Are you looking to invest your money in a technology startup? Do you want to invest in startups but don’t know where to start? Do you want to start a new project and need some funding? Well, since China is one of the largest emerging economies, we’re sure you are looking for Chinese chip startups.
China is home to some of the world’s most innovative companies and startups. In recent years, China has emerged as a significant player in the global marketplace, with billions of dollars worth of investments pouring into technology-related projects. The country houses several of the latest and cutting-edge chip manufacturing facilities. China’s chip industry is booming. Intel is slowly on the push out, while Chinese chip makers are investing and working harder than ever to deliver higher-quality devices.
As China’s economy continues to grow, upstart chipmakers have been facing several obstacles. These obstacles include intellectual property and relationships with the country’s tech giants, including Baidu, Alibaba, and Huawei. But many companies have persevered and are now among the Top 10 Chinese chip startups. We have selected some of the best Chinese chip startups out there, which are working on things really promising. For example, XinpleTek and Tacsense Technology both have strong growth potential.
China’s memory and mature node logic foundries
China’s memory and node logic foundries are undergoing a dramatic transformation. The government has invested $16 billion in state-owned memory fabs and leading Chinese foundries are fast ramping up production. According to VLSI, China’s memory capacity will grow at a 14.7% CAGR. With so many outsourced assembly operations, China is becoming a major player in the global memory market.
The Chinese government has broadcasted its desire to establish supply chain independence, yet private companies must be global to remain competitive in the global semiconductor market. While the Chinese government argues that local semiconductor companies do not belong in the global value chain, Chinese company executives have watched US trade restrictions hit local competitors. With heightened inventory, Chinese company executives must balance the demand and supply mismatch with the needs of local leadership, and CCP goodwill, which is essential to maintaining goodwill.
China’s Chip Industry and the Recent Developments in it
The recent developments in the Chip industry of China are raising questions on whether one state will dominate the global semiconductor market. While the United States continues to dominate the global chip supply chain, Chinese firms have increased efforts to copy foreign chip technologies. In 2020, the United States issued a foreign direct product rule that bars the TSMC chip manufacturing facility from shipping to a subsidiary of Huawei. This action came on the heels of an announcement of a new chip manufacturing facility in Arizona by Huawei. But it is also putting the spotlight on China’s increased focus on internal investment.
Although China relies on foreign companies for semiconductor manufacturing equipment and EDA tools, Chinese domestic chipmakers have made remarkable advances. But they are still two generations behind the industry leaders. Their newest foundries typically produce chips at 28 nanometers. Meanwhile, the national champion, SMIC, is working on 14nm technology. Even though China has made tremendous progress in chip manufacturing, it is still two generations behind those in other countries.
The Chinese government has focused on developing the chip industry, intending to make the country self-sufficient in the semiconductor industry. As a result, Chinese investments have given the industry a major boost. The industry has gained international influence. This growth is a result of China’s commitment to innovation. It has also benefited from its recent trade war with the United States. These developments paved the way for China’s chip industry to expand.
Some of the world’s major tech companies have origins in China, and several new start-ups have entered the domain in recent years, making it a hot destination for investors looking to make a profit. Below are examples of Chinese chip start-ups that have made significant headway in their respective fields.
Eswin Technology Group
When it comes to Chinese chip startups, there is no company more promising than Eswin Technology Group, based in the southern city of Shenzhen. Their specialty is the production of semi-conductors, especially power semiconductors.
Eswin Technology Group is a Chinese chip startup specializing in human-computer interaction integrated circuits. The founder of the company is Wang Dongsheng, who was previously in charge of BOE Tech Group firm, which yields displays for smartphones and TVs. The company began building production facilities in Xi’an in December 2017. Its revenue is estimated at RMB 4.5 billion annually.
