Hello Interconnected Readers:
This Interconnected Weekly issue covers more news on China’s semiconductor industry as it continues to balloon. I also shared some thoughts on Bessemer Ventures’ 2021 State of the Cloud report, the Apache Software Foundation, and yet another Chinese tech company IPO on Wall Street.
[If you’d like to skip ahead to the six news stories and commentaries from last week – three from English language sources, three from Chinese language sources -- here are this issue’s items:
- “Chinese companies are making their own semiconductors” (English Source: Protocol)
- “State of the Cloud 2021” (English Source: Bessemer Ventures)
- “Why I Didn't Open-Source My Second SaaS" (English Source: PanelBear)
- “Hundreds of millions worth of term sheets without due diligence; Investors say: using the Internet startup way to invest in chips does not work” (Chinese Source: China-Venture)
- “Energy Monster submits US IPO prospectus; Alibaba, Hillhouse Capital help push first shared-charging product’s first listing” (Chinese Source: iponews)
- “Wu Sheng Elected to Apache Software Foundation Board of Directors for 2021” (Chinese Source: Open Source Community News)]
Before you read on, please check out last week's deep dive post: "Semiconductor Design Consolidation: MIPS -> RISC-V"
“Chinese companies are making their own semiconductors” (English Source: Protocol)
My Thoughts: Continuing with a recent semiconductor-focused theme on Interconnected (three of my last posts were focused on semiconductors in China), this article from Protocol is worth reading. Two things stood out to me. First is how the semiconductor investment boom is giving old, unsexy companies an opportunity to reinvent themselves (or at least a new excuse to attract fresh capital). Appliance makers like Gree and Midea are starting their own chip subsidiaries and raising money with them. Second is the continued importance of local governments’ role. I emphasized this point in “China's ‘Semiconductor Theranos’: HSMC”, where the Wuhan East-West Lake District Government played an outsized role in HSMC’s rise and fall. Zhuhai, a southern city and part of the so-called Greater Bay Area, is now poised to become a semiconductor hub worth more than $15 billion dollars by 2025.
“State of the Cloud 2021” (English Source: Bessemer Ventures)
My Thoughts: Bessemer Ventures’ annual State of the Cloud report and presentation is always worth reading (or watching). This year’s report is especially so given how much the cloud industry has grown last year -- one of the biggest beneficiaries of the global pandemic. The cloud industry, as Bessemer defines it, is now worth $2.2 trillion dollars. Bessemer sees a changing of the guard stock market growth leaders, from the FAANG (Facebook, Amazon, Apple, Netflix and Alphabet) stocks to cloud stocks. Thus, they coined a new acronym: MT SAAS (Microsoft, Twilio, Shopify, Amazon, Adobe, Salesforce). The acronym doesn’t quite have the ring of FAANG, so might not stick, but the growth of cloud will no doubt continue. (For more of my commentary on cloud, please go to the Cloud Industry tag -- one of the most popular one on this newsletter.)
“Why I Didn't Open-Source My Second SaaS” (English Source: PanelBear)
My Thoughts: This is a personal blog post from an entrepreneur that was trending on HackerNews, not a media report. I want to share it because the author described some hard-learned lessons from building his previous open source project to be a SaaS product as a solo-preneur, detailing why it failed. As much as I love open source, as both a way to create new technologies and as the basis for creating new companies, it has many drawbacks. One important point Clint Smith made during the second Company Building webinar I hosted last week was you must know why you open source before committing to it -- not a list of reasons, but one core reason. (We will publish the transcript and audio of this session soon.)
“Hundreds of millions worth of term sheets without due diligence; Investors say: using the Internet startup way to invest in chips does not work” (Chinese Source: China-Venture)
My thoughts: Despite high-profile failures like HMSC (and possibly others that have yet to be exposed), investment from VCs continue to pile into new semiconductor startups in China, often without due diligence. Many of these funds made their first pot of gold from investing in China’s consumer tech market and appear to approach their semiconductor investments with the same set of expectations. Of course, that won’t work. Tackling any part of the semiconductor supply chain or production process takes about a decade to mature. That being said, China’s domestic stock market is being “flexible” in allowing strategic industries to IPO and raise money from the public market without much maturity. There are already 22 semiconductor companies listed on the Shanghai STAR market. Thus, for these investors, they can “exit” long before the companies produce any quality semiconductor products at scale -- and that’s just fine for these VCs.
“Energy Monster submits US IPO prospectus; Alibaba, Hillhouse Capital help push first shared-charging product’s first listing” (Chinese Source: iponews)
My thoughts: Energy Monster, a mobile charger maker, is the latest in a continuous stream of Chinese tech companies going public in the US. Any systemic risk posed from the delisting of three Chinese telcos back in January (see more in “Lame Duck Delisting”) has yet to produce much deterrence. Like I discussed in “Wall Street Blunts the ‘Delisting’ Hype” last year, taking companies public is a profitable business stream for Wall Street, Chinese companies are a big source of that business, and the bankers will do what they need to do to keep that business flowing.
