Building an integrated software and hardware ecosystem: How does Sailing Capital break through the core bottlenecks to fully connect the AI and semiconductor industrial chains?

Against the backdrop of the accelerated evolution of the global technology competition landscape, computing power has become the core driving force reshaping the digital world, and semiconductors, as the physical foundation of this transformation, have once again become the focus of global technology competition. With the recent technological breakthroughs in China's DRAM sector, market attention to the semiconductor industrial chain has continued to rise. As a professional investment institution deeply rooted in the hard technology sector for a long time, Kailian Capital recently conducted an in-depth analysis of its investment logic in the semiconductor and artificial intelligence fields, demonstrating how to build an industrial ecosystem with coordinated upstream and downstream linkages through the power of capital.

Face up to cyclical fluctuations and tap into structural upgrading opportunities

The semiconductor industry has typical cyclical characteristics, and such fluctuations often deter short-term investors. However, for institutions that adhere to value investment, the structural opportunities behind the cycle are the key to position allocation.

Back in 2021, the semiconductor industry was in a complex adjustment period, and domestic DRAM was faced with the dual pressures of technological catch-up and high-intensity capital investment. At the critical node of industrial development, Kailian Capital chose to invest in Changxin. Kailian Capital believes that this decision is not based on the game of short-term market sentiment, but on the in-depth research and judgment of the underlying logic of the industry. Although there are cyclical fluctuations in the global semiconductor market, benefiting from the explosive development of large artificial intelligence models, semiconductors, as the cornerstone of the digital economy, still have a positive long-term demand trend.

In the view of Kailian Capital, the three elements of artificial intelligence — computing power, algorithm and data — all have their physical foundations rooted in semiconductor hardware. Investing in Changxin is essentially the recognition of the value of the core strategic asset of the "computing power base", aiming to promote the localization of the industrial chain related to the underlying computing power of artificial intelligence in the gaps where Moore's Law is approaching the physical limit through capital support.

Deploy the "global closed loop" to build an integrated software and hardware ecosystem

Based on the understanding of the macro trend, Kailian Capital has established the overall investment strategy of "taking midstream and upstream technologies as the core and downstream scenarios as the traction", trying to break the limitation of single-link investment and build a scenario-driven closed-loop ecosystem integrating software and hardware.

In the upstream of the industrial chain, Kailian Capital attaches great importance to basic fields such as core semiconductor materials and wafer supporting facilities, and is committed to completing and strengthening the industrial chain. In terms of midstream core chips, relying on the core advantages of Changxin in the storage field, Kailian Capital has simultaneously invested in enterprises including Maxscend, Unicps, and Unisoc, covering key categories such as analog chips, FPGAs, and radio frequency chips.

In order to realize the effective connection from underlying materials to final products, Kailian Capital has made key investments in xFusion, the world's leading provider of computing power infrastructure and services. xFusion focuses on AI servers and intelligent computing centers, which can efficiently integrate upstream basic materials and midstream core chips, and collaboratively open up the localized supply chain of "materials - chips - complete machines".

While building the hardware base, Kailian Capital is well aware that the progress of hardware technology cannot be separated from the test of real application scenarios. In the field of end-edge-cloud global computing power, Kailian Capital has invested in Qingmicro Intelligence, a leading enterprise in reconfigurable computing chips, to transmit the demands in real industrial scenarios to the chip design end. In addition, in cutting-edge fields such as embodied intelligence and commercial aerospace, Kailian Capital has also expanded the application boundary of semiconductor technology by investing in enterprises such as Deep Robotics, Agibot, and i-Space.

Through the combination of the downstream hardware base and the diversified scenario demands in the upstream, Kailian Capital has built a positive cycle mechanism of "hardware supports scenario implementation, scenarios drive hardware iteration", and empowers local industries to achieve technological breakthroughs through capital support.

Adhere to long-termism and be a rational "builder" and "partner"

In the field of hard technology investment, time is often the variable that most tests patience. Kailian Capital is well aware that the breakthrough of the semiconductor and artificial intelligence industries cannot be achieved overnight. Kailian Capital always upholds the spirit of professionalism and is committed to being a "builder" and "partner" for enterprise development.

Kailian Capital stated that its role is not only to provide financial support in the prosperous period of enterprise development, but also to provide long-term and stable capital support and industrial resource empowerment for enterprises based on a profound understanding of industrial laws during the cyclical fluctuations of the industry. This concept of "value symbiosis" requires not only focusing on the financial statements of enterprises, but also paying attention to the construction of their technical barriers, the growth of team capabilities and the improvement of their position in the industrial chain.

Looking ahead, Kailian Capital will continue to adhere to in-depth research and value investment, deploy the future with rational strategies, and help China's technology industry continuously consolidate the industrial foundation for independent development in future competition by building a resilient industrial ecosystem.

*Risk Warning: Investment involves risks, and caution is required when entering the market. The enterprises mentioned in the text are only for case analysis and do not constitute investment suggestions.