"Tens of billions of won for a single chip"... Exynos CEO Kim Jin-young reveals the harsh reality of fabless companies

There is a company aiming to overcome the massive cost burdens and technical challenges faced by semiconductor design specialist (fabless) startups, with the goal of generating full-scale revenue in the first half of next year. According to a video from 'Understanding: All the Knowledge in the World', Exynos CEO Kim Jin-young revealed a business strategy based on the high entry barriers of the fabless industry and the competitiveness of South Korean talent.

"Tens of billions of won to produce one chip"... In fabless, failure determines the fate of the company

Since fabless companies do not own factories (Fabs) directly, human resources are key. However, CEO Kim Jin-young explained that massive capital investment is essential in addition to labor costs. This is because the cost of designing and manufacturing a single prototype can reach tens of billions of won. CEO Kim said, "It depends on the chip size, but producing one exceeds 10 billion won terrifyingly and usually costs tens of billions of won." Especially in the case of advanced processes using fine processes, the cost burden becomes even greater.

Even if the design is perfect, the costs in the verification process are also significant. The simulation equipment used on computers before manufacturing the chip, and the measurement equipment used to check if the manufactured chip works properly, each cost billions of won. CEO Kim emphasized, "It is a situation where if you design incorrectly once, tens of billions of won can fly away," adding, "From the perspective of a small company, whether the development of the first chip is successful determines the fate of the company."

To manage these risks, Exynos has attracted investments of approximately 120 billion won and has equipped itself with the necessary equipment. CEO Kim explained, "The basic role of a fabless company is to systematically and holistically review and verify errors that occur during the design stage or the chip manufacturing stage," and explained that they can lower the probability of failure because their personnel consist of experts who have produced enterprise-grade products multiple times at top semiconductor companies such as Samsung Electronics.

"South Korea is a treasure trove of hardware talent"... Technology that attracts global talent

CEO Kim analyzed that South Korea has a very advantageous environment in terms of securing global hardware talent. Unlike in the past when talent in Silicon Valley flocked to the software field, he explained that South Korea has a solid pool of hardware personnel centered around world-class memory companies such as Samsung Electronics and SK hynix. He stated, "South Korea is an industry where the people who can do the best in the world are gathered," and noted that his company's personnel are also at a level that does not fall behind compared to global top-tier companies.

In fact, it was mentioned that global companies are recently engaging in fierce competition to scout South Korean semiconductor talent. CEO Kim conveyed the status of South Korean talent, saying, "Even Elon Musk posted that he would hire South Korean personnel." Based on these human resources, Exynos is showcasing differentiated technology in the data center memory side, and as a startup, it unusually presented its technology at the 'Hot Chips' event held at Stanford University in the United States recently. Hot Chips is a world-class event where large companies like Google or OpenAI mainly present papers, and Exynos explained that it conducted a presentation as a startup, almost for the first time, on the data center memory side.

CEO Kim also mentioned the importance of disclosing technology. The intention is that as a startup, sharing technology to some extent allows potential customers or partners to think, "We could use this too," thereby creating new opportunities. He added that he is expanding these opportunities through meetings with investors and partners locally in the United States.

Exynos is currently conducting sampling at the prototype stage, and mass-produced chips are expected to come out at the end of this year. CEO Kim stated, "Since the mass-produced chip is similar to the current prototype chip, the risk is not large," and "We plan to build a full-scale revenue pipeline through mass-produced chips starting from the first half of next year." To this end, they are also considering an IPO in the future.

Exynos's core technology has a differentiation in the number of cores used for near-memory computing. According to CEO Kim's explanation, unlike competitors who use about 10 cores, Exynos is gaining an advantage in performance by being equipped with thousands of cores. Based on this technological prowess, they have the ambition to lead the future memory market by attaching differentiated functions to memory.

Regarding the recent rise in memory prices, in response to questions about the utility of the technology, he answered, "Even if memory prices drop somewhat, technology that makes memory systems efficient is still advantageous." As memory prices increase, infrastructure construction costs also increase, so the demand to maximize memory efficiency and lower total infrastructure costs is expected to continue. CEO Kim emphasized the marketability of the technology, saying, "If memory is used efficiently, much more infrastructure investment can occur."