Are electronics startups becoming more thrifty?

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Will trend for low cost design bring investment back to chip sector?

Publitek has traditionally done a lot of PR for electronics startup companies. Obviously, this has reduced under today’s economic climate but of the startups and young companies still around  a we’ve noticed a trend emerging to become a little more thrifty in their approach.

The 2008 crash, coupled with a handful of high-profile losses, led to a lack of investor faith in the sector. And even when company’s with large VC backing have exited profitably, it’s occasionally been for little more than the investors could have made by leaving the money in a high interest bank account… but with a lot more risk involved.

What we’re now seeing is a host of startup clients (both past and present) taking a lower risk model that uses less VC money, focuses it into projects that will deliver an innovative product in a sector that is about to take off, and delivers a far less risky model – for the investors, allowing them to make more, albeit smaller investments.

The VC title Venture Beat has asked us to write about this emerging trend – albeit asking us not to use it as an opportunity to promote our current chip clients – and the article can be found here.

As we mention in the piece, the global chip industry is the bedrock of the $1 trillion electronics industry and startups are the ones that either come up with the breakthroughs or exploit them. Has the bubble burst for the chip design space – I don’t think so… especially not if you take a long term view and look towards R&D centres such as Cambridge, the South West here in the UK or Austin Texas and Silicon Valley in the US.

The investment we saw may never be the same again but the emerging trend for lower costs within this sector is reducing the risk, and should — we hope – tempt investors back.


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