Samplify raises $11.2 Million for Analog Chips

Although venture capitalists are not exactly thrilled about funding chip start-ups due to their huge initial capital needs, Samplify has managed to persuade the venture capitalists at Integrated Device Technology, Charles River Ventures, Formative Ventures, and Schlumberger to invest in its analog chips project. Woodside Capital Partners have also taken part in the transaction, but only as advisors. The Samplify team has managed to convince venture capitalists to invest in their start-up project by demanding a smaller amount of money justifying that their analog chip project requires a lot of engineering expertise, but not a lot of personnel.

Samplify is now working at an analog chip project whose purpose is to make the processing of real world data more sound efficient and thus less expensive. The device they are planning to produce is intended to be swept through most of the electronic devices in order to lower their prices. The technology is based on a system that converts analog data into digital data, easier put, a system that converts elements of reality into the zeros and ones used by computers. These chips are destined to be suitable for all the electronic systems surround us, from the medical technology field to the industrial and army field. Their real innovation consists in the fact that their convertors don’t only transform real data into digital data, they also compress it. This feature is a result of a “mixed signal” technology that combines the analog and digital data on the same chip. This means that the chips can provide not only cheaper technology, but also more accurate devices.

This business idea of “mixed signal” technology comes as a result to the demands of the market and to the actual situation of competitors. The analog chip market has been dominated by firms such as Texas Instruments, National Semiconductor, Maxim Integrated Products, Linear Technology, and Analog Devices by now. They produce only analog chips that are cheap, but that are not easily compatible with digital circuitry. Moreover, as the analog data transmitted on to the second digital chip is not compressed and that makes the transmission process complicated and expensive. But the chief executive of Samplify, Tom Sparkman, has announced that they have found a way of putting both the analogical and the digital circuitry into just one chip with its Prism IQ signal compression technology.

If able to do this, samplify could help to drastically cut down the prices of electronic gadgetry of all kinds, from ultrasound and cat-scan machines to the cell phone infrastructure and data acquisition equipment.

The idea on which the chip is based belongs to Al Wegener, chief officer of Samplify. He has tried to produce it back in 2000 with the Texas Instruments, but they have refused him. So he took it to a start-up company and obtained initial funding in 2006 from Charles River Ventures. Afterwards, they have raised another round in March 2007 from Formative Ventures and other angel investors. Counting this new round, Samplify has managed to gather up to $22.5 million in venture capital by now. The firm is designing its own chips which will be manufactured by Taiwan’s United Microelectronics. The money raised in this round will be used in order to expand into new markets and to attract customers.