Venture capitalists, most of whom have exited semiconductors for the greener pastures of Web software, are back funding MEMS startups thanks to the surge in sensors for smartphones and the Internet of Things.

"I'm working with 10 MEMS startups now," Kurt Peterson from the Band of Angels said in a panel. "They use older lithography than traditional semiconductor plays, but they add a lot of power and have a lot of potential." He noted lots of activity in Taiwan.

One of his companies, Lumedyne, is getting traction by offering accelerometers and gyroscopes with higher accuracy than competitors, Peterson said.

"MEMS is a place you can continue to differentiate," said George Pavlov, a principal at Tallwood Ventures, noting the recent acquisitions by Invensense.

"We've seen companies making MEMS-based kidneys," said Eileen Tanghal from Applied Ventures. "There's a proliferation of semiconductor technology going into broader industries."

One Gartner analyst projected a medium-term demand for 30 billion MEMS sensors -- enough to fill 22 200mm wafer fabs.