InfiniFast: Customers, but no market

Cellular technology is not the only field with an intermediate generation; InfiniBand has one, too. InfiniFast has not made a final decision on its name, but it already regrets that Israelis have not heard the news.

InfiniFast already has a name, but it is not yet official. It has a domain, but it only refers you to the parent companys site. It also has customers, butit is impossible to say that it has a market.

Eli Dahan and Ofer Yaaran met at the Haifa Technion, but their paths did not converge for many years. In 1997, Dahan founded Elik-Tronics, a Petah Tikva-based company that plans and designs electronic cards, and numbers Applied Materials (Nasdaq: AMAT), ECI Telecom (Nasdaq: ECIL), and Netro (Nasdaq: NTRO) among its customers. Yaaran worked at several high tech companies and founded OmniSend, a cellular consultant firm. Dahan and Yaaran heard about the wonders of InfiniBand a year ago and decided to enter the field. We have connections at Mellanox, Yaaran says. Connections with a company crowned as the leader of this emerging market are always good to have.

A few words about InfiniBand, for those who missed the last lesson. In the future (near or distant, depending on whether youre optimistic or pessimistic), well be able to transmit huge quantities of information and release the bottleneck created by the processor. Already existing developments on the InfiniBand infrastructure allow two computers to exchange traffic at a speed of 30 Gbps.

Eventually, every future server will be supplied with such a component near its processor. The component will serve two purposes. It will transmit information at high speed and remove the load from the processor itself, in cases where the data must be distributed quickly to customers and are not needed for further operations. If there are no security or personalization problems with the content, and it can flow freely, the InfiniBand components will handle the transmission.

Dahan: Its clear that the end-users, meaning those buying the servers, wont invest in InfiniBand servers in the near future. You dont adopt new technology and throw away servers with proven reliability that youve had for years so quickly. In the initial stage, theyll prefer to use InfiniBand-based network cards in order to get the bandwidth the cards provide. This situation could last as long as two or three years; only then will InfiniBand begin to make headway as a component on which the servers will be based, rather than as an addition to existing servers.

Playing piggyback on Mellanox

InfiniFast (the temporary name) is using the experience accumulated by its parent company to integrate various InfiniBand components into one network card. They already have a four port card, capable of transmitting at a speed of 10 Gbps.

Yaaran: One of our customers deals in data storage and needs a solution for converting between the IP TCP protocol used for transmitting data on the Internet, and protocols used by their data storage systems to transmit information within the system. The intermediate stage cards solve their problem, until the processor is hooked up directly to the Internet.

Elik-Tronics made the transition from just another company providing contracting services to a systems manufacturer in November 2000. In February 2001, they appeared at an Intel developers conference with a card in hand. Making the presentation as part of the Mellanox pavilion didnt bother them: Were playing piggyback on Mellanox, which supplies us with its chips, and staying close to them. Wherever they are, were there, too, says Dahan.

As of now, the company is financed from its founders capital. Yaaran: When the new entity was founded, we tried to raise money from Israeli funds. We looked around and even contacted the most prestigious funds, but we couldnt raise anything. We decided to use our own equity, and weve invested $500,000 in the company to date. Were assuming that its very difficult or impossible to raise money now, so were not investing resources in (fundraising). Its not as if weve completely ignored the possibility of getting external capital all sorts of people came and told us, Well write a business plan for you or Well help you raise money. We even wanted to go to the Chief Scientist, but the moment we understood it would take too much time because of the bureaucracy, we decided to give up the idea.

InfiniFast believes it will now be easier to attract the funds, and even gain the attention of strategic investors. Since the card was launched in February 2001, many bits have flowed down InfiniBand River. The capital situation may not have improved, but products featuring the companys components have already been presented to the market, and InfiniBands star is on the rise.

The company employs a staff of seven, and an eighth employee is used as a freelancer when necessary. Because of the financing problem, there are no significant marketing operations at the moment, which means that InfiniFast must work closely with its customers, and remind them thatthe start-up knows its product inside out. Dahan: We have an agreement with one customer, under which we do jobs for them, but we can keep the documentation with us and sell it again to other companies.

Nevertheless, operating outside of Israeli requires money, which the company is now trying to raise. The money will also be used to realize their other development dreams, which include repeaters and the other components of the InfiniBand food chain. Just a few million (dollars) would take us a long way forward, Dahan says. The connections they have nurtured with the manufacturers of InfiniBand software, like VIEO and Lane15, willbecome useful when the financing finally arrives. What is surprising them in the meantime is that, except for one company in the US, they have not discovered any direct competition.

Globes: Looking at you from the sidelines makes someone think, This is a nice company that does beautiful projects on demand, but its not a conventional start-up. Do you find that insulting?

Dahan: Whats that supposed to mean? Didnt 3Com produce a network card? And modems? Werent they based on the components of other companies? We produce a network card for InfiniBand. Maybe many people think that only a company that manufactures the silicon for itself can be called a start-up and be considered sexy. As far as we know at least, our card is the only one in the world that has US Federal Communications Commission (FCC) approval. Not only that; they even approved it for home use, not just for organization offices.

Maybe we didnt design the silicon, but not everyone can design a printed circuit board (PCB) today. After three generations of our products, we have already been through the birthpains of development in this field, and we feel we have an advantage in it. We already have tens of thousands of dollars in sales this year. I dont plan to forecast how much well sell next year it all depends on the reawakening of the market in general and the InfiniBand field in particular. Theres not enough Israeli activity in the field.

Business Card

Name: InfiniFast

Founded: 1997, repositioned at the end of 2000

Founders: Eli Dahan and Ofer Yaaran

Product: InfiniBand communications adaptors

Employees: Seven

Previous financing round: $500,000

Investors: Founders

Competition: None

web site:

Published by Israel's Business Arena on January 15, 2002

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