Disrupting the trillion-dollar electronics industry — Why we invested in CELUS
We are excited to have led the oversubscribed € 25 million Series A financing round of Munich-based CELUS alongside DI Capital and existing investors SpeedInvest, Plug&Play and a range of high-profile angel investors. The exceptional team around the founders Tobi, Alex and André are on a mission to establish a horizontally integrated platform for electronics engineers and suppliers — enabled by design automation.
Without a doubt, electronics power our world today. No matter if it’s a washing machine, smartphone, television, or factory equipment — electronic devices form an integral part of our everyday lives and will become even more indispensable in the future. At the core of this trillion-dollar industry are printed circuit boards (PCBs), the glue that adheres and connects electronic components such as resistors, capacitors or microchips in a controlled manner — all to ensure that electronics function in the desired way.
⚡️ The electronics industry is at a turning point: Enhanced resilience and flexibility to counter increasing pressure on global supply chains requires a modern tech stack
Yet, this well-established industry faces two major challenges:
🐌 1) Tedious electronics design process: Electronics engineers manually select every single component based on experience and page-long spec-sheets, wasting valuable time on a process with high automation potential. As a result of these inefficiencies and constrained engineering talent, today’s design output is limited, and far from meeting the demand.
🏓 2) Supply chain ping-pong: Once the design is finished, the electronics engineer gets in touch with their distributor of choice to order the selected components. The distributor, who mainly acts as the router and fulfillment intermediary, then reaches out to the respective component manufacturers to check for component availability. Considering COVID-related but also general supply chain bottlenecks, this step is where the ping-pong begins, meaning a back and forth among engineers, distributors, component manufacturers and electronic manufacturing services (EMS), as depicted in the figure below. If specific components or machine capacities are unavailable, the engineer needs to find alternatives and redo the design.
Despite these broadly known challenges and the resultant lack of flexibility and automation, the tech stack of electronics engineers has remained mostly unchanged over recent decades; the potential of digital platforms to integrate the fragmented electronics supply chain has not been exploited. Surprisingly, the disruptive progress that other engineering tech stacks, especially in software engineering, underwent has not found its way into electronics engineering.
🛠 Fixing the electronics supply chain from its roots: Establish a horizontally integrated platform for electronics engineers and suppliers — enabled by design automation
CELUS fixes this problem by establishing a platform that horizontally integrates the fragmented value chain based on design automation and a single source of truth about component and subsystem data. Today, the platform consists of two products: CELUS Orbit and CELUS Supernova, as depicted in the graphic below.
The source of truth is created in CELUS Orbit, a component library that integrates directly into the systems of downstream partners such as global electronics distribution giant AVNET or electronic component manufacturers such as Molex as well as other external data sources. The ultimate vision is to replace spec-sheets and digitize all available components in one library.
This library then serves as the foundation for CELUS Supernova, the interface to electronics engineers that enables automated PCB design based on basic requirements such as functionality, measurement or price constraints. Once entered by the engineer, an optimization algorithm picks the right components from the digitized spec-sheets in the library and fits them together in the best way possible, inspired by thousands of designs that the system has learned before.
End result: CELUS Supernova automatically creates the design files, including the bill of materials, the schematics and the layout. Although the resulting output could theoretically go straight into production, the ultimate authority remains with the electronics engineer who has the option to do final adjustments, leading to an overall automation rate of up to 90% already today.
🚀 Strengthening CELUS’ pole position with a €25m Series A
Despite the relevance of the problem, there is no dominant player with a comparable product offering in the electronics engineering tech stack yet. While incumbents predominantly focus on delivering point solutions for electronics engineers, there is no player who has horizontally integrated the electronics value chain. Only a few emerging players joined CELUS’ race towards an open electronics engineering platform, yet they are all in their early stages and follow different go-to-market approaches.
Our hypothesis: The first player to achieve sufficient marketplace liquidity on the supply-side with the downstream suppliers, and on the demand-side with the electronics engineers, can close the market and become the dominant platform provider.
We believe that CELUS is best positioned to win this race and solve the marketplace-related chicken-egg problem. Their automated design solution solves a major problem (inefficiency and an overly iterative design process) for the key decision-maker in the whole electronics value chain: the electronics engineer. Having started to onboard electronics engineers at a large scale, CELUS is now able to provide value to downstream players such as distributors and component manufacturers. In return, it brings them on the decision maker’s radar — ultimately becoming the router that connects all players in the fragmented value chain. WIN-WIN-WIN! The first successful milestone in this row is certainly the partnership with AVNET, one of the globally leading distributors.
At Earlybird, we’ve been following the CELUS team for several years and were deeply impressed by their ability to continuously expand their vision and execute their goals. Founded straight out of university, the CELUS team has proven themselves and attracted a group of high-profile industry experts such as Rolls-Royce’s former CEO Sir John Rose, Google’s VP of hardware development Paul Gojenola and NXP’s chairman and former CEO of British Telecom Sir Peter Bonfield in their advisory board.
It is an honor to be able to lead this round and join the team on its mission of disrupting one of the largest and most important global industries.
Team CELUS, welcome to the #EBVCgang. We’re excited about the journey ahead! 🚀🚀
By @MoritzBelling and @AndreRetterath
Are you a founder, industry expert, VC or researcher interested in the field of AI, developer tools or data tools? I’d be more than happy to learn about your work, so feel free to reach out via andre@earlybird.com.