Eswin recently completed a nine-figure Series C round with Legend Capital, Lenovo’s investment arm, and the China Internet Investment Fund. Legend Capital, a spin-off from the conglomerate Legend Holdings, also participated in the round. Lighthouse Capital acted as financial advisor to Eswin. Despite its booming market, Eswin is not a clear investment. However, despite the uncertainty in the semiconductor space, the company’s future looks bright.
ESWIN raises $283 million in new financing round
in 2020, Beijing-based semiconductor supplier ESWIN raised $283 million in a new financing round led by IDG Capital and Legend Capital. The company also received investments from Lighthouse Capital, Riverhead Capital, and Haining City. ESWIN designs and manufactures semiconductors for semiconductor packaging, displays and wireless connections. It currently has offices in Beijing and Hefei.
With a focus on the automotive sector, Eswin performs regular research into new semiconductor technology and develops innovative devices for use in cars and smart homes. In addition, the company also provides innovative semiconductor components to traditional manufacturers that want to upgrade their production lines.
Eswin’s main customers are Chinese auto manufacturers such as Geely and Dongfeng, who work closely with the group to develop innovative products.
Innoscience
Innoscience is a Chinese chip company that produces GaN-on-Si power transistors. The company is well-positioned to provide the security of supply needed by the industry. It recently established the first 200mm mass-production line for this technology. The company produces a variety of products, with a focus on the latest technologies. Products manufactured by Innoscience are available in various applications, and their design has reached international top-tier standards. Innoscience’s technology is widely useful in portable devices, smart phones, and more.
The company also develops microprocessors, flash memory, and integrated circuits for quantum computing, artificial intelligence, and OLED displays. Its global operations include circuit design companies and massive production fabs.
Innoscience produces about 10k wafers a month, but is targeting 70k. The company has invested in modern manufacturing systems to increase its production capacity. Innoscience is not a state-owned firm, but a privately-owned company. Innoscience is focused on producing normally-off/e-mode GaN devices with a range of voltages from 30V to 650V, and expected to reach 1200V soon.
The company also aims to mass-produce new SoC products that support WiFi 6. It is also looking ahead to consumer products that feature AR and VR. The company has mass-produced over 20 SoC products for Wi-Fi, Bluetooth, and cellular 4G. Innoscience’s management includes people with years of experience in prestigious firms. A recent survey shows that Chinese chip consumption is increasing faster than any other global market.
Its new 8-inch fab in Suzhou, China
Innoscience has plans to increase its capacity by 40% this year with the new 8-inch fab in Suzhou. The company says its new fab in Suzhou will be able to produce seventy-eight thousand 8-inch wafers per month by 2022. It also expects to generate profit of 1.5 billion RMB. It will employ more than 600 people and produce semiconductors for high-end automotive and industrial applications.
The company states that it is the largest or principal 8-inch Integrated Device Manufacturer (IDM) focusing on the GaN technology. As of December 2018, Innoscience had over 1400 employees, with 300 devoted to research and development. Its headquarters are in Suzhou, near Shanghai. While it is relatively unknown in the GaN industry, Innoscience has also recently opened design and sales support facilities in other countries.
The company manufactures both high-voltage and low-voltage enhanced-mode HEMTs. They have worked to lower specific on-resistance, shrink the size of their devices, and improve their performance. Their manufacturing process includes depositing a stress-enhancement layer during epitaxy and gate formation. They claim high device yields and excellent wafer-to-wafer reproducibility.
Lightelligence
A new Chinese semiconductor company is aiming to revolutionize the optical computing market, and Lightelligence is the latest addition to the MIT STEX25. Its mission is to de-risk 80 to 90 percent of optical computing challenges by 2021. The company is building deep relationships with tier-one customers, including OEMs and data centers. Its innovative semiconductor technology is a great fit for future cloud computing.
In a recent investment round, Lightelligence has secured $10.7 million in equity funding from Baidu Ventures and a group of US semiconductor executives. Lightelligence plans to use this funding to further its research and development of photonic chips. The Chinese chip startup hopes to develop a chip that can perform calculations faster than any other on the market. Lightelligence has received venture capital from several investors, including Baidu itself, Matrix Partners China, and China International Capital Corporation.
