The company, called Ostendo, in California has created the hologram projector chip which is small enough for smartphones.
The Tic-Tac-sized chip should be ready for manufacturing next year.
The Ostendo Quantum Photonic Imager combines an image processor with a wafer containing radically miniaturised light-emitting diodes (LEDs).
The system can control the colour, brightness and angle of more than a million individual beams of light, according to 'Discovery News'.
One chipset, small enough to fit into a smartphone, is capable of projecting video on a surface with a 48-inch diagonal.
The first iteration of the chip will only project 2-D videos, but the next version, expected to follow soon after will feature holographic capability, Ostendo's chief executive and founder, Hussein S El-Ghoroury told the Wall Street Journal.