With the recent gyrations of the stock market, we've seen a dramatic fall in the numbers of venture-capital placements and initial public offerings in the optoelectronics arena. But that doesn't mean that all the recent startups are struggling to survive. Here are my choices for privately held companies to watch in the coming months. In my view, they all offer outstanding technologies and good long-term business potential.
Naturally, I'm not saying you should immediately pick up the phone and instruct your broker. If/when these fledglings go public, their shares will be hard to find. And, of course, some of them will likely be picked up and merged into their larger brethren, such as the Ciscos, Nortels and Cornings of this world, if the big guys' shares regain their former health and they hit the acquisition trail once again.
My list is in alphabetical order and I have no financial interest in any of these companies.
Agility Communications Inc., Santa Barbara, CA (www.agility.com). Founded in 1998 by Larry Coldren of UC-Santa Barbara and Ron Nelson of Motorola. Designer and manufacturer of tunable lasers (VCSELs). Key investors include Milton Chang and Dell Ventures. Coldren is a leader in VCSEL research.
Axsun Technologies Inc., Billerica, MA (www.axsun.com). Founded in 1999 by Dale Flanders, James Lewis, and Peter Whitney of Lasertron. Developing integrated photonic devices for WDM applications. Has raised $157 million in debt and equity financing. Investors include Oppenheimer Funds, Goldman Sachs and Ray Stata (of Analog Devices).
Caspian Networks Inc., San Jose, CA (www.caspiannetworks.com). Incorporated in 1999 by ArpaNet pioneer Larry Roberts. Recently hired Bill Stickler, veteran COO of Ungermann-Bass, as president. Prominent investors include Nicholas Negroponte of MIT and Gordon Bell, formerly of Digital Equipment Corp. Developer of optical switching systems.
Genoa Corp., Fremont, CA (www.genoa.com). Founded in 1999 by two Lawrence Livermore National Laboratories veterans, Sol DiJaili and Jeff Walker. Developed single-chip linear optical amplifier aimed at metropolitan-area networks. Raised $95 million in venture funding led by August Capital and Bessemer Venture Partners.
GiantLoop Network Inc., Waltham, MA (www.giantloop.com). Formed by Harry Dixon, chairman, and Mark Ward, president and CEO, both EMC Corp. veterans. Builds and manages optical networks for large companies. Has secured $160 million in financing from Greylock, Nortel Networks, Roger Marino (one of the founders of EMC), Pilot House Ventures, and others.
Novera Optics Inc., San Jose, CA (www.ultra-band.com). Initially called Ultraband Fiber Optics, Novera Optics was started in 1999 to make dynamic optical-signal processors. Raised $83 million in debt and equity financing in March from investors including Agilent Technologies and Intel. Started by Byoung Yoon Kim, chairman and CTO, formerly of Korea Advanced Institute of Science and Technology.
Onix Microsystems Inc., Richmond, CA (www.onixmicrosystems.com). Founded in 1998 to develop optical switches using MEMS technologies. Led by Steve Pankyo, CEO, formerly president of Harris Communications Products Division, and Kam Lao, one of the founders of Ortel Corp. and a professor at UC-Berkeley. Raised $70 million in third-round funding.
Packet Video Corp., San Diego, CA (www.pv.com). Established in 1988 to develop audio and multimedia applications over wireless links to cell phones and PDAs. Founded by ex-Motorola researcher Jim Brailean, president and CEO, and former Motorola sales executive Jim Carol, chairman. Has more than $140 million in financing from Intel, Motorola, Sony, Texas Instruments, and others.
Sigma Networks Inc., Boca Raton, FL (www.sigmanetworks.com). Founded in 2000 by former FCC chairman Reed Hundt, venture capitalist Andy Rachleff, and CEO John Peters, previously with Concentric Networks. Developer of metropolitan-area networks. Has raised over $435 million in equity and debt financing from such investors as Marc Andreessen (of Netscape fame) and Salomon Smith Barney.
Xtera Communications Inc., Allen, TX (www.xtera.com). Jon Bayless, chairman and CEO, was a venture capitalist with Sevin Rosen Funds. Has raised $133 million to date, largely from Rho Ventures of New York and Star Ventures of Munich, Germany. Developing optical products based on Raman technology for long-haul networks.
A company that would have made my list is Tellium Inc., Oceanport, NJ (www.tellium.com), which successfully went public in May of this year (at $15/share, recent price around $22). So there's still hope for these embryo outfits in the IPO market.
Jeffrey Bairstow | Contributing Editor
Jeffrey Bairstow is a Contributing Editor for Laser Focus World; he previously served as Group Editorial Director.