Ten Chinese semiconductor start-ups that got a leg up from their founders’ foreign experience
- AMEC has a 1 per cent share of the global etcher market dominated by US players but it holds 14 per cent of the Chinese etching systems market
- GigaDevice was established in Silicon Valley but founder Yiming Zhu moved the company to China after he saw there were no indigenous memory chip makers
Although China imports US$300 billion worth of chips annually – about US$160 billion of which are re-exported in finished electronics products – it is a laggard when it comes to making them.
Chinese President Xi Jinping has repeatedly urged the country to become more self-reliant when it comes to core technologies like semiconductors, which power all manner of electronics from AI to smartphones.
Officially, the Chinese government has never stipulated that chip making technologies should be of Chinese-origin. Rather, it has emphasised the need to attract foreign capital, technology and talent.
To that end, a large number of overseas trained and educated Chinese nationals have heeded the call and returned to China to establish start-ups in the semiconductor field, ranging from electronic design automation (EDA) software and IC design to silicon foundry and wafer processing equipment.
Most of the founders on this list started their companies well before the US-China tech war, but have had to navigate a more difficult external environment amid US bans on certain core technologies over national security concerns.
Why semiconductors are important in the US-China tech war
China’s most advanced chip maker, Semiconductor Manufacturing International Corp (SMIC), was established in 2000 by Richard Chang, who worked for more than 20 years as a wafer fab specialist at US chip major Texas Instruments.
Although Chang resigned from SMIC in 2009, many have followed in his footsteps by starting their own companies after learning the ropes at foreign semiconductor companies. Here are 10 of them.
ACM Research (ACMR)
Business: Semiconductor production equipment
Founder: President and CEO: David H. Wang
Previous experience: Quester Technology
Established/headquarters: 1998, Silicon Valley (moved to Shanghai in 2006)
Revenue (2019): US$108 million
ACMR, which provides wet processing technology used by chip makers, was originally domiciled in the US. In 2006 company founder David Wang moved the business to Shanghai and it listed on the local stock market in 2017.
ACMR has posted 40 per cent annual growth over the past two years and its projected revenue for 2020 is $151 million, according to Jefferies.
Before forming ACMR, Wang spent four years at US company Quester Technology, according to his LinkedIn profile. He received a PhD and Master of Engineering in Precision Engineering from Osaka University and a Bachelor of Science in Precision Instruments from Tsinghua University.
Wang is credited with inventing stress-free Cu (copper) polishing technology and he holds more than 100 patents in semiconductor equipment and process technology. The company’s equipment includes coating, developer, wet stripping, scrubber and plating systems for the production of integrated circuits.
The company counts Korean chip maker SK Hynix and Chinese foundries SMIC and Huahong Semiconductors as key customers. Yangtze Memory Technologies Co, a NAND flash memory maker in Wuhan, China, is ACMR’s biggest customer, contributing 28 per cent of revenue last year, according to Jefferies.
Advanced Micro-Fabrication Equipment Corp (AMEC)
Business: Etching and deposition equipment
Founder/CEO: Gerald Zhiyao Yin
Previous experience: Lam Research, Applied Materials
Established/headquarters: 2004, Shanghai
Revenue (2019): US$298 million
AMEC is China’s largest supplier of etchers and chemical vapour deposition (CVD) systems used in wafer fabrication. In etching it has 1 per cent of the global market dominated by US players like Applied Materials and Lam Research but holds 14 per cent of the Chinese etching systems market, according to Jefferies. Its 5nm etching equipment was used by leading global foundry TSMC starting in 2019.
Gerald Zhiyao Yin has served as AMEC’s chairman and CEO since he established the business in 2004. Before returning to China, he spent 16 years at Lam Research and Applied Materials where he headed their etching equipment divisions.
Yin emigrated from China to Silicon Valley in 1984, spending two years working for microprocessor giant Intel before he made the switch to the process equipment side of the business.
In 2007, Applied Materials sued AMEC for “misappropriation” of trade secrets and unfair competition. In a settlement reached in January 2010, AMEC agreed to pay Applied an undisclosed amount for patents allegedly obtained using Applied trade secrets, and both companies agreed to collaborate on projects in the future.
A patent infringement lawsuit AMEC filed against US equipment supplier Veeco Instruments relating to metal-organic chemical vapour deposition (MOCVD) was settled in early 2018.
AMEC listed on China’s STAR market in 2019.
Brite Semiconductor
Type of company: Fabless/ASIC chips
Founders: Charlie Zhi and Zhuang Zhiqing
Previous experience: TI, Conexant, Broadcom, Jazz
Established/headquarters: 2008, Shanghai
Funding: $US49.99 million raised in August 2020
Brite Semiconductor was founded in 2008 with venture capital backing from China and abroad. The company closed its Series D fundraising led by Chinese state-own Haitong Securities in August, raising a total of US$49.99 million.
