Subscribe and receive the latest news from the industry.
Join 62,000+ members. Yes it's completely free.
Metropolitan Ethernet equipment provider and recent Top Ten inductee Luminous scores a hefty round
June 19, 2001
In one of the largest rounds of funding for an optical startup this year, Luminous Networks Inc. has scored $80 million from a slew of investors. The healthy round, backed by more than a score of institutional and private investors led by Pyramid Technology Ventures, brings the company's total to $148 million.
Cable equipment maker Scientific-Atlanta Inc. (NYSE:SFA) also kicked in an unspecified amount as a strategic investor, following up on its $10 million investment last year (see Scientific-Atlanta Invests $10M in Luminous).
CEO Alex Naqvi says the company will use the money to continue its foray into the metro optical Ethernet market.
Luminous is among the first startups to ship carrier-class optical Ethernet gear for metro networks, and it recently made Light Reading's list of Top Ten Private Companies. Its equipment, comprising a 1-Gbit/s Ethernet switch for metro networks, with 2.5-Gbit/s and DWDM interfaces on the way this quarter, comes with a pre-standard version of Resilient Packet Ring (RPR) technology. RPR aims to bring Sonet-like redundancy to metro networks and is being honed for standardization by the Institute of Electrical and Electronics Engineers Inc. (IEEE).
Analysts say the size of the funding bodes well for the possibility that the startup may be able to realize its rumored deal with Qwest Communications International Corp. (NYSE: Q).
"A round of this size tells me they must have at least one very big deal," says a Wall Street analyst. News of a possible contract surfaced at the recent Supercomm 2001 tradeshow, but so far, nothing's been confirmed (see Luminous Close to Qwest Deal).
Naqvi refuses to be led. "We are engaged with all the carriers across the board," he says. "It's important for us to do that in order for the company to succeed."
The only customer Luminous owns up to is China Netcom for a massive national rollout (see China Gets Luminous). "We have some pretty decent customers already signed up, but we can't say any more than that," Naqvi says.
Nonetheless, Luminous has been singularly aggressive for months in establishing a presence with carrier prospects. Early on it arranged alliances with billing vendor Portal Software Inc. (Nasdaq: PRSF) (see Luminous Teams With Portal Software) and this year followed up with a partnership with softswitch supplier Sonus Networks Inc. (Nasdaq: SONS) (see Luminous, Sonus Team on VOIP). And it's enlisted the help of an integrator called Photonic Bridges as part of its foray into China.
With all this good news, it's tough to find a downside, other than the obvious one -- that all this backing puts Luminous under considerable pressure to live up to expectations.
Naqvi says his company's in the hot spot. "Despite the slowdown, metro is stil a very hot market. Carriers need to bridge their core network bandwidth to end users via metro services... We have the confidence of our investors and customers."
- Mary Jander, Senior Editor, Light Reading
You May Also Like
Rethinking AIOPs — It's All About the DataMar 12, 2024
SCTE® LiveLearning for Professionals Webinar™ Series: Fiddling with Fixed WirelessMar 21, 2024
SCTE® LiveLearning for Professionals Webinar™ Series: Cable and 5G: The Odd Couple?Apr 18, 2024
SCTE® LiveLearning for Professionals Webinar™ Series: Delivering the DAA DifferenceMay 16, 2024