Shortly after we chatted with the company last year, Apple sued company founder and CEO Gerald Williams III for breach of contract, with the company arguing that its former chip designer was trying to poach employees for his nascent startup. Williams counter-sued earlier this year, and the two parties are now in the discovery phase of their lawsuit, which remains ongoing.

In addition to lead Mithril, the round was done “in partnership with” the founders of semiconductor giant Marvell (Sehat Sutardja and Weili Dai), funds managed by BlackRock, Fidelity, and Temasek, plus Atlantic Bridge and Redline Capital along with Series A investors Capricorn Investment Group, Dell Technologies Capital, Mayfield, Nepenthe LLC, and WRVI Capital.

Aug
14
2019
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Why chipmaker Broadcom is spending big bucks for aging enterprise software companies

Last year Broadcom, a chipmaker, raised eyebrows when it acquired CA Technologies, an enterprise software company with a broad portfolio of products, including a sizable mainframe software tools business. It paid close to $19 billion for the privilege.

Then last week, the company opened up its wallet again and forked over $10.7 billion for Symantec’s enterprise security business. That’s almost $30 billion for two aging enterprise software companies. There has to be some sound strategy behind these purchases, right? Maybe.

Here’s the thing about older software companies. They may not out-innovate the competition anymore, but what they have going for them is a backlog of licensing revenue that appears to have value.

Apr
17
2019
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The Exit: an AI startup’s McPivot

Five years ago, Dynamic Yield was courting an investment from The New York Times as it looked to shift how publishers paywalled their content. Last month, Chicago-based fast food king McDonald’s bought the Israeli company for $300 million, a source told TechCrunch, with the purpose of rethinking how people order drive-thru chicken nuggets.

The pivot from courting the grey lady to the golden arches isn’t as drastic as it sounds. In a lot of ways, it’s the result of the company learning to say “no” to certain customers. At least, that’s what Bessemer’s Adam Fisher tells us.

The Exit is a new series at TechCrunch. It’s an exit interview of sorts with a VC who was in the right place at the right time but made the right call on an investment that paid off. 

Fisher

Fisher was Dynamic Yield founder Liad Agmon’s first call when he started looking for funds from institutional investors. Bessemer bankrolled the bulk of a $1.7 million funding round which valued the startup at $5 million pre-money back in 2013. The firm ended up putting about $15 million into Dynamic Yield, which raised ~$85 million in total from backers including Marker Capital, Union Tech Ventures, Baidu and The New York Times.

Fisher and I chatted at length about the company’s challenging rise and how Israel’s tech scene is still being underestimated. Fisher has 11 years at Bessemer under his belt and 14 exits including Wix, Intucell, Ravello and Leaba.

The interview has been edited for length and clarity. 


Saying “No”

Lucas Matney: So, right off the bat, how exactly did this tool initially built for publishers end up becoming something that McDonalds wanted?

Adam Fisher: I mean, the story of Dynamic Yield is unique. Liad, the founder and CEO, he was an entrepreneur in residence in our Herzliya office back in 2011. I’d identified him earlier from his previous company, and I just said, ‘Well, that’s the kind of guy I’d love to work with.’ I didn’t like his previous company, but there was something about his charisma, his technology background, his youth, which I just felt like “Wow, he’s going to do something interesting.” And so when he sold his previous company, coincidentally to another Chicago based company called Sears, I invited him and I think he found it very flattering, so he joined us as an EIR.

And really only at the very end of his residence did he come up with this idea that would become Dynamic Yield. He came about it very much focused on the problem he saw with publishers being outwitted by ad buyers. He felt like all the big publishers really didn’t understand their digital businesses, didn’t understand their users, didn’t understand how performance ad buying was working, and he began to build a product that could dynamically optimize a publisher’s website to maximize revenue, hence the yield … the dynamic yield.