The company was founded by Charlie Zhi and Zhuang Zhiqing, who both worked for semiconductor companies in the US and Asia Pacific. Zhuang and Thomas Xu serve as co-CEOs, according to data from PitchBook and the company’s website.
Zhuang has previous work experience at Texas Instruments, Conexant Systems, SimpleTech and Broadcom in the US.
Before Brite, Zhi held senior positions in chip making companies both in the US and Asia Pacific region, including as general manager of Jazz Semiconductor’s China Operation for two years. Jazz, an independent wafer foundry formed in 2002 with the acquisition of the Newport, California wafer fab of Conexant Systems, was acquired by Israeli foundry Tower Semiconductor in 2008. Before joining Jazz, Zhi worked at Chinese foundries ASMC and SMIC.
Enflame Technology
Business: AI chips for cloud
Founders: Zhao Lidong (CEO) and Zhang Yalin (COO)
Previous experience: AMD, Juniper Networks
Established/headquarters: 2018, Shanghai
Funding: US$99 million raised in Series B in May
The two founders of Enflame, which focuses on developing chips for cloud computing, gained their experience in semiconductors at US chip maker Advanced Micro Devices (AMD). CEO Zhao Lidong worked in Silicon Valley for 20 years, including seven years with AMD as senior director of the computing division, involved in product planning and R&D for CPU/GPU and APU products.
Before AMD Zhao worked for Juniper Networks, responsible for the R&D of network security chips, and at fabless chip maker S3 Inc, involved in R&D for GPU graphics processor chips. Before co-founding Enflame, he spent four years at Ziguang Group in China, which operates a subsidiary called RDA Microelectronics.
Zhao holds a master’s degree in electronics and computer science from Utah State University and a bachelor’s degree in electronic engineering from Tsinghua University.
Co-founder and Enflame COO Arthur Zhang Yalin joined AMD in 2008 where he led the development and production of chip products at AMD’s Shanghai R&D centre.
Zhang also contributed to the founding and management of the AMD Shanghai R&D Centre Fusion Chip Division, AMD Beijing R&D Centre and AMD China Multimedia IP Division. Before AMD, Zhang served with Shanghai Qima Digital Information Co. from 2000 to 2007 as the head of the design department, developing a series of set-top box chips.
The company raised US$99 million in Series B venture funding in a deal led by SummitView Capital in May 2020, according to PitchBook data.
GigaDevice Semiconductor
Business: Fabless chip company
Founder/CEO: Yiming Zhu
Previous experience: MoSys
Established/headquarters: 2005, Beijing
Revenue: US$489 million
GigaDevice was originally established in Silicon Valley but founder Yiming Zhu moved the company to China in 2005 after he saw there were no indigenous memory chip makers. The company’s original business model was licensing IP to other chip companies but it has since focused on designing its own chip products, including flash memory and general-purpose MCU products.
GigaDevice listed on the Shanghai Stock Exchange in August 2016 and was ranked as one of the 10 best-performing stocks on the CSI 300 in 2019.
GigaDevice received support from the National Integrated Circuit Industry Investment Fund – a government-backed fund created in 2014 to support local semiconductor companies.
Zhu founded GigaDevice with “a couple of guys who only know about memory,” according to an interview he gave to EE Times. The Tsinghua University graduate earned a master’s in electrical engineering at SUNY-Stony Brook in 2000, then spent eight years working in the US, including a stint at California-based memory designer MoSys.
In July 2018, Zhu resigned as GigaDevice CEO to take up the post of chairman and CEO of Innotron Memory, since renamed ChangXin Memory Technologies (CXMT), a memory chip maker based in Hefei.
Primarius
Business: Electronic design automation
Founder/CEO: Zhihong Liu
Previous experience: Cadence Design Systems
Established/headquarters: 2010, Jinan, Shandong province
Funding: Intel Capital invested undisclosed sum in May
Primarius is not a new company in the highly specialised field of electronic design automation (EDA), having been established 10 years ago, but its roots go back much further than that. Chairman and CEO Zhihong Liu studied at the University of California at Berkeley in the early 1990s where he co-developed an industry standard model for IC designs that is still in use today.
Liu then co-founded a US based EDA company that eventually merged with another to form Celestry Design Technology. In 2003 Celstry was acquired by US based EDA giant Cadence Design Systems but three years later Liu and his core engineering team instituted a management buy-out, getting back most its products and customers. That business would eventually become the Chinese based company Primarius.
In May this year Intel Capital said it invested an undisclosed amount in Primarius as part of its latest investment round in 11 chip companies worth US$132 million in total.