The company’s ancestors have worked at the Chinese Academy of Sciences, Harvard, Dartmouth, the Institute of Computing Technology, Microsoft, and Siemens. The founders of Lightelligence hail from companies such as Baidu, Microsoft, Siemens, and ByteDance. Its founders have extensive experience in chip design and engineering, including former Broadcom executives. Lightelligence recently raised $11 million in angel financing and has already completed two successful round-stage rounds.
Artificial Intelligence
A research project aimed at developing an AI system for Chinese semiconductor manufacturer Lightelligence aims to improve the quality of its products by utilizing massive language models. The AI-based system can help engineers improve their productivity by implementing new learning techniques. Among its applications is the creation of pair-programming software in Microsoft Visual Studio VSCode. In addition, DALL-E 2 works as a photo editing assistant and GPT-3 writes and edits documents in Google Docs. In the field of medicine, AI medical image recognition and detection technology is already finding a place in oncology, dermatology, and radiology. With the help of AI medical image identification, these systems can detect tumors and lesions. AI algorithms will eventually power the process of drug discovery. As a result, the FDA has laid out plans for AI-
Silicon photonics
Silicon photonics are a relatively new technology, but their promise is already making their way to mainstream computing. The company recently demonstrated a silicon photonic accelerator capable of running the Ising problem faster than a typical GPU setup. Called Pace, the chip is an integrated optical computing system comprised of 12,000 photonic devices that operate at 1GHz. Its speed represents an improvement of about a million times over the previous prototype, called Comet, which only included 100 photonic devices. It also marks the start of use cases that extend beyond AI acceleration.
Integrated optical computing
The Lightelligence Pace demonstrator chip combines an ASIC control die with an array of photonic die. It is mounted on a conventional substrate via a PCB and connected to an optical fiber array. The mixed-signal ASIC contains the digital block, the control logic, and SRAM for data storage. The analog portion of the ASIC bridges the digital block to the photonic devices.
Biren Tech
Beijing-based chip designer Biren managed to raise 4.7 billion yuan within 18 months from such investors like Ping An Insurance Group, CITIC Securities, IDG Capital, China Merchants Capital and GL Ventures. The company is targeting a valuation of 17 billion yuan. Its valuation may change as the company scouts investors.
The company is a self-developed GPU system developer who raised more than $800 million in financing. The startup has completed a round-B round of financing, and plans to seek another $786 million in funding at a $2.7 billion valuation. This is a sign that it is on its way to a major chip design and technology breakthrough. The company’s products are expected to power a variety of smart homes, and will also have a massive impact on the future of the Internet of Things.
A new company called Biren Technology was founded in 2019 and focuses on developing GPUs for AI, HPC, and graphics rendering. While the company does not plan to create a single GPU for every use, it does plan to launch its first product targeting cloud AI workloads. However, its future products will address other areas, including graphics and HPC applications. But it remains to be seen if Biren can meet the ambitious goals set by Tencent and Alibaba.
The founder of Biren Tech Semiconductor Company, Zhang Wen, is an experienced individual in chip design, cloud computing, and R&D. With unique insights in computer architecture, GPU, and DSA, this team dedicated their energy to developing a universal computing system. With the company’s efficient software platform, it plans to provide integrated intelligent computing solutions. As a new company, Biren will initially focus on building cloud data center network chips, but ultimately surpass the solutions currently available in many fields.
Zvision
A recent investment by Intel Capital has made two Chinese chip startups, including Zvision, one of the top 10. The move comes amid heightened tensions between the U.S. and China over chip manufacturing. Intel is also investing heavily in the global automotive industry. The chipmaker recently announced investments in two Chinese chip startups, Zvision and ProPlus. The chipmaker is bullish on Zvision’s technology, LiDAR solutions, and underlying chip.
