Executive Interview: Joe Montano, President and CEO, Delphon

1. What is the focus of Delphon and what are the core competencies that differentiate the company from its competitors? At Delphon, we’ve carefully curated a portfolio of companies that develop and deliver highly engineered materials for the semiconductor, medical, photonics and electronic industries. We are not done adding to the current portfolio and are constantly looking for new acquisitions that are a financial and technology fit, to expand our holdings.

Tapping into decades of experience, our technology experts at each of our companies work with you to create and innovate custom solutions that add value to your products.

Our portfolios of companies include Gel-Pak, Ultratape and TouchMark, all recognized leaders in the markets they serve. We collaborate and invest in their research, development and production of performance materials, processes and products, helping them specialize in the development of advanced polymer and adhesive technologies and solutions. We ensure our companies have what they need to deliver for you at the highest level.

2. What's the history of Delphon, beginning with how the company started and the evolution in how it is owned and managed? It all started with Gel-Pak, which was born in 1980 out of Hewlett Packard’s need to securely transport highly fragile beam-lead diodes. Jeanne Beacham, now Delphon executive chairman of the board, joined the company in 1994 and ultimately led a management buyout of Gel-Pak in 1997.

In 2004, Delphon was started in order to provide a platform for future growth and acquisitions. We purchased TouchMark in 2006 and UltraTape in 2007. By merging the innovative technologies of these acquisitions, we have been able to expand our fundamental capabilities to provide a more diverse product portfolio.

Delphon was acquired in 2018 by Grey Lion Capital, which has allowed us to accelerate investments in our people and manufacturing operations and will enable us to continue developing cutting edge products and customized solutions for new and existing customers.

3. Tell us more about your products, particularly those that intersect RF/microwave and high speed digital applications. At Gel-Pak, we’re excited to support the industries that are transforming the world. The unique and complex needs of high technology customers drive us to continuously explore and investigate new materials, form factors and solutions that safely and securely handle and transport your valuable products. We are recognized as a leader in our field and pioneers of complex solutions for securing your devices and components.

For over 40 years, we have created innovative solutions for the safe handling and shipping of leading edge technologies, including compound semi components. We combine our materials expertise with our ability to understand and meet specific needs to provide the best products for our customers.

Gel-Pak’s standard Vacuum Release products have been a go-to solution for protecting fragile compound semi components. If customers need something more tailored, we have the flexibility and capability to create a customized handling or transport solution. For example, we recently collaborated with BAE Systems to create the LCS2, a combination lid/clip system that prevents thin compound semi devices from migrating out of the pockets of waffle pack chip trays. When you work with us, you’ll connect with experienced, collaborative experts who will guide you in the right direction to find the right solution

4. What's your size and footprint, i.e., number and location of factories and offices? Delphon has a global footprint with about 63,000 square feet of state-of-the-art manufacturing facilities in Hayward, California, and about 30,000 square feet in Wilsonville, Oregon. We have sales offices in Taiwan, Korea and Southeast Asia, with global distribution centers around the world.

5. How vertically integrated is your manufacturing? Have you been affected by any supply shortages? There is vertical integration within Delphon, TouchMark’s printing of all Gel-Pak product is a great example, but we do rely heavily on our supply chain for certain raw materials, as well as contract manufacturers.

During the unprecedented market dynamics brought on by the pandemic, our three companies—Gel-Pak, UltraTape and TouchMark—were able to do their part to ensure our customers saw little or no disruption to their demand needs. Our dedicated organization puts a high priority on delivering an excellent customer experience. That drive and desire was harnessed to demonstrate the creativity and problem-solving skills it took to consistently overcome the challenges that faced us and the entire industry.

It is easy, during times like these, to throw your hands up and use the macro environment to cover your short comings. Delphon instead used this opportunity to show why we are a trusted partner and best in class when it comes to protecting the world’s delicate devices.

6. What new capabilities and products are you working on? More broadly, what problems are you trying to solve? Broadly, we are known for temporary immobilization of delicate devices. We are constantly researching ways to minimize or eliminate any evidence that the device has not been immobilized by one of our products once it is removed from our films, tray or carriers.

One of the areas where we continue to innovate is thin die handling. As mentioned earlier, we are collaborating with BAE Systems to solve the issue of thin die migrating out of waffle pack chip trays. The cost associated with component migration is substantial and represents millions of dollars of yield loss and rework labor. Given the current chip shortage, protecting every device is now more important than ever. This product is especially well suited for microwave components.

Chiplet technology is calling for the disaggregation of monolithic functionality into smaller interconnected die. This trend presents some unique handling challenges for known good die. To address this need, Gel-Pak has developed a surface texture with reversible adhesion that offers an interesting approach to device handling. The textured film material can be applied to any surface, including 2 in., 4 in. and JEDEC standard handling trays, and transform into a universal carrier. The textured material holds components in place using non-adhesive microstructures and can accommodate a wide range of device sizes. Use cases for this material include in-process testing or handling and shipping both bare ICs or packaged components.

Gel-Pak is also working closely with customers in the optics space. Our new polyurethane material, offered in traditional Gel-Pak form factors, provides customers in this market with a material that has been optimized for optical components.

7. You joined Delphon slightly more than a year ago. What attracted you professionally and personally? Many of my previous positions prior to Delphon required major course corrections of underperforming businesses in order or execute my objectives successfully. The main attraction to this opportunity was not having to turn around a failing business but instead accelerate the growth of a business already performing very well.

Once I visited our Hayward facility in person and saw firsthand the infrastructure and fundamental capabilities to develop new products for applications outside where we currently

play, the role was very exciting to me. Once I met the teams of our three companies and saw the dedication and hard-working nature of the organization, I was sold. I have been preparing my entire career for a CEO role, and I was very personally motivated to take on the challenge.

8. How would you describe the corporate culture of Delphon? Has being a privately held company shaped it? I would describe us as being nimble and flexible with a can-do attitude. We are very customer centric. The fact that we are not publicly held means we can move quickly to make decisions, which ultimately helps us better serve our customers.

9. You recently added the CEO title to your role as president. How will this shift where you focus your energy? My original focus over the last 12 months was mainly on sales, marketing, R&D and quality. I am now expanding that scope to include operations, finance, HR and IT. I truly enjoy being involved in the day-to-day activities, but with the transition to CEO, this is something I need be careful isn’t consuming too much of my time because I need to ensure I am focused on driving the more strategic initiatives and organizational optimization as we rapidly expand our business.

10. The press release announcing your appointment as CEO said Jeanne Beacham, the prior CEO, will focus on M&A and collaborations to “expand Delphon’s capabilities and product offerings into new markets.” What can you share about the markets or technologies that are attractive? We are always on the lookout for acquisitions that can enhance our core capabilities and allow us to expand our offerings in both existing and new markets. Any acquisition is looked at in terms of how it will help us meet our goal of developing a portfolio of companies that build internal value and deliver customer value.

11. What have we not touched on that you would like known about Delphon? Some people may consider Delphon as a provider of consumable products, which isn’t quite true. Gel-Pak, for example, has a proven track record of collaborating with companies to tailor handling solutions and develop custom films to meet the specific needs of their applications or a market need. The industries we operate in are rapidly changing and we want customers to know we are ready and able to leverage our fundamental capabilities to help solve whatever challenge they throw our way.