Xtalic Takes in $8M in Latest Funding RoundJanuary 24, 2011
Mass High Tech
by Rodney H. Brown
Nanotechnology coatings company Xtalic Corp. has landed $8 million in its latest round of financing. The Marlborough-based company has now raised at least $23.7 million since it was founded in 2005, according to company officials.
Previous investors Matrix Partners and North Bridge Venture Partners are also in this latest round, a Series C investment, according to Xtalic CEO Tom Clay. Xtalic, now at approximately 30 employees, last took in financing in 2008, when it grabbed $10 million.
Xtalic, founded in 2005 by MIT researchers Christopher Schuh and CTO Alan Lund, has developed a new way to shrink metal crystals into metallic nanostructures to make safer and stronger alloy coatings for metal parts. In 2008, then-new CEO Tom Clay said that the company was initially looking to replace traditional chroming, a process that usually includes harmful chemicals like hexavalent chrome.
For its first customer wins, however, Xtalic marketed its process to electronics manufacturers, stating that a layer of its coating on substrates can improve wear and durability while not adding any measurable thickness to the electronic board or connector component. The connector field has brought Xtalic its first sales, Clay said.
“We have two primary customers,” he said. “They are the two largest companies that serve the connector space. One is Amphenol and the other has not yet announced it publicly.”
Connecticut-based Amphenol Corp. already has connectors using the Xtalic process in the field, Clay said, and Xtalic has opened an office in China to work with the manufacturing facilities there. One of the main attractions for companies like Amphenol is that the Xtalic process makes the connector tough enough that manufacturers can reduce the amount of precious metal – in this case, gold – being used to make the connectors higher-performing than standard metal connectors.
Clay said that the company can now focus on becoming cash flow positive and on expanding into new markets.
“The goal of the Series C is really to effectively bridge the company to the next stage of development as we move from early revenue to a break even point,” he said, noting that he expects that to happen within 18 months.
The new markets the company is looking at include a potential huge space – the defense industry – and Xtalic is working on some developments in “soldier protections,” Clay said.