Hardware will constitute 60% of “Technology” revenue over the next five years, but has received only 10% of venture investments over the past five years. US investors need to pick up the pace to fix that imbalance.
The latest advances in AI (GPT, LLM, transformers, etc.) are like a Nokia phone in the 90’s – everyone could see the appeal, but no one could predict all that it would lead to.
SVB was the bank of choice for the Valley because they wanted our business. Say what you will about its wind-down process, but commercial banks in the US ignore small businesses, and now it looks like that is all we are left with.
We think the market will probably improve later this year, and IPOs & venture funding will pick up pace, but the investing environment will be very different than the long summer we have enjoyed for too long. (Unless your company has AI in its name.)
Despite conventional wisdom, building a software company can be just as capital intensive a building a semis company. With the huge disparity in valuations at every venture round, it is clear that there can be a massive opportunity in semis investing.
The risk profile for venture investing in hardware and software are of course very different, but the market is shifting, making hardware investing much more appealing.
Google recently published a paper on the history of its TPU chip. There are some valuable nuggets of information in here that can help others think about building chips, and also help outsiders understand many of the changes in the semis industry today.
How to create a fundamental technology? – There is no easy answer. Start-ups face enough challenges, but building ecosystems for an entirely new, foundational technology need a lot of time, capital and luck to succeed.
Start-up Semis Live – CRN published a great list of ‘hot’ semis start-ups. We hope this encourages more investors to support chip companies.
Semiconductors’ Midlife crisis – Chip companies need to start thinking about how they want to spend their golden years – save up for retirement or blow it all on big splashy initiatives that remind them of the glory days.