Sondrel is a UK founded and headquartered fabless semiconductor business providing turnkey services in the design and delivery of complex, high end ‘application specific integrated circuits’ (“ASICs”) and ‘system on chips’ (“SoCs”) for leading global technology brands. Sondrel’s capabilities are provided to customers seeking competitive advantage by including customised ASIC/SoC devices enabling differentiation of their end products when addressing fast growth technology megatrends.
Sondrel has grown over a period of more than 20 years and delivers complex ASIC/SoC designs on a consultancy and/or project basis for a wide range of leading multi-national corporate customers. The high-end complex ASICs/SoCs designed and supplied by Sondrel to its customers and Sondrel’s previous designs have been included in well-known products such as Apple iPhone, Sony PlayStation, Meta’s Oculus Quest virtual reality headset, Samsung, Google and Sony smartphones, JVC prosumer camcorders and Tesla and Mercedes-Benz cars.
Originally, Sondrel provided customers with both its market leading ASIC/SoC designs, and also an engineering consulting service during the ‘new product introduction’ (“NPI”) prototyping, testing and production phases. However, in recent years Sondrel has successfully transitioned its business model such that customers also now contract directly with Sondrel to purchase production ASIC/SoC devices directly from Sondrel as a ‘one stop shop’, something which customers have previously been required to source themselves from a third party.
With OEMs and OEM suppliers increasingly focused on semiconductor supply chain resilience and efficiency, customers are able to contract Sondrel as a single counterparty in the design, supply chain management and production of ASIC/SoC devices. Sondrel’s customers are therefore able to differentiate their end products with Sondrel’s market leading design capabilities at the forefront of technology whilst also leveraging Sondrel’s expertise and relationships throughout the semiconductor industry. In doing so, Sondrel’s customers are able to remove the requirements for multiple counterparties in the ASIC/SoC supply chain and for supply chain management.
The Directors believe that Sondrel has a number of key strengths and advantages that are important to the success of the business:
- Sondrel is delivering designs at 5 nanometres and is now working on 3 nanometre process nodes. This level of engineering capability is limited to Sondrel and a small number of Asian competitors and positions Sondrel to benefit from megatrends driving the increasing use of ASICs globally and the production of products utilising increasingly complex design geometries.
- Sondrel provides leading edge ASIC/SoC designs to a global customer base iIn advanced end markets with significant structural growth drivers including high performance computing, automotive, artificial intelligence, VR/AR, video analytics, image processing mobile networking and data centres.
- Sondrel has a team of more than 130 expert engineers that are located across 5 design centres globally; the UK, USA, China, India and Morocco. This enables Sondrel to be one of only a handful of companies worldwide with the scale, capability and strength of industry relationships to deliver projects in leading technologies.
- Established relationships with semiconductor IP and electronic design automation (“EDA”) providers, materials and equipment companies and fabrication partners. Sondrel has a long-standing partnership with and capability approval from Arm; is one of only 22 global partners in TSMC’s Design Centre Alliance; and has comparable relationships with Samsung, being one of only three non-Asian Samsung Foundry SAFE™ design service partners globally, and Global Foundries.
- From concept to delivered ASICs/SoCs, Sondrel is able to act as a single counterparty to its customers as a provider of a full turnkey suite service in the design, prototyping, testing, packaging and production of ASICs and SoCs.
- Sondrel is able to provide customers with the ability to de-risk the design of ASICs/SoCs through the use of Sondrel’s “Architecting the Future” IP platforms.
- Sondrel has a clear organic growth strategy focused on increasing its engineering headcount and investing in IP to further enhance its competitive position, accelerating its growth in key geographies including the USA and Asia.
- Sondrel has a proven and experienced founder-led management team.
- Sondrel has delivered revenue growth from inception to 31 December 2021 at a CAGR of 20 per cent. As at 31 July 2022, the Group’s pipeline of revenue opportunities stood at more than £300 million4 (excluding potentially material related production/supply revenues) and the Directors have ambitions to grow the Group to £100 million of annual revenue in the medium term.
The Group has ambitions to grow revenues to over £100 million in the medium term.
Transition in business model
Sondrel has transitioned its business model to provide a full turnkey ASIC/SoC design and supply service for its customers that includes contracting for the testing and production of ASICs/SoCs in addition to the existing design and production consulting. Tturnkey design and supply contracts will allow the Group to address more opportunities in parallel than has historically been the case and therefore to scale revenues more rapidly.
Increase in engineering headcount
Sondrel plans to increase the number of engineers it employs from its current level of 134 to approximately 150 by the end of 2022 and to approximately 165 by the end of 2023. This will enable the Group to address more opportunities in its pipeline, further develop its Architecting the Future IP platforms and increase its efforts on R&D.
Increase opportunities in the USA
Sondrel has identified the USA as a key growth market and plans to increase investments in sales and marketing in region to accelerate sales of the Company’s services.