Although uncertainties such as inflation and economic recession linger over the near-term prospects, this is just the right time for investing in next-generation technology and capturing opportunities for transformation, according to tech entrepreneurs and venture capitalists in the 2022 Technology Investment Summit organized by Taiwania Capital on December 14.
David Weng, CEO of Taiwania Capital, drawing from his experience as a venture capitalist witnessing the 2000 internet bubble and 2008 financial crisis, noted that many innovations actually were created during those tumultuous times.
"The worst of times will lead to the best of innovative technology, and innovative startups that can survive economic hardship often change the lives of generations to come," Weng cited the examples of Google and Amazon, which survived the dotcom bubble in 2000 and became technology giants, in addition to FB, Uber, Tesla, SpaceX, and Apple - all survived the financial Tsunami in 2008.
Yet speakers continued to remind the audience about the uncertainties they are facing for 2023 as a result of multiple risks. The imminent economic downturn is the result of Black Swan events in 2022, such as the Ukraine-Russia War, the pandemic lockdown, the build-up of inventory, and inflation, sparking the global dissipation of venture capital and drastic deflation of startup valuation since the second half of 2022.
"Recession will pass, it is just a matter of time," Weng told the audience who are mainly members of SEMI Taiwan and Taiwan Electrical and Electronic Manufacturers' Association. "But if you can invest in the right direction at the right time, it will make a great difference to your business coming out of the crisis."
Sean Pien, GM of Microsoft Taiwan, shared Microsoft's journey of transformation through the strategies of "cloud first", "embrace open", and "pivot to industry". He also took the audience to see what Microsoft is doing as an enabler in the digital transformation of various industries as well as its vision in smart manufacturing through the implementation of the industrial metaverse.
Three portfolio companies of Taiwania also pivoted in the forum. They represent the three directions of emerging technologies that Taiwania is investing: Arris Composites, representing circular economy and smart manufacturing; Ambiq, a startup working on lowest power consumption solutions for semiconductors used in the internet of things (IoT) and wearables; and Light Field Lab, a startup working on virtual reality and visualization technologies such as holograms, which can be applied on education, business, and industries.
They also reflect Taiwania's faith in cross-disciplinary/cross-domain innovation and the vision for the value of eco-friendly technologies and ESG to grow into the future. In his talk on "trailblazing amidst headwinds in volatile times", Cheng Wu, managing partner of Taiwania's technology funds, said the circular economy and supply chain with ESG consideration will be the inevitable trend for the next decade or two. With the maturity of 5G, 6G, and low-earth-orbit communication technologies, new innovations emerge and open up new opportunities and create new business models, said Wu.
"Downtime is the best time to invest – easier to hire good people, and tension is good for Taiwan," said Michel Chu, president of Industrial Technology Investment Corp. That statement was echoed by Metanoia Communications president Stewart Wu, but he emphasized that Taiwanese entrepreneurs need to collaborate and elevate their value through innovation and should not be content to compete with price cuts.
Brian Sung, country manager of Cadence Taiwan, said the EDA firm is seeing booming demand for the semiconductor business that was driving the growth of the future. "Although there is a bit of slowdown of semiconductor business right now, but we actually heard a lot of people saying they are prepared and expecting a bottom-out before the end of Q3 2023 and rebound in 2024," Sung said the semiconductor industry is generally quite optimistic over the outlook of 2024 and beyond.
Communication, energy, silicon photonics, AI, IoT, edge, and cloud computation are identified as fields of next-generation technologies, and Chu said healthcare and biotech are recession-proof, while clean tech and net zero, deep tech in automation and AI, are all the targets that venture capitalists are looking into.
