Maybe you don’t think of them that much, semiconductors. But, without them, civilization as we know it would stop. Many of the devices that make our modern life possible would stop working, including the energy system. If they ceased to exist, lights would go out, airplanes would fall from the sky and phones would stop working. No more Netflix.–Semiconductors are the reason you can stream from the beach, says Dr. Jonas Sundqvist, who has worked with semiconductors all his career, among other things as the head of Lund Nano Lab.

During the pandemic, the world ran short of semiconductors, due to many factors such as disruption in supply chains. Since then, semiconductors have been in the spotlight. In Sweden, it has become a national priority. Lund Nano Lab has been extremely successful in semiconductor technology for decades. Semiconductors are now one of Lund Faculty of Engineering’s key priority areas.

To make the intricate and miniature structures that semiconductors consist of you need advanced technology and expertise.

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An Unexpected, Accidental Discovery

AlixLabs, headed by Dr. Jonas Sundqvist, grew out of a scientific ‘accident’ that happened when he was the manager of Lund Nano Lab.

–It all started with an unlikely discovery we made in the cleanroom, says Jonas. We had a thesis project with a student from Bangladesh. The idea was to test a few new things.

–We had been assigned a mission by the professors at Nano Lab, says Jonas. We were to try to influence the size of semiconductor nanowires and make them thinner. They had gotten stuck at a certain size, and we couldn’t progress.

Taiwan is the world’s largest semiconductor manufacturer. In Sweden, the Lund Nano Lab is a leading national laboratory and is globally recognized in the semiconductor field. It is built around nanotechnology, specifically focusing on growing and expanding advanced nanowires made of semiconductor material, a leading area at Lund’s Nano Lab, engaging in significant research projects with leading semiconductor companies worldwide, such as IBM.

Now, the entire semiconductor industry wanted thinner wires to make smaller semiconductors. And Jonas’ team had to fix it.

The reason the world wants smaller semiconductors all the time is to fit more of them into hardware like phones and computers.

–By reducing the size of semiconductors, you can add more transistors and memory components to phones, laptops, internet servers, and other electronic devices. Every year, companies like Apple aim to release new versions of their products. Part of that involves making everything smaller each year.

Today phones are costly and keep getting more expensive since they are so advanced:

–They contain about 25 different data chips, Jonas explains. To pack in that many features, the latest technology is used. Today, a phone can have 3-4 cameras. For each of them, there is an advanced chip. Then there is the phone’s processor, which has become essentially as powerful as a laptop. Then it is the memory… and so on.

In the past few years, however, the mobile phone market has slowed down.

–People are not keen on spending 10,000 SEK and more on a new phone anymore, says Jonas.

Pushing Nano Tech Boundaries

–Our mission was to try to reduce the size of the nanowires, says Jonas. Imagine an extremely thin wire that you try to make even thinner.

The goal was to go below a nanometer, one-millionth of a meter.

–It was a real attempt to push the limits of nanotechnology. As the nanoscale was reaching its limits, the next scale was Angstrom*. (One nanometer is ten Angstrom (a tenth of a nanometer)).

So, the task was to make something already tiny even tinier.

All the experiments take place in the cleanroom, an advanced laboratory with a high level of cleanliness for manufacturing semiconductors. It has a controlled atmosphere that maintains a constant temperature. There are virtually no particles present:

–In this facility, some filters remove all particles, Jonas explains. The filtration is so effective that it can filter out coronavirus. This is why it is also practical to stay there during a pandemic…

Action in the Clean Room

–As planned, we had already figured out how to achieve the task, says Jonas. As researchers, a bit knowledgeable, we had a clear picture of what we wanted to achieve.

But then something unexpected happened.

The thesis student had spent time with the microscope, examining semiconductors.

–Suddenly, we received an email from him with very mysterious-looking images, says Jonas. It turned out that he, instead of making these wires smaller, had managed to split the wires in half. From one wire, he could make two incredibly tiny—much smaller than the original ones—wires.

The team was stunned.

–Since I had been working on semiconductor processes for more than twenty years to develop smaller and smaller components, I realized this was interesting, says Jonas. If we could do this in a controlled manner on a large scale, we could help the industry with new manufacturing processes that would make semiconductors way less expensive than they are today.

–Our PhD student succeeded with something we hadn’t.

Patenting Instead of Publishing the Discovery

The team understood that they were onto something big:

–When you make a scientific discovery in the lab, the normal procedure is to publish an article. But at this moment, we realized that we must patent the method of splitting semiconductors first, instead of publishing it, as we normally would.

The discovery was about how, the process of, splitting nanowires.

Once the team had obtained patent protection, they began to publish. But just a little.

–Quickly, we received significant interest from the industry, says Jonas. This led to grants from LU Innovation and Almi Invest, among others, to establish a company. With that, we decided to stop publishing and keep it a secret.

During the pandemic, in 2019, AlixLabs was founded.

The startup joined the incubator program at Ideon and drew back to the cleanroom, where they continued to develop the technique of splitting nanowires, a technology that will revolutionize the way semiconductors are manufactured.

