Jun. 13–RALEIGH, N.C.–Kyma Technologies, a semiconductor materials company, closed on $4 million in new venture capital this week and will add to its staff and production facilities by the end ofthe year.<\/p>\n
Kyma makes substrates, or wafers, of gallium nitride for use in semiconductors for light-emitting diodes, lasers and wireless base stations.<\/p>\n
Ed Pupa, the chief executive, said the company would add six employees to a staff of 16 by the end of the year and add fabrication space at its offices near the Angus Barn off U.S. 70 in Raleigh.<\/p>\n
The investment round was led by Digital Power Capital of Greenwich, Conn., and Siemens Venture Capital of Germany.<\/p>\n
Harald Kirchner, a partner with Siemens Venture, said the investment in Kyma was prompted in part by the fact that Kyma is supplying gallium nitride wafers to Osram Opto Semiconductors, a subsidiary of Siemens AG. Kirchner said such wafers, called GaN for short, are hard to come by.<\/p>\n
“The market for them is just starting,” Kirchner said. “So far, nobody could really deliver this kind of material. So we’re at the beginning of a new area.”<\/p>\n
“We’re as far ahead as anybody in the marketplace,” Pupa said. He said there are a few other companies working on GaN substrates, but the process of making them is still being refined. Kyma is shipping 2-inch GaN wafers to semiconductor companies that are using them in new devices. Once those devices go into production, demand for Kyma’s wafers will increase. Pupa declined to give a revenue forecast.<\/p>\n
Kyma, named for the Greek word for wave, is a potential supplier of wafers to two local companies that use GaN in their semiconductor devices, Durham’s Cree and Nitronex of Raleigh.<\/p>\n
But being the first to make GaN wafers does come with risk. Companies such as Nitronex use an easier process, apply the gallium nitride to silicon. Mike Slawson, a venture capitalist with Alliance Technology Ventures in Atlanta, is an investor in Nitronex and knows the semiconductor industry. Slawson said he thinks the ability to produce high-quality, purely GaN wafers in bulk is still a decade away.<\/p>\n
“If you could take advantage of gallium nitride while using another substrate and do it for much cheaper, why would you not?” Slawson asked.<\/p>\n
Still, the demand for GaN materials for use in the optical-electronic and micro-electronic fields is expected to grow, according to a study coming out today from Strategies Unlimited, a specialized market research firm in Silicon Valley. According to its research, the market for gallium nitride devices is expected to grow from<\/p>\n
$1 billion in 2003 to $4.5 billion in 2007. GaN-powered LEDs have been on sale since 1999, but the first electronic devices with GaN devices will start shipping in 2004, according to the report.<\/p>\n
Kyma, which was formed in 1998, received $2.6 million in venture capital in 2001.<\/p>\n
—–<\/p>\n
To see more of The News & Observer, or to subscribe to the newspaper, go to http:\/\/www.newsobserver.com.<\/p>\n
(c) 2003, The News & Observer, Raleigh, N.C. Distributed by Knight Ridder\/Tribune Business News.<\/p>\n
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