Nearfield Instruments is determined to build the supply chain that enables the scale-up to ship a total of 50-60 metrology systems in a few years’ time. As if this wasn’t enough, founder and CEO Hamed Sadeghian also wants his company to go public in the near future.
Hamed Sadeghian wants to take Nearfield Instruments public within a few years. That’s a rather bold ambition for a company that only just shipped its very first product to a customer and is tormented by the challenges it faces in times of corona. But the move also expresses Sadeghian’s confidence in a fast scale-up. He expects Nearfield to ship about 50 to 60 of its high-value Quadra metrology systems within a few years. In addition, the Rotterdam-based company aims to grow worldwide staff to 170 plus at the end of the year, from 110 this summer.
The market Nearfield penetrates is particularly challenging. It targets the very high end of chip metrology. Its machines are designed to inspect integrated circuits at the device level at the scale of ångstroms (a tenth of a nanometer, smaller than an atom). The most obvious customers are Intel, Samsung, TSMC, Hynix and maybe a few others – the behemoths that currently dominate the semiconductor market and are still following Moore’s ruthless road towards ever smaller features on chips.
Metrology and inspection for high-end semiconductors might be a lucrative business, but it’s dominated by established players. A startup that wants its piece of the pie can expect fierce competition. But this arena is also rocked by Moore’s Law and quite a bit of turbulence. For example, lithography giant ASML has become a significant force in metrology, with four Yieldstar systems for optical metrology and four e-beam systems for metrology and inspection on offer. How does metrology with atom probes fit into this picture?
At this moment, an initial public offering would clearly be Sadeghian’s preferred option for an exit. “We want to establish Nearfield Instruments as a mature, sustainable company and not necessarily as a quick sell to an equipment manufacturer. It’s an IPO that we have in mind. This is a challenging target and the circumstances might change – tomorrow’s life may be different, but this is our baseline today. How it will materialize really depends on our planning and milestones to come, but I’d say, in a couple of years from now.”
So far, Nearfield has amassed 48.5 million euros of investment. In 2017, it received 10 million from Samsung Venture Investment and Innovation Industries, a Dutch fund. In a second round, the Korean financial services firm Eugene Investment & Securities joined and later in 2020, Invest-NL followed. Currently, round C is being prepared, with a target capital in the direction of 100 million euros.
Asked about an acquisition by one of the existing metrology equipment vendors, Sadeghian politely dismisses the possibility. “I’m not saying it’s always wrong. Sometimes, a takeover is useful. You can benefit from existing sales channels, support organizations and so on,” he explains. “But we think we, as a technology leader, can add more value as a stand-alone company, given our potential and product roadmap. Our discussions with customers show us that we can stay relevant on a long-term basis. So, a takeover isn’t our preferred choice at this stage.”
Nearfield has already been courted. “We have the technology and a roadmap to bring several products to the market. With a quick M&A, the potential won’t be fully capitalized, and that would be a pity.” Sadeghian dislikes the idea of becoming a pawn in a chess game between the metrology big shots. “Customers really want initiatives like Nearfield to become successful and sustainable rather than being sold to other equipment manufacturers. What often happens is that the acquiring party keeps providing its existing solutions. That’s natural. You always give priority to your own core technology. After most M&As, the acquired technology gets lower priority.”
Sadeghian has built up his bold confidence over the past decade through his close collaboration with top chip manufacturers. While listening carefully to them, he eventually showed them how chip surfaces could be mapped at high speed by physically scanning them with parallel atom-sharp probes. Up till now, Nearfield is the only company able to provide this technology in a chip production environment. In fact, for many years, no one even thought metrology with sensitive but vulnerable atom probes would prove itself as a viable, reliable and production-worthy method.
The beauty of AFM
Sadeghian is an entrepreneur by nature. During his mechanical engineering study at the Technical University of Isfahan in Iran, at the age of 20, he already started a company building equipment like lifting platforms, mixers and conveyors. “Heavy stuff, not necessarily high-tech. It was nice design work, but at a certain moment, that became boring.”
Attracted by the more complex stuff, Sadeghian decided to do a PhD. “There were a few options, and at the end of the day, I selected the Netherlands. This country is strong in mechatronics and control. I was already familiar with ASML and what Philips did with optical pick-up heads in CD and DVD players. The project I was offered at the university of Delft was attractive. I liked the multidisciplinary aspect, which always makes it challenging and complex. Also, being in Europe and specifically in the Netherlands was important for me.” Aged 25, he sold his company and went to Delft, where he split his PhD work between the mechanical engineering and electronic instrumentation departments.
After finishing his thesis cum laude, Sadeghian revisited the idea to start a company. His PhD resulted in some patents on the calibration of precision instruments such as transmission electron microscopes and atomic force microscopes. But after carefully studying the business case, he decided the nano-calibration instrument market would be too small. “I stopped it because the business case was too narrow. Somebody else picked it up, but at the end, that also didn’t happen.”