But very quickly, we told him, ‘That’s interesting, but we’re not sure how big that market is. And, you know it’s not always great to sell to those kind of weak customers. Sometimes they’re weak for a reason.’

Dec
18
2018
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Cisco to acquire silicon photonics chip maker Luxtera for $660 million

As networks get put under increasing pressure from ever-growing amounts of data, network equipment manufacturers are facing huge challenges to increase data transmission speeds over farther distances. As a premier networking equipment company, Cisco wants to be prepared to meet that demand. Today, it opened up its checkbook and announced its intent to acquire Luxtera for $660 million.

Luxtera, which was founded in 2001 and raised more than $130 million, will give Cisco a photonic solution for that data networking problem. Rob Salvagno, head of Cisco’s M&A and venture investment team, sees a company that can help modernize Cisco’s networking equipment.

“That’s why today we announced our intent to acquire Luxtera, Inc., a privately-held semiconductor company that uses silicon photonics technology to build integrated optics capabilities for webscale and enterprise data centers, service provider market segments, and other customers. Luxtera’s technology, design and manufacturing innovation significantly improves performance and scale while lowering costs,” he wrote in a blog post announcing the acquisition.

Photonics uses light to move large amounts of data at higher speeds over increased distances via fiber optic cable. Cisco sees this as a way to future-proof customer networking requirements, while keeping them on Cisco equipment. “The combination of Cisco’s and Luxtera’s capabilities in 100GbE/400GbE optics, silicon and process technology will enable customers to build future-proof networks optimized for performance, reliability and cost,” Salvagno wrote.

While Cisco has been acquiring its share of high-profile software properties in recent years, including AppDyanmics for $3.7 billion in 2017 and Jasper Technologies for $1.4 billion in 2016, it also acquired Israeli chip designer Leaba Semiconductor for $320 million in 2016 for its advanced chip making capability.

Today’s announcement would seem to build on that earlier purchase as Cisco tries to modernize its hardware offerings to meet increasingly stringent demands inside large-scale data centers.

The acquisition is subject to the typical regulatory scrutiny, but Cisco expects it to close in its fiscal year 2019 Q3. It reported its Q1 2019 earnings in November.

Apr
02
2018
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SiFive gets $50.6M to help companies get their custom chip designs out the door

With the race to next-generation silicon in full swing, the waterfall of venture money flowing into custom silicon startups is already showing an enormous amount of potential for some more flexible hardware for an increasingly changing technology landscape — and Naveed Sherwani hopes to tap that for everyone else.

That’s the premise of SiFive, a startup that’s designed to help entrepreneurs — or any company — come up with a custom designed chip for their needs. But rather than having to raise tens of millions of dollars from a venture firm or have a massive production system in place, SiFive’s goal is to help get that piece of silicon in the hands of the developer quickly so they can see if it actually works based off a set of basic hardware and IP offered, and then figure out when and how to move it into full-scale production. The company starts by offering templates and then allows them to make some modifications for what eventually ends up as a piece of RISC-V silicon that’s in their hands. SiFive today said it has raised $50.6 million in venture financing in a round led by Sutter Hill Ventures, Spark Capital, and Osage University Partners.

“The way we view it, is that we think we should not depend on people learning special languages and things of that nature to be able to modify the architecture and enhance the architecture,” Sherwani said. “What we believe is there could be a high-level interface, which is what we’re building, which will allow people to take existing cores, bring them into their design space, and then apply a configuration. Moving those configurations, you can modify the core, and then you can get the new modified core. That’s the approach we take, we don’t have to learn a special language or be an expert, it’s the way we present the core. We’d like to start with cores that are verified, and each of these modifications does not cause to become non-verifiable.”

SiFive is based on a design framework for silicon called RISC-V. You could consider it a kind of open source analog to designs by major chip fab firms, but the goal for RISC-V chips is to lean on the decades of experience since the original piece of silicon came out of Intel to develop something that is less messy while still getting the right tasks done. Sherwani says that RISC-V chips have more than 50 instruction sets while common chips will have more than 1,000. By nature, they aren’t at the kind of scale of an Intel, so the kinds of efficiencies those firms might have don’t exist. But SiFive hopes to serve a wide array of varying needs rather than mass-producing a single style of silicon.

