NRF piles $35m into Morse Micro's $88m Series C
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The news: Morse Micro has raised $88 million in a Series C a fundraising round that included a $35 million investment from the National Reconstruction Fund (NRF).
The numbers: However, the raise is just over half the $170 million it raised for its 2022 Series B. Chief executive Michael De Nil told Capital Brief its valuation is now "significantly higher", and that the startup did not raise more because it did not need more.
The Series C was led by Japan's MegaChips, a 144 billion yen ($1.4 billion) semiconductor designer. Existing investors Blackbird, Main Sequence, Malcolm and Lucy Turnbull, and superannuation groups Hostplus, NGS and UniSuper also returned for the round.
The context: Morse Micro, which does not disclose its valuation, develops long-range WiFi chips designed for industrial and agriculture settings.
Founded in 2016, the startup spent years in R&D mode before pivoting last year to commercialising its IP. De Nil would not disclose revenue numbers, but did say Morse Micro has made "millions" of chips.
Though the NRF's chief mandate is to boost Australia's advanced manufacturing capabilities, Morse Micro's semiconductors are made in Taiwan. NRF chief executive David Gall said the fund invested in the company because its design and prototyping work is done in Australia.
"The research, the development, the design, the prototyping, the testing, the verification and validation process of the microchips is all done here in New South Wales," Gall said in an interview.
Morse Micro earlier this year released a second-generation version of its HaLow Wi-Fi chip earlier this year, which supports much faster network speeds.
"We'll keep building on that, so for us it's about how we can these chips go even longer range," he said. "How can we make them even lower power? How do we get more integration?"
What they said: Regarding Morse Micro's revenue, De Nil said: "With deep tech companies it always keeps it longer than you anticipate... but we're now actively selling our first-generation chip into a range of different module vendors, ODMs, OEMs.
So first, and primarily, we sell chips to manufacturers in Asia, who then build products for companies in the US. And so we've now seen semiconductors being designed into products for outdoor video cameras, for edge AI products, access control systems... We're still investing really heavily in R&D, so we're not profitable at at this stage."
The sources: Morse Micro, NRF
