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Portable power supply developer Lilliputian Systems Inc. announced Tuesday that Intel Corp. has become its newest investor and has agreed to manufacture chips for its products at a facility in Massachusetts.
The Wilmington-based company said the announcements represent a major step toward the product’s commercialization and add credibility to the plans.
Lilliputian said that Intel, the world’s largest semiconductor chip maker, will manufacture the chips at a facility in Hudson. Meanwhile, Intel’s investment arm, Intel Capital, has taken an undisclosed equity stake in Lilliputian, the company said.
Lilliputian Systems, founded in 2001, says it has developed a portable charging system that aims to revolutionize the way consumers use electronics, by providing on-the-go power.
The manufacturing and investment agreements with Intel came following discussions that had been ongoing since the spring, said Mouli Ramani, vice president of business development at Lilliputian.
“We’re elated that Intel has signed up to be our wafer manufacturing supplier,” Ramani said in an interview. “But it also means something a bit different for a company the size of Intel to agree with us to the point of investing its own dollars in us.”
Intel started retrofitting production equipment for Lilliputian two weeks ago at the Hudson plant, where Intel will have capacity to support “several hundred thousand chips” for Lilliputian in the first years of production, he said.
The chips will serve as the backbone of Lilliputian’s silicon power cell, which would be used to re-charge portable electronics that have USB charging capability. The fuel cell cartridges, which Lillipution expects to cost $1.99, will be used with the company’s USB Mobile Power System, expected to cost $99.
Lilliputian must now line up an integrator for assembly of the company’s product, along with one or more brand name partners to distribute the products, Ramani said.
Possible distribution partners might include battery companies, retailers and companies that produce portable electronics such as smart phones or MP3 players, he said. It will be up to the distributor to decide when to bring the product to market, Ramani said, declining to say whether this is likely to happen in 2011.
The product would likely be sold under the distributor’s name, though it would likely contain a small logo of the company, he said.
Being able to outsource the manufacturing to Intel is a unique opportunity, Ramani said. “Intel has not generally thought a lot about making chips for other (companies), but they’ve started to be a little more open to things like that recently,” he said. “We’re one of the first folks they’re doing this with.”
Ramani said it’s expected that the Hudson plant will be able to hire staff as a result, though he didn’t have any specifics.
Lilliputian currently has a headcount of about 50 in Wilmington and plans to hire staff in coming months, Ramani said. The company announced in April that it had received a $5 million low-cost loan from the Massachusetts Clean Energy Center and MassDevelopment, to help expand the company’s development work.
Lilliputian previously said it had raised more than $90 million in venture capital since its founding, from investors that include Atlas Ventures, Rockport Capital and Kleiner Perkins Caufield & Byers.
The Hudson facility contains 95,000 square feet of manufacturing space and is located on a 149-acre campus acquired by Intel in 1998, according to Intel’s website.
Along with the manufacturing plant, the campus also includes Intel’s Massachusetts Development Center, which provides research and development in the areas of hardware and software for cell phones and handheld computing devices; microprocessor building blocks for networking equipment; storage components; and microprocessor design and development, according to the website.
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