A study of corporate entrepreneurship in the semiconductor industry

Abstract

The number of semiconductor companies receiving venture funding has been decreasing through-out the last decade. The economics of manufacturing semiconductors do not offer an attractive risk-reward profile to the traditional VC model of investing. Moreover, fewer significant positive funding outcomes have further pushed VCs away from this space. Stagnant in-house R&D, dying start-up ecosystem have led the large corporations to consider corporate entrepreneurship to boost the innovation possibilities. In the past 20 years, many large semiconductor corporations have established corporate venture capital units and other initiatives to foster innovation and growth, while putting idle cash on the balance sheet to good use. However, corporate entrepreneurship has seen a mediocre performance with many initiatives not yielding the desired success. This thesis focuses on Corporate Entrepreneurship, with a special emphasis on Corporate Venture Capital (CVC) in the Semiconductor industry. Primarily relying on interviews and secondary research, it attempts to study some of the more successful CVCs in the industry, and understand, the key traits that have made them successful, and how they tackle the challenges facing the industry.