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$12M Deal Energizes Quake Technologies

Arguing that speed is only half the equation when it comes to broadband networking, Quake Technologies Inc. recently secured $12 million in first round financing from Mohr, Davidow Ventures (MDV). The completed deal is the initial tranche of a larger Series A offering that is scheduled to close within 10 days at a total capitalization of approximately $15 million.

Quake, which is headquartered in Ottawa and also has offices in San Jose, Calif., develops physical layer chips designed to not only work up to 10 times faster than traditional chips, but also provide greater energy efficiency.

“People are focusing on speed because it is the obvious way to get into the game,” said Jim Smith, an associate with MDV and new Quake board member. “But to build a real company that can stand alone in the public market you have to offer more, and that’s what Quake’s doing by also dealing with lower power consumption.”

Smith added that the overall value of his firm’s investment in Quake would go beyond the dollar amount as its portfolio offered a number of potential corporate synergies, customers and suppliers. Moreover, MDV Partner Robert Chaplinsky will join Smith on the Quake board of directors.

“The truth is that people want to watch TV on the Internet,” said Dan Trepanier, president and chief executive with Quake. “People have higher and higher demands for bandwidth with things like Napster out there, and we think that we’re going to be able to help ease the stress.”

Once the secondary segment of the Series A deal is completed, expect Quake to be back out in the venture market in the second or third quarter of next year with an offering in the range of $20 million.