Mini hard-drive specialist lands $51 million
Start-up Cornice, a maker of tiny hard drives, gets a multimillion-dollar second round of funding, a sign of momentum for both tech investment and for hard drives in consumer devices.
Longmont-based Cornice said on Wednesday that it has received $51 million in a second round of venture financing, bringing the total to $81 million. The hefty investment is an indication that venture funding for technology is picking up and that hard drives are becoming more crucial to consumer electronics devices.
"With the additional financing and very high, sustained interest in the Cornice Storage Element from leading electronic device manufacturers, we are confident that the company has tapped into a market need that has been unmet for some time," Cornice CEO Kevin Magenis said in a statement.
The Cornice Storage Element is a 1-inch drive that holds two gigabytes of storage. It is designed to appeal to manufacturers of products such as video cameras, music players and Global Positioning System devices.
Several makers of hard drives are finding a storage role for their products in devices other than computers. Toshiba makes the hard drives that run the popular iPod music player from Apple Computer, for example, and a 1-inch drive from Hitachi is at the heart of Apple's new iPod Mini. Hitachi also manufactures larger drives for other music players, including a player from Dell. In addition, hard-disk drives are used in digital video recording (DVR) machines, which record television programs and pause live broadcasts.
Cornice's windfall may be a sign that venture capitalists are warming up to the technology industry again. The amount of VC investment in tech companies rose slightly from the third to the fourth quarter of 2003, according to a recent VentureOne report. For the entire year, however, investment money flowing into tech companies dropped for the third consecutive year, from $12.6 billion in 2002 to $9.3 billion in 2003, according to the report.
Previous investors CIBC Capital Partners, Nokia Venture Partners and VantagePoint Venture Partners contributed to Cornice's second round. BA Venture Partners and GIC Special Investments also made investments.