Audio chip maker avneraAvnera is announcing today that it has raised $10 million in a fourth round of funding.

Avnera is making Audio Magic chips such as those used in Best Buy’s Rocketfish brand of wireless stereo speakers. Those products eliminate interference and speaker noise, allowing you to take any music device and broadcast the sound wirelessly to any speaker in the house. That gets rid of unsightly wires and gives you music in places such as a sun deck. Avnera collaborated with Best Buy in creating the products, and that’s one reason Best Buy is one of its investors.

avnera 2Avnera just announced its second-generation AudioMagic 2G chips, which the company says can play high-quality, uncompressed audio with the quality of wired solutions. That’s because Avnera’s chips have a way to correct errors in transmission, fixing problems on the fly so that the sound comes through clearly, said Manpreet Khaira (pictured), chief executive of the Beaverton, Ore.-based company. The products using the second generation chips will be out this year.

The funding round was led by existing investors and Japanese electronics firm Onkyo. That brings the total amount of money raised to date to $52 million. Other investors include Altien Ventures, Bessemer Venture Partners, Best Buy Capital, DAG Ventures, Intel Capital, Panasonic Venture Group, Polycom and Redpoint Ventures.

The company competes with other makers of analog audio chips. Those companies, such as National Semiconductor and Texas Instruments, create a collection of analog chips that have to be connected on circuit boards. But Avnera’s talent is taking analog chips that are separate devices normally and combining them all on one chip. These “analog system on chip” devices have lots of applications, of which audio is just one.

There are 10 analog system on chip products in the market now. Onkyo and Avnera are working on new products that will use Avnera’s chips. Beyond Best Buy’s products, Avnera’s chips are used in 30 different audio products, each with the Avnera Rocketboost logo, from more than 15 customers.

The company was founded in 2004 and has 60 employees.

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