Ember, Rising to Profitability, Wants to Network the Smart Grid—and Home Security Systems

12/1/10Follow @gthuang

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$30-35 million this year, as compared with $13 million in 2009. Ember currently has 63 employees, and has raised some $89 million (including $8 million last year) from venture capitalists and strategic partners. Its investors have included Polaris Venture Partners, GrandBanks Capital, RRE Ventures, Vulcan Capital, DFJ ePlanet Ventures, New Atlantic Ventures, WestLB Mellon Asset Management, STMicroelectronics, Hitachi Corporation, and MIT. Its strategic partners include Chevron Technology Ventures and Stata Venture Partners.

The company faces plenty of competition from the likes of Texas Instruments, Atmel, Freescale Semiconductor, and NXP. But these firms tend to come at problems from a semiconductor perspective, rather than from a networking perspective, as Ember does, LeFort says. And Ember’s networking technology is increasingly being used in smart-metering projects in places like California, Texas, and Michigan, which bodes well for the company’s business.

What about business in Massachusetts? The state is “really doing interesting things in smart energy, but less so in smart grid and infrastructure,” LeFort says. Although Massachusetts is fairly progressive in terms of its state energy policy, he says, it is “not one of the leaders” in smart-energy infrastructure.

Ember does have another major sector it’s working in besides energy—and that is home security, monitoring, and automation. It’s still early, but it’s not too much of a stretch to imagine the same networking technology that’s in smart meters (used by utility companies) being put into light switches and motion detectors, and perhaps being used by cable companies and telecommunications firms to compete with security companies like ADT Security Services.

Lastly, I asked LeFort whether he feels pressure to sell Ember if and when it becomes solidly profitable. “We’re not looking to be acquired,” he says. “We should manage our business every day as if we are going to IPO and be the next Intel. If something else happens along the way that makes sense, then so be it.”

Gregory T. Huang is Xconomy's Deputy Editor, National IT Editor, and the Editor of Xconomy Boston. You can e-mail him at gthuang@xconomy.com or call him at 617-252-7323. Follow @gthuang

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