There are signs that Sequoia Capital partner Chris Rust is settling into a more permanent role as CEO of Mahi Networks Inc., a position he took with the "interim" title on November 15, 2001, after former Advanced Fibre Communications Inc. (AFC) (Nasdaq: AFCI) executive Gregory Peters resigned from the post. Sources close to the company say he's in there for the long run (see Peters Out at Mahi).

Rust is on the board of directors at Afara WebSystems, Nexsi Corp., and Santur Corp. in San Jose, as well as Turin Networks Inc. in Petaluma, Calif.

Light Reading has also gathered more information about what Mahi's been up to -- more specifically, on the product the company is calling the Mi7 Optical Transport Switch Router (OTSR). Those familiar with the company's plans say the Mi7 is a metro switch that combines the functions of DACS (commonly referred to as a "digital crossconnect"), Sonet ADM, Sonet switch, and Layer 2 switch, with scaleability to more than 500 Gbit/s. The product is designed to fit in the largest POPs carriers operate in each metro, where bandwidth is aggregated, switched, and put onto long-haul backbones (see A New Optical Taxonomy). The company has licensed routing software from Nortel Networks Corp. (NYSE/Toronto: NT), and it has bought 4-milliwatt tunable lasers from Agility Communications Inc.

The product is currently in trials with five carriers, Light Reading has learned. These include three CLECs, one RBOC, and one IXC. One source close to Mahi says the company has secured a deal worth between $20 million to $30 million to provide equipment to Qwest Communications International Inc. (NYSE: Q).

Mahi has been out trying to raise a third round of funding. In the spring of 2000, it closed its second round, worth $64.4 million, bringing its total funding to date to about $71 million. Sequoia, Benchmark Capital, Goldman Sachs & Co., London Pacific Group Ltd., Anschutz Investments, Williams Communications Group (NYSE: WCG), WorldCom Inc. (Nasdaq: WCOM), GE Equity, Comdisco Inc. (NYSE: CDO), Van Wagoner Capital, Berkeley International Capital, and Mitsui Corp. are Mahi's backers.

At last count, the company employed about 225 people. Last month Tom Giunta, Mahi's director of business development joined Ciena Corp. (Nasdaq: CIEN) as VP of engineering for its core switching division. Jim Nowack, who handled systems testing at Mahi, recently took a position in Ciena's metro switching division.

Mahi executives did not return calls seeking comment.

— Phil Harvey, Senior Editor, Light Reading
http://www.lightreading.com