LONDON – STMicroelectronics NV, Europe's leading chip company, has announced the launch of ST New Ventures, a corporate venture capital fund. However, the announcement did not indicate how much money the organization has at its disposal.
ST New Ventures will invest in technology, product and service startup companies, preferably at the early-stage, partly to help ST gain an understanding of emerging markets for semiconductors, but also to produce a return on investment. Healthcare, Cleantech, and Smart Infrastructure are among the main areas of focus, ST said.
ST New Ventures will be a wholly-owned subsidiary of ST headquartered in Geneva, Switzerland, led by managing director Loic Lietar. It will invest alongside other financial and corporate venture capital funds.
The group has no specific geographic focus, according to its website, and nor does it invest with a view to making, or fostering a relationship between the startup and STMicroelectronics. However, the managing director and partner both have a deep experience of semiconductor business acquired as executives with ST. ST stressed that while investments could be in fabless chip companies they could also be in product companies and service providers.
Venture capital funding of fabless semiconductor companies has been declining for a number of years – particularly at the early-stage – as independent venture capital funds have turned their back after a decade of low returns after many years of investment.
This has given rise to increasing reliance on strategic investors but also to initiatives within the Global Semiconductor Alliance, the European Microelectronics Academy and the Singapore Semiconductor Industry Association seeking to address the situation.
Yes, I agree. This gives ST the opportunity to take an interest in a startup and help direct their activities with an eye to acquire them in the future. It may have less risk to the company than having their own employees try new risky ventures.
Actually, most companies desperately want innovation, but are too afraid of failure to take the risk. It took me a long time to understand the resistance to new ideas until I realized that only one idea in 100 pan out to be a useful product. Only one of 100 of those actually make a profit. Innovation is a great thing, but a business just cannot take the long shot risk. Let alone try to figure out if the idea is the one that will make money.
I never understand why so many CEOs restrict staff from developing new ideas - if they help the inventors with their early-stage problems, technical, resources, logistic and business, they would earn great respect from the new company's founders. In fact, anyone who did that would be described as 'enlightened management'.
I guess it is the same dumb human behaviour that causes people with power to use that power to get more of whatever turns them on, without considering the consequences of robbing those under their power.
Why they always tighten the screw, never loosening, even taking more than the minions can sustainably afford, and never back off until its too late.
Lack of empathy is it?
if its just another VC fund for chip companies, I wont put much hope on this. I would recommend ST to start something like an incubation centre for chip companies, where the startups get access to ST's resources like EDA tools,development toolkits/libs,test hw and some free ES for their 1st product.