The company plans to use the funds to continue developing its product line and commercialize existing products. It plans to create new products utilizing haptic feedback, and hire more workers. The company plans to reach mass production in 2028. It will also use the money to hire more employees. It has headquarters in Shenzhen. Zvision is a leader in biomedical imaging.
The recent Chinese government initiative focuses on building chip technology to cut reliance on foreign suppliers. This has inspired Chinese chip makers to build their own chips. Baidu and Alibaba both have chip companies. Home appliance brands like TCL and Haier have also joined the chip race. Chinese chip makers are joining a competitive field that requires years of investment with no immediate returns. It took Huawei more than a decade to enter the global chip market. Likewise, it will take many years for newcomers to break through.
The latest round of funding from a consortium of investment firms including China Renaissance, XPeng Motors, Shangqi Capital, Dongfeng Bank of Communications Auto Fund, and Intel Capital. Zvision said it will use the fresh funds to accelerate its efforts in developing MEMS lidar solutions. The company was founded in November 2017, and has already participating in several MEMS lidar projects and collaborations with other companies.
Eigencomm
The firm has a base in Beijing, China. It last underwent a strategic investment round in July 2018 and received undisclosed funding from local investors. EigenCOMM offers turnkey solutions for IoT ecosystems, relying on self-developed capabilities and employing engineers and scientists. The firm had five dozen employees as of September 2018.
With its cellular communication chips, Chinese semiconductor firm EigenCOMM is making waves in the IoT space. Established in February 2017, Eigencomm Semiconductor Company is one of China’s leading cellular communication chip designers. Its products are useful in smart meters, intelligent fire systems, home appliances, and more. These chips enable various 5G applications. The company plans to maintain its leadership position in the IoT chip market by enhancing its international development with the assistance of SoftBank Vision Fund 2.
The company has successfully researched two NB-IoT chips with low power consumption, high performance, and wide voltage. Its products are in various industries, including smart meters, intelligent fire protection, and asset tracking. Its latest breakthroughs will make it a leading cellular communication chip designer in China. Further, it will expand its global presence by creating more jobs in the field.
The company and the economy
As the world’s largest semiconductor market, China significantly impacts the semiconductor industry. The country accounts for 60% of the world’s semiconductor consumption, making it a major growth area for the industry. In addition to a growing population, Chinese demand continues to outpace supply, which means a bright future for chip companies. Eigencomm’s team includes former executives from leading technology companies like Intel and Qualcomm.
The country has been aggressively developing its chip technology to reduce its dependence on foreign chips. It has launched a national initiative to bolster its semiconductor industry. The initiative has attracted VCs and startups in the electronics industry. While Chinese government officials have often been secretive about funding, it is safe to assume that the number of startups in China is much higher than that of the entire world combined.
Nurlink
If you’re looking for a Chinese startup to back, look no further than Nurlink. Founded by a former Oracle employee and featuring its chip products, this company also boasts a machine learning platform called SkyDiscovery. While its capital haul is going towards mass production, its team includes people from major industry names, including Qualcomm, Intel, and ARM. As of 2018, China’s semiconductor consumption is growing faster than any other market, accounting for nearly 60% of world semiconductor demand. The company’s core management is composed of people with substantial experience in the chip-making process, from design to manufacturing.
Despite their relatively small size, the Chinese chip startup ecosystem is bursting with enthusiasm, attracting a wide range of investors and raising significant amounts of money. While competing with giants like Nvidia and AMD is no easy feat, their startup is on the cusp of a massive opportunity. Wang Endong, the chief scientist of big data and cloud computing provider Inspur, predicts exponential growth in demand for AI computing chips.
Sencomm
Are you curious about the Sencomm Semiconductor Company in the Chinese market? The Chinese semiconductor market is growing much faster than any other global market. China accounts for 60% of the world’s consumption of semiconductors, and domestic demand far outstrips supply which is driving the growth.
