Menlo Microsystems unveiled its Ideal Switch recently and it also raised $150 million to shake up the electronics industry.
It calls this the biggest innovation since the transistor, as it can power its functions with less than a milliwatt and switch at speeds in the billions of operations a second. The Irvine, California-based company raised the money to start domestic manufacturing, and it hopes its tech will save over $7 trillion by 2050.
The lead investors in the recent round included Vertical Venture Partners and Tony Fadell’s Future Shape, with participation from new investors Fidelity Management & Research Company, DBL Partners and Adage Capital Management. Existing investors also participated. All told, the company has raised $225 million.
Garcia said that there are a billion ceiling fans in the world. If you replaced existing fans with Ideal Switches, he said you could save enough energy to take 17 power plants offline.
To Garcia, the Ideal Switch is the electronic industry’s Holy Grail, as it is a device that delivers the benefits of a mechanical relay and a semiconductor switch, with no compromises. It is tiny, fast, reliable, withstands extreme temperatures, is ultra-low loss and can handle thousands of watts. And it can be built with conventional semiconductor equipment.
Fadell noted in a statement that electrical switches that distribute power are shipped on the order of 20 billion a year. Adroit Market Research said the global electrification market is experiencing tremendous growth, projected to reach $128 billion by 2028. The Ideal Switch is transforming the electrification of everything by increasing energy efficiency of the entire legacy electric infrastructure, upgrading 100-year-old relay technology with a microelectromechanical (MEMS) switch.
The company said it can eliminate 20% of global emissions and bringing $37 billion in electricity savings by 2050, a major contribution to the fight against climate change. The company is evaluating chip manufacturing locations in California, New York, Texas, and Florida.
An analyst’s view
In an email to VentureBeat, Vole Development analyst Ana Villamor said there is a big market for relays (or also called circuit breakers), which are being used as circuit protection in applications such as EV (very important for battery management system) or datacom (also linked to UPS systems and batteries).
“These applications will require many more relays in the next years due to ens system demand increase,” she said. “Moreover, with the increase of global energy demand, more battery energy storage systems will be installed over the world to support energy storage. This will also increase the demand of efficient relays. Notice that the reliability and safety of the applications linked to the circuit breakers is of extreme importance (and more specifically, all the applications linked to batteries).”
She noted relays are mostly mechanical devices. With electrification push to increase efficiency there is an opportunity for “electrical relays.”
“When going to electrical relays, one of the criteria is to have a fast-switching speed, and this can be achieved by using different approaches like using MEMS technology (like MenloMicro) or for instance to use SiC components,” Villamor said. “Most of manufacturers are today in R&D, but we see a high interest from different companies to understand this market.”
She said that, theoretically, Menlo’s technology is indeed interesting as it decreases the size of the component (very important in EV applications, but also interesting for other applications), and it saves power, which is also in line with the efficiency increase of the systems.
“Today, both SiC and MEMS solutions as relay are still expensive compared to standard relays, but high volumes should considerably decrease the cost of those,” Villamor said. “Silicon relays would be slower in switching than these new options, and when a circuit is linked to a battery, it is key to have a fast response to be able to disconnect the battery from the circuit.”
Origins at GE
The tech was originally invented in a research lab at General Electric in Schenectady, New York about 18 years ago. The idea was to reinvent the circuit breaker, which was patented 140 years ago by Thomas Edison, and it has not changed much since then.
“And as you look at the physics, making things smaller, putting more small elements together versus larger elements to carry large amounts of power, there are some huge efficiency gains in that,” Garcia said. “And then of course, you can make things faster. And so all of that was really about the efficiency of power distribution.”
The researchers chose a particular technology that was being developed back then by a number of companies called MEMS, or micro electromechanical systems. It turned out MEMS could be scalable due to their small size. But the challenge was reliability.
“One of the questions I always get is, ‘Why didn’t anybody else do this before?’ Well, they didn’t do it before, but they tried to do it before but were not able to be successful,” Garcia said. “So one of the keys were was drastically reducing the power requirements for it. By doing so, you can drastically increase the efficiency of conducting electricity.”
The problem was that the MEMS devices used materials that were already useful in semiconductor factories. GE did research for 12 years and spent $40 million figuring out why the devices were failing with a variety of materials. GE took engineers who did the metallurgy for fins on aircraft engines, coupled them with the device physicists, and asked them to solve the problem.
They came up with an alloy that solves the reliability issues. The result was a reliable switch that has substantially enhanced and improved electrical properties. The founders of Menlo Microsystems asked GE to spin the technology out as a startup around 2016. The company raised its first round to prove it could manufacture the devices in a plant in Schenectady. They raised a second round to further qualify production and in 2021, the company started generating revenue. It hit just under $10 million in the first year.
Ramping up production
With the new round, the company plans to sale up its volume manufacturing and set up a factory in the U.S. for the sake of supply chain efficiency. The first products are coming soon.
The three primary markets are a wireless communications infrastructure, aerospace and defense, and power distribution, which is the largest market where most of the revenue is coming from today.
The Idea Switch transmits power at two or three times better than an electromechanical devices or even solid-state devices today for wireless, and it uses substantially less power in a power distribution, Garcia said.
As to why it got overlooked and took so long to develop, Garcia said the whole world has been focused on renewables and new energy sources. This turned out to be a good way to reinvent electronics.
“What broke the log jam here was the invention of this alloy. And that’s what gives us both the reliability as well as the electrical efficiency that we get from this,” Garcia said. “We can build it in a semiconductor process with the regular semiconductor toolset.
The company has about 50 people and it could grow by another 50%. Most of the staff is in engineering. Garcia said that 60% of energy in electronic devices is lost through inefficiency.
“As you start employing this into into distribution systems, it will make an impact instantly,” Garcia said. “We will probably start on the high ends of the market as we scale up. So industrial automation, eventually working through microgrids charging, charging infrastructure, and then even building management where you start being able to control every single circuit in a building.”
He added, “This is taking that that whole concept of digitally controlled energy management one step further, but in doing it with a far more efficient device.”
Garcia said the feedback since the announcement has been overwhelming. He noted there were more than 130 design commitments from various customers, from aerospace to power delivery. Menlo Microsystems had to focus on the basics of material science to get gains in power efficiency.
As for making the devices in the U.S., Garcia noted some geopolitical reasons of controlling a supply chain. On top of that, semiconductor manufacturing isn’t labor-intensive anymore. So the labor rates and economics doesn’t play into the decisions in a big way. COVID-19 also made it clear that controlling the supply chain is essential, he said.
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