With close to 30 years of history, Accuron Technologies (Accuron) started out in contract manufacturing for aerospace parts and components. As the years passed, the Singapore-based company expanded to include other pillars: semiconductor equipment manufacturing and advanced manufacturing equipment.

But on Tuesday, at the sidelines of the Singapore Week of Innovation & Technology (SWITCH), Edwin Chow, Vice President for Industrials & New Ventures at Accuron, spoke to e27 about the company’s corporate venture capital (CVC) arm.

“The idea is to invest in younger, fast-growing companies that have their own intellectual property, proprietary technology, and know-how. [These companies] are already scaling up in sectors or segments that are either part of our core businesses or operating in sectors that have a long-term growth trajectory, driven by the so-called megatrends, demographic change, and digitalisation,” he elaborates.

“In a nutshell, we spot promising, high-growth, fast-growing companies that require financial resources and other capabilities that we can provide–and we want to invest in the right ones.”

Accuron invests in areas within or adjacent to its core business areas, from aerospace and semiconductor equipment to 3D printing. The organisation is also looking at sectors that it believes have long-term growth potential, such as renewable energies and digitalisation of the manufacturing process.

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“People are getting older; fewer people are willing to work in factories. So, the natural thing to do is to digitalise and automate,” Chow explains.

He also added that Accuron is looking for companies at a later stage. “They already have customer traction, so [that includes] positive cash flow and customers in their home base. They have their own proprietary IP and a management team that is growth-oriented and ready to scale. What we do not want is companies that are just too early, but we want to keep these companies on our radar.”

During our conversation, Chow also discussed the challenges late-stage startups may face in scaling their businesses. Securing more customers without losing profitability and managing a more efficient supply chain and supplier base are top of the list.

“The third area is something that most earlier-stage startups tend to ignore until later: the internal governance of the company. It includes the financial and HR governance. As a young startup, you focus on getting the next customers and partners, ensuring you raise funds. Sometimes you do not realise that if you are raising a bigger round, the investors that come in are usually institutional investors,” Chow points out.

“They will probe your management processes, financial statements, and HR policy.”

Looking ahead

With the rising popularity of Generative AI, the semiconductor industry is experiencing a surge in demand. As a company with a business pillar in the industry, how does Accuron plan to seize this opportunity?

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Chow begins by stressing that the semiconductor market is “very, very big.” As a US$600 billion market, it includes a wide range of products and requires Accuron to clearly focus on what it wants to achieve in the space.

“We have existing companies that make machines that help the fabrication process of the chips, companies that make machines that help handle the wafers … so when you speak about the relations between AI and the semiconductor industry, it is a very broad brush,” he says.

“In terms of strategy, we look at how we can grow the business units that we already have in that sector and the area of new corporate ventures. We want to identify companies that can perhaps use AI to help in the digitalisation of the manufacturing process,” Chow continues, giving examples of machine learning that can help improve the manufacturing process by reducing defects and improving yields.

“I am quite cautious in saying there is such a grand strategy. Frankly, unless you are TSMC or Nvidia, I would take anything anyone else says with a big pinch of salt.”

The same open-mindedness is also seen in Accuron’s plans for 2025.

“We do not have a target in mind, which is the benefit of being a Corporate VC. Because we do not invest other people’s money; we invest our own money from our balance sheet,” Chow closes.

“We are taking a more curated and targeted approach. So, we want to meet as many interesting companies as we can, but we will probably act on only a few that fit our strategies.”

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Image Credit: Accuron

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