Tool startups bet on autonomy

Santa Cruz, Calif. -- Stepping into public view this week are two analog/mixed-signal design automation startups chasing a goal that has eluded most of their predecessors: building a viable, independent company that doesn't fold or end up being acquired.

Lynguent Inc. (Portland, Ore.) will roll out ModLyng, a graphical model-creation environment for analog/mixed-signal models. Solido Design Automation (Saskatoon, Saskatchewan) will not make a product announcement but will declare its intent to bring new technology to transistor-level design, including analog as well as some custom digital work.

Founders of both companies were involved with previous analog EDA startups. Martin Vlach, CEO of Lynguent, was a founder of Analogy Inc., acquired by Avanti Corp. in 1999. Solido CEO Amit Gupta was a founder of Analog Design Automation (ADA), acquired by Synopsys Inc. in 2004.

By going beyond point tools and building a foundation for broad sets of offerings, both Vlach and Gupta believe they can forge thriving, independent companies. If they do, they will be bucking history; most analog EDA startups have either "folded or been acquired poorly," said Jim Solomon, the founder of Cadence Design Systems Inc.

Analogy, for example, went public in the mid-1990s, but struggled with slow growth and declining revenue and was ultimately sold to Avanti. Cadence acquired NeoLinear Inc., a provider of analog layout and optimization tools, in 2004 and bought the assets of Antrim Design Systems Inc., a provider of optimization and characterization tools, in 2002. Barcelona Design Inc., a provider of configurable analog intellectual property and tools, shut its doors last year after burning through $44 million in venture funding.

The irony, said Solomon, is that "there is a desperate need for a next-generation analog design system. If you look at all of EDA, the analog design flow is probably the oldest and most in need of updating." Solomon is not affiliated with either Lynguent or Solido, but he currently sits on the boards of four other analog/mixed-signal tool providers.

Gary Smith, chief EDA analyst at Gartner Dataquest, said that traditional analog designers comprise a very small market--around 12,000 engineers. A successful startup, he said, "will need to address a different design engineer." What's really needed, Smith said, is to bring analog design up to the register-transfer level.

Lynguent pegs the analog/mixed-signal EDA market at around $600 million, or about 15 percent of the overall EDA market. But a look at Dataquest's "2005 EDA Market Trends" report shows how thoroughly the big EDA vendors--Cadence, Synopsys and Mentor Graphics--dominate. For example, those three collectively hold 97 percent of the mixed-signal simulation market. Cadence still owns the analog design tool market, said the report, while Agilent EEsof dominates in RF design tools.

But there's hope for others, said Smith. "The leading tools are vulnerable, and we have seen AWR make some good headway," he said. Applied Wave Research (El Segundo, Calif.) supplies high-frequency EDA products for the design of wireless telecom equipment, semiconductors, high-speed computers, networking systems and other electronics-based products.

New approach to modeling
Lynguent has been a long time coming. Vlach left Avanti a year after the Analogy acquisition and set up Lynguent in 2001. He later hooked up with Alan Mantooth, Lynguent's chief scientist, who is a professor of mixed-signal IC design at the University of Arkansas.