Pivotal Systems

Pivotal Systems Corp.

19.9% of portfolio as of 12/31/17

Pivotal Systems is a private company that provides monitoring and process control technologies for the semiconductor manufacturing industry.

The Quest for Efficiency

The semiconductor industry is decades old—manufacturers first began shipping integrated circuits more than 50 years ago. Today's hottest electronic devices still have semiconductors at their cores, and complexity of semiconductor integrated circuits (ICs) continues to increase with each new generation of products.

In the IC manufacturing business, wafer yield is a key productivity metric. A small imperfection can lead to significant equipment down time and entire batches being scrapped. Although impurities and other physical defects can occur at virtually every step of the semiconductor manufacturing process, one of the most critical steps is the etching process, when the circuit design is actually laid down on the silicon wafer.

Mass Flow Controllers

Despite revolutionary advances in the technology of integrated circuits themselves, some of the technologies being utilized to manufacture these chips are decades old. One example is the mass flow controller (MFC), which has seen very little innovation over the past 20 years.

MFCs are critical components in several types of semiconductor manufacturing equipment. The basic job of an MFC is to control the flow of a gas into the processing chamber of a manufacturing tool during the production process. Semiconductor manufacturing processes demand high precision in gas flow, and gas flow inaccuracy has been identified as one of the leading IC manufacturing issues.

Pivotal Systems' gas flow controller (GFC) is a new take on the old MFC. The GFC's revolutionary design enables continuous monitoring and calibrating, delivering unprecedented accuracy and reliability. Pivotal has a deep patent portfolio on flow control products and offers the only flow control technology that both monitors and controls—at industry-leading accuracy—during wafer processing.

Pivotal's technology offers tremendous cost savings for manufacturers, which lose critical time and resources interrupting the manufacturing process between batches in order to test the gas flow calibration. These disruptions and the resultant down time significantly affect productivity for these manufacturers. Additionally, gas flow anomalies can account for as much as 30% of a manufacturer's product being scrapped, which is why inaccuracies in gas flow have been identified as the number one wafer processing issue by leading semiconductor companies such as Samsung, Intel, and Toshiba.

The Pivotal Advantage

The primary advantage of Pivotal's technology is its ability to measure gas flow variability in situ (i.e., during the etching process, in real time). If the flow is determined to be out of spec, adjustments can be made immediately. The key is minimizing system downtime while simultaneously reducing inaccuracies. That Pivotal's product is a difference maker is shown by the fact that companies are willing to pay nearly twice as much for a Pivotal GFC as for its competitors' products. The potential market for Pivotal's product is substantial: The current controller market is approximately $1 billion, with the semiconductor industry representing roughly $400 million of that.

Customers include industry-leading equipment manufacturers and device manufacturers.

The executive staff at Pivotal each have 20+ years' experience in industry, at semiconductor equipment companies like LAM Research, Applied Materials, and KLA-Tencor. They know the business and understand firsthand what improvements are necessary to make a semiconductor manufacturing business competitive.

Firsthand Technology Value Fund has invested approximately $19 million in Pivotal Systems, and it represents roughly 20% of the Fund's portfolio as of December 31, 2017.

  • $1 Billion
  • Global gas flow controller market