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Theo Lee Ray Kao Paul Butterworth Andy Hayler Bulent Celebi
Rajeev Madhavan Larry Bock Kurt Petersen Oleg Suitin Jennie Mather
The micromachine man
AT A GLANCE
COMPANY NAME Cepheid CEO Kurt Petersen
LOCATION Sunnyvale, CA PHONE 408/541-4191
URL www.cepheid.com OWNERSHIP Nasdaq: CPHD
FOUNDED 1996 EMPLOYEES 170.0
PRODUCT Test systems for DNA analysis PARTNER Environmental Technologies Group, Infectio Diagnostic, Northrop Grumman
COMPETITORS Bio-Rad Laboratories, F.Hoffmann-LaRoche Revenuelast 12 months (Headwaters) $10.4M
Valuation (Headwaters) PROFITABLE? no
The Herring Take Growth in the latest quarter was good, though revenue numbers are still small, and growth outside the U.S. has been elusive. But prospects are good for a U.S. Postal Service deal that will use Cepheid's technology to protect against biological attacks.
 

Throughout his career, Kurt Petersen has refused to do research for research's sake. In fact, he has spent the last 27 years of his life taking technologies and turning them into commercial successes. "I really enjoy being on the cutting edge of things, but I don't enjoy it just for the sake of doing science or technology," he says.

Considered by some to be the father of microelectromechanical systems, or MEMS, Mr. Petersen wrote the industry's seminal paper and did early important work in the field. MEMS are tiny mechanical machines that are manufactured using the same technology that's used to make computer chips. Mr. Petersen was first introduced to the idea when he interviewed at Xerox after completing his Ph.D. in electrical engineering at the Massachusetts Institute of Technology in 1975. At Xerox, researchers were developing a gas chromatograph, a sophisticated device used to identify molecules in soil or water. The device was made of silicon, a material that had previously only been used in electronics. "I was mesmerized by this," he says. "Here they were using crystal silicon--this powerful electronic material--for a totally mechanical application."

But he took a job at IBM instead and worked there from 1975 to 1982; at IBM he focused on MEMS--then called micromachines. While wandering around the campus in San Jose, California, he noticed a lab that had black stains on the floors. It turned out that the group was developing a new ink-jet printing technology that used nozzles made of silicon. He wondered how many other groups were also using silicon to make mechanical devices. His interest evolved into a paper called "Silicon as a Mechanical Material," which is now a must-read for those involved in MEMS work. "I've had people recently tell me that that's still probably the most referenced paper in the field," says Mr. Petersen.

In 1982, with the MEMS experience at IBM under his belt, Mr. Petersen left to start his first company, Transensory Devices, where he continued to perform fundamental MEMS research. But after three years of trying unsuccessfully to turn MEMS into a commercial product, he moved on to create NovaSensor. At NovaSensor he perfected three technologies now employed universally within the MEMS industry.

The first, electromechanical etch-stop technology, is a process that uses electrical current to precisely control the construction of silicon components. The second, fusion bonding, enhances the naturally reactive nature of silicon, and the last, deep reactive ion etching, is a process for building deep tunnels within silicon. Together, these three technologies enabled the manufacture of a new breed of electronic pressure sensors and accelerometers-devices that today are used to measure pressure in car engines and inflate car airbags.

Just seven months after it was founded, NovaSensor built the smallest pressure sensors in the world, and its first product incorporated these three technologies into a device that monitors blood pressure using a catheter. Now part of automotive and aerospace giant TRW, NovaSensor continues to manufacture a broad range of MEMS-based sensors that are used in a variety of industries, including automotive, consumer, and industrial markets.

Ten years after founding NovaSensor, Mr. Petersen was ready to move on. He cofounded Cepheid, a leader in fast polymerase chain reaction (PCR) technology, which is a process used to make copies of DNA. His knowledge of MEMS helped him further miniaturize Cepheid's products and better design the way they handle and test fluids. The key to the company's success is the "fast" part of its PCR devices. Its DNA amplification and testing takes as little as 30 minutes, instead of hours or even days, and can be applied to areas as diverse as food testing, clinical diagnostics, drug discovery, and biodefense. "I never thought I'd be an expert in anthrax," says Mr. Petersen, noting that his company is working with the U.S. government to develop better defenses against biological warfare.

Though his entrepreneurial past suggests something newer and more exciting may be on the horizon, Mr. Petersen remains fully committed to his work at Cepheid. "There are a lot of people that invest something and then quickly move onto something else. But me, I really like to follow through until it's successful."

Sources From:RED HERRING 2002


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