There are two flows for developers looking to build out silicon using SiFive. First is the prototype flow, where developers will get a chance to spec out their silicon and figure out their specific needs. The goal there is to get something into the hands of the developer they can use to showcase their ideas or technology, and SiFive works with IP vendors and other supply chain partners — during this time, developers aren’t paying for IP. Once the case is proved out (and the startup has, perhaps, raised money based on that idea) they can switch to a production flow with SiFive where they will start paying for IP and services. There’s also a potential marketplace element as more and more people come up with novel ideas for operational cores.

“For any segment in the market there will be a few templates available,” Sherwani said. “We’ll have some tools and methodologies there, and among all the various templates are available show what would be the best for [that customer]. We also have an app store — we are expecting people who have designed cores who are willing to share it, because they don’t need it to be proprietary. If anyone uses that template, then whatever price they can put on it, they can make some money doing that. This whole idea of marketplaces will get more people excited.”

As there is an intense rush to develop new customized silicon, it may be that services like the ones offered by SiFive become more and more necessary. But there’s another element to the bet behind SiFive: making the chip itself less ambiguous and trying to remove black boxes. That doesn’t necessarily make it wildly more secure than the one next to it, but at the very least, it means when there is a major security flaw like Intel’s Spectre problems, there may be a bit more tolerance from the developer community because there are fewer black boxes.

“All these complications are there and unless you have all this expertise, you can’t do a chip,” Sherwani said. “Our vision is that we deliver the entire chip experience to that platform and people can be able to log in. They don’t need a team, any tools, they don’t need FPGAs because all those will be available on the web. As a result the cost goes down because it’s a shared economy, they’re sharing tools, and that is how we think dramatically you can do chips at much lower cost.”

While there is a lot of venture money flowing into the AI chip space — with many different interpretations of what that hardware looks like — Sherwani said the benefit of working with SiFive is to be able to rapidly adapt an idea to a changing algorithm. Developers have already proven out a lot of different tools and frameworks, but once a piece of silicon is in production it’s not easy to change on the fly. Should those best practices or algorithms change, developers will have an opportunity to reassess and redesign the chip as quickly as possible.

The idea of that custom silicon is going to be a big theme going forward as more and more use cases emerge that could be easier with a customized piece of hardware. Already there are startups like Mythic and SambaNova Systems, which have raised tens of millions of dollars and specialize in the rapid-fire calculations for typical AI processes. But this kind of technology is now showing up in devices ranging from an autonomous vehicle to a fridge, and each use case may carry different needs. Intel and other chip design firms probably can’t hit every niche, and the one-size-fits-all (or even something more modular like an FPGA from Intel) might not hit each sweet spot. That, in theory, is the hole that a company like SiFive could fill.

Mar
21
2017
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Mythic launches a chip to enable computer vision and voice control on any device

 Hardware that responds to voice commands is already out there and probably in your hand or house right now. Whether it’s a smartphone, smart speaker or wearable, it has to connect to the cloud to deliver answers. Now, a startup called Mythic (formerly known as Isocline) is launching a chip and software that will change all that, putting voice control, computer vision and other kinds of… Read More

Nov
16
2016
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Phononic raises a cool $40 million to make quiet, spacious refrigerators

Arctic sea ice from NOAA's At The Ends of the Earth Collection. Refrigeration and air conditioning used to require vapor compressors, chemicals like Freon, fans, water chillers or passive heat sinks. But a North Carolina company called Phononic has developed solid state refrigeration technology instead.
Phononic, which employs about 110 full-time today, just raised an additional $40 million in equity funding to rapidly expand manufacturing of its… Read More

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