Ittiam Systems gets second round of funding

Bank of America to invest $6.5 million

Ittiam Systems, the Bangalore-based technology product company focussing on digital signal processing (DSP) systems, has just concluded its second round of funding.

After establishing its business model in the last four years, the company has received $6.5 million in its Series B funding from Banc of America Equity Partners-Asia (BAEP-Asia), which is the private equity investment arm of Bank of America.

Ittiam had raised its first round of funding of $5 million in 2001 from Global Technology Ventures (GTV).

Bank of America is one of the world's largest financial institutions. Nearly 85 per cent of its relationships is with Global Fortune 500 companies. Its current portfolio, including commitments, is about $10.3 billion. The India group primarily focuses on providing development capital to companies in high growth industries.

An enthused Srini Rajam, who is the chief executive officer and chairman of Ittiam Systems, said, "Ittiam has successfully completed its first mission of proving its business model. We have shown that the revenue streams which include both licence and royalty could be well applied to our IPs in the field of DSP. The investment from Bank of America has come at a time when the company is all set to enter the next phase of growth."

Rajam added that these funds will be crucial to the company's intention to go public by 2008. According to him, the company will invest $1-2 million next year. However, it is yet to decide if the investment will be made in media processing or communication markets, to be able to address the convergence space between the segments.

The demand for Ittiam's IP is the best proof that it is all set to enter the volume game next year. The company's IP for portable media player, IP Video phone, wireless LAN and digital video has impressed many an OEM client across the world. These include the likes of Sony and Texas Instruments among others. (Rajam was managing director of Texas Instruments India before he left to lead Ittiam.)

Some of these interested OEMs have even begun production. In fact, the portable media player is proving to be the favourite gift for the Thanksgiving celebrations in the US.

Ittiam has over 130 DSP experts and the number is expected to grow to 200 in 2005. In the last 18-24 months, the company has secured over 25 patents. It also has over 50 customers across Asia, US and Europe.