LONDON Ė Cre8 Ventures, a 2005 offshoot from Mentor Graphics formed in the UK by Carson Bradbury to support startups with networking contacts and other benefits but not venture capital, has been extended, taken independent and renamed as the European Microelectronics Academy (EMA).
The EMA has similarities to an initiative in Silicon Valley that is being launched by the Global Semiconductor Alliance (GSA) with participation from Intel Capital, Cadence and TSMC amongst others (see Group tackles declining VC for chips in the November edition of EE Times Confidential).
Just as the GSA working group plans to do in U.S., the EMA intends, with a continent-wide remit, to reduce the cost and time to market for microelectronics startups, and particularly for fabless chip company startups, which are suffering from a lack of capital funding at the early-stage, executives said.
Bradbury, founder of the EMA and a similar organization in India called the Indian Microelectronics Academy, is CEO and has attracted Chris Smart, general partner at Acacia Capital to take the role of chairman.
Chris Smart, general partner at Acacia Capital and chairman of the European Microelectronics Academy
One motivation for the move is that without a healthy pipeline of startups coming along in semiconductors, companies such as Mentor Graphics and IP licensors will have fewer customers in years to come. That pipeline has been impacted as venture capital firms have turned away from investing in fabless chip companies because in the last decade the investment cycles have proved too long and the returns too small, according to Smart.
As a result VCs, were they are prepared to get involved with semiconductors for IT applications, are looking to come in as late-stage investors where the company has ICs in production and customers taking delivery. The situation is somewhat better for developers of ICs and other technologies away from the leading-edge of digital design, Smart said. Some VCs have simply closed down their semiconductor-savvy groups while there are some that are going "counter cyclical" and looking again at chips.
Smart thinks that EMA can improve the landscape for startups by reducing their costs, reducing their time to market and acting as a focus for VCs who would be prepared to invest in companies given support from the broader community. "Europe is a generator of ideas and it needs to be supported," said Smart. Adrian Buckley, northern European area director for Mentor Graphics, said the Cre8 Ventures approach had proved itself over the period 2005 to 2009."Mentor got a 40 percent better return in regions where Cre8 operated," said Buckley.
EMA is an open and independent organization that is seeking the involvement of EDA companies, IP licensors, foundries, strategic investors, venture capital firms, Smart said. Amongst the benefits it can bring is helping to negotiate low- or no-cost access to EDA tools, multiproject wafer runs, peripheral IP. The support can also be in the form of networking to provide experienced managers to run startups. "There is a benefit in the interested parties collaborating;
efficiencies of scale, access to foundries, IP, design services, and as a
focus for fund raising," Smart said..
There is, so far, no list of companies involved in EMA. It has only had one board meeting so far, Smart said. The board comprises: Smart; Bradbury; John Forrest, founder of NTL and chairman of Mirics Ltd.; Jacques Noel, formerly with STMicroelectonics; and Libby Kinsey, investment manager at NESTA Investments.
EMA has also drawn up steering committee made up of entrepreneurs comprising: Simon Atkinson, CEO of Mirics Semiconductor Inc.; David Baillie, CEO of Cambridge Semiconductor Ltd.; Glen Collinson, director at Neul Ltd.; Neil Dickins, founder of Intellectual Capital Group recruitment agency; Simon Knowles a cofounder of Icera Semiconductor Ltd.; Jalil Oraee formerly CTO with Oxford Semiconductor Ltd., Georges Karam, chairman and CEO of Sequans Communications SA; and U.K. broadcaster Maggie Philbin.
The group has set itself the goal of being involved in the creation of a billion-dollar company within ten years. However, Smart said it would also measure itself in terms of engagements with startups and partner companies.
Related links and articles:
Group tackles declining VC for chips
Four Israel VCs bet on fabless
Scots institute to host free EDA tools for startups
Mentor initiative helps startup Mirics