Perhaps someone more skilled than me in such matters as this can explain how the VCs allowed this to happen. Do the math: someone is going to get disappointed, either the VCs or the staff, considering the offer is not even $5M more than the funding according to my math.
Good point. I had forgotten that that was the total. In view of this, an interesting transaction. Perhaps SiliconBlue simply believed they had reached the limits of what they could accomplish as a small, independent startup.
SB had two fundamental issues, 1) being a startup, and 2) socket life. Lattice solved #1 but in doing so inherited the socket life issue.
SB's niche FPGA business survives mainly on getting designed in (ie., socket wins) to high-volume products such as cell phones. Because cell phones have a short life cycle there's frequent opportunity for a device to get designed out. SB's FPGAs are typically targeted for a 'design out' because the functionality they provide usually gets pulled into a custom chip. In other words, SB FPGAs are a good temporary solution to time-to-market.
Once their investers started to understand the nature of the beast I suppose Lattice started looking like an extension to writing on the wall, and good exit strategy for execs with stock options.
This looks like a good deal for Lattice. Other than the product, SB has a lot of great FPGA veterans on staff.
I agree with the comment that the math doesn't appear to work out for the VCs, but I do not think we know the full story here.