Towards More Semiconductors, Faster and Cheaper

–With our new multiplication technology, and manufacturing method, we can significantly reduce the cost of producing more advanced circuits, says Jonas.

The business idea is to offer industries a more efficient and less costly way of manufacturing semiconductors.

–There is a secondary effect as well, says Jonas. The new method allows us to replace several steps and hence shorten the whole procedure. Instead of requiring between four and ten process steps, there is just one step.

This makes the investment for new factories lower.

–There are also environmental benefits. If you need only one machine instead of five to ten, you’ll consume much less power and emit fewer greenhouse gases.

This is, says Jonas, a key aspect now that semiconductor manufacturing is becoming more sustainable, as we are now building semiconductor factories in Europe and the USA.

Growing, Getting New Labs, and Handling Finances

Since AlixLabs started its operations from a small office at Ideon, the team has gained access to much-needed labs in the old Max Lab.

With the help of capital from investors, AlixLabs has hired experts to develop the technology.

–LU Holding is one of the major shareholders, says Jonas, and entered early in our first financing round with capital together with some of the founders and board members. Almi Invest was also one of the large early investors.

Initially, AlixLabs had planned to try to raise three million in their first round. –We succeeded in securing nine million SEK.

AlixLabs worked on their valuation by looking at other companies, to achieve a fair valuation – neither over- nor undervalued.

–LU Holding has played a crucial role in the work, says Jonas. Also, the coaching we’ve received – and are still receiving – from Ideon business coaches has been priceless.

Pitching – a Key to Success

The (elevator) pitch training that Jonas and his team have gotten from Ideon’s pitch coaches, has made a huge difference, Jonas says:

–I am convinced that it was thanks to our pitch that we managed to secure nine million instead of three in our first round, he says. Four of us have undergone pitch training. Our pitches are now excellent.

Startup activities revolve around pitching, online as well as in person:

–We have pitched in Sweden (Lund, Malmö, Stockholm), Finland, and Germany, says Jonas, and have greatly benefited from everyone being able to do the pitch.

The process of preparing the pitch was key:

–Perhaps the most valuable aspect was building up the pitch, learning how to do it, and then testing and receiving feedback in iterations, he says. It has allowed us to refine it. Pitching has truly been one of the most valuable things we take away from Ideon, he says. We are all scientists and have no experience in building companies.

Pitching new technology to giant companies worldwide is not something the team was prepared for.

–We were complete amateurs in the beginning, and we didn’t realize it. Building a good pitch is quite an art. And now we’ve got it.

Jonas decided that they would all learn pitches of different lengths as advised by the coaches.*

–We know how to deliver anything from delivering a one-minute pitch to a ten-minute pitch and everything in between (3, 6 minutes, etc.), he says.

Pitching for Funds

Valuation and dealing with investors have been exciting and at times, nerve-racking:

–We have had to say no to investors a couple of times, says Jonas, who underlines caution. Some investors want to participate for the wrong reasons. Take over completely or undervalue us. In those situations, we’ve been careful to think thoroughly. The main arguments have been that we don’t want to sell ourselves too cheap or too early.

It’s tough but necessary to say no.

–These are typical strategic decisions where our board has been a great help. Board members have been through similar situations. Having them on our side gives us confidence when making these decisions.

The composition of the board, he says, has been fantastic. Board meetings are often work meetings and the hands-on springboarding from the board members is invaluable.

Next Steps

AlixLabs has a clear plan laid out.

–We have been following the same plan for a long time now, Jonas says.

Jonas has always been cautious and meticulous about keeping a watchful eye on the finances.

–Last summer, we secured 40 million SEK, says Jonas. We expect it to last until midsummer 2025. We have maintained strict budget control. It has been a success factor to bring in a CFO early on to avoid burning all the money immediately, which is easily done. The CFO has experience going public, which feels secure when the time comes for that.

As for the product and the technology, they still require further development.

–We are carrying out studies in three phases – alpha, beta, and gamma, he says.  We’re currently in the alpha. It will run until 2025 and is fully funded. After that, we will need to raise funds for the beta phase. Alfa, which will cost 40 million SEK, involves testing various systems, components, and processes to build a manufacturing machine.

The beta phase is expected to be four times more expensive than the alfa:

–We aim to raise approximately 150 million, Jonas says. The goal of that phase is to prepare for selling a beta product, a pilot manufacturing machine. The beta phase depends on the success of the alpha.

The board helps the team be business-oriented:

–We need to learn to think commercially. It’s not enough to succeed in the lab; we must bring the product to market, commercialize it, and expand it, Jonas says. Once we overcome the physical and chemical challenges, it will increasingly be about resources in the future. We will focus on securing strong agreements with potential customers and ensuring that we avoid rookie mistakes.

Lund – A Center for Semiconductor Expertise

For AlixLabs, the semiconductor environment in Lund is perfect, a cutting-edge hub in semiconductor technology:

–We are in the process of moving to our lab and will continue to use university laboratories with infrastructure, research, and expertise for a long time, says Jonas.

To attract the right talent, Lund is also perfect.

–Completing a master’s degree in physics, nanotechnology, or electronics at LTH gives you a top-notch education, says Jonas. We are exactly where we should be.

https://www.alixlabs.com/

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