As mentioned in my introductory post on the 2nd Chipnation Congress, I will be sharing my thoughts on some of the talks I enjoyed there. In this post I will be talking about the roundtable "SPANISH CHALLENGES: VERTEBRATING THE NATIONAL SEMICONDUCTOR ECOSYSTEM", moderated by Mr Javier Calpe, Analog Devices’ Design Center Manager. The rest of the panelists were:
MrLuis Fonseca, Director of the Institute of Microelectronics of Barcelona (IMB) – one of the 3 sites that conform the National Centre of Microelectronics (CNM). IMB-CNM manages the largest clean room in Southern Europe to-date, and is part of CSIC, the National Scientific Research Council. They work in microelectronics, photonics, quantum, materials research (2D-materials, wide band-gap semiconductors, etc).
Ms Paula Calvão, Chief Officer for Business and Strategic Relations of the International Iberian Nanotechnology Laboratory, (INL), a joint initiative from the Spain and Portugal governments founded ~15 years ago that has enjoyed significant growth (around 500 new employees from 32 nationalities in the past 5-6 years!). INL focuses on microelectronics, nanoelectronics, and spintronics, as well as its application to various sectors: advanced materials, energy, quantum computing, photovoltaics, particles, health, food among others.
Mr Francesc Bach, Silicon Catalyst Spain Managing Partner. Silicon Catalyst is the world’s only semiconductor-focused startups incubator, accelerator and investor, based in the Silicon Valley (network of 350+ advisors worldwide, 400+ investors). They started a decade ago and count with a portfolio of over 100 companies that have raised around 800 million dollars in venture capital and are currently valued around 2.5-billion dollars.
Mr Guillermo Gómez, Technical Director of SETT (Sociedad Española de Transformación Tecnológica) the state-owned company in charge of managing the over €12,000 million fund allocated to the PERTE Chip.
Panel discussion summary
The moderator started firing questions right ahead. Firstly, he asked Mr Gómez if he could share some early success cases. Mr Gómez shared that SETT (formerly SEMyS), have already completed quite a few actions, directly, and indirectly, namely:
On the R&D and Talent dimension:
Misiones Chip. A programme dedicated to develop the microelectronics and semiconductors ecosystem, which funded different innovative undertakings in new materials, applications, and architectures.
Chip Chairs. 17 Chip Chairs at renowned universities that offer subsidised masters and expert courses in microelectronics and semiconductors.
Support to Spanish companies in the IPCEI ME/CT (Microelectronics & Communications Technologies), where Spain, via PERTE Chip, will contribute with €500-million (€266-million already assigned).
On the capabilities dimension, fundamental to support the Spanish ecosystem with the right prototyping, pre-series manufacturing, and testing capabilities (lab-2-fab facilities):
At national level, financing the National Centre of Microelectronics, led by the IMB, but also at a regional level, financing a network of facilities distributed across different regions (micronanofabs).
Financing the Spanish Supercomputing Network (Red Española de Supercomputación) so both the research communities and SMEs can benefit from this infrastructure for their research, to create innovative apps and services.
Carrying out strategic investments in different areas, partnering with global players, e.g.:
Intel-BSC Exascale Lab, focused on cooperative research on key enablers for future exascale computing.
Cisco's European Chip Design Center, focused on next-generation semiconductor designd for different sectors (Automotive, Aerospace, Health, Telco, Energy, Industry).
IMEC’s new 300mm R&D process line, The facility aims to leverage the unique advantages of leading-edge 300mm semiconductor process technology to drive new applications in, e.g., health care, life sciences, photonics, augmented and virtual reality, precision sensing.
Then he questioned Mr Fonseca about their role in Spain in the context of similar efforts abroad (e.g., CEA-LETI in France, Tyndall in Ireland, or Fraunhofer Institute’s research fab in Germany). Mr Fonseca made it clear that they are far smaller than these players. Even if they all are renowned research and technology intensive institutions, with strong credibility at the R&D stage, and there the Spanish institutions have a strong reputation, when it comes to gain credibility at the innovation stage, at gaining the trust from the industrial ecosystem, they still have a lot of space to grow, and PERTE Chip could be the means to that end.
Ms Calvão jumped into the conversation, emphasising that different ecosystem around also means different challenges and agreed that the Research and Technology Organisations are key to support the Public Administration Authorities to define the measures needed to promote and create a vibrant ecosystem. About recent challenges, and the approach to follow, she shared a few success stories that made use of a similar proces. The first example was born when 6 years ago they wonder about exploiting lithium mines in Portugal. If they did, they concluded they should develop all the links in it, and to do so, no better instrument than a leading RTO to guide and coordinate the efforts, and came up with a 3 stage process that worked efficiently: (1) the RTO coordinates a first (big enough) project; (2) the RTO makes use of that project to create a cluster that joins all key companies in the ecosystem; and (3) the RTO coordinates the launch of additional projects that gradually adds value to the ecosystem. The second example was in the microelectronics field, which is more complex. In this case, they positioned themselves in the context of the EU global strategy via the Chips Act, where they tried to set a foot in different strategic areas, such as the Advanced Packaging Pilot Line, a proposal for the Design Platform, and the Quantum Pilot Line. Being aware they are small, in this case they just try to set a footprint, but take this opportunities to learn from each of the fields playing the role of an orchestrator (e.g., by leading the competence centre in a topic), as this role will let them taste the whole value chain, and they apply the lessons learnt to go further. Finally, she mentioned that it is key to wisely choose the niche area to focus on, so that the efforts made are sustainable, and make use of the orchestrating capabilities of the RTOs to align the interest of the local ecosystem.
