Stealthy startup lures top fibre talent

Ex-JDS Uniphase chief joins board of Innovance Networks

Rod MacIvor, The Ottawa Citizen / Kevin Kalkhoven is investing in a startup that has quietly lured talent from the likes of Lucent and Nortel Networks.

Kevin Kalkhoven, the former chief executive officer of JDS Uniphase Corp., is investing in a fibre-optic startup that has quietly hired 35 employees in Ottawa.

Mr. Kalkhoven will also serve on the board of Innovance Networks, a company led by former senior Nortel Networks and Lucent Technologies employees.

While several Ottawa-area fibre-optic startups have raised more than Innovance's $18-million U.S. initial stake, few can match the profile of Mr. Kalkhoven or the credentials of key executives.

Along with current JDS chief executive Jozef Straus, Mr. Kalkhoven led the mergers and acquisitions that made JDS the world's biggest component company.

Mr. Kalkhoven said yesterday that Innovance is his first investment since setting up KPL with Dan Pettit, a JDS Uniphase executive, and Jack Levine, general counsel with Montgomery Securities in California.

"I've known (Innovance chief executive) Peter Allen for many years, and I am excited by his plans," Mr. Kalkhoven said.

He added that KPL's principals will invest their own money in fibre-optic projects with long-term prospects for change. "We are not interested in simply flipping investments."

Mr. Kalkhoven sold $100 million U.S. in JDS stock in August, about 10 per cent of his holdings. He said the Innovance products are not aimed at hurting either JDS or Nortel.

Mr. Kalkhoven, who resigned as chief executive in May after medical warnings to slow down, said his blood pressure has stabilized. "I feel great."

Other investors include Azure Capital, Pacific Capital Ventures and Archery Ventures.

Mr. Allen said Innovance is still in "stealth mode" about products it hopes to develop for international and regional carriers.

The new company will also have operations in Piscataway, New Jersey, where it now has 25 employees. It plans to grow to about 300 employees in a year.

Mr. Allen has 20 years' experience with in optical and broadband technologies, most recently as vice-president of business development of Nortel's optoelectronics organization.

Chief operating officer James Frodsham was vice-president of product management in Nortel's optical networking business.

From Lucent, Innovance has recruited chief financial officer Wayne Edmunds and Dr. Lucas Hsu, vice-president, technology.

Chief technology officer Dr. Alan Solheim and senior vice-president of product development David Nicholson worked on the Nortel team that developed the 10-gigabit optical system that allowed Nortel to grab market leadership from Lucent in the past year.

Other Innovance executives include Kenneth Friedman, formerly an investment banker with Credit Suisse First Boston's technology group, and Todd Kimmel from Wasserstein Perella where he worked as telecom analyst and investment banker.