Challenges and Opportunities in the Semicon Industry: DNX Bites and Insights

Q Motiwala
Oct 21, 2019 · 3 min read

Last week, I, a recovering semicon engineer myself, hosted an evening connecting industry stalwarts and early-stage semicon entrepreneurs for a lively discussion on the industry’s potential, challenges, and advice from industry operators and VCs.

Early-stage startups had the opportunity to seek advice and lessons learned from some of the brightest minds in the space, serial entrepreneurs, and operators turned investors.

These thought leaders, included Faraj Aalaei (Aquantia), Karthee Madasamy(MFV Partners), Maryam Rofougaran (Movandi), Sam Heidari(Quantenna Communications), Sanjay Jha (Eclipse Ventures), and Shahin Farshchi (Lux Capital).

They opened up with how the industry has changed over the last couple of decades, their best advice for those following their pursuits, what they now look for in future investments and insights for addressing the challenges facing the semicon industry.

Offering a glimpse into the challenges of investing in this market, conversations got real, with industry experts providing their candid perspective not only on the challenges of investing in semicon, but other questions and topics entrepreneurs should be thinking about.

Takeaways:

  1. Semicon startups need two out of these three to be successful: (1) Improved process (2) Improved architecture / structure (3) Hardware — software co-work, including monetizing software.
  2. Improvements need to be in order of magnitude, not 30–50%.
  3. It’s great to have new architecture, low power or low cost technology that get us all excited, but help us paint a picture of your vision in front of our VC partnership so that we can make an investment decision. We need a story that can show a large outcome that would move the needle for our fund.
  4. Build your best thing you possibly can but get to “commercial” revenue faster. Revenue through Innovation groups is not true revenue. It needs to be through a business unit or true procurement groups.
  5. Importance of choosing the right fund and the right Venture Capitalist. Ensure you pick one that believes in your vision.

Early stage startups included Celera, Atlazo, Movellus, Rain Neuromorphics, Etherwhere, AONdevices, Analog Inference, Coolstar, Roviero, Ascenium, and Tortuga Logic.

They posed some tough questions to the industry leaders regarding the topics below

  • OEMs’ and Hyperscalers’ trend towards customization and vertical integration
  • Applications driving real time AI
  • How semiconductor startups can compete with established companies?
  • VC investment trend in semiconductor sector
  • Trade war, CFIUS, lack of VC, and fab investment in the US

We lost track of time as decades of experience and wealth of knowledge came to center on a topic every individual around the table felt so much passion for.

We’re excited to host future Bites and Insights to bring more dynamic conversations to the forefront.

DNX Ventures Blog

DNX’s perspectives on startups and venture capital

Q Motiwala

Written by

Co-founder and Managing Director @dnxventures, Boards of @Nauto, @Enlighted, @Iceye, @Cyphy, @Grabit, @Vitriflex

DNX Ventures Blog

DNX’s perspectives on startups and venture capital