Venture Capital funding in semiconductors going up...
I was reading through the 2006 Venture Capital Industry Report and found a very interestin, and very heartening, news.
(Pg. 10)
The number of companies and amount of capital
invested in semiconductors and electronics has grown
significantly, reflecting increasing activity in storage,
mobile, and consumer devices.
The median amount invested in semiconductors is standing at bubble-era funding - $10m (Pg. 16)
(FYI - investment in healthcare and bio-pharma services are reaching MUCH higher levels than bubble-era funding)
It was also very interesting to note that the most active corporate investor was … Intel Capital
However, early stage companies were left to fend for themselves in the big, bad world
(Pg. 14)
As they have in recent years, investors also concentrated a
bit more heavily on established companies that were generating
revenues, rather than those in startup and development phases
Number of deals closed in Semiconductors is pathetically low (34 compared to 103 pre-bubble). However pre-money valuation has increased from 13.7 M to 20 M (I dunno if this is because the VC blokes have too much money to throw around, or has the general quality of the startups gone up??)
Now for the bad news - # of deals in Design Automation software has gone down to 27 from last year’s 39 (Pg. 25). In fact the only segment in the semiconductor software industry which is going up is Communications/Connectivity (???)
The EDA companies which successfully raised capital were also interesting - LVL7 Systems was the highest with $15M funding and Eridon the least with $1.7M funds (one more thing was that several of the EDA companies receiving funding were third/later rounds!!)
Compare with ASIC or General purpose IC companies - highest funding was $48M for SolarFlare and least was $4.65M for MultiSpectral Imaging.
Number of semiconductor companies going for IPOs in the US market(Pg. 56) was 4 (+ 14 M&A). Compare it with the European market where the IPO number was 47 !!!! Read that again - 47
The amount of funds raised by VC firms was 160% of 2004 fund-raising. Israel had 20 IPO’s in Semiconductors…
Where’s that book on STL…