Another of Ottawa's startups in the cutthroat market for optical long haul equipment is falling on hard times ? Innovance Networks.
CEO Peter Allen confirmed with the Ottawa Business Journal Wednesday that the company has temporarily laid off two thirds of its staff, bringing its workforce in Ottawa and New Jersey down to about 50.
The move comes less than a month after Ceyba, another local startup competing in the market, shut down entirely despite a rich history of venture capital funding and products in the hands of customers.
Last month, Innovance announced a successful field trial of its key product ? the AgileCore - with a major telecom services provider.
The AgileCore is touted as the world's first automated, tunable, agile photonic network.
"The good news is we had a successful field trial," Allen said.
Now the trick will be to use that positive news and capitalize on what Allen dubbed "short term opportunities."
Allen didn't go into specifics, but emphasized that nailing down these potential contracts will be vital to the company's future. He said investors are eager to see Innovance sign up more customers and generate revenues.
"Investors will always look at forward market dynamics," he said.
Allen said if that new business materializes, the company will be able to recall the laid off staff.
In 2000, Innnovance secured $145 million in venture capital through two financing rounds. Those deals were followed by another $88 million in February 2002.
Before this week's layoffs, Innovance had already whittled its workforce down to reduce how quickly it burns through that VC warchest.
At the end of 2001 Innovance employed about 360 staff. A year ago the company cuts its staff to about 215. Additional cuts have come over the past year, reducing the workforce to about 150 before this week's layoffs.
Innovance's challenges will likely come as little surprise to the local tech sector considering last month's demise of peer Ceyba.
The company, which began as Solinet Systems in May 2000, was also developing optical components for long-haul networks.
Ceyba still had cash, but needed to land another round of financing to bring it to the breakeven point. The telling blow came when the venture capital firm that was supposed to take the lead role in that new financing round bailed out.
At the time, Benoit Fleury, Ceyba's VP of product management and marketing, commented that most investors "don't want to touch long-haul with a 10-foot pole."
Ceyba made headlines two years ago with one of the region's largest ever venture capital wins, $144 million in May 2001.
CEO Peter Allen confirmed with the Ottawa Business Journal Wednesday that the company has temporarily laid off two thirds of its staff, bringing its workforce in Ottawa and New Jersey down to about 50.
The move comes less than a month after Ceyba, another local startup competing in the market, shut down entirely despite a rich history of venture capital funding and products in the hands of customers.
Last month, Innovance announced a successful field trial of its key product ? the AgileCore - with a major telecom services provider.
The AgileCore is touted as the world's first automated, tunable, agile photonic network.
"The good news is we had a successful field trial," Allen said.
Now the trick will be to use that positive news and capitalize on what Allen dubbed "short term opportunities."
Allen didn't go into specifics, but emphasized that nailing down these potential contracts will be vital to the company's future. He said investors are eager to see Innovance sign up more customers and generate revenues.
"Investors will always look at forward market dynamics," he said.
Allen said if that new business materializes, the company will be able to recall the laid off staff.
In 2000, Innnovance secured $145 million in venture capital through two financing rounds. Those deals were followed by another $88 million in February 2002.
Before this week's layoffs, Innovance had already whittled its workforce down to reduce how quickly it burns through that VC warchest.
At the end of 2001 Innovance employed about 360 staff. A year ago the company cuts its staff to about 215. Additional cuts have come over the past year, reducing the workforce to about 150 before this week's layoffs.
Innovance's challenges will likely come as little surprise to the local tech sector considering last month's demise of peer Ceyba.
The company, which began as Solinet Systems in May 2000, was also developing optical components for long-haul networks.
Ceyba still had cash, but needed to land another round of financing to bring it to the breakeven point. The telling blow came when the venture capital firm that was supposed to take the lead role in that new financing round bailed out.
At the time, Benoit Fleury, Ceyba's VP of product management and marketing, commented that most investors "don't want to touch long-haul with a 10-foot pole."
Ceyba made headlines two years ago with one of the region's largest ever venture capital wins, $144 million in May 2001.