“Wu Sheng Elected to Apache Software Foundation Board of Directors for 2021” (Chinese Source: Open Source Community News)
My thoughts: Wu Sheng, the creator of the open source project Apache Skywalking, has been elected the first Chinese national to serve as a member of the Apache Software Foundation (ASF) board. As you can see in this ASF slide below, Apache-affiliated projects that originated from China are growing. Same can be said for China’s overall contribution to open source globally. Having a seasoned open source creator like Wu Sheng be represented in ASF governance is long overdue.
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- “中国公司在造自己的半导体”（英文来源: Protocol）
- “2021云行业状态”（英文来源: Bessemer Ventures）
- “为什么没有开源我第二个SaaS公司”（英文来源: PanelBear)
- “不尽调就发出数亿元的TS，投资人：'互联网投法'在芯片行不通” (中文来源: 投中网）
- “怪兽充电递交赴美上市招股书，阿里、高瓴加持，冲刺共享充电宝第一股” (中文来源: 独角兽早知道）
- “吴晟当选 Apache 软件基金会 2021年董事” (中文来源: 开源社）】
往下读之前，请别忘看看上周的深度分析文章：《半导体设计领域整合: MIPS -> RISC-V》
我的想法: 继续最近在《互联》上针对半导体为主题的文章（我前三篇文章都与中国半导体行业有关），Protocol的这篇文章也值得一读。其中有两点我觉得值得一提。首先是半导体当前的投资热潮给了许多老牌的、没那么热门的公司一个重塑自我的机会（或者至少是一个吸引资本的新借口）。像格力和美的这样的家电制造商正在成立自己的芯片子公司，并用来集资。二是地方政府在行业中的重要作用。我在《中国的 "半导体Theranos"：弘芯》中强调了这一点。武汉东西湖区政府在弘芯这个烂尾项目的背后扮演了重要角色。珠海（也是国内所谓的 “粤港澳大湾区” 的一部分），现在高调称准备在2025年成为一个价值超过150亿美元的半导体产业的中心。
“2021云行业状态”（英文来源: Bessemer Ventures）
我的想法: Bessemer Ventures一年一度的《云行业状态》报告和演讲总是值得一读（或观看）。今年的报告尤其如此，因为云产业去年整体暴涨，是全球疫情的最大受益者之一。按照Bessemer的定义，云产业现在市值是2.2万亿美元。Bessemer还认为，股票市场未来的增长领头羊们会从FAANG (Facebook、亚马逊、苹果、Netflix和Alphabet) 交接到云股票。因此，他们也创造了一个新的缩写词：MT SAAS（Microsoft, Twilio, Shopify, Amazon, Adobe, Salesforce）。说实话，这个缩写没FAANG那么好上口，估计“火”不了，但云行业的增长无疑会持续下去。(想度我对云行业的深度分析和评论，请看“云产业”这个标签，也是《互联》上最受欢迎的标签之一。)
我的想法：这是一个创业者的个人博文，在HackerNews上了头条，不是媒体的报道。我之所以想分享它，是因为作者描述了他之前以个人创业者的身份将自己的开源项目打造成SaaS产品的一些惨痛教训，详细介绍了失败的原因。虽然我很喜欢开源，认为它既是创造新技术的最佳方式，也是作为创业的好基础，但并不证明这个模式没有缺点。Clint Smith在上周我主持的第二次Company Building webinar上也提出了相关的观点：作为创业者，必须在投入开源之前清楚知道自己为什么要开源 -- 不是一系列的理由，而是认定一个核心理由。（我们团队会很快发布这次webinar的记录和音频，请大家耐心等待哦。）
“不尽调就发出数亿元的TS，投资人：“互联网投法”在芯片行不通” (中文来源: 投中网）
我的想法: 尽管有弘芯这样的亿级烂尾项目 (很可能还有其他没曝光的)，风投机构仍继续涌进中国的半导体创业公司，而且许多投资前都没有尽调。这些基金的第一桶金是从中国的消费科技市场中赚到的，所以它们似乎也以同样的期望和做法来投半导体。这自然是行不通的。攻克半导体供应链或生产过程中的任何一个环节，都需要十年左右的时间来打磨成熟。但国内的股市交易所在以一个 “宽容” 的姿态来对待有战略意义但并不成熟公司，允许它们上市融资。目前已经有22家半导体企业在科创板上市。因此，对于风投来说，投的半导体项目很可能在没达到规模化生产优质产品之前就能exit。何乐而不为呢？
“怪兽充电递交赴美上市招股书，阿里、高瓴加持，冲刺共享充电宝第一股” (中文来源: 独角兽早知道）
“吴晟当选 Apache 软件基金会 2021年董事” (中文来源: 开源社）
我的想法: 开源项目Apache Skywalking的创始人，吴晟，作为第一位华人当选为Apache软件基金会(ASF)的董事会成员。从下面这张ASF的ppt中可以看到，源自中国的Apache项目正在不断增长。中国对全球开源的整体贡献也是如此。让像吴晟这样经验丰富的开源创作者参与到ASF的管理决策过程中，是早就应该的。