RealTime IT News

Intel's VC Arm Makes Connection

To spur development of products using the Advanced Switching (AS) standard, chip maker Intel has taken a stake in semiconductor specialist StarGen.

The amount of the investment was not disclosed.

The privately held firm will use Intel's backing to design a family of switches and bridges interconnecting storage, server, communications and embedded applications.

StarGen, of Marlborough, Mass., says its new product line, dubbed StarXpress, is due in 2005.

Intel and StarGen particpated in the Arapahoe Work Group, which originally developed the AS specification, a StarGen spokeswoman told internetnews.com.

Intel's investment comes after StarGen raised $16 million in third-round financing from by Morgenthaler Ventures, St. Paul Venture Capital, Commonwealth Capital Ventures, The Boston University Community Technology Fund, Ironside Ventures and CommVest.

In its first two rounds, StarGen banked $26 million. The firm was founded in 1999 and has about 45 employees.

Executives of Santa Clara, Calif.-based Intel believe breaking down barriers between computing and communications platforms is key to the IT industry's growth.

Unlike many other IT firms that established venture capital arms in the 1990s, Intel survived the Nasdaq swoon and continued to invest hundreds of millions of dollars in semiconductor startups and other firms.