Ken Lawler, Battery Ventures: Smooth-Stone Secures $48M for More Energy Efficient Server Solutions

August 16, 2010

The capital will be applied directly to the final development and market delivery of high performance, low power chips that will change the server market and the makeup of data centers. Smooth-Stone funding partners include ARM, Advanced Technology Investment Company (ATIC), Battery Ventures, Flybridge Capital Partners, Highland Capital Partners and Texas Instruments Inc.

"This kind of investment, the amount, and the strength of this syndicate is a strong endorsement for the innovation we are bringing to market," said Smooth-Stone CEO Barry Evans. "We look forward to taking advantage of the insights and know-how of these industry-leading investors."

Power consumption matters more than ever. Smooth-Stone will bring the low-power virtues of mobile phone technology to servers and data centers. Its semiconductors and software will provide a solution for companies where energy consumption by servers has become a constraining and expensive issue by increasing the density of computer resources while significantly conserving energy, cooling and space in the data center. Smooth-Stone customers will have new, unseen options as they plan their future server deployments.

"Our goal is to completely remove power consumption as an issue for the data center. Imagine that change for companies with a large presence on the Internet," added Evans. "They all deal with the reality that as the mass of information grows daily, so does their power consumption. Every day these companies are thinking about managing their data center sprawl. We want to make sure that space and power are not constraining their potential."

"The necessity of finding more energy efficient server solutions for data centers has created an enormous and truly revolutionary opportunity for the industry," said Battery Ventures General Partner, Ken Lawler. "As a firm, we recognized from the beginning that Smooth-Stone had the innovative technology, the customer value proposition and the engineering and management capability to disrupt the web server landscape. Working with management, we've put together a unique investment structure and syndicate of both strategic and traditional venture capital investors that gives the company what it needs to succeed in this highly competitive market. Smooth-Stone has a very bright future and we're thrilled to be part of this investment."

Semiconductor investment has traditionally required a unique skill set and discipline, the importance of which has only been amplified by the recessed economy. The Smooth-Stone investor syndicate offers a strong collection of previous successes in the semiconductor industry including companies such as Advanced Analogic, Cimaron, Ikanos, MaxLinear, PA Semi, Sigmatel and SiTera and will actively support the company in its mission to redefine the server market and data center performance.

"ARM invests in companies that are taking innovative approaches to solving industry challenges. Smooth-Stone's approach of bringing low power technology into the server domain made them a perfect fit for our investment model," said Bruce Beckloff, vice president of corporate business development, ARM. "There is a strong market need for a new class of data center platforms that offer a significant improvement in performance from both the energy and density perspectives, and ARM is excited to support Smooth-Stone's efforts to develop innovative chip solutions for this new class of platforms."

With this investment, ARM continues its seat on the Smooth-Stone board of directors, along with Evans and an independent, Howard Bubb. The three VCs, Battery Ventures, Flybridge Capital Partners and Highland Capital Partners, and ATIC, also join the board.

The Smooth-Stone board now comprises:

-- Smooth-Stone, Barry Evans, CEO

-- ARM, Tom Lantzsch, Executive Vice President, Corporate Development

-- ATIC, Daniel Durn, Executive Director

-- Battery Ventures, Ken Lawler, General Partner

-- Flybridge Capital Partners, David Aronoff, General Partner

-- Highland Capital Partners, Sean Dalton, General Partner

-- Howard Bubb, semiconductor industry executive