The company, which has developed technology for global television receivers that allows set-top boxes and digital TVs to work in any country around the world, described its product as “breakthrough” and “highly disruptive”, and said it aims to capture at least 10% of a market estimated to be worth more than $700m (£454m) a year.
The latest funding round, which is the Livingston company’s second, was led by Scottish Equity Partners (SEP) and supported by Octopus Investments and a number of existing investors including the Scottish Investment Fund, Braveheart, Kwik-Fit founder Sir Tom and Stagecoach chief executive Souter.
The deal also marks Scotland’s biggest venture capitalist-backed IT investment round this year.
The company said it will use the money to develop new products for the digital TV and radio markets and increase technical support, lab and sales staff in Asia and the UK from 20 to 29 over the next six months.
Founder and chief executive David Srodzinski said: “The investment allows us to pursue our growth strategy, targeting the global television and radio market with our world-leading CMOS RF tuner technology.
“We have built up an excellent position in the silicon tuner market and this additional funding allows us to accelerate our sales momentum.
“Digital TV is being rolled out around the globe now, and at the moment every set-top requires different chips for different countries.
“Our global digital TV receiver allows televisions and set-top boxes with our technology to work in all geographies, and the technology is low-cost and low power consumption.”
Asked about the firm’s flotation ambitions, Srodzinski added: “It’s the dream of every company to get there, and it depends on how we build up revenues and how our products are received in the market.
“But I believe that in two years’ time the market will be dominated by four or five players, and in a $700m a year market we expect to have 10% of it.”
The global tuner market is widely expected to expand as the worldwide television and radio industry switches to digital technology.
Digital TV markets are anticipated to be among the fastest growing in the sector as the television industry moves from 50-year-old analogue technology to silicon chips.
Aside from home entertainment systems and set-top boxes, mobile phone companies have also begun to roll out mobile-TV technology on a global scale.
Stuart Paterson of SEP said: “Elonics has created a world-class product which twins high performance and low cost. It is also the greenest tuner on the market.
“This is not something we anticipate happening in the future. It’s a market that is happening now.
“Silicon tuner sales are growing rapidly thanks to rising demand not just for set-top boxes but for more tuners per box to cope with added features.”
Paterson also said that much of the confidence in the company was based on the quality of its “world-class” leadership.
Elonics is part-funded and chaired by David Milne, the co-founder and former chief executive of Wolfson Microelectronics. Fellow Wolfson and Advanced Micro Devices co-founder and chairman John Carey is also a stakeholder.
Srodzinski, meanwhile, is a former senior engineer with Wolfson and one of the lead developers of the chip that was used in Apple’s iPod and on which the company prospered.
SEP also backed Wolfson prior to its initial public offering in 2003.
Wolfson raised around £213m from its listing on the main London stock market, a flotation that made millionaires of the founders of the Edinburgh University spin-out.
Asked about the company’s ambitions to float on the stock market, Paterson, who declined to reveal the size of SEP’s stake in Elonics, said: “There are a lot of similarities between Wolfson and Elonics -- not so much in terms of their products, but more in that they follow the same model of having offered design services in the early years, and once they made some money they began to develop their own technology and products.
“Of course it depends on the state of the capital markets at the time, but an IPO for Elonics will certainly be an aspiration in a couple of years.”
Elonics has raised a total of £8.6m through two funding rounds since being founded in 2003.