The moderator then questioned Mr Bach on some success stories from Silicon Catalyst. He started by drawing attention to the fact that incubators, accelerators and venture capitalists, can actually make the difference in a region. In this regard he shared the story when they landed in the UK, and how they found that most startups there, at that time were very immature (when compared to the ones in the US) and how Governmental actions where either too focused on research, or too focused in established companies. In fact, they detected that most UK startups at that time were even immature to proceed with the incubation programme they used in the US. For this reason they decided to take action, and together with the Department of Science Innovation and Technology (DSIT) of the UK, they designed an incubation programme fully tuned to the UK reality (ChipStart UK). As a consequence, over the last 18 months, the first 11 companies selected in the first batch could raise overt €17-million from private investors (24x public money RoI).
Asked by the moderator for the actual Spanish market reality, very different from the one in the US or the UK, he insisted on that precisely the global network that Silicon Catalyst brings to the countries they start to work with makes a difference, as their network experts and advisors, not only bring experience and advice, but also act as door-openers as they have access to key stakeholders in the value chain. In summary he believes they can bring a multiplier effect to the public investment.
Next, the moderator questioned Mr Fonseca about the level of (mis)alignment between the current education and research system and the industry needs. Luis mentioned that, firstly, there is for sure a talent shortage, and he recognised that the government decision via Chip Chairs to bring to the market a greater number of experts in semiconductors and microelectronics (imho, however, I am a bit sceptic as it will probably will not be enough to generate talent: we also need to be able to retain it… and considering the global talent shortage and the level of salaries abroad, I am not optimistic about this… we will see). He also mentioned the need to bring back talent to Spain including the Spanish talent abroad.
Mr Bach jumped in, mentioning that in a recent workshop they say that it is paramount to make this sector attractive starting at high-school level, even talking to the parents, to try and increase the number of graduates.
Next, the moderator asked Ms Calvão about her perspectives on the challenges derived from this industry globalisation, both from a talent acquisition perspective, and form a startup lifecycle perspective. Paula mentioned that in many cases you do not really need to go across a full degree or master: sometimes training is enough, as she has heard from Synopsis. In this regard, she brought attention to the role of the EU to create competence centres, to both design training and education paths, but also to actually provide such training or advise universities in the masters/degree programmes design. About start-ups, she mentioned that everythign is a challenge, but that the huge difference comes in terms of the huge quantities of up-front funding they need to be able to develop fast enough to reach this competitive market in the best conditions: €100K, €200K, even €1M is just not enough and, unfortunately, in Europe, we are still thinking with small minds (and much worse in Spain, imho).
Finally, the moderator jumped to Mr Gómez, and asked him if he really thinks that Spain can make the difference. He mentioned that after making significant effort at the offer side, and that now it is needed strong effort at the demand side: we need to go through all relevant use-cases demanding these chips, so that the investment in infrastructures (and startups) can really pay-off. In regards to investment on startups or scale-ups, he mentioned the elephant in the room: it is true that there is a ton of public money available from the PERTE Chip, but they can only co-invest, so it is needed an effort from the private investors to, at least, be able to match the governments tickets so that these companies can be supported with the right amount of investment. In regards to the actual investments, and in the context of this effort on detecting the actual market demand, it is important to detect those niche opportunities where Spain can gain (and retain) its market position, be it e.g., compound materials, new substrates, aerospace applications, cybersecurity.
PANEL TAKEAWAYS.-
Summary: Spain’s semiconductor ecosystem must prioritise talent retention, niche specialisation, and fostering public-private investment for global competitiveness.
Panel insights and recommendations:
Spain must shift from R&D to industrial scalability to build credibility in global markets.
Retaining and attracting talent is critical for Spain’s competitiveness amid global shortages in microelectronics expertise: go to high-schools, and even approach parents if necessary. Good to have masters and degrees, but also design complementary training courses.
RTOs serve as ecosystem orchestrators, aligning stakeholders, coordinating projects, and adding sustainable value. Ecosystem cohesion through clusters of companies and competence centres accelerates innovation and growth.
EU initiatives like the Chips Act offer Spain opportunities to integrate into global semiconductor strategies.
Public-private co-investment models are essential for start-ups to scale given the high up-front investments usually required to compete globally and the usual tickets in the local VC ecosystem. However, even finding local VCs able to co-invest is a huge challenge, so a wider investors network might be needed.
Local adaptation of incubation programmes can help transforming immature ecosystems into global competitive hubs.
Niche specialisation. Do not go where more mature countries are already strong: focus on niche areas where Spain can build sustainable competitive advantages, e.g., compound materials, new substrates, advanced packaging, or supercomputing.
DISCLAIMER: My views are my own: partial, subjective, biased and, unfortunately, not immune to mistakes nor misunderstandings on my side. In no way I pretend to be accurate in my interpretation, so please, check the original recording provided and feel free to disagree!
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