Should Private Equity Invest in Semiconductors?


June 17, 2024

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In 2020, a silicon shortage led to an increase in silicon prices. This demonstrated two things: that the semiconductor supply chain had some real flaws and that buyers were willing to purchase silicon wafers even if they were more expensive.

Silicon wafers have become a crucial input to our society. Experts predict semiconductor demand will only grow, and governments in the US, the EU, and the UK will start to intervene to create more stable supply chains.  

All of this has made the semiconductor market more investable. So, should private equity firms invest too?

Can silicon prices attract private equity

What Are the Semiconductor Market Prospects?

The chips used in contemporary electronics depend heavily on semiconductors. According to Deloitte, semiconductors generated about $520 billion in sales in 2023.

Given these figures, venture capital wouldn’t shy away. Over the past five years, more than $50 billion has been invested in companies related to semiconductors, according to PitchBook.

Demand patterns are becoming more consistent since modern electronics consumption does not appear to be slowing down anytime soon. In the meantime, governments worldwide are encouraging the sector by putting laws and money in place to bring manufacturing onshore and boost output.

That’s why we ask ourselves, should private equity start investing in semiconductors?

Can silicon prices affect revenue

Win With Growing Silicon Prices  

For investors, the semiconductor market is an opportunity to start making revenue with the potential wafer shortage that’s looming.

If you’re interested in hearing more about our wafer production, give us a call! At Wafer World, we make the finest quality silicon wafers for various purposes.

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