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Ember Gains Financing and New Chairman

Wireless networking developer closes on $25 million in new financing and welcomes Ethernet inventor Bob Metcalfe as company chairman.

Bob Metcalfe
Bob Metcalfe

Ember Corp., a Boston-based developer of wireless semiconductor solutions and promoter of the ZigBee Alliance, has closed an additional $25 million in funding, led by Vulcan Capital, the investment group of Microsoft co-founder Paul G. Allen.

ZigBee is the name given to wireless mesh networking technology defined in IEEE standard 802.15.4. The name is derived from the zig-zag dance a honey bee does to inform members of the hive about new-found food sources—referred to as the ZigBee Principle.

Ember also announced that Bob Metcalfe, father of Ethernet and founder of 3Com, will become the new chairman. Outgoing board chairman and Ember co-founder, Robert Poor, will focus on researching new technologies and evangelizing Ember’s message in business and industry forums.

According to Poor, Metcalfe’s appointment to company chairman is perfectly timed as the company transitions from startup mode to a well-established market leader with real customers and proven technology. “As Ember continues to experience strong, sustained growth, Bob’s reputation and experience is a tremendous asset at this stage of Ember’s evolution.”

“I see parallels between ZigBee and Ethernet,” said Metcalfe. “As Ethernet has connected millions of computers, Ember’s technology has the potential to network-enable billions of devices that previously couldn’t communicate. The company’s early commitment to ZigBee will further accelerate the adoption of Ember’s wireless mesh network solutions in the marketplace.”

Joining Vulcan in this latest round of funding are new strategic investors ChevronTexaco Technology Ventures, Hitachi Ltd. and WestAM. Existing investors Polaris Venture Partners, DFJ New England, GrandBanks Capital, RRE Ventures and DFJ ePlanet Ventures also participated in the round, bringing the total capital Ember has raised to $53 million. CIBC World Markets served as financial advisor to the company for this round.

Internet of things

The investors are said to be excited about Ember due to the potential of its embedded wireless network technology, which is helping to create an “Internet of things” by enabling billions of devices to support low-cost, low-power networking applications in any industry. Ember is also committed to standards-based solutions, exemplified by its role as a promoter of ZigBee. The market for low data rate, low power networking devices will grow 47.4 percent between 2003 and 2007, from just over $1 billion to $8 billion in component revenue, according to the Wireless Data Research Group, San Mateo, Calif.

“Of the more than eight billion microcontrollers built into products every year, less than 2 percent are network-enabled,” said Steve Hall, director at Vulcan Capital, who joined Ember’s board in conjunction with the financing. “That’s an enormous opportunity for Ember as companies realize the advantages of linking microcontrollers into monitoring and control networks. We believe Ember’s seasoned executive team and substantial customer traction have well positioned the company to be the market leader in the space.”

Ember’s solutions replace wired networks with self-healing and configuring wireless networks in a wide range of applications such as home control, building and industrial automation, cold chain monitoring and infrastructure security. Ember’s chip architecture is the IEEE 802.15.4 “golden suite” on which ZigBee-based wireless semiconductors are judged for interoperability and standard compliance.

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