Light Reading
Sources confirm that Novafora, a video chip startup headed up by the founders of Terayon, has run out of money and ceased operations

Novafora Burns Out

Jeff Baumgartner
LR Cable News Analysis
Jeff Baumgartner
8/7/2009
50%
50%

Novafora Inc. , a stealthy video chip firm helmed by the founders of Terayon Communication Systems, has closed, Light Reading has learned. Sources say Novafora has ceased operations less than eight months after the company closed a deal to acquire Transmeta Corp. Back on July 30, PEHub, a Thomson Reuters site, reported that all 40 employees had been let go and that the company was selling its Transmeta assets. (See Novafora Snaps Up Transmeta.) The last time Novafora did anything in the public eye occurred on May 19, when CEO Zaki Rakib, rang the opening bell for the New York Stock Exchange as a representative of the Israel Venture Association (IVA). Novafora (formerly known as Sipharos) was founded in 2004, with Zaki Rakib coming on board with brother Shlomo as CTO as Novafora secured its first round of significant funding in 2007.

Sources familiar with the situation say the company simply burned through its coffers and was unable to convince investors to help get it off the ropes. Novafora, which had about 60 employees before acquiring Transmeta and ran some ops out of Israel, previously disclosed that two venture capital partners -- Gemini Israel Funds and Vertex Venture Capital -- had invested about $25 million in the startup. Downhill after Transmeta deal
The situation appeared momentarily bright late last year when Novafora announced it had offered to acquire Transmeta in a stock and cash deal valued at $255.6 million. At the time, Zaki Rakib said Novafora intended to incorporate Transmeta's "LongRun2" power management technologies into a new line of video-processing chipsets. Novafora had plans underway to launch its first product in the first half of 2009, promising a "better mousetrap for video processing" for a broad range of fixed and mobile devices. They managed to seal the deal in February despite facing the specter of a class action lawsuit alleging that Transmeta and its massive patent portfolio was being grossly undervalued. The suit noted that Transmeta had about $255 million in cash and cash equivalents as of Sept. 20, 2008, so the terms of the Novafora offer valued Transmeta's "operations and intellectual property at zero." (See Novafora/Transmeta Faces Scrutiny .) Or close to it. For Transmeta's part, it placed an enterprise value (market capitalization, minus cash, plus debt) of $11.6 million on the deal. An analyst at Algorithm Capital was then quick to point out that Transmeta's technology portfolio cost more than $400 million to develop over a period of about 10 years. So, what's going to happen to the remaining assets? Calls to Novafora (or what's left of it) have not been returned, but sources speculate that the company will attempt to sell off its intellectual property, which was bolstered significantly through the Transmeta acquisition. The closing of Novafora marks the latest failed attempt by the Rakib brothers to make hay with advanced silicon. At Terayon in 2001, they spun off a Docsis chipset division called Imedia Semiconductor, which briefly took a run at a market dominated by Texas Instruments Inc. (NYSE: TXN) and Broadcom Corp. (Nasdaq: BRCM). Terayon, however, made its own Docsis cable modems and cable modem termination systems (CMTSs), making it next to impossible for the chip division to win OEM deals with vendors that, in essence, competed with Imedia's parent company. Terayon eventually folded Imedia Semiconductor and started to buy and integrate chips from the legacy suppliers.

The Rakib brothers resigned from Terayon in 2004, about three years before Motorola Inc. (NYSE: MOT) stepped in to buy the company for $140 million. (See Motorola Seals Up Terayon .)

— Jeff Baumgartner, Site Editor, Cable Digital News

(0)  | 
Comment  | 
Print  | 
Newest First  |  Oldest First  |  Threaded View
Flash Poll
Light Reedy
Numbers Are In: LR's 2014 Salary Survey

7|24|14   |   1:25   |   (1) comment


Our fourth annual Salary Survey paints a picture of who's hiring, firing, earning, and yearning for a change in the telecom industry.
LRTV Custom TV
Driving the Network Transformation

7|23|14   |   4:29   |   (0) comments


Intel's Sandra Rivera discusses network transformation and how Intel technologies, programs, and standards body efforts have helped the industry migration to SDN and NFV.
LRTV Custom TV
Distributed NFV-Based Business Services by RAD

