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PhotonEx Axes Staff

Maynard, Massachusetts-based PhotonEx Corp. is the latest startup to fire dozens of workers in order to make its funding last longer. The maker of 40-Gbit/s long-haul optical transport systems said it had a "significant" staff reduction on Friday.

CEO Kristin Rauschenbach and CFO Pat Scannel were at pains to avoid saying how many jobs had been cut, usually an indicator that the number was high.

"This action was taken as a proactive move based on market conditions and what we understand that the burn rate position of the company should be to match what the customer uptake of our product offering is," said Rauschenbach, in response to a question about how many people PhotonEx fired.

"As you look at the market and understand what's happening from a macro economic standpoint, as well as from a telecommunications standpoint, we felt that given where we are, and where our customers and prospective customers are, that it was just prudent for us to be able to be a player and survive through 2003 and into 2004," said Scannel, in response to another question about how many employees lost jobs.

The situation for equipment and component startups targeting the service provider market is grim. Many smaller carriers have gone under. And the larger phone companies are still slowing down the rate at which they build out their networks with new equipment, pushing out new technology purchases several months.

Companies developing bold and innovative optical transport solutions -– such as Latus Lightworks Inc. -– have found it hardest to find funds and paying customers in this environment. Others, like OptiMight Communications Inc., have backed off their positioning as long-haul equipment makers in order to continue to appeal to investors (see Lights Dim at Latus and OptiMight Reaches for New Funding).

For PhotonEx -- whose products will be field tested by carriers in the first quarter of this year -- the earliest it will see significant revenues from customer deployments might be late 2002 or early 2003.

The company has raised $178 million in three funding rounds since its inception in September 1999, and it employed 190 people as of October 2001 (see PhotonEx Raises $90 Million and Photonex Has a 40-Gbit/s Idea).

— Phil Harvey, Senior Editor, Light Reading
http://www.lightreading.com
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edgecore 12/4/2012 | 11:06:27 PM
re: PhotonEx Axes Staff
Does this mean we should expect similar announcements from Innovance and Meriton in the not so distant future?

EC
edgecore 12/4/2012 | 11:06:26 PM
re: PhotonEx Axes Staff Good Point, I meant Ceyba...not Meriton!

EC
SS 12/4/2012 | 11:06:26 PM
re: PhotonEx Axes Staff And how about Ceyba Systems (formerly known as Solinet Systems)? I haven't heard any news regarding that company.

Thanks,
SS.
Route495 12/4/2012 | 11:06:25 PM
re: PhotonEx Axes Staff No idea, but investors like to keep employee count in startups with no revenue to be around the 100 mark.

--
>Any guesses to how many of the 190 are left?
zipple 12/4/2012 | 11:06:25 PM
re: PhotonEx Axes Staff Any guesses to how many of the 190 are left?
Any guesses as to how much of the money is left?
Wendigo 12/4/2012 | 11:06:22 PM
re: PhotonEx Axes Staff
Word is that 1/3 were let go, which implies about 125 left.
laserman 12/4/2012 | 11:05:54 PM
re: PhotonEx Axes Staff I heard that Qwest is not buying any gear from them in 2002. That's why they have to slow down a bit. Can any one confirm?

Laserman
fhe 12/4/2012 | 11:05:53 PM
re: PhotonEx Axes Staff Qwest is buying nothing from nobody in 2002...
realdeal 12/4/2012 | 11:05:52 PM
re: PhotonEx Axes Staff I hear the same thing but I think it's because the project at Qwest was cancelled so I don't think it's anything they did wrong.

zipple 12/4/2012 | 11:05:50 PM
re: PhotonEx Axes Staff "I hear the same thing but I think it's because the project at Qwest was cancelled so I don't think it's anything they did wrong."

Except, of course, understand the timing of their market and hiring accordingly. Then again, did anybody get it right last year?
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