In 2011, Sadeghian joined TNO, and there, he started to build the first program around optomechatronic instrumentation for nanoscale characterization. “It was clear that the characterization and failure analysis in semiconductor production would become a bottleneck. The existing solutions with optics and electron beams would have difficulties in a few years from then. New metrology inspection methods were required.”
Sadeghian started the program by himself. “TNO didn’t have a background in scanning probe microscopy but was well versed in optomechanics. It was a good combination, and I liked it.” Looking at various options, the atomic-force principle surfaced as a method for the nanoscale characterization of chips. “We knew the throughput was extremely low and that the classical way of imaging with AFM had its limitations. For upcoming devices, we needed an imaging mode that was fast and able to measure structures with high aspect ratios. So, I took up the challenge to use the beauty of atomic force microscopy and make it high-throughput and develop an imaging technique, a way of control, allowing to use AFM for complex nanostructures.” This resulted in patents that later became part of Nearfield’s portfolio of more than fifty.
Viable business case
From 2011 to 2015, Sadeghian worked to overcome the shortcomings of AFM for semiconductor production with a growing team. That ultimately led to a proof of concept that could scan 300-millimeter wafers with parallel scanning heads.
In these first four years, Sadeghian didn’t have a company in mind. Instead, the goal was to develop metrology and get semiconductor manufacturers as well as equipment builders interested. “I always like to start from demand. There should be a pain in the market. Customer questions are the basis to innovate, to develop a product.”
From the very start, he had intense discussions with chip manufacturers. “What throughput, accuracy and resolution should we achieve? What application should we target? The talks resulted in a list of specifications and requirements for the system I was developing.”
In the early stages, it wasn’t easy to get in touch with the biggest in semicon. But Sadeghian noticed he really got their attention when he touched on the right problems. “That’s where they also had an interest. In this industry, it’s important to build trust. It’s a long trajectory to get to know your customer and show that you want to add value.”
Talks with metrology and inspection equipment manufacturers were likewise instructive. “They were addressing the same problems of their customers, being the chip manufacturers. That was very helpful for me because I got to understand the limitations of their technology and products. They were working on the same problem, and that was a validation that I was on the right track.”
The only difference was that Sadeghian didn’t try to tackle the problem with light or electrons but with scanning probes. “I also approached them to ask if they were interested in AFM as an add-on for their instruments. Since it wasn’t within their core and I didn’t yet have proof, they weren’t really interested – which only strengthened our conviction that we found a special niche.”
In the meantime, his R&D projects at TNO grew in size and momentum. “We were building knowledge that we could use for all kinds of R&D projects, also for different fields and applications.”
At some point, Sadeghian realized that there might be a viable business case in scanning probe metrology. “I remember that I was talking to one of the equipment giants when I realized: wait a minute, why not start a business in the Netherlands? Why not set up a metrology company? Why not produce the product ourselves? I sanitized the idea back at TNO with some of my colleagues and with Roland van Vliet (Nearfield’s co-founder and currently responsible for operations, RR). We said: why should we sell the IP? We can make a business, a company, out of it.”
Thinking about setting up a business in a market dominated by multi-billion dollar companies didn’t feel comfortable initially. “At the start, I wasn’t confident,” admits Sadeghian. “But this is where your heart starts to beat, and you say: let me find out.” So, he decided to seriously focus on the business case by doing a part-time executive MBA program in Leuven to work on a business plan and study the feasibility of a new tech company. This meant working at TNO until Friday afternoon and taking on his business master on the weekend.
Sadeghian says he enjoyed the experience. He had a clear goal and wasn’t just running to get an MBA. “Every course I took, every assignment I had, I used it towards feasibility and assessing the business. An MBA doesn’t make you an entrepreneur or businessman, though. The most important lessons I learned were from the mistakes others made.”
While doing his MBA, Sadeghian also worked on a proof of principle for an AFM metrology system. “In 2015, as the proof of concept to test full 300-millimeter wafers was almost finished, I ran out of money. Finishing the experimental setup was expensive. But I said to myself: I’m not going to lose this.” So he went to the board of TNO and asked the then-CFO, Cis Marring, and chairman, Paul de Krom, for the cash he needed, 1.2 million euros. “I said, give me 1.2 million, and I’ll bring back 10 million.”
By that time, Sadeghian was leading a group at TNO of twenty researchers, for which he attracted several contract research projects from industry. That earned him credibility to get the funding for his proof of principle. After finishing his MBA, he also started to build a knowledgeable and experienced advisory board. “A few people in the Netherlands who had done this before, who knew how to start a business in high-tech semicon equipment and knew how to raise funds for it.” Together with Roland van Vliet, he officially founded Nearfield Instruments in January of 2016.
