China's fabless startups to get a boost

BEIJING, CHINA: At a time when most venture capitalists are outing investment plans on the backburner, China is looking at promoting as many as 30 fabless semiconductor startups.

The country’s planners believe that the start ups can grow to $200 million or more in annual revenues. They are said to be setting apart an amount from the $586 million China economic stimulus package announced late last year.

The money would be utilized as funds for grants, loans and equipment for the fabless startups. A report added that the planers have started working with industry executives to define target markets and attract venture capital funds.

According to Lip-Bu Tan, chairman of venture capital firm Walden International, believed to be the largest investor in China's semiconductor industry after Intel Capital, has said that he is striving to help organize the promotion of the fables startups.

"The main attraction is the China market is so big, and they need the semiconductors to serve the market," Tan said, adding "China is a leading consumer of electronic components now, so now is the time to build the fabless companies."

Significantly, market research firm IC Insights had recently said that China's IC market is expected to grow to $100.1 billion in 2013, when it will represent 35 per cent of the global chip market. China's 12 per cent growth rate will be twice that of the global chip market, it has been estimated.