Next stop, Guam?

"I have built three chip companies for less than $25 million this way, so it can be done," said Tan who helped bring the venture model to Asia and sits on the board of China's Huaya Microelectronics.

"The semiconductor center of gravity is moving West from Silicon Valley, and it's about at Guam right now," quipped Stevens who has a couple early stage investments in chip startups in China where costs are lower.

Stevens has also been studying a model used in the biotech industry. Big companies help fund startups and once their products are ready to go they buy up the companies outright in what amounts to pre-arranged marriages.

The startups save the costs of rolling out sales, marketing and support teams. Cisco Systems used a version of this model to get into storage networking markets with startups Andiamo and Nuova Systems.

Other opportunities will emerge as the industry reaches what may be the end of CMOS scaling, perhaps around the 10 nm node. "There has to be a breakthrough in investing on component companies because there has to be a discontinuous change," said Stevens.

Rappaport talks about new "horizontal" plays in semiconductor investing that avoid the high verification and support costs. For instance, he is backing Unity Semiconductor, a startup working on an alternative to NAND flash that because of its regular cell structure and low functional complexity faces low tape out and verification costs.

Both Rappaport and Tan are moving into more analog and mixed-signal investments. Such technologies typically require less advanced process technologies yet they can be key to emerging video and communications markets.

For example, August Capital is backing Scintera Networks, a startup Rappaport says is making a high-speed analog signal processor that will be cheaper and more power efficient than DSPs.

"These chips are relatively low cost and we can build them with a small team, so we are not spending $25 million but $5-6 million," he said.

Whatever the direction, some veterans like Tan plan to stay in the semiconductor game for the long haul.

"We make five to seven investments in semiconductors every year, and we will continue at that pace," said Tan. "I am a diehard semiconductor guy, that's what I do," he said.