Chip VCs: Enhanced “nerd” factor needed

I mentioned Chip Scale Packing (CSP), which I should also explain further. In simple terms, for these miniaturized consumer devices, Printed Circuit Board (PCB) real estate is a big problem. CSP is a packaging technology that allows chips to be packaged “at the scale of the chip” with marginally more area requirement.

In recent times, a company that has monetized CSP technology really well is Tessera (TSRA). Tessera’s µBGA® technology enables many of the miniaturized device vendors’ high volume products, creating a lucrative royalty stream for the company. The stock shows a 52-week range of 15.64 – 46.28 this morning, steadily increasing in the last year, following a late 2003 IPO.

For VCs looking for new investments, the IP licensing model that Tessera has used is a good one to consider. VCs should also look at the periphery of the core component business – towards packaging, interconnects, thermal and power optimization techniques for new investment opportunities.