Yokohama, Japan -- February 1, 2001-- Asian South Pacific Design Automation Conference
There's actually no secret to successfully starting an EDA company. In fact, a panel of executives from new EDA companies at the Asian South Pacific Design Automation Conference in Yokohama, Japan, agreed on the essentials: people, good ideas, sufficient funding, and the ability to accept a high risk-reward environment.
The panel, moderated by Jan Goodsel a marketing consultant currently helping companies start operations in Japan, included Doug Fairbairn, CEO of Simutech; Hiroyasu Hasegawa, CEO of HD Labs; Bernie Rosenthal, vice president of marketing for Tensilica; Mike Tsai, CEO of Axis; and Sang Wang, CEO of Nassda.
Fairbairn advised that the entrepreneur must plan on making the company fun and exciting, and recruit a quality team with independence, confidence, a sense of urgency, very high risk tolerance and a willingness to do whatever is necessary to succeed.
Hasegawa noted that the Asian areas have a dearth of potential professional investors like U.S. venture capitalists, but the opportunities are still there. Not only that, he said, but the culture in Japan is much more risk averse than in Silicon Valley. So he opted for a "lifestyle" self-funded startup with a group of like-minded people who have an opportunistic attitude and the speed and agility not possible in a large corporate environment. He suggested that engineers should try at least one startup in their lives just for the experience of it.
Rosenthal suggested the initial team must have prior startup experience and the ability to adopt a global perspective as quickly as possible because of the worldwide nature of EDA user communities. He suggested that any new company must make a new tool that delivers a quantum benefit, because less that an order of magnitude change is easily overcome by the existing companies' services, support and the legacy infrastructure developed to use the older tools. He noted that a new company should migrate as much as possible to the Internet as soon as feasible.
Tsai emphasized the need for nurturing. In addition, he noted that the founders must have a clear vision and direction for the company while keeping close contact with the market and with customers, and startups must make sure their employees are well motivated and feel a sense of ownership, fueled by stock as a supplement to other compensation. He cautioned future entrepreneurs to take the first two months to carefully work on the details and directions for the company and to make sure the idea is sound and the business is viable. He noted that any funding should come from people who can contribute something of value in addition to money.
Wang noted that Asian areas have a cultural and traditional bias against startups, but have a wealth of highly talented people available to staff a new venture. One challenge is to convince others that the goal of a start-up is to attain sufficient wealth to sustain a comfortable lifestyle. New companies must earn their customers' trust, develop good relationships with other companies and have some luck in defining the proper timing, developing the appropriate solutions and catching market windows. Success, he said, requires vision, focus, persistence and teamwork. An EDA startup needs good ideas, a clear understanding of user requirements and the ability to create good solutions.