Let me say I find it insulting that as a shareholder I have to pay $25 to hear what the CEO has to say.

But I paid it and am sharing here. If I ever have the good fortune to meet you guys you can buy me a bourbon.

TWST: Let’s start with an introduction to POET Technologies, some background on the company’s origins and important milestones over the years.

Dr. Venkatesan: POET Technologies has been a Canadian-headquartered public company since 2007, so it has been around for a while. In its current rendition, we’re highly focused on integrated photonics, and that’s not historically been the case.

I joined the company in 2015, and I’ve been working to transform this company into a leading-edge provider of integrated photonic solutions. I think that the key important transition in the company happened in 2018, when we invented a brand-new concept of integration in the world of photonics. As a company, we’ve been really focused around implementation and commercialization of those concepts and ideas.

So, I think the transformation of the company into the world of optics really started after I joined. It took me a while to assess what was in the company at the time. I decided that we needed to take a different direction, and basically re-invented the company in 2018.

Since then, we’ve been pioneering the concept of optical integration using a proprietary technology we developed called the Optical Interposer. We spent about four years in development, and we’ve since been announcing customers and products.

I would say perhaps the most important development in the company’s history is really our foray into the artificial intelligence market. Earlier this year, we announced products in that space.

As you know, that space is obviously hot, and there are a lot of hardware challenges with regards to AI. We feel that we have, through the course of the past five years, developed a compelling technology solution to address the growing needs and demands in the AI hardware segment.

TWST: Explain your key technologies and products today a bit more for our readers. What are they, what do they do, and how do they differ from others that are available?

Dr. Venkatesan: Fundamentally, our primary product offerings are what we call optical transceivers, and the best way to explain what that is, is through an analogy with Wi-Fi. Everybody knows what Wi-Fi is, and we all have modems in our houses. These Wi-Fi modems are designed to convert electric signals coming in to radio frequency waves that are then transmitted to your house and then picked up by other devices. That particular modem is an electrical-to-RF conversion.

What an optical transceiver does is an optical analog of Wi-Fi, in that it takes electrical signals and converts them into light, as opposed to RF waves. The reason to do that is because light, by definition, is the fastest means of communication, and it’s inherently very low power in terms of its power consumption as it transits through a glass medium that it’s transmitted in.

For a lot of the high-speed data communications, where we’re trying to pump a lot of data from point A to point B, fiber optics has become the preferred mode of communication.

What POET does is make these optical transceiver products that enable this light-based communication to occur. We’re not the first to make optical transceivers. Optical transceivers have been around for a long time, I’d say about 30 years. But what we’re doing is transforming the way optical transceivers are manufactured.

The world of photonics hasn’t had significant innovations in manufacturing over its period of time, and what POET is trying to do is pioneer a concept that we call the semiconductorization of photonics. We want photonics manufacturing to look like semiconductor manufacturing, which everybody is familiar with.

What we have developed is this Optical Interposer platform that enables photonics manufacturing to mimic semiconductor manufacturing, thereby bringing economies of scale, lower cost, lower form factor, and more tightly packed components to that world of photonics.

It’s been about five years for us to do the development, but it’s now increasingly clear that these kinds of manufacturing transformations in photonics are going to be essential to meet the needs of the AI segment that is growing like crazy.

The speed demands are intense, and conventional manufacturing techniques don’t come close to meeting this requirement or demand. POET is one of very few companies that has developed a scalable manufacturing solution to address these growing needs.

TSWT: You mentioned the AI space. Can you tell us a bit more about what the ultimate applications or end-use markets are?

Dr. Venkatesan: If you segment out the AI market, I would broadly categorize it into three buckets.

There is, of course, software like OpenAI, ChatGPT, etc. There are a bunch of software applications that are driving AI-based applications, if you will.

Then there’s the hardware, and that is the focus of companies like Nvidia and AMD and Intel and others. They’re basically hardware processors, they’re either GPUs or memory CPUs. These are processors that are processing data for AI.

And then there’s the third segment in the middle, that is communications. In all of these applications, you’re trying to pump a lot of data from either chip to chip, server to server, data center to data center, and so there is a need for a communications medium that can route all of this data.

And that’s where POET comes in. We’re in that segment of AI-enabling, high-speed optical data communications, which then work in conjunction with the hardware to provide the processing power needed for the software applications to run.

