XMOS: turning chip technology into a growing business

1stNov 2013
"While we could have done everything without SETsquared, it would have been much more difficult, expensive and time-consuming. SETsquared accelerated the early growth of XMOS and allowed us to focus on building the business."
Nigel Toon, CEO, XMOS

Fast facts 

  • Start date: 2005
  • Website: www.xmos.com
  • Market sector: Electronics
  • Location: Bristol
  • Investment raised: $16m in VC funding round in 2007, total raised to date around $40m
  • Number of employees: 50

SETsquared support

  • offices
  • networking
  • mentoring

Company overview

Semiconductor company XMOS has developed the xCORE multicore microcontroller aimed at embedded applications in audio, automotive, consumer and industrial products.

What was the vision for the company and what problem were you aiming to solve? 

"The company was based on technology spun out of the University of Bristol Computer Science group, providing high performance, flexible, low-cost semiconductors that met a need in embedded applications."

Company successes

September 2007: $16m Series A VC funding raised
November 2007: first working chips unveiled
January 2008: moved out of Innovation Centre
May 2009: second-generation xCORE multicore microcontroller ships
May 2012 : over 1Million units shipped to customers

SETsquared support

"In the early days, SETsquared provided a home, and a lot of support and advice to help get the company established and to a position where it could raise that first significant funding. SETsquared was instrumental in helping get the company going through that first seed period."
"After XMOS secured significant funding, the company stayed in the Innovation Centre bringing on new people and moving forwards towards the first products. When we were looking to move out of the Innovation Centre, SETsquared was very helpful in helping to find the right offices to move to – removing some of that administration burden from people who were busy trying to build the business."
"The biggest transition for XMOS was moving from being a seed-funded business in the Bristol Innovation Centre to being a fully-funded business, backed by world-class VCs like Amadeus and Foundation Capital and able to stand on our own two feet. We were able to achieve all of that while based in the Innovation Centre."
"Since the company has moved out, we've remained very closely linked through various networking events and contacts. We are in the network of entrepreneurs that are based in SETsquared or have been associated with it, and that's a great sounding board for us to work with.
"As XMOS has grown, SETsquared has introduced us into the broader Bristol business community and also the national community to get our voice heard, such as getting access to government to talk about what businesses like our own need. For example, we've been invited to a couple of the Local Enterprise Partnership (LEP) meetings with people from the Treasury where we've been able to express our views on subjects like tax strategies for small businesses."
"SETsquared's support has transitioned: in the early phases it was some solid tactical support, a home, and introduction to advisers, as well as credibility for the business when it was young. As the company has grown, it's transitioned into more of a mentoring relationship. Now, it's more about networking. SETsquared has been supportive through all those phases, and as XMOS has grown, SETsquared has naturally adopted the appropriate relationship with us."
"In Bristol, there is a large semiconductor community, and SETsquared does a fantastic job supporting new innovative companies in this sector. Nick Sturge has been very helpful, and continues to take a pro-active supporting role whenever he can."
"The challenge for any technology business is to think beyond the technology and to worry about how you're going to position the business, who your customers are going to be, and what problems you're going to solve for customers. SETsquared has been able to help companies such as XMOS think through those issues, and how they're going to turn their technology into a business."

Future plans

"We are looking to raise another round of money later this year. Flotation would be our eventual goal, and we are on-track to build more scale so that we can achiev that."