Lace Lithography, headquartered in Bergen and founded in July 2023 by physicist Bodil Holst and her former PhD student Adria Salvador Palau, uses a beam of helium atoms rather than light to etch chip patterns. The company just secured $40 million in Series A funding from Atomico and Microsoft's M12, signalling confidence in a radical alternative to the machinery that has defined the chip industry for two decades.
For Asian chipmakers weighing long-term capital investments, the implications are already worth watching. ASML's position is structurally dominant but politically sensitive, with the Netherlands' export controls on EUV machines to China having turned chip lithography into a flashpoint in the broader technology competition between the United States and China. Any viable alternative could reshape the geopolitical calculus of semiconductor supply chains. But the gaps between promise and production remain enormous.
The advantage of Lace's approach is elementary physics. Atoms don't have a diffraction limit, whereas photon-based lithography, including ASML's EUV systems, is constrained by the wavelength of the light it uses. The beam is approximately 0.1 nanometres wide, roughly the width of a single hydrogen atom, and about 135 times finer than ASML's EUV light. The practical implication, if the technology can be made to work at manufacturing scale, is chip features up to ten times smaller than what current lithography allows: transistors and other structures at what Holst describes as "ultimately atomic resolution."
For Asian manufacturers and investors, smaller features mean more transistors per wafer and therefore higher performance at lower cost. Smaller features mean more transistors on a chip, which translates into higher performance for AI workloads. This matters enormously in a region where Taiwan Semiconductor Manufacturing Company, Samsung, and Intel are racing to capture the AI chip market.
Industry experts acknowledge the potential. John Petersen, Scientific Director of Lithography at Imec, a research and innovation hub for the chip industry, explained that the industry could create features such as transistors, the building blocks of modern chips, an order of magnitude smaller to an "almost unimaginable" degree. Yet Lace faces structural obstacles that remain underestimated in the investment narrative.
Where competing approaches still rely on photons, Lace abandons electromagnetic radiation altogether, meaning that its approach has no existing ecosystem of process flows to plug into. ASML spent decades and billions of dollars turning EUV from a research concept into a commercial product, and even well-funded newcomers face a long road to viability. The company has already developed prototype systems and is targeting a test tool in a pilot chip fabrication plant, or fab, around 2029. Volume production likely lies a decade or more beyond that milestone.
The broader context matters for investors and policymakers. Governments and investors are pouring money into semiconductor supply chain diversification, driven by geopolitical exposure and AI demand. Lace's funding reflects this broader trend, but also reflects something deeper: the recognition that large customers and partners are actively funding alternatives to traditional lithography flows.
From a regional perspective, the announcement carries mixed signals. In the near term, Asian chipmakers will continue relying entirely on ASML systems for leading-edge production. Lace's helium atom beam concept challenges the assumption that light based lithography will remain the only route for leading edge patterning that matters for AI chips and high performance computing. Yet the assumption that Lace's approach will reach commercial scale remains speculative. While Lace has built prototype systems, the gap between the lab and production is huge. The company is currently targeting 2029 for the deployment of a test tool in a pilot facility, with any eventual move to volume manufacturing unlikely to follow for a long time after that.