Japan's fledgling foundry biz Rapidus has secured funding of $1.7 billion to help it progress to mass production of 2nm semiconductors by 2027, making it a potential rival for Taiwan's TSMC.
The startup silicon manufacturer has completed a funding round delivering ¥267.6 billion (equivalent to $1.7 billion) from the Japanese government and private sector companies.
¥100 billion of the funding came from the Information-technology Promotion Agency (IPA), an independent administrative body under the jurisdiction of the Ministry of Economy, Trade and Industry (METI).
The remaining ¥167.6 billion has been sourced from 32 companies including Canon, Fujitsu, NTT, SoftBank, Development Bank of Japan, and Sony Group.
Rapidus was founded in 2022 with the aim of revitalizing Japan's fading semiconductor industry, and has signed up help from IBM and Belgian-based R&D organization Imec (Interuniversity Microelectronics Center) for the development of the technology required to reach its goal.
IBM claimed to be the first company in the world to show off 2nm chips back in 2021, and was also the first to show 5nm and 7nm wafers previously, although it does not have the facilities to mass produce them itself.
Rapidus said it will continue to secure funding through capital increases and loans from both public and private sources. It believes this strategic funding plan will enable it to progress from its current R&D phase through to mass production of 2nm silicon by 2027.
This is an ambitious plan for a four-year-old firm and could position Rapidus as a rival to chipmaking giants TSMC and Samsung, both of which started volume production using their own 2nm silicon processes in Q4 of 2025.
It is unlikely to be able to match either of those established manufacturers on volume, at least in the early days, but could prove a valuable extra foundry for chip designers looking to get cutting-edge silicon products made.
"I don't think that Rapidus will be a serious competitor to TSMC all of a sudden," said Omdia Principal Analyst for Data center IT, Manoj Sukumaran.
"The value proposition of Rapidus is small volumes at fast turnaround time. Being a small fab and also aligning the manufacturing setup for large number of small batches will help to attract companies who are iterating their chip designs fast," he told The Register.
The fab will also have to integrate with electronic design tools and chipmakers will have to test and validate their IP on the new process node before it can deliver any products, so there is a long way to go yet.
"However, it is great progress. It is very important if you look at it from a sovereignty standpoint. It's a Japanese initiative and the intention is to regain Japan's lost leadership in leading-edge semiconductor manufacturing," Sukumaran added.
According to Japanese newspaper The Mainichi, the country's government has now become the largest shareholder in Rapidus, holding 11.5 percent of its voting rights, as well as holding a "golden share" giving it veto power over key management decisions.
"It is a key element of the investments for growth promoted by the government and a national project that must succeed for the sake of the country's interests," it quotes the minister for economy, trade and industry Ryosei Akazawa as saying.
Fujifilm, one of the companies contributing to the latest investment, said it is committed to realizing the domestic mass production of leading-edge semiconductors and to the development of Japan's semiconductor industry.
The firm, a supplier of semiconductor raw materials, stated it will support Rapidus by providing a range of technologies and will work closely with it on next-generation process development. ®
Source: The register