With more than 20 years of semiconductor design and manufacturing experience, Sencomm is becoming one of the top Chinese chip startups. The company plans to mass-produce new SoC products supporting the WiFi 6 standard. It is also looking at future consumer products featuring IoT applications, VR, and AR. The company has mass-produced over 20 SoC products for Wi-Fi, Bluetooth, and cellular 4G. The company’s management has worked at renowned companies, and its engineers have more than 20 years of experience.
While Chinese firms have made significant strides in many sectors, they still lag behind global competitors in several critical areas. One area where Chinese semiconductor firms can gain an edge over multinationals is in the supply chain. Many of these companies are targeting the “indigenization” of their supply chains to reduce the risks of entity listings and future export controls. In addition, Chinese firms are also aware of the dynamics of the local market.
XinpleTek
As China continues to develop its next-generation microprocessors, Chinese chip startups are racing to gain market share and challenge U.S. chip giant Nvidia. Investment in general purpose graphics processing units (GPGPUs), the advanced computing chip that renders images on computers, has surged. In addition to graphics, the chips are also gaining importance for AI computing, such as facial recognition.
Although local officials supported the upstart chipmakers, the two largest failed to build chips for commercial use. Wuhan Hongxin Semiconductor Manufacturing Corp., founded in 2016, and Jinan XinpleTek, founded in 2020, never commercialized their products. After HSMC’s woes, the Jinan government forced Wang Gang’s company out of its initial project as a main shareholder. Both companies did not respond to requests for comment.
XinpleTek creates chips for consumer electronics, including the Internet of Things (IoT) and wireless communications terminals. The company is in Shenzhen, but originally had its headquarters in Beijing. It counts Xiaomi as its third-largest shareholder with a 6.98 percent stake. Currently, OnMicro focuses on developing a 5G RF front-end chip. It’s eagerly waiting for widespread adoption of 5G networks in China.
While Chinese semiconductor firms still rely heavily on foreign companies for tools and equipment, they are becoming increasingly self-sufficient in this area. China’s reliance on foreign companies means that Chinese companies are more vulnerable to geopolitical tensions and other factors that may affect the semiconductor industry. Chinese semiconductor companies are developing their own technologies to differentiate themselves from their rivals. This policy will continue to be effective for at least the next decade, when Chinese companies become increasingly competitive.
Tacsense Technology Shenzhen Company
TacSense is developing tactile sensing technology for medical devices, wearable electronics, and robotics. The company claims to develop an ionic-electronic interface in response to mechanical stimuli using proprietary materials. The company has developed three types of tactile sensors: moisture-proof, temperature-tolerant, and flexible. It has offices in China, Europe, and the U.S.
Former SMIC employees, including Chang, founded the company. After a four-year stint at Quester Technology, Wang decided to start his own company. The company, which provides chip makers with wet-processing technologies, has grown rapidly since listing on the local stock market. In the past two years, Tacsense has enjoyed growth of 40 percent per year.
China imports US$300 billion worth of chips each year, and much of that money is re-exported as finished electronics. The Chinese government has repeatedly urged the country to become more self-sufficient in chip production. However, the country still relies on imported chips for a significant portion of its electronics needs. While the government has not specified a minimum amount of chipmaking technology in China, it has encouraged chipmakers to seek foreign investment and talent.
Conclusion
China has quickly become a global leader in developing innovative electronic devices. The country’s emerging technology sector has made significant strides in fields like artificial intelligence, semiconductors and self-driving cars.
This is just the tip of the iceberg, as many of the world’s top tech companies use components produced by China-based companies to manufacture their products. With China continuing to invest heavily in developing new innovations, it won’t be long before we see a Chinese firm take on a leadership role in these areas.
Browse through these Chinese tech companies and you’ll see just how innovative this country is when it comes to new product development.