Silicon Integrated
Business: IC design/fabless
Founders: Liu Deheng, Rui Quan
Previous experience: Philips, NXP
Established/headquarters: 2016, Wuhan, Hubei province
Funding: Raised US$25.28 million in Series B round in June
Silicon Integrated specialises in analogue and mixed-signal chips for applications in optical sensing and 3D vision. It has R&D and sales offices in Shenzhen, Shanghai, Europe and the Americas. Co-founders Rui Quan and CEO Liu Deheng studied engineering at Delft University of Technology in The Netherlands and both landed jobs at Dutch-based semiconductor companies after graduating.
Liu worked as a research engineer for Philips in Eindhoven for two years while Quan was a senior analogue design engineer at Dutch chip maker NXP Semiconductors for four years.
In June this year Silicon Integrated said it completed a 180 million yuan (US$25.28 million) series B round of financing led by CTC Capital. Source Code Capital, Allin Capital and Jiangmen Investment Fund also took part in the round.
“3D vision and perception is a highly promising and explosive track. Technology innovation and market structure are rapidly evolving, and there is a huge potential for growth,” said CTC Capital partner Tang Zhihua. “Silicon Integrated is backed by decades of experience in European research and development, and an excellent domestic management team.”
Spectrum Materials
Business: High purity gases and materials
Founder: Guofu Chen
Previous experience: Matheson Tri-Gas, USGS
Established/headquarters: 2009, Quanzhou, Fujian province
Funding: Undisclosed sum from Intel fund in May
Spectrum Materials supplies high-purity speciality gases and materials for semiconductor wafer fabs and LED, LCD and photovoltaic production. The company’s major clients include TSMC, SMIC and Toshiba.
Guofu Chen founded Spectrum in February 2009 and serves as chairman, CEO and president.
Earlier in his career he worked as a product marketing manager for US speciality gas supplier Matheson Tri-Gas and from 2004 to 2008 served as president of US Gas Standards (USGS), during which time he oversaw the setting up of a facility in Yangzhou, China, according to his LinkedIn profile.
Before founding Spectrum Materials Chen did a 10 month stint as president of Yangzhou Taiyo Nippon Sanso, the Chinese affiliate of Japanese gas giant Taiyo Nippon Sanso.
In May this year, Intel Capital said it invested an undisclosed amount in Spectrum Materials as part of its latest investment round in 11 chip companies worth US$132 million in total.
VeriSilicon Microelectronics
Business: Semiconductor IP
Founder, president and CEO: Wayne Wei-Ming Dai
Previous experience: Cadence Design Systems
Established/headquarters: 2001, Shanghai
Revenue (2019): US$205 million
Before founding VeriSilicon, Wayne Wei-Ming Dai was co-chairman and chief technology officer of Celestry Technologies, an EDA company acquired by Cadence Design Systems in January 2003.
VeriSilicon, which employs more than 1,000 people worldwide, has six design and R&D centers in China and the US, as well as 11 sales and customer service offices worldwide.
Under its “Silicon Platform as a Service” (SiPaaS) business model, the company creates silicon products for applications in consumer, automotive, computer and Internet of Things (IoT) applications.
Dai received his bachelor’s degree in Computer Science and PhD in Electrical Engineering from the University of California at Berkeley. He also was a professor in the department of Computer Engineering at the University of California at Santa Cruz.
Although not a VeriSilicon founder, executive vice-president Wei-Jin Dai, Dai Wei Ming’s younger brother – who joined VeriSilicon in 2016 – was president and CEO of Vivante Corp before it merged into VeriSilicon. Before joining Vivante, Dai was a corporate vice-president at Cadence Design Systems, which acquired the company he co-founded, Silicon Perspective Corp.
X-Epic
Business: Electronic design automation
Founder/CEO: Wang Libin
Previous experience: Cadence, Synopsys
Established/headquarters: 2020, Nanjing, Jiangsu province
Funding: Raised US$60 million in three rounds since October
Wang Libin, founder and CEO of X Epic, started at Cadence Design Systems as an engineer when the US firm opened its first China office in Shenzhen in 2000. He worked at Cadence for 15 years in both engineering and sales. In 2015, Li jumped to rival firm Synopsys, where he stayed for five years before founding X-Epic, according to a report from Ijiwei.com, a media outlet that focuses on the semiconductor industry.
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In August, X-Epic also hired EDA industry veterans TC Lin as chief scientist and YT Lin, who previously worked at Cadence and Synopsys, as vice-president of research and development.
In December the company, which stands for “accelerating EDA pioneer innovation centre”, raised more than 200 million yuan (US$30.6 million) in a new Series A round of fundraising, bringing its total raised this year to US$60 million following two other investment rounds that closed in October and November, according to statistics from PitchBook, which tracks deals in private capital markets.