The company's operations have been cut to a "minimal" level, according to a report from The Oregonian. Several employees have been let go and the company could be running out of money, according to the report. That story can be read here.

Teseda sells the WorkBench software, which is designed for real-time DFT debug and validation. It also makes the Teseda V520, an engineering test platform designed specifically for DFT validation and debug.

Last year, Teseda closed a new investment round. That round featured the addition of strategic investor KT Venture Group LLC, the investment partner of KLA-Tencor Corp. Existing investors PacRim Venture Partners and SmartForest Ventures also participated in that round.

It's been a tough period for the DFM and DFT startups. EDA company Mentor Graphics Corp. recently agreed to acquire struggling LogicVision Inc., a provider of built-in self test technology, in a stock deal valued at $13 million.