You cannot get a nicer compliment as an entrepreneur: the Dutch government invests 20 million euros in your company, to prevent foreign investors from stealing it.
That happened to Smart Photonics, a young Eindhoven tech company that builds photonic chips. These are semiconductors that produce and process laser light on an extremely small scale.
It is expected that in a few years such chips will be indispensable in superfast data connections that can send terabits per second, over tens of kilometers. They will be used in impact-resistant lidar sensors for self-driving cars, or in smartphones that allow you to monitor air quality and take yourself a medical test.
On the foundations of Philips
Smart Photonics arose on the foundations of Philips’ technology, explains Luc Augustin (42). He is technical director and one of the persons who founded Smart Photonics in 2012. He shows the former Philips Natlab, where he has now set up his laboratory and a small production facility.
The indestructible linoleum in the hallway dates from the Philips era, just like the machine that drapes a wafer-thin layer of semiconductor material over chips: an heirloom that still serves well.
“Here, Philips laid the foundation for laser technology that connects telecommunications companies worldwide through fiber optics,” explains Augustin.
Smart Photonics goes a step further: Augustin managed to reduce the laser technology and combine all the separate parts on one handy chip, the Photonic Integrated Circuit or PIC.
What can you do with a laser on a chip? #nrc got a peek in the kitchen at Smart Photonics, a chip giant in the making that arises on the foundations of Philips’ optical technology. https://t.co/YDPdtFGrrU pic.twitter.com/V9dMVYd4Us
— marc hijink ?nrc (@marchijinkNRC) June 30, 2020
That reduction in scale is impressive. Where previously loose parts of a few centimeters were needed, a single chip of four by four millimeters is now sufficient. The semiconductors are not constructed from conventional silicon, but from another semiconductor material, indium phosphide. This allows you to generate, modulate and analyze light.
Also read: Radiant silicon as an alternative to hot electronics
Smart Photonics supplies building blocks with which other manufacturers design applications. The Eindhoven company becomes one foundry – a specialized production facility. The potential is to develop, in the wake of chip giants such as ASML and NXP, a high-tech industry in the Netherlands. The burgeoning photonics market is expected to generate at least 25 companies with a combined turnover of 1 billion euros and 4,000 jobs by 2026.
Smart Photonics is said to be the hub of this new chip industry. To achieve this, the company wants to grow from 500 to 5,000 wafers per year within two years (a wafer is a disc on which several hundred chips are produced). These are modest numbers if you compare it to conventional chip production, but enough to develop new applications and provide the first data center customers with PICs. “The demand is great,” says CEO Johan Feenstra.
Production is further automated – especially chemical treatments. Smart Photonics now has 70 employees and hopes to have half more in a year.
A ‘party from Asia’ was interested in the Eindhoven high-tech company
The company will receive an investment of 35 million euros, through a consortium of, among others, the Brabant Development Agency (BOM), Stichting PhotonDelta and KPN Ventures. The Ministry of Economic Affairs and Climate will provide a loan of EUR 20 million to BOM.
Smart Photonics started looking for capital in 2019. “Risk investors do not like to put money in a factory,” says Joachim de Sterke of PhotonDelta. “There is no clear exit but long-term dividend. But in the US or China, they do keep an eye on Brabant’s hardware development. ”
Also read: Extra layer of protection for the internet in the Netherlands
Smart Photonics does not mean which company or investor showed interest, except that it is a party from Asia. Any Chinese interest would explain the alertness of Economic Affairs. Usually the government assists when a lot of employment is at stake.
This time preserving knowledge and technology is paramount, to prevent damage to the Dutch economy, wrote State Secretary Mona Keijzer (CDA) in a letter to the House of Representatives. Keijzer refers to the call of the European Commission to be alert and to act against ‘undesirable market developments, such as the prevention of strategic dependencies’. That warning mainly concerned Chinese takeover attempts.
A version of this article also appeared in the NRC Handelsblad from 1 July 2020
A version of this article also appeared in nrc.next from July 1, 2020