By Salvatore Caputo
Small Times Correspondent

Feb. 27, 2002 — Ever since Microlab Inc. developed its “better mousetrap” — actually, a microscopic latching switch that it says uses less energy and is more durable than other MEMS switches — the startup has been attracting the attention of venture capital companies.

The Chandler, Ariz.-based company gained $5.5 million in private investments last May.

Investors included EnTrust Capital Frontier Fund LP, Next State LLC and a consortium of individuals, including Henry Nicholas and Henry Samueli, co-chairs and founders of Broadcom Corp.; Vincent Tese, chairman of Wireless Cable International; and Michael Fitzpatrick, former chairman, CEO and president of E-TEK Dynamics.

What attracted the venture capital, investors say, was confidence that their cash would not be burned willy-nilly but applied judiciously to developing the company’s product, facilities and executive team in order to go to market.

“Business success is really betting on people,” said Cliff Conwell, an associate with EnTrust Capital Frontier Fund LP, one of Microlab’s investors. “When we invested originally, we were betting on two very bright engineers and their know-how, but since then they’ve brought on outstanding executive talent as well.”

The “two very bright engineers” who co-founded Microlab are Ph.D.s Jun Shen, who is president and CEO, and Charles Wheeler, executive vice president and chief technological officer.

Between them, they hold dozens of patents. Since coming to the United States from China, Shen has been principal staff scientist at Motorola Inc. Wheeler has held technical positions at GTE Microcircuits, Intelligent Automation Inc. and Abbie Gregg Inc.

The “outstanding executive talent” includes Chief Financial Officer James Valenzuela, who had previously been part of the management team at Interact Commerce Corp., a maker of contact-management software, and David McCartney, vice president of marketing and sales. McCartney had previously been president of e-Tenna Corp., a company that developed RF technology for the wireless industry, and has held senior management positions at Telecom, Motorola and Ericsson.

The company has grown from 11 people when the funding was completed to about 20 people now, Shen said. The money enabled the company to move into its own facility last June and build a clean room.

“We are working on a beta sample of our first product,” Shen said. “The plan is to have these beta sample products out at the end of June.”

Shen, also an Arizona State University professor, developed the MagLatch switch at the school with the help of his students.

The MagLatch stays in position, just like an electrical switch in your home, without consuming power. Instead of a human hand turning the switch, Shen said, “We use an invisible hand — that’s the magnetic force — to pop it one way or the other.” Most other MEMS switches work electrostatically and require a flow of power to hold them in the “on” or “off” positions.

“They have a very significant technology that can be used in a broad series of applications,” Conwell said. “It reduces cost and improves efficiency of devices it’s applied to. They’re now figuring out which end market they want to focus on.”

Ask Shen about the potential end markets and he sounds excited. He talks about manufacturers of reconfigurable antennas, automatic testing equipment, radar systems for the military and wireless communications.

As a for instance, he mentioned smart power amplifiers that could use the MagLatch to regulate the amount of power transmitted to a cell station from a cell phone, making the phone more energy efficient. “When you are closer to the station, you want to transmit less power,” he said.

“We will also be enabling new technologies … because solid-state switches do not provide the performance advantage and conventional relays cannot be made as small as ours,” he added.

“I’m not an engineer but when I’ve passed the report (on Microlab’s switch) along to engineers, they’ve raised their eyebrows,” said Marlene Bourne, a senior analyst with Cahners In-Stat Group. “It’s very intriguing because it’s quite a different approach from the others that are being developed. It’s one of the few that’s using electromagnetic actuation. It’s latching with zero power, that’s unique.”

A couple of other companies have looked at this type of electromagnetic switch architecture but so far nothing has come of it, she said. “As far as a company having real products (of this type) in development, Microlab is the only one I’m aware of.”

Although the focus is on potential wireless communications applications, Bourne said that the MagLatch could be used in any device that requires durable switches that take up minimal space and consume little power.

For Shen, having his own company has always been his dream and the pending beta model release of his switch is something like finding the Holy Grail. He went to Arizona State after working for Motorola because of the relative freedom the university setting gave him to innovate.

However, just inventing the technology wasn’t enough for him: “There is no better way of validating what you’re doing in the university than commercializing the technology and putting in the market.”


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