So, I think that’s broadly the categorization. The end-use markets for POET’s products are basically AI clusters that people are building, essentially enabling server to server communication, or AI cluster to AI cluster communication, or data center to data center communication, as it relates to very high-frequency data transfer.

TSWT: You’ve announced a few new collaborations recently, one with a company called MultiLane, another with ZKTel. What are some of the details, and what is the overall significance of these relationships for POET?

Dr. Venkatesan: ZKTel is a customer. They are a manufacturer of these optical transceiver modules. When we started POET, we of course started at the low end of the data communications products. ZKTel is a customer at the low end. They’re an important customer. They’re not ultimately pushing the limits, if you will, of data transmission speeds and frequencies, but they are nevertheless a very critical customer for us, because they have allowed us to validate this manufacturing approach that we have pioneered in the market.

At the end of the day, technology is technology, and unless it’s transferred into a product and that product can actually be commercialized in the market, the technology in and by itself is meaningless. I think what ZKTel has been able to do for us is to validate that this technology concept that POET has pioneered can, in fact, be used to make optical modules that are commercially viable and can be deployed in high volume.

We’ve moved on from there. The initial products we had would transfer 100 gigabits per second of data. I think people generally are familiar with the term gigabits because that’s used in, for example, the amount of memory you have on your cell phones. This is basically a measure of how much data can be transmitted per second. A few years ago, the standard was 100 gigabits per second. Those are the initial products that we put out. Today, the state of the art is 800 gigabits per second and moving up, doubling to 1.6 terabits per second.

That’s where POET really is placing our bets in terms of capitalizing our technology in those markets, which are also the markets that are most tied to AI. And that’s where the partnership with MultiLane comes in. POET has partnered with them to create these end optical transceiver module products for the AI segment.

MultiLane is very experienced in software development, and they have good access to the end markets through their existing business, which is selling test equipment. POET, on the other hand, is very good at a lot of the electrical and optical design. And so, our partnership with MultiLane enables us to put together our strengths in electrical and optical design, as well as software development, to come up with an end product faster than each of us could do it on our own.

It’s an important collaboration for us because it allows us to deploy products on a quick time-to-market basis for this fast-growing AI segment.

TWST: Are there any other important relationships with partners or customers that you’d like to tell us about?

Dr. Venkatesan: Yes. We have a few customers that are in various phases of their design cycle. We have a customer called Adtran, a global networking company. We have other module customers in China as well as in Taiwan.

Some important relationships we have, particularly in the AI segment, are for products that we’re selling to a customer called Luxshare. Luxshare is one of the larger component suppliers to Apple, for example. They have a division to make these optical transceiver modules, and we have a design-in with them.

We’re also exposed to chip to chip communication for artificial intelligence, with tie-ins with some prominent startups in the field, Celestial AI being one of them.

We do have good customers that are currently committed to our platform, and we expect to have them ramp into production over the course of the next year, which is when POET really starts driving revenue growth. We expect to be able to drive our revenue growth through the back half of this year, but really largely in 2025 and then beyond into 2026.

Of course, we have very good supplier collaborations with companies like Lumentum, who supply some basic and fundamental components for high-speed data transfer to us that we then incorporate inside of our manufacturing platform to convert it into the end product.

TWST: Switching to the financial side of things, you reported your fourth quarter results in March. What would you point out as key highlights for investors?

Dr. Venkatesan: Although we’re a public company and we trade, we’re effectively a pre-revenue startup. We’re constantly developing new technologies and new capabilities.

I think the key highlight, from a product availability perspective, is that for the first time we’re now at the leading edge of technology in our company’s progression. We’ve marched ourselves up from the 100 gigabits per second, and we were one of very few companies in March to demonstrate that our platform was capable of 1.6 terabit per second communication links.

That was a very important development for us that now allows us to get more premium eyes on our product, and we expect to be able to capitalize on that.

I think the big highlight over the past quarter or quarter and a half is driving the collaboration agreements that allow us to get to deploy cutting-edge products in the AI segment, showcasing the capability of our technology to be able to not just meet today’s demands, but to largely meet the demands for the next three to five years.

For our customers, they make an investment in our platform, but it’s an investment that takes them through multiple nodes of technology and multiple nodes of bandwidth increases, if you will, in these AI clusters.

