Deal focus: RayVio targets China’s water problems

When Yitao Liao, a Chinese-born electronics engineering graduate from Boston University, pitched his idea to Robert Walker it was little more than a university research project. Walker was at the time a partner at Sierra Ventures and an expert in semiconductors and solid state lighting. He had looked at every start-up in the US trying to monetize ultraviolet LED technology, but came up against the same problems: low performance, poor reliability and high cost. But Liao had made a breakthrough.

"When I realized he had solved the fundamental problem at the materials level I got very intrigued by the company," Walker says. "I spent some time with Yitao and realized he was the right guy to build a company around. I then spent six months with him trying to understand the right end market and arrived at the same place we are at today - taking a semiconductor technology and applying it to consumers in their daily lives to allow them to improve their health and hygiene."

The transition from incandescent lighting to LED-based solutions in televisions and other devices came about because the introduction of indium gallium nitride (InGaN) meant that white LEDs could be produced at lower cost without compromising on quality or energy efficiency. For UV LEDs, the key component is aluminum gallium nitride (AIGaN). Liao's breakthrough - which was part of his PhD work - was to find a way of making AIGaN mimic the physics of InGaN when applied to disinfection.

"A dozen companies have been trying to do this for about 15 years but success has been limited to scientific instrumentation and other niche markets. Yitao developed a new approach that enables us to do high performance at low cost with a manufacturing platform that is scalable," Walker says. He was sufficiently impressed to leave Sierra and join Liao's nascent company, RayVio, as CEO. Liao is CTO.

RayVio received $4.6 million in Series A funding from DCM and Capricorn Investment Group in 2012, the year after it was founded. Those two investors returned in 2015 to provide a $9.3 million Series B round, alongside Applied Ventures, Augment Ventures, Tolero Ventures and New Ground Ventures. Now China-based VC firms IPV Capital and Tsing Capital - semiconductor and cleantech specialists, respectively - have led a $26 million investment that Walker describes as a follow-on to the Series B.

The company is already generating revenue, but these new backers will help take its technology into China, one of numerous emerging markets in which problems with contaminated drinking water mean there may be strong demand for cost-effective disinfection products. Hospitals are a target market for RayVio but so too are retail consumers: water bottles implanted with the technology, allowing people to disinfect on the go, or faucets with disinfection capabilities built into them are likely.

RayVio's technology doesn't affect the taste or odor of water like iodine tablets, it is less bulky and faster-acting than mercury bulbs, and is less energy intensive than boiling water. But the principal challenge is persuading people to change their habits. "We are really an evangelical company that is trying to foster a new technology," says Walker.

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• Topics
• Greater China
• Cleantech
• Early-stage
• Venture
• Technology
• Tsing Capital
• IPV Capital