The continuing evolution of semiconductors into smaller, more powerful forms was only made possible by the continued evolution of the equipment and materials used to make them.

Not excluded from that is photolithography, the process in which light exposed onto a layer of photoreactive chemicals creates a pattern that is later etched into the surface of a silicon wafer, producing pathways for the chip’s circuitry.

Yet while the scanners, optical equipment and lasers involved in the process have advanced to help make chips smaller, the materials serving as the foundation for those photoreactive chemicals — called “photoresists” — haven’t fundamentally changed in 25 years. Meanwhile, the industry is moving toward a next-generation process, called Extreme Ultraviolet Lithography, that is expected to usher in a new class of photoresists.

Corvallis startup Inpria is developing what it hopes becomes the standard of that new class, a photoresist that employs molecules one-fifth the size of the current standard, allowing for smaller and more precise patterns. It’s also been designed from the outset for EUV lithography.

So far, it’s raised more than $40 million, primarily from strategic investors, including a $23.5 million Series B round in July led by Samsung Ventures. Other investors include Intel Capital and Applied Ventures, the venture capital arm of Applied Materials Inc.

We spoke this week with Ann Carney Nelson, Inpria’s chief operating officer, to learn more about how the company is using its latest capital infusion. The interview has been edited for brevity and clarity. 

Is there an advantage to having strategic investors as opposed to venture capital? In the semiconductor industry, absolutely yes. There are two times I’ve seen in the past 10 or 15 years where the conventional venture capital industry has moved away from hardware and from really core hardware innovations in the semiconductor industry in general. There’s been a shift to more of a consumer-facing technology, things that don’t take as long to build. But what I’ve observed is a dramatic increase in both the activity of those strategic investors and their comfort and interest to move in at an earlier stage. Around 25 years ago it would have bene unlikely for Samsung and Intel to invest in an early stage company. Part of it is there’s since been so much consolidation in the industry; there aren’t as many semiconductor players. The stakes for some of these new solutions just go up and up and up. That early stage, traditional venture funding has shifted, so Intel and Samsung realized they needed to step up. Working with people in the semiconductor industry, they’re very methodical, but as the end user they could understand the need and the problem far earlier than any venture capital investor could. Personally, just watching the collaborative nature of these larger companies working together to support an innovative new product has been really impressive.

What is Inpria doing with this Series B funding? We are completing product development and we are building out our pilot production facility in Corvallis. We’re working with ATAMI — the Advanced Technology and Manufacturing Institute — at Oregon State University. We’re a spinout of OSU and we still have a very tight synergies with a lot of the centers there; there’s key analytical equipment we’ve worked with over the years. We wanted to stay in Corvallis and put this pilot production facility there. The opportunity came to locate at ATAMI. We’re expecting that facility to support our production and sales for the first several years.  

What does this do for the size of the company? We’re certainly going to increase our employment. We're in the 30s now and most our team has been on the product development side. We’re in the process of scaling up the production team. We grew quite a bit last year and we’ll be growing going forward.

What are the next steps to get to market? EUV lithography is in its infancy right now. The first generation of production-grade EUV scanners started shipping earlier this year, so we are intersecting the market as it begins. The great thing about that, as a new company, is you don’t have to go from a standstill to super large volume overnight. As we look at how that industry is going to ramp, the volumes ramp in such a way that we can support them out of our pilot facility for probably four years or so. Beyond that there are a number of considerations we’ll take into play to determine the best way to support them longer term. With Intel and its advanced R&D in Hillsboro, there’s a strong interest to keep as much of our activity in Oregon so we can be close to one of the world’s most advanced semiconductor manufacturers.

Will there be additional funding rounds? I would say there may be. It would depend on a number of different factors.

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Reposted from "Why a Corvallis startup drew attention — and investment — from Intel, Samsung," Portland Business Journal, January 12, 2018, from https://www.bizjournals.com/portland/news/2018/01/12/why-a-corvallis-startup-drew-attention-and.html?surround=etf, with permission of the Portland Business Journal. This material is copyrighted, and any further reproduction or distribution is prohibited.