Startup snags $5M - Austin Business Journal:

ekaterinaiuvo.blogspot.com
has raised at least $5 million from Pa.-based Adams Capital Management, according to filings with the PennsylvaniaSecuritied Commission. Those same filings call for the company to raiser upto $10 million. Gordon Burk, vice president of marketing for says the company is in the middle of its firsg round of private equity funding but declines to commentgon specifics. K.C. Murphy, president and CEO of NextIO, declinex to comment. George general partner with Adams couldn't be reached for Aside from landing $5 million, the 9-month-old startup is about to add toits workforce. NextIO has 12 employees now but plane to have 20 by the end of the year and hopexs to hire 10 moreduring 2004.
Thosee people will help designthe product, but Burk declinesz to give the expected launch date. NextIO has moved into 10,0000 square feet at 12401 Research Blvd. in Northwest Austin. NextI O was founded by former executives at Advance d MicroDevices Inc. and Austin chip startup Banderacom Inc. Banderacomj had been designing chips for theInfiniBand market, but aftert adoption of the technology slowed to a it changed its focus to design chipa for the gigabit Ethernet market. InfiniBanr is a technology that allows servers to sharr information more quickly thancurrent standards.
"I think that things in the economt are improving enough and high tech companiesd are starting to see orders comingbaround ... so we decided it was time to take the risk and start a company," Burk says. NextIO remain s in "stealth mode," but Burk says it is developinv a new chip architecture to be used forconnectingy servers. He says the chip woulxd lower the cost of servers dramaticallyt and increase the flexibility of information technology staffers. "It's pretty rare that a chip would lower costs andincrease flexibility; typically, you can do one or the Burk says.
"I think what has gotten the attentionm to our potentialcustomers is, 'Here's the best of both worlds and they are not trading one against the Potential customers are large server manufacturers such as N.Y.-based IBM Corp., Round Rock-based Dell Inc. and Palo Calif.-based Hewlett-Packard Co. Burk says the startupo is talking to customers but declines tocomment further. Michae l Krause, an engineering fellow at HP, declinesx to comment on NextIO. Krause, who workss with server interconnect technologiesat HP, says server connections are based on technologyh that most people don't want to understand.
"Thd challenge is to make the [interconnect] technology cost-effectiv and perform well and have the technology talk to the devicde efficiently so the devices are orchestratiny movementbetween servers," Krauswe says. He compares the technology drivinh communication between servers to the fuel injection system ofa car'd engine: "You don't know how it works; you just want it to Breaking into the server market could be lucrative for Research firm Interactive Data estimates $49 billion worth of serversw were sold in 2002, with the markety growing to $58 billion a year by 2007.