Chelsio Raises $25 Million

Chelsio Communications Inc., a Sunnyvale, Calif.-based provider of 10-gigabit Ethernet unified wire solutions, has raised $25 million in Series E funding. Investor Growth Capital led the round, and was joined by return backers New Enterprise Associates, INVESCO Private Capital, LSI Logic Corporation, Hotung Capital Management, Abacus Capital Group, Pacesetter Capital Group and Horizon Ventures. Chelsio has now raised around $84 million in total VC funding since 2001.

 

PRESS RELEASE

Chelsio Communications Inc., a leading provider of 10-Gigabit Ethernet unified wire solutions, today announced the closing of a Series E private funding round, raising a total of $25 million from a prominent team of investors with proven track records in semiconductors and communications.

This round was led by an investor new to the company, Investor Growth Capital, while existing investors New Enterprise Associates, INVESCO Private Capital, LSI Logic Corporation, Hotung Capital Management, Abacus Capital Group, Pacesetter Capital Group, and Horizon Ventures all participated.

Powered by the 3rd generation Terminator 3 (T3) ASIC, Chelsio’s portfolio of unified wire adapters enable 10Gb Ethernet to replace disparate fabric technologies such as Fibre Channel and InfiniBand in a wide range of applications, including Network-Attached Storage (NAS) Filers, Storage Area Network (SAN) Arrays, Server Adapters, High Performance Cluster Computing, Blade Servers, Video Servers, Application Servers and Web Accelerators. Chelsio’s product line constitutes the industry’s broadest 10Gb Ethernet adapter portfolio targeting all major market segments.

Chelsio’s cut-through T3 architecture delivers the highest transactions rate in the industry, in excess of 16 million packets per second. Chelsio’s customers are able to use the same drivers for any host bus, any physical media, any offload protocol, and any number of ports and speeds of Ethernet.

“Enterprise data center managers do not want three separate networking fabrics. The one they obviously want is Ethernet with high levels of throughput coupled with reductions in latency and CPU utilization that prior generations of Ethernet could not achieve,” said Jose Suarez, managing director of Investor Growth Capital. “Chelsio is a proven provider of 10GbE adapters that enable data center fabric convergence without requiring software modification. We see Chelsio as a key enabler in the rapid shift of this very large market, bringing the performance that data centers need and the single networking standard they want, creating a compelling opportunity for customers as well as investors.”

“We believe that there is a huge opportunity to address data center cost of ownership through 10 Gigabit Ethernet fabric convergence solutions,” said Forest Baskett, Chairman of the board and general partner at NEA. “Chelsio is well positioned to be a leader in this market, building on its technology and product leadership, and significant and accelerating revenue base. We welcome Investor Growth Capital to our team.”

“We clearly see a significant market for 10 Gigabit Ethernet solutions enabling improved data center agility, performance, and overall return on investment,” stated Esfandiar Lohrasbpour of INVESCO Private Capital. “Given the quality of Chelsio’s technology, roadmap, and team, we believe they have the necessary product elements and customer momentum to become the leading company in this sector.”

“We appreciate the confidence and support our investors have shown with this round of funding,” said Kianoosh Naghshineh, president and CEO of Chelsio Communications. “This additional capital allows us to continue to extend our technology lead with our family of unified wire adapters and silicon, to staff our engineering, sales, and marketing organizations, and to assure our customers that Chelsio will be a long term and dominant player in this space.”

About Chelsio Communications

Chelsio Communications is leading the convergence of networking, storage and clustering interconnects with its robust, high-performance and proven unified wire technology. Featuring a highly scalable and programmable architecture, Chelsio is shipping 10-Gigabit Ethernet and multi-port Gigabit Ethernet adapter cards, delivering the low latency and superior throughput required for high-performance computing applications. For more information, visit the company online at http://www.chelsio.com .

About Investor Growth Capital

Investor Growth Capital (IGC) is the wholly-owned venture capital arm of Investor AB, a publicly traded industrial holding company, listed on the Stockholm Exchange. IGC was formed in the mid-1990s to invest in high quality, growth oriented companies, primarily in the IT and Healthcare industries. Today its 30 investment professionals are developing a portfolio whose value exceeds $800 million from offices located in New York, Menlo Park, Stockholm, Hong Kong, Tokyo and Beijing. Investor AB is a leading shareholder in a number of European multinational corporations, including Astra Zeneca, Ericsson, Atlas Copco and SEB. For almost a century Investor AB’s business philosophy has been to build best-in-class companies in sectors where the group has strong knowledge and a networking advantage. IGC shares that approach and benefits from Investor AB’s extensive global network of companies and senior managers.