I sat down with Alex Benik of Battery Ventures Tuesday morning to swap perspectives on the Communication components business, semiconductors in particular.
We lamented the growing barriers to entry for fabless startups, and talked about what needed to be done differently to make Telecom chip startups a reality. While everyone is avoiding Telecom chips like the plague, investors have not lost their moon-shot mentality of funding 6 businesses all chasing the latest IEEE standard (in this case, Copper 10GE Ethernet transceivers). Two land successfully and folks forget about the four that didn’t.
Other than Cortina, and the FTTH PON guys, there have been virtually no Telecom semi startups in the past 5 years. Zero. Not only that, but the incumbents have been doing little except make duals, quad, and octal port versions of the same designs from 2002.
Pundits proclaim the rebirth of optical yet no money is flowing. Which either means the pundits are wrong or a very big opportunity is lurking out there.
I’m convinced that a massive innovation opportunity exists in this sector that either an incumbent or startup can capitalize on. As is usual for me, I think it exists in the dirtiest and ugliest sector of all – Optical Transport. If you have an idea, I suggest you speak with Alex, because private investments just are not our bag.