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This ‘deep tech’ Aussie chipmaker just raised $170m

Tess Bennett
Tess BennettTechnology reporter

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Australia’s largest semiconductor maker Morse Micro has pocketed $30 million from a handful of superannuation funds to top up its giant $140 million Series B funding that was announced in September.

TelstraSuper, HESTA, Hostplus and NGS (managed by Blackbird Ventures) and UniSuper (managed by Uniseed) participated in the round, which will allow the chipmaker to accelerate its growth, with the goal of getting its chips into as many new devices as possible.

Co-founder and chief executive of Morse Micro, Michael de Nil. Edwina Pickles

Co-founder and chief executive Michael de Nil declined to disclose the company’s valuation following the $170 million round, but said the investment was significant in that it brought new institutional investors on board.

“We weren’t really looking for more money, but it’s fantastic to get [these investors]. Especially the superannuation funds, it’s money from the average working Australian and being able to bring them in is just fantastic,” Mr de Nil said.

Morse Micro has been working closely with its new lead investor Japanese chip giant MegaChips, which contributed $100 million of the Series B round two months ago.

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The original $140 million raise also included backing from Blackbird Ventures, Main Sequence Ventures, the government’s Clean Energy Finance Corporation, Skip Capital, Uniseed, SpringCapital Investment and Malcolm and Lucy Turnbull.

“There was some interest already from some of those institutional investors. We decided to just close that round and then further explore a top-up round,” Mr de Nil said.

“There is definitely a lot of value for us in getting those institutionals involved in Morse Micro.”

Mr de Nil said the new cash would help the company accelerate the manufacture and distribution of its energy efficient, long-range WiFi HaLow chips, by investing in its sales and customer support teams and recruiting more senior and graduate engineers.

The raise is one of the largest since the VC funding began to slow down in April.

Companies such as Cyara, Employment Hero, Scalapay, Zeller and Immutable were able to raise $100 million-plus rounds in the first three months of the year, but there have been few nine-figure VC raises since then.

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In June, US-based, Aussie-founded NFT (non-fungible token) marketplace Magic Eden banked $US130 million, and in October Airwallex banked $US100 million and Advanced Navigation raised $108 million this month.

“We’re very different from many other start-ups in Australia. We are a deep tech start-up and it takes quite a bit of money to build these amazing products,” Mr de Nil said.

“I feel privileged to be working with so many great investors, and then have them trust us and help us scale the business.”

Morse Micro is growing, taking over a third floor in its Surry Hills office to expand its R&D lab and hiring a further 50 people.

In January, the team will head to the Consumer Electronics Show (CES) in Las Vegas to demonstrate its chips, which reach 10 times the range of conventional Wi-Fi technology and last many years on a single battery.

Morse Micro has designed its chips to provide a robust and reliable connection over a long range, by trading off speed for distance.

They are typically used in smart home devices, such as surveillance cameras, motion sensors and lighting controls in homes, or industrial use, such as in smart door locks, vehicle gates, heating, ventilation, and air conditioning systems and supply chain asset tracking.

Tess Bennett is a technology reporter with The Australian Financial Review, based in the Brisbane newsroom. She was previously the work & careers reporter. Connect with Tess on Twitter. Email Tess at tess.bennett@afr.com

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