Europe is seeking to strengthen its position in the semiconductor industry amid the accelerating global race to produce electronic chips, and the German startup QuantumDiamonds appears to be one of Europe's key bets to achieve this goal.

After years of Dutch company ASML's dominance in chip manufacturing equipment, QuantumDiamonds has secured significant financial support from the European Union and Germany to develop new technologies that would speed up chip manufacturing processes and improve their quality.

€76 million to support manufacturing

The company, spun out from the Technical University of Munich (TUM), received €76 million in non-dilutive government funding after approval from the European Commission, through the German Ministry of Economic Affairs and the Bavarian state government, according to a report published by TechCrunch and reviewed by Al Arabiya Business.

The funding will be used to establish a new facility in Munich dedicated to producing semiconductor inspection equipment, as part of an investment plan totaling $178 million previously announced by the company.

The company also succeeded in raising €15 million in an investment round led by World Fund, with participation from investors including Bayern Kapital, Earlybird, IQ Capital, Creator Fund, and others.

Chip inspection in two minutes instead of weeks

CEO Kevin Berghoff said that the demand from chip manufacturers was a key factor in quickly completing the funding round, stressing that the company is already cooperating with a large number of companies in the semiconductor manufacturing ecosystem.

QuantumDiamonds' technology reduces the process of detecting defects inside chips from weeks to just two minutes, without needing to stop production lines.

The company believes this technology could save hundreds of millions of dollars for chip factories, especially in Taiwan and South Korea, by improving production and reducing the rate of defective chips.

Berghoff noted that the cost of purchasing the system is typically recovered within just a few months, while the company generates additional revenue from software subscriptions and technical support services that help customers analyze inspection data and identify causes of defects in manufacturing processes.

Quantum technology based on synthetic diamonds

Despite the company's name, the diamonds used are not natural but synthetic diamonds, whose precise quantum properties are exploited to monitor the flow of electricity inside electronic chips.

This method can detect defects across all layers of the chip without damaging it, unlike traditional inspection methods that focus only on the surface layer using microscopes.

Berghoff believes this advantage is becoming increasingly important with the growing trend toward three-dimensional chip manufacturing, especially as the use of artificial intelligence and data centers expands, where transistors can no longer be shrunk further, and the solution lies in adding more layers within a single chip.

Competing with the giants

Despite the existence of giant American companies specializing in chip inspection equipment, Berghoff asserts that his company currently has a first-mover advantage, noting that no American or Asian company has yet commercially introduced similar equipment.

The company currently aims to transition from laboratory inspection systems, which test one sample out of millions of chips, to systems capable of fully inspecting all chips on production lines.

The prices of the company's current systems range from several million dollars, while the cost of high-throughput industrial systems could reach $10–15 million, still far less than the cost of ASML machines, which can exceed $400 million.

Will it become the next European ASML?

Daria Saharova, managing partner at World Fund, believes that QuantumDiamonds has the potential to become 'the next European ASML,' benefiting from innovation and increasing government support.

However, Berghoff does not rule out a different scenario, noting that ASML itself could be a candidate to acquire QuantumDiamonds in the future if it decides to expand its activities in chip inspection, although the Dutch company recently stated it is not currently enthusiastic about acquisitions.

Global expansion and launch from Munich

The year 2026 saw international expansion for the company, as it opened a regional office in Taiwan and deployed its first commercial systems in both Taiwan and the United States, including the installation of a system at Eurofins EAG Laboratories in Sunnyvale, California.

At the same time, the company plans to expand its engineering team in Munich, which currently includes around 70 employees, and double the number of engineers in the coming year, leveraging European expertise in quantum technologies and semiconductors as part of its ambition to become a global player in the chip manufacturing equipment sector.

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