Jasper Design's Kranen talks biz models, investment

Global competition
Brian: Several companies such as Tanner, Altium, are seeing an opportunity  at the lower end of the market that may actually turn them into successful companies.  The semiconductor industry is taking off in China, but do they need the same sophisticated products given that they are a few nodes behind everyone else?  And are we going to see EDA companies moving to China to lower development costs?

Kathryn:  Yes, we may see stratified solutions with new players specializing at the lower end of the market.  Or we may see existing vendors creating less-feature-rich product packages for those markets.  But I don't think you can draw a hard geographical link between where a product is developed and what market it serves.  If you look at Jasper, we’re headquartered in Mountain View, CA, at the heart of EDA right here in Silicon Valley, but my developers and applications engineers are all over the globe - Brazil, Israel, Sweden, Singapore, Taiwan, China, Greece. It is becoming less relevant where your company is headquartered. It would be foolish to think that people in China can only develop low-end products, or that people in Silicon Valley would only want to build high-end products. And it would be shortsighted to think companies in the U.S. are going to ignore the lower-cost markets. I think across all industries, people see the market opportunities in China and the rest of Asia, and understand that’s a very important market to serve. We’ve been impressed with the Asian customers that we deal with, our end users.  I think the myths out there, about Asia being decades behind the US, are way overblown.

Brian: To go along with your point, I was recently looking through some ACM transactions, and I think that every paper I looked at had a Chinese name on it.

Kathryn: I have noticed that, too. That’s where I do get worried - about higher education. I see a lot of academic investment and wonder are we, the EDA industry, doing enough investment in academia here? I was recently at the Memocode conference in Washington, DC, and I sat with some of the top professors that have been in this field a long time. We had a long talk about how EDA is not investing in academic institutions in the US and what will be the ripple effect of that. I came away from that conversation thinking about a pendulum swinging.  Yes, in the US there’s more academic investment in other fields right now, whether it's cloud optimization or whatever.  But those leading-edge solutions usually run on hardware systems at the end of the day, and if the hardware systems get bottlenecked by the capabilities of EDA, then you will see more academic investment going back into EDA. Of course, it’s not just about hardware; it’s software and systems too. The footprint of EDA isn’t just the SOC – there are EDA companies that offer solutions for software development, and IPs that are more system-related. So back to your question, I guess we’re seeing more EDA-related academic investment in Asia right now. I don’t think it’s unhealthy, but I do think that it’s a bit of a wake-up call.  I will say, we have a lot of immigrant top students from other countries coming to get their higher education in the US.  Some of the Asian names you see on those ACM papers are for authors residing here in the US, or even US citizens, for matter.  You can't draw too many conclusions from the names.

Brian: I have noticed that many Indian and Chinese people, who have been in this country for a long time are now considering going back to their home country. I think they’re taking a lot of knowledge and talent with them, particularly in the areas they lack, which is management experience.

Kathryn:  We benefit from the work of those engineers for whatever period of time they choose to stay, even if they ultimately move back home. We want to recruit top talent, wherever. We’re not fixated on geography.  The reason we have several international development sites is because some of our top people wanted to live in their home countries again. For instance, our VP of Engineering, Claudionor Coelho, approached Jasper in 2004 even though he was living in Brazil. Guess where I set up a development site? In Brazil, around Claudionor, the top talent. That led to Jasper discovering a fantastic pool of talent there – I’m so, so happy.  Progressive, fast-growing companies need to recognize that geography is not all-important. Managing people in remote locations is not prohibitive. You just want the talent, wherever they live. If I find a group of people with the right skills, that I believe we can effectively manage, and they’re in China, then that may be my next development site. Jasper has a strong multi-national team, with many diverse perspectives and an interesting mix of cultures.

And we will have to leave it there for today. There is still more to come from this interview and the third installment will probably be available early in the New Year.

Brian Bailey – keeping you covered

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