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Custom RFID Tag Manufacturer Gets $2 Million

Last week RCD Technology announced series A funding in the amount of $2 million. The company is a manufacturer and designer of custom inlays. RFID Update spoke with CEO Jeff White about the funding and RCD Technology's strategy within the RFID market.
May 31, 2006This article was originally published by RFID Update.

May 31, 2006—Last week RCD Technology announced series A funding in the amount of $2 million from NextStage Capital, Zon Capital, and Ben Franklin Technology Partners. RFID Update spoke with CEO Jeff White about the funding and RCD Technology's strategy within the RFID market.

Essentially, the company is a manufacturer and designer of custom inlays. (Recall that inlays are the chip-antenna-substrate combination that is then wrapped in plastic, sheathing, or adhesive to make a finished, usable RFID tag.) As a "vertically integrated" provider, the company performs almost all steps of the inlay production process, which affords it unusual flexibility and customizability. RCD typically produces custom inlays for applications that have unique needs for which "off-the-shelf" inlays from the likes of Alien or Avery Dennison would not serve. Furthermore, the company employs a patented antenna fabrication process that it claims is a low-cost, high-performance alternative to processes employed by competing manufacturers.

Given the specialty-inlay niche that RCD serves, much of its business is for closed-loop, asset-tracking applications. "Where we're finding the most success right now is people that want unique form factors," said White. One client needed to track high-value ball bearings to which standard inlays could not be attached; RCD designed and manufactured a custom inlay that could. In another case, RCD worked to provide inlays that could be attached to medical stents. In yet another, the company designed inlays for wristbands that become deactivated if removed. According to White, 80% of the company's business is custom inlay work. RCD is "chip and frequency agnostic", meaning it will design inlays that use chips from any manufacturer (Impinj, STMicroelectronics, Philips, etc.) and any frequency (UHF, HF, etc.).

White said the company's strategy is to target a currently underserved segment of the RFID market that is exhibiting strong demand but is too specialty for the inlay "big guys" like Alien, Avery Dennison, Raflatac, Symbol, and Omron. Those providers are focused on selling very high volumes (many millions and eventually billions) of a few RFID tag inlay models. Typically, any order of less than five million is too low for them to consider, according to White. But there are many asset-tracking applications that don't require such volumes or that require special tag form factors. It is there that RCD expects to thrive.

The five-year old company is located in Bethlehem, Pennsylvania. Last week's funding was the company's first institutional round, which White said will go toward building up its manufacturing and sales capabilities.

Read the funding announcement
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