New Year's Interview with Shi Fangmin, Founder and CEO of Gutaiwei: In 2022, the local IC industry will face a "big test"

New Year's Interview with Shi Fangmin, Founder and CEO of Gutaiwei: In 2022, the local IC industry will face a "big test"

With the acceleration of global digital transformation and the outbreak of AIOT and smart car markets, the scale of the global integrated circuit market is growing rapidly. It is expected that the global integrated circuit market will grow to US$570 billion in 2021 and will grow to US$1 trillion in the next five years! Such a rapidly growing large market has brought good opportunities for the development of local ICs. At the recently held ICCAD2021, Professor Wei Shaojun, Chairman of the Integrated Circuit Design Summit of the China Semiconductor Industry Association, pointed out that the number of Chinese IC design companies in 2021 reached 2,810, an increase of 26.7% from 2,218 in the previous year. The number of design companies has increased by more than 26% again in the past year. In 2021, the industry's sales are expected to be 458.69 billion yuan, an increase of 20.1% from 381.94 billion yuan in 2020!

It can be said that local ICs are still maintaining rapid growth in quantity and sales, but in terms of product layout, many companies' products are concentrated in the digital IC field. Local ICs need to achieve more differentiated layouts in the analog, RF, and mixed signal fields to avoid product homogeneity competition.

Recently, Semiconductor Technology Media interviewed Shi Fangmin, founder and CEO of Gutaiwei. He is a semiconductor veteran who has started businesses in the analog RF field. Before founding Gutaiwei, he had successfully started two businesses, targeting RF and analog IC respectively. This time, he is targeting the mixed signal and sensor fields. It can be said that the three entrepreneurial ventures are all aimed at the most difficult fields. Why did he choose the entrepreneurial direction in this way? Let's listen to his sharing on his insights on the innovation of local ICs.

Q: Could you please give a brief introduction of Gu Taiwei?

Shi Fangmin: Gutai Microelectronics is a chip design company. The company has certain technical reserves and development capabilities in the fields of analog chips and optical sensor chips! Gutai Micro has a rich range of analog chips and optical sensor chip products. Analog chip products mainly include ADC, DAC, analog switches, operational amplifiers, analog front ends, power management, etc. Optical sensor products include optical navigation chips, infrared sensor driver chips, blood oxygen sensor chips, etc. Related products are widely used in medical electronics, instrumentation, automotive electronics, industrial electronics, consumer electronics and other industries.

Q: Before founding Gutaiwei, you had several successful entrepreneurial experiences. Why did you choose to start a business again? What kind of new startups do you think the current industrial environment needs?

Shi Fangmin: Actually, every process from zero to one is the most difficult. I founded two chip companies before, and they are both very successful. I think the reason why I started my third business is that thanks to the trend of this industry, I can do it again and create a successful company again. Of course, the third business will have a better team and supporting resources. I hope that all three companies will be successful in the future. In my opinion, the current industry is no longer suitable for companies with homogeneous competition. We must be committed to real technological improvement and innovation, rather than simply following and surviving only by domestic substitution. In the future, local ICs must have their own core technologies. After so many years of development, local IC companies already have excellent product definition and design capabilities, and it is time to accumulate strength and make a breakthrough. Therefore, I chose the third business, hoping to build Gutaiwei into a company with high-end analog mixed signals. I believe that in the future, IC companies that do not have their own core technologies and do not actively innovate will be eliminated!

Q: Summarizing your previous successful entrepreneurial experiences, what do you think are the key factors for entrepreneurial success? What types of startups are more likely to succeed?

Shi Fangmin: I think for a start-up, the first thing to do is to recognize the company's strengths, have its own core technologies and products, clearly define the product positioning and formulate a reasonable market strategy. In addition, close cooperation between R&D, production and sales is essential. In the future, only companies that have real core technologies and a strong supply chain system and a certain market foundation will have a chance to survive.

Q: In what application fields are Gutaiwei's products positioned? What are the pain points in these fields?

