U.K. Should Emulate Israel for Semiconductor Startups to Succeed

Reprinted from EETimes Europe / October 14, 2021 Nitin Dahad

Senior executives from the U.K. semiconductor industry met at Bletchley Park to discuss how to nurture and grow the country’s semiconductor startups.

This week, some of the most successful senior executives from the U.K. semiconductor industry gathered at the birthplace of modern computing, the Bletchley Park National Museum of Computing, to discuss how to crack the code to chip startup innovation in the country.

It was rather like a re-run of Captain Ridley’s shooting party [see my note at the end of this story], quipped Sean Redmond, managing partner of the incubator Silicon Catalyst, co-host of the gathering this week with the National Microelectronics Institute (NMI). The two organizations announced a collaboration just a couple of weeks ago to work on creating the right environment for more U.K. semiconductor startups to be more successful globally.

The gathering this week was aimed at bringing together in a room those who can potentially help make that happen, discuss what are the challenges and the possible solutions. There were successful chip and EDA industry veterans like Jalal Bagherli, Simon Davidmann, and Stan Boland, as well as other influencers in the ecosystem such as John Goodacre and Neil Dickens, plus of course various startup founders, as well as government representation on semiconductor industry policy.

The debates on challenges are for semiconductor startups in the country threw up some common themes, as we heard from two startups, Salience Labs and Cascoda, as well as the panel discussion that followed.

It won’t be anything new for those familiar with the U.K. scene over the last 20-25 years as it’s the same old story: lack of long-term capital for scaling up, access to talent, and the right kind of support from government programs. On the latter point, one panelist said many U.K. startups have to apply for DARPA funding in the U.S. or look for European Union grants, as there’s no real program for them in the U.K.

The CEO and co-founder of Salience Labs, Vaysh Kewada, talked about her experience as a new startup established in 2020, and how as part of the Silicon Catalyst program the company already raised its first funding in March 2021, and is about to close its second round of funding to build the company’s prototype chip. She highlighted the top three needs of a semiconductor startup as supply chain, customer integration, and hiring at speed. On the supply chain, she said being part of Silicon Catalyst helps, especially since their SoC is multi-platform. Customer integration is also essential as, she said, “We need to be able to show traction and demonstrate integration with a customer’s requirement, hence the need to work closely with customers.”

Salience Labs is developing a high-speed photonics chip for AI acceleration. The company has shown that photonic processors can process information much more rapidly and in parallel, something electronic chips are incapable of doing. Their work on this was published in the Nature journal earlier this year. Kewada said, “The market needs a new compute platform as a result of the end of Moore’s Law and with AI compute requirements doubling every three months. With the rise of silicon photonics, we have been able to come together as a team to create hybrid photonic in-memory compute. Photonics can enable us to get up to 50x improvement in inferences per second per watt compared to electronics.”

Meanwhile, Bruno Johnson, CEO of Cascoda, explained how his company played the long game having established the company in 2007 and without having the support of a dedicated chip industry support network as provided by Silicon Catalyst now. He talked about how Cascoda worked over many years to realize their vision of enabling standards-based IoT to address the huge lack of interoperability in the industry. It invented a new type of radio demodulator which offers a significant increase in range by improving receiver sensitivity, without sacrificing power consumption and with no need for a power amplifier. Johnson’s approach to growth is to work on developing a scalable technology that integrates into existing infrastructure, and work with or be part of standards bodies (he’s involved with the Thread Group as well as the Open Connectivity Foundation).

The panel: Where are we now, where do we want to go?

Having heard from the two startups, the panel dissected where is the U.K. semiconductor industry right now as regards nurturing startups, and where could the industry learn from.

Tim Ramsdale, CEO of Agile Analog, a four-year old startup who recently closed a $19 million funding round, highlighted that the semiconductor industry is a long-term play, in the range of 20-30 years. “But in the U.K., the appetite for investing in semiconductors wasn’t really there, say five years ago. We also need larger ecosystem players here,” he commented, the latter point referring to the ability to get a wider skills and talent pool to enable hiring locally.

John Reilly, the sales director for silicon partners in EMEA, India and Russia for Arm, illustrated how Israel has managed to succeed with nurturing its chip startup ecosystem and how this could be a model for the U.K. “Our business in Israel is almost exclusively with startups. So what lessons can we learn? Well, if you look at the Israeli military, it churns out a pool of experienced resources [who then go on and do their own tech startups when they leave].” In addition, he said success breeds success. “This is when successful entrepreneurs go and help other startups and also become role models themselves.”

Reilly certainly has a key point. Two of Israel’s military units, unit 81 and unit 8200, have alumni who have launched many successful technology startups. Since they are elite units looking at things like security and intelligence, and whose remit is to use technology to develop solutions that keep Israel safe, they have excellent skills and experience of using technology to solve real world problems.

When they come out of the units, they already have teams that have worked together successfully so often come together to form their own startups – an example of a recent one is NeuroBlade, who just raised $83 million for its compute-in-memory chip. Hailo is another example. According to one report earlier this year, soldiers and officers who served in Unit 81 between 2003 and 2010 have since then founded many startups – in fact around 100 veterans from the unit at the time founded 50 companies and have raised over $4 billion, with valuations over $10 billion.

Coming back to the panel, Alec Vogt, director northern Europe for Synopsys, talked about the importance of an incubator like Silicon Catalyst for startups. “In the U.K., there is no lack of creative ideas. However, what happens next is not so great. Because there isn’t an appetite for longer term investment in semiconductors in the U.K., the ecosystem supporting semiconductor investments is weak, and there are no real government funding programs.” He then said that there was a danger of the country closing in on itself. “We need to be open, create a pool of talent, bring expertise and funding here so that the great ideas can have more chance of becoming a success.”

The Silicon Catalyst and NMI collaboration is meant to address some of the issues around access to various aspects of support, including tools and in-kind benefits from key partners of the network, plus access to funding sources.

Redmond said, “The UK has world class research universities and a track record for semiconductor innovation. It also has fifteen semiconductor fabs specializing in advanced processes for photonics, power and mixed-signal RF applications. This manufacturing base has been extended with a strong MEMS, PICs and ASIC ecosystem. Combining these local assets with international partners and entrepreneurial drive creates a springboard for semiconductor start-up success.” Hence, his vision was to help create a better support network for semiconductor startups to help them grow.

Meanwhile, the legal entity behind NMI, called TechWorks, was keen to work with Silicon Catalyst to ‘de-risk’ the path to growth for chip startups in the country. The CEO of TechWorks, Alan Banks, said, “By cultivating collaboration and ensuring government recognition of the semiconductor sector in areas such as automotive, IoT, communications, AI and edge computing, we have ambitions to facilitate the next generation of semiconductor companies building on the legacy of companies such as Arm, Wolfson, Icera and, more recently, Graphcore.”

Note: “Captain Ridley’s shooting party” was the cover name used by secret service agents from MI6 and intelligence experts who headed out to Bletchley Park in 1938 to activate the secret base that became the home of the code breaking center, where Alan Turing and many others broke a number of German codes, including that of the Enigma machine.