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ThingMagic Receives $9.8 Million from Current Investors
RFID reader and module developer ThingMagic received $9.8 million in new venture capital, all from previous investors. The company said it will not seek additional investment and that this is only the second time it has taken venture capital. It also received $21 million in 2005-06.
Jul 15, 2008—This article was originally published by RFID Update.
July 15, 2008—ThingMagic received $9.5 million in funding from its investors, the Cambridge, Massachusetts company announced yesterday. The eight-year-old developer of passive UHF RFID readers, sensors and software will use the funds to continue its product development and to expand marketing to new industries and geographic regions. The company is not seeking additional funding, CEO Tom Grant told RFID Update.
Grant said the funding will mostly be used to pursue opportunities that resulted from ThingMagic's product introductions in the last year. Last October ThingMagic released new compact reader modules designed for use by other manufacturers to RFID-enable their products. In February the company announced a system jointly developed with Ford Motor Company and power tool maker DEWALT to automatically track tools and equipment loaded into select Ford vehicles (see Ford Builds RFID into Pickups and Vans to Track Cargo).
"That has resulted in us having a reader system that can be used to enhance anyone's fleet of vehicles," Grant said. "There is a lot of interest in our work with vehicles."
To help meet growing interest in its vehicle systems and OEM reader modules, ThingMagic plans to hire more field application engineers to work with customers and prospects, Grant said. He said demand for ThingMagic's products is growing in Europe and Asia and the company will continue to pursue partner relationships there, rather than opening offices.
The new funding will also be used to further product development. "Our product line got a pretty significant facelift last fourth quarter with the introduction of new RFID reader modules that are about the size of a credit card. We need to get them even smaller than that for integration into some other devices," Grant said.
The M5e-Compact reader module ThingMagic introduced last year is one of several of the company's products that uses the R1000 reader chip, which was originally developed by Intel and supplied to ThingMagic under an OEM agreement. Last week RFID tag and reader maker Impinj, which competes with ThingMagic in some segments of the market, acquired the R1000 product line from Intel (see Impinj Buys Intel's RFID Business, Cements Leadership). Grant said the deal won't require ThingMagic to change its product roadmap and that the new funding won't be used to develop alternative technology to replace the R1000 in its products.
"We've been aware of the R1000 situation for some time. We're comfortable with Impinj's acquisition of it, and we support their acquisition," Grant said.
The $9.8 million in funding ThingMagic announced this week all came from previous investors, including Tudor Partners, Exxel Group, Morningside Technology Ventures and .406 Ventures. ThingMagic was founded in 2000 and first accepted venture funding in 2005, when it received $21 million from the investors named above plus Cisco Systems and noted technology futurist Nicholas Negroponte, who knew of the company through their mutual work in developing EPC technology at the MIT Media Lab. (See Cisco Invests in ThingMagic and ThingMagic Gets $10 Million in VC for more on these earlier investments.)
Grant said the climate for raising this round of funds was very positive.
"It was pretty easy for us because we never left the house -- the funding came entirely from our existing investors," he said. "The nature of the RFID industry is such that it is a slow, steady build, which suits our investors."
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