Shi Fangmin: Our products are used in many industries such as medical electronics, instrumentation, automotive electronics, industrial electronics, and consumer electronics. In recent years, due to the acceleration of domestic substitution, domestic products have gradually become dominant in basic consumer categories, but in terms of industrial and automotive high-end chips, foreign products are still the main ones, such as high-speed and high-precision ADCs, which are still in a state of being stuck. In response to this situation, Gutaiwei cooperates with the industrial and automotive industries to deploy high-end ADC/DAC and other products in order to seek independent innovation and provide the market with high-quality and high-performance domestic chips.

Q: What new breakthroughs has Gutaiwei made in product definition?

Shi Fangmin: Gutaiwei's products will mainly be aimed at industry and automobiles in the future. We have strong technical support in the analog ADC/DAC product series, and have also made great breakthroughs in high-speed and high-precision ADCs!

Q: What do you think about the development of local ICs? In what areas do you think local ICs need to make breakthroughs in the future?

Shi Fangmin: The ecological environment of the domestic integrated circuit chip industry is very good now. The government strongly supports it and the society also pays great attention to it. It is completely different from the situation of the integrated circuit industry before. Although the chip industry is being vigorously developed now, the phenomenon of being stuck in the neck has not been alleviated. There is still a long way to go in terms of technological innovation, improvement of the industrial chain, and talent reserves.

According to Professor Wei's report this year, the sales performance of our local IC companies is very good and continues to maintain high growth. This is caused by the sudden outbreak of supply and demand tension in the market. Next year and the year after, when the market gradually returns to rationality and many real demands are released, how should we deal with the weak market demand? Therefore, our local IC needs to cooperate more closely with terminal manufacturers and channel vendors, deeply understand their needs, and define products based on market demand and customer needs. Only in this way can products have vitality. This is where our local IC needs to be strengthened.

Q: What are the things that make you most anxious at the moment?

Shi Fangmin: The integrated circuit industry has a long payback cycle and large investments, so companies need to withstand the pressure. It takes a long time to accumulate talent and technological innovation, so many excellent companies did not survive the early losses. Therefore, the development of high-tech companies such as integrated circuits depends more on the government's strong support and also needs the support of funds, so that companies can focus on research and development and innovation. We must be prepared to "sit on the bench for ten years" and polish our products with tenacious perseverance. I am most worried that some companies and capital will give up after encountering setbacks, which will be a huge blow to the industry.

Q: What fields does Gutaiwei's products focus on? How to open up the market?

Shi Fangmin: Gutai Micro focuses on the research and development of analog chips and optical sensor chips. The company has invested a lot in research and development, especially in high-end chips such as ADC/DAC. In order to ensure the performance stability of the products, we have established our own MEMS packaging and testing factory. In order to quickly respond to customer needs, we have set up technical sales service centers in Wuxi, Nanjing, Hangzhou, Shenzhen, and Taiwan. Providing customers with the most needed products is our guarantee for opening up the market.

Q: What is your future vision for Gutaiwei?

Shi Fangmin: Gutaiwei will always adhere to the values ​​of "following the road, connecting the world, technology first, and achieving you and me", focus on market demand, concentrate on technological innovation, continuously launch high-quality and high-performance chip products, and work with customers to contribute to China's core. Gutaiwei will grow into an IC company with world-class influence in the analog mixed signal field.

Q: What do you think about the current chip shortage? What are the reasons? When will it be alleviated? How does Gutaiwei ensure production capacity supply?

Shi Fangmin: According to my analysis, the global chip crisis is unlikely to ease in a short period of time. However, it has eased in some local areas, but it is still in serious shortage in the industrial and automotive fields. However, this is also an opportunity for localization. In the past, semiconductor products relied on imports and the industry developed slowly. Now, with the strong support of the country and external pressure, China's integrated circuit industry has entered a period of rapid and vigorous development. Although the road to catch up is long and difficult, there is always a reward for hard work. Only by truly mastering advanced technology can we avoid the bottleneck phenomenon. Gutaiwei has maintained a good cooperative relationship with well-known domestic upstream companies, and we can guarantee the stability of production capacity to the greatest extent.