Reports of Exalt's death 'greatly exaggerated,' CEO says

Exalt Communications may be long gone, but its successor, Exalt Wireless, is in for the long haul.

Amir Zoufonoun CEO Exalt Wireless

Zoufonoun (Source: Exalt)

So says the company's CEO, who's still bullish on the company's long-term prospects. Exalt Communications shut down in September after it ran out of financing from its previous venture capital investors.

The company now known as Exalt Wireless announced Oct. 14 that it had completed a successful management buyout of the assets of Exalt Communications from its previous investors. This week, CEO Amir Zoufonoun followed that up with a letter saying that "reports of our death have been greatly exaggerated," and spelling out how the new company is well positioned to shape the future of the industry.

The new Exalt includes a company, with about 50 employees, that will continue to serve its more than 2,000 customers in 70 countries with the product line that transferred from the old company. In an interview with FierceWirelessTech, Zoufonoun said he sees pockets of potential for the company's products all around the world, along with traditional wireless Internet service providers (WISPs), and newer companies that historically have not been in wireless but they're eyeing wireless broadband services and 5G.

Exalt's Ex-Series and Air-Series platforms cover frequencies in popular licensed, area-licensed and license-exempt bands from 2 GHz to 42 GHz. The company says it has been the fastest company in the industry to develop new microwave backhaul products, and the pace has continued as Exalt has delivered new products such as the ExtendAir G2, eMIMO and ExpandAir.

As for the management buyout, Zoufonoun said the company's venture capital investors were patient for many years, but when it came time to exit, there was no one else to take their place. The management buyout came after an Assignment for the Benefit of Creditors (ABC) procedure had started, reports Light Reading.

When the company was founded in 2004, it was self-funded for the first year. The company raised multiple rounds after that, but times got tough, Zoufonoun said. Competitors like Huawei came in with aggressive pricing strategies in microwave products and that meant margins were suppressed. "Things were unfavorable from an investment point of view and we had a decision to make," he said. The company decided to continue to invest, creating new platforms with better margins, and that worked for a while.

When management had an opportunity to make its own offer for a buyout, there was a period of uncertainty before the bank gave its OK. That was a difficult time, he said. When the bank did make a decision, "it was a big moment in the sense that now we have clarity, from that point of view."

The company is continuing to have conversations with the same vendors it worked with in the past in order to bring them new business; he declined to name the vendors due to non-disclosure agreements. Terms of the buyout were not disclosed.

"We waited a long time and we've been very, very patient," he said. "Finally we see signs of some of these nascent markets really starting to take off. We want to use the Exalt Wireless as a platform and to go out there and execute on a long-term strategy."

He also said "copper is dead" and it's going to take a long time before fiber is everywhere. But with all the demands being made on data services, there's reason for optimism. Streaming video services in particular are driving bandwidth demands "through the roof," he said.

The company has a long history in license-exempt product, but that is limited due to spectrum and regulatory constraints, he said, adding that he believes there will be more shifting to higher bands from lower bands.

The company has been watching the 60 GHz and above segment "like a hawk" for years, and some vendors fell victim to the timing of that market. Exalt could have entered the market in the past five years, but "we avoided it and I'm glad we did," he said. "There wasn't enough of a market." Going forward, however, opportunities may improve.

For more:
- see this Light Reading article

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