In the latest example that cleantech startups really need the big corporations in their corner, power conversion startup Transphorm says it has raised funds from, and created a partnership with, a group of some of the largest electronics companies in Japan. The news is also another indicator that innovations created by cleantech startups in California, and funded by the Valley’s venture capitalists, are finding a growing amount of opportunities outside of the U.S.
Transphorm says it’s raised a round of $35 million (series E) led by the Innovation Network Corporation of Japan (INCJ) — a partnership between the Japanese government and two-dozen Japanese companies like Sharp and Toshiba — as well as power electronics giant Nihon Inter Electronics Company (NIEC). Existing investors including Kleiner Perkins, Google Ventures, Foundation Capital, and Lux Capital also participated in the round.
Five-year-old Transphorm makes energy-efficient power conversion devices out of the semiconductor material gallium nitride, instead of the more commonly used silicon. Power conversion devices are used in any device that uses electricity, like electronics, HVAC systems, servers, data centers, electric car chargers and solar panels.
Transphorm says its energy-efficient power conversion devices can eliminate up to 90 percent of electric conversion losses. The company has been making strategic products in its early days, like power diodes made of gallium nitride. Transphorm is also working with solar inverter company Enphase Energy (also backed by Kleiner) to develop a solar power conversion device using financial support from the Department of Energy’s ARPA-E program.
Transphorm didn’t invent gallium nitride as a semiconductor; other companies have been tinkering with the material for years. But most companies that use gallium nitride are working on low-voltage conversion, while Transphorm is looking to crack high-voltage conversion. Transphorm’s products will likely be more expensive than comparable silicon ones in the short term.
Transphorm has now raised $104 million. The news today also includes a business partnership with Nihon Inter Electronics to help Transphorm move into commercial high-volume manufacturing. Check out our video interview with Transphorm CEO Umesh Mishra from Green:Net 2011.