7|18|14   |   5:38   |   (0) comments


With the ETSI-approved Distributed NFV PoC running in the background, RAD's CEO, Dror Bin, talks about why D-NFV makes compelling sense for service providers, and about the dollars and cents RAD is putting behind D-NFV.
LRTV Custom TV
MRV Accelerating Packet Optical Convergence

7|15|14   |   6:06   |   (0) comments


Giving you network insight to make your network smarter.
LRTV Custom TV
NFV-Enabled Ethernet for Generating New Revenues

7|15|14   |   5:49   |   (0) comments


Cyan's Planet Orchestrate allows service providers and their end-customers to activate software-based capabilities such as firewalls and encryption on top of existing Ethernet services in just minutes.
LRTV Custom TV
Symkloud NVF-Ready Video Transcoding, Big Data

7|9|14   |   3:41   |   (0) comments


Kontron and ISV partner Vantrix demonstrate high-performance video transcoding and data analytic solutions on same 2U standard platform that is ready for SDN and NFV deployments made by mobile, cable and cloud operators.
LRTV Huawei Video Resource Center
The Evolving Role of Hybrid Video for Competitive Success

7|4|14   |   4:09   |   (0) comments


At Huawei's Global Analysts Summit in Shenzhen, China, Steven C. Hawley from TV Strategies speaks to us about the evolving role of hybrid video for competitive success.
LRTV Huawei Video Resource Center
How CSPs Leverage Big Data in the Digital Economy

7|4|14   |   4:48   |   (2) comments


Justin van der Lande from Analysys Mason shares with us his views on how telecom operators can leverage customer asset monetization with big data. His discusses the current status of big data applications and the challenges and opportunities for telecom operators in the digital economy era.
LRTV Huawei Video Resource Center
Accelerator for Digital Business Future Oriented BSS

7|4|14   |   3:08   |   (0) comments


Mobile and internet are becoming intertwined; IT and CT are integrating; and leading CSPs have begun to transform to information service and entertainment providers. How should the BSS system evolve to enable this transformation? Karl Whitelock, an analyst at Frost & Sullivan, shares his views.
LRTV Huawei Video Resource Center
Orange Tunisia Discusses Multi-Band Antenna With EasyRET Solution

7|4|14   |   2:45   |   (0) comments


As new site acquisition becomes more difficult, Orange Tunisia has requested multi-band antenna to support UMTS and LTE innovation. Some things considered include reducing the cost of antenna maintenance and having high reliability antenna and EasyRET solution.
LRTV Huawei Video Resource Center
How Telefonica Spain Considers Antenna Selection for LTE Network Deployment

7|4|14   |   2:19   |   (0) comments


Tony Conlan, Global CTO of RAN, Telefonica, shares his opinion on antennas in LTE network deployment: Tower space is the premier requirement on antennas; reliability is important to reduce OPEX; and EasyRET solution will be helpful for antenna maintenance.
LRTV Huawei Video Resource Center
dtac Thailand: Multi-band Antenna & Capacity Solution for a Better MBB Experience

7|3|14   |   3:45   |   (0) comments


With the development of LTE, tower space and load are limited for new antenna, but users' capacity requirements are growing fast. To provide a better MBB experience, Panya Vechbanyongratana from dtac Thailand shared his experiences and antenna requirements.
Upcoming Live Events!!
September 16, 2014, Santa Clara, CA
September 16, 2014, Santa Clara, CA
October 29, 2014, New York City
November 11, 2014, Atlanta, GA
December 9-10, 2014, Reykjavik, Iceland
June 9-10, 2015, Chicago, IL
Infographics
Allot's latest MobileTrends Charging Report shows that value-based pricing plans are up from 35% in 2011 to 85% in 2014.
Today's Cartoon
Hot Topics
Microsoft to Axe 12,500 Ex-Nokia Employees
Sarah Reedy, Senior Editor, 7/17/2014
The Municipal Menace?
Jason Meyers, Senior Editor, Utility Communications/IoT, 7/22/2014
GM: 10 Car Models on Road With AT&T's LTE
Dan Jones, Mobile Editor, 7/18/2014
Cisco Puts a Fog Over IoT
Sarah Reedy, Senior Editor, 7/23/2014
Apple Earnings: Strong iPhone Sales, iPad Sales Slump, $7.8B Profit
Mitch Wagner, West Coast Bureau Chief, Light Reading, 7/22/2014
Like Us on Facebook
Twitter Feed