Chelsio Communications Raises $25 Million Series C Funding

Chelsio Communications, Inc., the established leader in 10-Gigabit Ethernet server adapters and protocol acceleration technology, today announced it has completed its third round of private venture funding, raising $25 million from leading financial institutions and venture capital firms. The third round was led by INVESCO Private Capital and includes new investor Hotung Capital Management. Existing venture partners Sequoia Capital, New Enterprise Associates, Global Catalyst Partners, Pacesetter Capital Group, Horizon Ventures and Abacus Capital are all participating in the new round. The new round is one of the largest in the networking and storage industries in 2004, signifying Chelsio's leadership position in the fast growing 10-gigabit Ethernet market. This latest round of funding raises the total investment in Chelsio to $55 million. With a steep revenue ramp of over 300% quarter-to-quarter growth since introducing the industry's first 10Gb Ethernet adapters with protocol offload capability in early 2004, Chelsio expects this investment will take the company to profitability by 2006. "The global $10 billion Ethernet market is going through major changes to accommodate the higher speed requirements of today's computing and storage networks. INVESCO Private Capital is excited to be part of the Chelsio team leading the migration to 10Gbps Ethernet and driving the convergence of networking, storage and clustering interconnects," said Esfandiar Lohrasbpour of INVESCO Private Capital. "We are pleased to add INVESCO Private Capital to our roster of preeminent venture partners, and their commitment allows us to continue to accelerate our technology development and expand our market opportunities. Chelsio is now enabled to continue to be a reliable and long-term supplier to our enterprise customers," said Kianoosh Naghshineh, president and CEO of Chelsio. Chelsio's flagship product is the T110 10GbE Protocol Engine, a 10- gigabit-per-second Ethernet adapter that offloads the CPU-intensive network protocol stack, returning precious CPU cycles to the application to deliver superior performance. The T110 can sustain line-rate performance using standard 1500-byte Ethernet frames on the wire with a single processor system and for a single connection with plenty of CPU cycles available for application processing on the server.