Ottawa-based Diablo Technologies announced Tuesday it has secured $19 million in series-C funding that will be used to expand the company’s sales, support and research and development teams.
Mark Stibitz is chairman and CEO of Diablo Technologies
The funding is a significant shot in the arm for the memory solution provider that had been derailed by a long and bitter court battle with California-based Netlist.
The latest investment round is led by new partner Israel Cleantech Ventures, with participation from Battery Ventures of Massachusetts, BDC Capital, Ottawa’s Celtic House and Germany’s Hasso Plattner Ventures.
“This syndicate, they were fantastic in supporting the company through the legal process,” said new chairman and CEO Mark Stibitz, who replaces Riccardo Badalone. “When it got resolved and the company was allowed to go back in business by the judge, they were more than eager to re-fund it and try to get back the momentum that was lost.”
ICV became involved through its previous working relationship with Battery Ventures, Mr. Stibitz said.
“Battery suggested, ‘Hey, why don’t you talk to Diablo.’ In the process of that conversation, ICV not only became very interested in investing in the company, but asking if they could lead the round,” he said.
ICV partner Glen Schwaber, who will also join Diablo’s board, said his firm was thrilled to welcome the Ottawa company to its portfolio.
“Diablo’s flash-as ‘system memory’ solutions promise to deliver massive data centre performance improvement for enterprise and hyperscale customers alike,” he said in a statement, “allowing them to do more with less, reducing energy costs and operational overhead, while reliably growing their businesses.”
Mr. Schwaber also paid tribute to what he called Diablo’s “first-class management team,” a unit which still includes Mr. Badalone, who is now chief product officer.
Mr. Stibitz, who joined Diablo’s board in 2012 and has had previous stints with Anobit, Elliptic Technologies, PMC-Sierra, Agere Systems and Lucent/AT&T-Microelectronics, said the executive shuffle will create a “one-two punch to attack the market.
“I have a very strong general management background. Riccardo is the creative genius on the technology side,” he said.
The company will use part of the new funding to expand its operations, including its research and development team in Ottawa. The company’s headcount of 60 is expected to increase to 90 shortly, Mr. Stibitz said.
Ottawa-based Celtic House first invested in Diablo back in 2005, and this current round is an “ambitious play,” according to partner David Adderley.
“This whole idea of bringing flash into memory is very aligned with the needs of everything you’re reading about,” he said, including big data and analytics.
“We may be a little Ottawa company with 60 people here, but this is a global opportunity.”
Mr. Adderley said this is Celtic House’s fifth investment in Ottawa companies, adding he expects two or three more investments over the next 18 months.