Syntiant Surge

OC's Latest Chipmaker: High on AI Applications. Low on Energy Use

By Chris Casacchia of the Orange County Business Journal

Irvine semiconductor maker Syntiant Corp. has put its first batch of chips into limited production, another mile stone for the closely watched startup.

The company’s churning out millions of chips — which use a fraction of the power of current semiconductor standards, facilitate artificial intelligence and machine learning in computing devices, and which are designed in large part for the next generation of Internet of Things-type and other consumer electronic products.

The chips are expected to help drive advances in ‘always on’ products including smart phones, micro phones, security cam eras, drones, sensors, lap tops and wearables, such as fitness trackers and Bluetooth ear buds.

Syntiant officials see a potential customer base of more than 40 consumer electronics makers.

Products using the voice technology of Amazon, Microsoft, and Intel are likely users of the chips; affiliates of each of those companies are already investors in Syntiant.

“We expect to have full production in summer,” Chief Executive Kurt Busch told the Business Journal in a recent interview at the two-year-old company’s new headquarters in the Spectrum area.

The minds behind the chip maker include execs with deep experience in AI research and chip design, and ties to OC companies including Broad com and Lantronix Inc. (Nasdaq:LTRX). Busch led the latter, a networking products maker, for four years as chief executive, re-signing in 2015.

Other Syntiant execs include Chief Technology Officer Jeremy Holleman, Chief Operating Officer Pieter Vorenkamp, Vice President of Software Stephen Bailey and Vice President of Hard ware Dave Garrett.

Always On

These aren’t your father’s semiconductors, designed simply for lightning-fast computation to facilitate tasks from communication to national defense uses.

This new kind of chip is designed for ‘always on’ applications, including Internet of Things, smart products and digital services that rely on voice recognition.

Think Alexa and other increasingly popular voice assistants like Cortana or Google Voice, whose products can operate appliances, activate electronics such as phones or TVs, execute tasks—even call 911—through self-improving performance algorithms incorporating experience from use.

“With the advent of machine learning the world needs a different kind of processor,” Busch said.

That belief led Syntiant to target such devices with chips expected to consume 10 to 100 times less power than current standards.

This low-power focus “is a space no one else is playing in,” Busch said.

The super-efficient processors in Syntiant’s chips will be among the first of its type to market, and Busch believes they’re going to eventually ship in the hundreds of millions of units.

Such volume would catapult Syntiant into the upper echelon of OC’s private companies.

Trade industry reports put the expected cost of its product at about $10 per chip for high-volume customers.

Big Name Backer’s

Syntiant enters a semiconductor sector jammed with newcomers and big players targeting the server market with AI chips, but few focused on low-energy, battery-powered devices.

“The world really needs a new chip company,” Busch said.

Investors agree.

Syntiant’s technology got the attention of Amazon’s Alexa Fund, a venture capital arm of the Seattle giant and one of the company’s latest financial backers.

Its technology “has enormous potential to drive continued adoption of voice ser vices like Alexa, especially in mobile scenarios that require devices to balance low power with continuous, high-accuracy voice recognition,” said Paul Bernard, director of the Alexa Fund.

Sales of machine learning chipsets are projected to grow at a 42% com pounded annual rate through 2024, when revenue will hit $12.2 billion, according to Tractica LLC in Boulder, Colorado.

The market opportunity, coupled with a seasoned management team assembled from established tech firms, also attracted support for Syntiant from the venture capital arms of Microsoft Corp. (Nasdaq:MSFT); Applied Materials Inc. (Nasdaq: AMAT); Intel Corp. (Nasdaq: INTC); and Motorola Solutions Inc.

Syntiant has raised $30 million to date, with $25 million of that coming last October in a Series B round.

Accelerant

Funding has been poured into R&D, as well as hiring and its recent headquarters expansion at 7555 Irvine Center Dr., where it occupies 17,000-square-feet and employs 35. That’s about double its year-ago worker total and Syntiant’s expecting to add at least 25 jobs by year-end, mainly software and hardware engineers.

“We think we can expand to about 120 here,” Busch said.

Syntiant in February was one of five graduates of the EvoNexus business incubator at University of California-Irvine’s Research Park.

Busch credited EvoNexus and its developing ecosystem for helping secure investors in its Series A round led by Intel Capital and for introducing the company to half a dozen potential customers.

Its $25 million Series B round last year was led by M12, Microsoft’s venture capital arm.

“With Intel in the A round and Microsoft in the B round, we have probably two of the greatest technology companies the world has ever seen as our backers,” Busch said.

Syntiant plans to look for more funding this year, with a potential close in the second quarter of 2020.

“There’s a high degree of venture capital interest in the company right now,” Busch said.

Its management team carries nearly as much heft as its backers, with long tenures at some of Orange County’s largest chip makers like Broad com, Conex ant, now Synaptics, and Mind speed, now Macom, as well as others such as Qualcomm and Bell Labs.