TLDR:
- China led the funding of chip startups in 2023, with local startups receiving 75% of all venture capital funds in chip-related companies.
- The US only received about 11% of VC chip investment last year.
A report by PitchBook revealed that Chinese startups received the majority of venture capital investment in chip design, chip manufacturing, and chip equipment companies in 2023. China secured 75% of all funding in this sector, while the US only received about 11%. This suggests that China is significantly ahead of the United States in terms of chip startup funding.
China’s emphasis on funding the chip sector is evident by its launch of a $40 billion fund in September 2023. This marked the country’s third major state fund dedicated to supporting the chip industry. In contrast, the US government passed the CHIPS Act in August 2022 to revitalize its chip industry. However, obtaining funding through the CHIPS Act is reportedly more complicated than securing funding for clean energy initiatives under Biden’s Inflation Reduction Act.
This report highlights China’s dominance in chip startup funding and its commitment to investing in the sector. The disparity in funding between China and the US suggests that China is currently ahead in terms of developing and supporting its chip industry. With China’s ongoing investments and initiatives, it is likely to maintain its lead in chip startup funding in the near future.
