Google Capital, the strategic venture capital fund run by search giant Google (NASDAQ:GOOG), has co-led a $32 million Series C funding round for InnoLight Technology Corp, along with Chinese venture firm Lightspeed China Partners. With its first investment in a Chinese startup, Google Capital joins the ranks of major Chinese firms like Tencent (HKG:0700), Baidu (NASDAQ:BIDU) and Alibaba (NASDAQ:BABA) in backing early- and growth-stage technology companies in the country. Suzhou Ventures and Acorn Ventures have co-invested in this funding round.
InnoLight designs, builds and markets high-speed optical transceivers meant for datacenter use. These devices convert electrical signals into optical signals, which are then transported from server to server through fiber-optic cables, where the light is converted back into electrical signals. At present, InnoLight specializes in 40Gbps transceivers, but has since ventured into 100Gbps transceivers, which it aims to bolster with this investment.
“InnoLight has experienced dramatic growth during the last three years, nearly doubling revenue every year. We are now a leader in 40Gbps optical transceivers and a first mover in 100Gbps solutions. With the Series C investment, we will continue to strengthen our technology leadership and expand productive capacity to support the rapid growth of the cloud computing industry,” says InnoLight CEO Dr. Sheng Liu in a statement.
“InnoLight’s technology is uniquely suited for next generation data center environments,” says Gene Frantz, general partner at Google Capital. According to James Mi, managing director at Lightspeed China Partners, the chipmaker will gain “operational expertise and deep insight into core computer center technology,” with Google Capital’s involvement.
Founded in 2008 and headquartered in Suzhou, China, InnoLight has sales and R&D offices in mainland China, Taiwan and the US. The firm earlier raised its Series A and B funding rounds worth $20 million. The investors will hold about two-thirds stake in the company, with the remaining shares owned by management and staff.
Google Capital was launched in 2013, with focus on growth-stage startups, as compared to Google Ventures, which funds early-stage startups. This year, Google Capital raised $300 million in fresh capital for funding growth- to late-stage startups, and has backed ten companies to date. These include peer-to-peer loan service LendingClub, market intelligence firm SurveyMonkey, and educational software maker Renaissance Learning.
