Boston’s Braemar Energy Ventures in March 2008, bringing the company’s total venture funding to nearly $140 million. If Luminus can earn enough revenue on near-term, smaller-scale applications of its chipsets, such as flashlights, projectors, spotlights, medical devices, and architectural lighting, it may be able to hang on long enough take a swing for Ward’s home run: the general illumination market, which accounts for about $40 billion in annual spending worldwide.
That’s a market where Luminus couldn’t play at all until recently, because it didn’t have a technology for making white LEDs until 2008. (For complicated reasons, it’s easier to build red, green, and blue LEDs than white ones.) How the company got from a few PowerPoint slides in Stata’s boardroom to the cusp of a revolution in lighting is a fascinating story—one where flexibility, learning, and the faith of investors is as important as technical ingenuity.
An LED is a semiconductor that releases light energy when a voltage is applied. Joannopolous and students in his lab proved back in the 1990s that it was possible to use a photonic lattice, a Lincoln-Log-like structure made from tiny slivers of silicon, to help more light escape from an LED, rather than being reflected back from the boundary between the semiconductor’s surface and the air.
Erchak, during his five years in Joannopolous’s lab, figured out how to reduce that concept to practice, and built a few prototypes. “By the end of that period, we knew how to deploy photonic lattices to improve the efficiency of LEDs better than anyone in the world,” Erchak told me in an interview last month. “What we didn’t know was, what is the application?”
With Stata’s investment in hand, Erchak moved into the Cambridge Innovation Center—the now-massive technology incubator that, at the time, occupied only one floor at One Broadway in Cambridge—and started pitching cell-phone manufacturers on the idea of using the company’s concept designs for high-efficiency LEDs in place of power-draining fluorescent bulbs to illuminate the backlit displays of cell phones. “They all said, ‘Great, but it’s going to take you two to three years to develop them, and if you’re talking about building millions of these things for a couple of cents apiece, you’re talking about a licensing play,'” Erchak recalls. “It was not a good play for a startup that wanted to grow into a large company.”
Erchak hired a consultant, Udi Meirav, to help him make sure he wasn’t missing anything. “He said, ‘Yes there is no business here.’…So at that point we came as close as you could possibly come to shutting down the company.”
But Meirav, like Erchak, was now hooked on the promise of photonic lattice technology. Erchak asked him to be CEO, keeping the CTO title for himself. And then, Erchak explains, came the company’s first critical turning point. “This guy from Stata Venture Partners, Greg Baletsa, called me and said, ‘Hey, I just talked to these guys from InFocus, the projector company, and they said they want to use large LEDs in projectors.”
The arrays of small LEDs that Oregon-based InFocus and other companies had been using in their LCD projectors—which, by then, were already standard equipment in corporate conference rooms—weren’t intense enough. What the manufacturers needed in their machines was a single, large, extremely bright LED. “We came to the conclusion that the type of LED they would need for this application would be 10 to 15 millimeters square—10 times as large as the largest LED at that time—and with 10 times as much light,” says Erchak. And by the way, it would have to