So, that was really the big development for us. It was something that we’ve been wanting and working on for the past couple of years. We’ve had some delays in our development, but I think we finally broke through, and we were able to showcase that over the past quarter, which was a very important milestone.

TWST: In roughly that timeframe you have either closed or announced both public offerings and private placements. What do those capital raises mean for your liquidity and working capital, and what does the balance sheet look like today?

Dr. Venkatesan: Over the course of the past five months we’ve been wanting to capitalize ourselves, and so we did a couple of small raises, and recently we’ve been able to get ourselves well capitalized.

I think it’s really important because we are in the hardware business. We have to be well capitalized to be able to take advantage of the opportunities ahead of us. We’ve been extremely good about stretching our dollar, and partnerships have really helped us there, because it allows us to get our end products out faster without having to deploy all of the capital ourselves.

So, being in a position today to be well capitalized to take advantage of the opportunities ahead of us is, of course, very important. Liquidity, in that context, is the lifeblood of a startup company. I think it’s been a good development for us over the past few weeks that, on the heels of a private placement, we’ve been able to close some additional financing that really allows us to truly focus on execution, knowing that we’ve got a good and strengthening balance sheet at this point.

TWST: Looking back, what have you been most focused on since joining POET as its CEO? And looking ahead, what are your main goals for the next year or two?

Dr. Venkatesan: The vision for the company from the time I joined hasn’t fundamentally changed. We wanted to be a premier supplier of what we would call highly integrated photonic solutions to the market. Arguably, it’s taken longer than perhaps even I thought, but that’s life in the fast lane, if you will.

If you look to the past, the key transition point was the invention of a brand new concept. I would say a good chunk of my time and effort was focused on that invention, understanding the market needs, market demand, and being able to develop fundamentally new intellectual property and patents around what it is that we’re currently doing.

In addition, we have of course been capitalizing ourselves. We were happy to do an asset sale back in 2019 for about $25 million, $30 million. That funded a lot of the development activity, so we didn’t have to go to the Street to get capitalized for all the basic development that we’ve done. That was very important for the company, as well.

Now that we’ve brought our company to a level of performance in its platform to deliver on products that are of great demand, we look forward to capitalizing on that over the course of the next couple of years, and turn them into a commercial revenue stream that allows us to break even down the road. It’s good that we’re well capitalized today, and we look forward to growing that to sustain the company before it can break even.

TWST: What’s a realistic timeframe for investors to be thinking about in terms of that breakeven point?

Dr. Venkatesan: We don’t provide any guidance in terms of revenue or revenue projections, but we do believe that we can achieve significant revenue growth over the next couple of years that might enable us to break even in that period of time.

TWST: Is there anything else you’d like to add to wrap up?

Dr. Venkatesan: I’ve been in the industry over 30 years. I’ve seen the late 1980s, 1990s; that’s when Motorola and Intel and all the memory companies — it was the realm of hardware. Then we went into the 2000s, and for maybe a couple of decades it became the realm of software, and nobody cared about the hardware anymore.

So, initially it was all about the hardware; it was, “Hey, is my computer 10 megahertz, 100 megahertz, 1 gigahertz?” We kept pushing that, and the hardware was really important. Then the hardware kind of blended away into the background, and everybody was talking about software, because there was enough processing power available to deliver unique new applications, Web 2.0, and all of the things that we’re doing with apps and so on.

But now I believe the pendulum is swinging again, where the software has grown so much that it now needs better hardware again, and so the entire demand is switched. That’s why Nvidia is so popular. All the hardware companies supporting the fundamental infrastructure around AI, for example, are critically important, because we find that unless there are fundamental transformative changes in the hardware infrastructure, it’s going to impede the progress on the software side.

So we find ourselves here, where we are providing a critical part of the hardware ecosystem for this growing demand around AI. I would see that at least for the next decade, there’s going to be this push to continue to drive hardware infrastructure capability that can then support the growing needs for AI in the future. I think it’s a good time to be in the hardware space again, after a couple of decades where it was a snoozefest on the hardware side and all the valuations were moving to software companies.

TWST: Thank you. (MN)

Dr. Suresh Venkatesan

Chairman & CEO

POET Technologies Inc.

120 Eglinton Avenue East

Suite 1107

Toronto ON M4P 1E2

Canada

(416) 368-9411

www.poet-technologies.com