Wednesday, January 25, 2006
Interview with Patrick Henry, President and CEO of Entropic Communications
Patrick Henry is President and CEO of Entropic Communications, a San Diego-based firm focused on the home networking and broadband semiconductor market. Entropic has been getting some major design wins for its home networking silicon, and I thought it would be interesting to catch up on how the company is doing.
BK: Tell me a little bit about Entropic and how you fit into the home networking field?
PH: Entropic was formed about 5 years ago, and we've developed a solution for home networking of digital entertainment. We've also developed another solution that is based on the same chipset for the last 500/600 meter broadband access. Our home networking products have a North American focus, and the broadband products are focused on Asia. What we're really focused on from a home networking standpoint is working with service providers on deploying the solution for whole house PVR and multimedia content, and dealing with major telco, cable, and satellite companies.
BK: It sounds like you already have deployment and design wins?
PH: Yes, we've announced design wins with Westel, Motorola, and Panasonic. Panasonic is using our products for an access modem. Panasonic is working with Broadcom to deploy with JCOM, a cable access provider in Japan. The initial customer for Motorola is Verizon.
BK: Do you compete against wireless, or do you see that as a different market?
PH: We see ourselves as complimentary to wireless. It's a different application need. Wireless is being used for whole house data, sharing an internet port, printer, and things like that. The service providers we work with don't have any intent of putting their content over the unlicensed spectrum used by wireless.
BK: So your main customers are the service providers, rather than end users?
PH: The consumer is ultimate customer, however we sell to set top box, broadband router, gateway, and other box providers who then sell their equipment to the service providers.
BK: I see you've raised $78M in funding so far?
PH: Yes, we've raised 78M total. The latest round was a Series C led by Focus Ventures with widespread participation by our existing investors. That round closed in December.
BK: Do you think you will need to raise more money?
PH: This should take us to cash flow positive.
BK: Has it been tough establishing yourself as a semiconductor provider?
PH: As I mentioned, we were started 5 years ago. Definitely, a lot of expertise goes into building a chip or semi company. In particular what we're doing is system engineering and experience in the cable and satellite domain, where we have the right kind of team. The system on a chip projects we are working on are difficult, and quite capital intensive. Our founding team had strong track record in communications. Our systems and chips experience and team came of of ComStream Communications, and the founding CEO Itzhak Gurantz was founder of ComStream and Linkabit, definitely a name guy in the industry. We've got a very strong team.
BK: How big is Entropic now, in terms of employees?
PH: We have about 50 people.