Key facts
- Taiwan's Taiex index rose more than 50% in 2026, the best performance among major indices after South Korea's Kospi.
- About 7% of Taiwan-listed stocks doubled in 2026, versus 3% in South Korea, per the report.
- Findit said seed and angel rounds fell to 17.1% of Taiwanese VC deals in 2024 from 38.4% in 2021.
- KPMG Taiwan said TSMC's share-price strength created a crowding-out effect for private funds.
- Operon Solutions founder Anderson Chen said he raised a $700,000 pre-seed mainly from Silicon Valley investors.
- Caleb Chu of Nova Studio said Taiwanese investors increasingly favor B- and C-round and pre-IPO companies.
Taiwan's benchmark Taiex index rose more than 50% in 2026, making it the world's best-performing major index after pulling ahead of South Korea's Kospi, according to a Business Insider report that did not date the event. The gains extended beyond Taiwan Semiconductor Manufacturing Co. to chip design, advanced packaging, networking and server companies. About 7% of Taiwan-listed stocks doubled in 2026, compared with 3% in South Korea, the report said.
A September Bank of America survey found that 35% of fund managers expected Taiwan to benefit most from the next phase of the AI cycle, tying it with the US, while 5% chose South Korea. That wider exposure made Taiwan a preferred Asian AI trade, the report said.
For startups, the public-market returns reshaped funding calculations. Anderson Chen, founder and CEO of Y Combinator-backed industrial AI startup Operon Solutions, said he chose to raise the company's $700,000 pre-seed primarily from Silicon Valley investors, leaving room for Taiwanese friends and family. Chen told Business Insider the semiconductor market was too good and that investors could get 10X returns from the stock market, while even a successful startup IPO might generate only a two- or threefold return.
Caleb Chu, an early-stage investor and founder of Taiwan-based Nova Studio, told Business Insider the stock rally had drawn many Taiwanese investors toward listed shares and away from venture capital and startups. Findit, a government-commissioned platform tracking Taiwan's startup ecosystem, found seed and angel rounds made up 38.4% of investment deals by Taiwanese VC firms in 2021, falling to 17.1% in 2024. B- and C-round deals accounted for 39 deals, or 29.1% of the total, in 2024, the report said.
A March report by KPMG Taiwan said TSMC's share-price strength had created a crowding-out effect for private funds, as investors favored liquid public AI stocks over funds with longer lockups and less certain exits. PitchBook and the National Venture Capital Association said early-stage dealmaking was more favorable for AI startups than non-AI peers in the first quarter of 2026, and that 87.5% of US venture dollars invested in the first half went to rounds of $100 million or more.
Chen said fundraising had become easier overall for Taiwanese deep-tech startups seeking overseas capital, helped by Taiwan's technical talent and semiconductor expertise, and that Operon's pre-seed closed within three days.