Proving the technology worked was the biggest challenge at the time, remembers Sadeghian. “Proving we actually could measure nanostructures at the right throughput without damaging the wafers. After we had shown this proof of concept, I had full belief. I believed in the product and the technology. I was convinced that this would work. And that we could solve the problems of this industry and this market segment. We’re not replacing everything, but we can add significant value to one market segment and would be able to have a big share of that segment. That part of the market wouldn’t necessarily be extremely big. But we could dominate such a niche, to make a very good business and be unique, very unique.”
Nearfield started to test wafers from the four biggest chip manufacturers while attracting attention from investors. Samsung Venture Investment asked engineers from Samsung Electronics to do a technical due diligence. “They used Samsung Electronics to technically assess the viability of our equipment. Several engineers from Korea arrived in Delft in June of 2017 with suitcases and wafers. We started on Monday with all the tests, and by Friday, we presented the results to them and listened to what they observed. After that, we got a term sheet for investment from Samsung Ventures and Innovation industries. The 10 million euros actually arrived.”
Asked about what convinced Samsung, Sadeghian says that Nearfield was able to map structures on wafers that the Koreans couldn’t measure. Just to be clear, he adds: “Samsung Ventures decided to invest because they saw a promising business. That had nothing to do with Samsung as a customer.” Other investment companies also showed interest. “We could choose, but we didn’t want to pick everybody. Suppose that two of these giants would have a stake, that would make it very difficult to serve them both. We chose Samsung because we came to the conclusion that they would help us a lot. The right chemistry is essential.”
100 scanning heads
Sadeghian underlines that Nearfield’s equipment is targeted at high-end, high-volume chip production, not at R&D. “We make metrology equipment that works continuously in a wafer fab. For R&D, it must be new. High-volume manufacturing is all about continuity, no change, maximizing yield and keeping constancy.”
Nearfield’s Quadra system can measure deep and narrow trenches from 200-250 nanometers, which can’t be done optically or with electrons. “The need for local measurement is very high,” notes Sadeghian. “In semiconductor process control, which means metrology and inspection, different length-scale measurements are needed on the wafer level and the device level. Optics has the right resolution, accuracy and throughput to measure at the wafer level on reference structures. But as devices become more complex, there’s a need to control the process on the device level.”
“A couple of years ago, ASML and STMicroelectronics stated in a 2019 SPIE paper that two-thirds of the total errors in CD metrology or overlay were caused by local effects. For these local measurements, there are only two techniques: scanning electron microscopy and scanning probes. SEM measures with very high resolution in XY, in 2D, but not in depth, not vertical, and it’s also destructive for fragile layers. That’s where we add value. We designed a control loop, an AFM imaging mode, for penetrating the probe in deep trenches in a very controlled way to measure dense narrow and deep structures, non-destructively.”
The Quadra is now doing parallel measurements with four scan heads. Sadeghian points out that he has a roadmap with milestones for systems with thirty and a hundred heads. For the latter system – expected ten years from now – the architecture will change.
Nearfield is having “active discussions with customers” about deliveries. “You have to understand that there are certain steps and milestones with each customer before it leads to a purchase order. But we’re in the process and expect to ship 50-60 systems in 3-4 years from now.”
The company is working hard to get its supply chain up to speed. Its partners include Aalberts, Capgemini, PI, Technolution, VDL ETG and VHE. Most of them also serve OEMs like ASML. So Sadeghian had to make sure Nearfield wouldn’t drop off the suppliers’ priority lists. Asked specifically about VDL ETG, he replies: “This has been a topic I brought up many times with the management, and they assured me it won’t happen.”
The Nearfield team is also in the process of developing a new product line based on the current Quadra architecture. This new metrology system will be able to image subsurface structures, also with nano precision. “It’s a different instrument, but we can build it on the same platform as Quadra,” explains Sadeghian.
Looking at semiconductor roadmaps and talking to customers, Sadeghian saw the need for subsurface measurement at an early stage. “This is market pull. The problems are clear. The origins go back to the introduction of new materials that are used in the chip industry and the importance of local effects. There are quite some metal layers and optically non-transparent layers that are difficult to penetrate for optics and electrons. So, how do you measure, in a non-destructive way, voids and overlay errors in non-transparent layers below the surface, preferably at the device level? That was the question. With acoustics, you’re also able to measure on the device with a very high resolution.”
The measurement principle is comparable to seismic sensing. An acoustic wave propagates through the chip layers and is picked up by AFM probes that can act as sensors. Sadeghian says the technology will stay feasible when future overlay requirements will drop below one nanometer.
The target customer has expressed the desire to receive the acoustic system in 2022. “The precise delivery depends on corona and the suppliers, but we’ll surely ship it somewhere next year. Using the Quadra platform enables us to speed this up. Still, it’s very tight. We have many other projects, and Quadra has to reach high volumes. It’s tough, but we’ll deliver.”