Arithmatica's Dave Burow
Promoting honesty as a best policy
by Peggy Aycinena
Dave was specifically interested in start-up opportunities in the electronics and semiconductor industries. His first job in Silicon Valley was at Fairchild Camera and Instruments, which later became Fairchild Semiconductor. I'll let Dave take the story from there:
"I grew up in a blue-collar working class area of Chicago. Only about half of my high school class went on to college, and of those only about a third went on to four-year schools. My father worked two jobs plus I worked as well to get me through college."
"I wanted to have an impact on the world in some way, and my career aspirations were quite specific. I wanted to be the CEO of a company by the age of 35, and I wanted to retire at 45. Given that I believed semiconductors would have a huge impact on the world, the only choice left to me [and my wife] was to relocate to Silicon Valley and pursue opportunities there."
"The irony is that in 2002, when I left Synopsys, I had the mindset to retire I was a little older than 45 by then but that mindset only lasted 7 months because, after meeting the team at Arithmatica, I was quickly drawn back into the CEO world without too much persuasion."
"Silicon Valley is a great place. I can't think of a single time since 1979, when I first arrived, that it hasn't been exciting. [The energy here] is ever present. People here are constantly aware of changes and developments in the technology; they're constantly trying to anticipate that next change, and to react to it. In fact, Silicon Valley has always exceeded my expectations. At every point in time, I've felt there were more opportunities that I was ready to take advantage of."
"As far as my goals are concerned I was a CEO before I was 35, and probably could have retired at 45. When you're young, you think you're working to an end goal. But by your late 30's, you know it's not about the next goal. It's about the joy and satisfaction of doing something well every day. It's a wonderful thing to have the opportunity to work with great people and to have an impact on the people in an organization. I feel very fulfilled by my work, and I have come to believe that it's the journey more than getting to a particular destination that's the [important thing] in life."
"I was with Fairchild through 1986. While I was with them, I started the business unit that did gate arrays the ASIC form at the time. I was involved in both the marketing and the applications, and was even running their design centers."
"I left Fairchild, to go to a company that had invented the channel-less gate array. I'm definitely a technology junkie, so I really enjoyed that company. However, they went bankrupt after they bought a fab that they couldnt operate. That was my first learning experience about what can go very wrong with a technology company."
"Following that experience, I went to SimuCad, which was a small EDA company with logic and circuit simulation tools. Their claim to fame was that they started the chain of events that ultimately resulted in Daisy Systems being established."
"SimuCad was acquired in a friendly transaction by a public company with logic and test technology, and that company was acquired by a circuit company, also through a friend transaction. Then Daisy Systems tried to do a friendly take over of all three of us, but failed. So, they launched a hostile take-over. They acquired shares of the company for cash in a very bitter fight."
"The results were that Daisy didnt have enough cash to compete with Mentor and Valid, and ultimately went from being a valuable company to a company that was sold 2 years later to Intergraph for $14 million. I didn't stay there very long only long enough to fulfill my acquisition agreement."
"Then I joined CrossCheck Technology and Silicon Architects, and then I joined Viewlogic, where I was responsible for a number of the companies that they had acquired in Silicon Valley. I inherited, for instance, Sunrise Test and Vantage Analysis. Then, we set off to take John Sanguinetti's technology at Chronologic when it was acquired by Viewlogic. We rebuilt that team and got it rolling in the marketplace so much so, that Synopsys acquired Viewlogic for $550 million in 1997. I joined Synopsys at that point and stayed until 2002."
"It was an exciting time. We grew the product lines and everybody viewed the acquisition as a very successful transaction. I really liked the people at Synopsys. I ran the verification business unit there until 2001. That was in the middle of the Internet bubble and all the brick-and-mortar companies through they'd be eclipsed by the Internet business."
"In 2000/2001, I was asked to do what we could to respond, so I spent the next one and a half years designing the capacity to deploy tools over the Internet, using the ISP model. The Internet was booming and at every meeting I was asked, 'Can't you go faster, Dave? We don't want to be left behind.'"
"What happened to the ISP model, of course, was that it didn't really catch on. And that was not just true in EDA, but in most business applications as well. As a result, we ramped the business down and brought the technology in-house. Today, it's the main way that technology is shared within Synopsys."
"Having had the chance to work for Aart de Geus was, I felt, a very special opportunity. Aart's amazing in that he's definitely always trying to learn more. He's never had the opinion that just because he's the founder of the company, that he had the right to be the CEO. He always worried that as the company went to $1 billion that his skills would [match the task]. He's never been afraid to bring in other smart people to help him run the business he's just an extraordinary person in that regard."
"I missed Synopsys a lot after leaving in 2002, particularly the people. You grow very attached to the people at a company, and that's always the hardest part of moving on. Of course, I don't miss so much having [the bulk] of my time scheduled into corporate meetings, but that goes with the territory when you're at a company the size of Synopsys. The [upside] is that when the company is of such a value and size, you can do projects and deploy technology on a very large scale."
"Small companies, on the other hand, have the attribute of allowing you to move quickly. There's not too much standing in the way of doing things at a small company. However, when you want to go to market, you don't have all the power of the big organization behind you."
"So, how did I arrive at Arithmatica? Well, there are two answers to that question. Having working for a lot of years and having been pretty successful, I was fortunate to be at a point where I could be selective in terms of the kind of environment I wanted to work in. I wanted an environment where the investors had the long-term view."
"Arithmatica had people who were very open to ideas, and had a very realistic point of view about how long things might take. More important, having worked at Synopsys, I came away with a very strong idea about where were the good places are to build a business."
"Today, the Holy Grail in EDA is all about going from system specifications to transistors, but it's a technology that's been slow in developing. Also, the ideas that transistors are free today, and that people worry more about abstraction than they do about silicon, don't ring true with my impression of things. I believe the idea is still about making chips smaller and more power efficient."
"In addition, when it comes to design, prior design [blocks] are being reused, so I definitely felt I wanted to be involved on the design side of the business in my next venture. I wanted to be where the value proposition was smaller, faster, and less power. And, as nobody really wants to reuse a design block completely most, but not all, of what was used the last time there's a huge verification problem out there. So, I thought that verification should also be part of the equation."
"At Arithmatica, I saw these extremely bright people with the right kind of investors behind them, and I saw them working towards smaller, faster design implementation. I looked at the situation and decided I would have the opportunity here to use my own ideas about how to solve the implementation bottleneck. I also thought that we could address formal verification in a way that other people couldn't."
"People at the company knew it was going to take a lot of time to convince customers that what they were doing was correct, so we started by taking a look at some these fundamentals. You could say it's going to take a lot of time to convince [potential] customers that what we're doing is correct. Or, you could say that people have been implementing math in software for going on 50 years now. How can Arithmatica discover anything new in these areas? However, the team here continues to find ways to implement things in new and innovative ways."
"The guys at Arithmatica are trying to solve a more general problem. The blocks for implementing math are growing smaller and faster, so they've started taking those building blocks and putting some services around them. Then, they convinced some high-profile customers people like NVIDIA and Xilinx that we could help them build things smaller."
"Now we're looking for problems that are even more high volume, that will have an even greater impact, and we're developing IP around the solutions to those problems. It's the consumer-driven applications that are really changing dramatically right now the quality of displaying, for instance 3D graphics, of transmitting and processing video and high-quality audio data, and so forth. These applications require more and more mathematical processing. The market's moving in the right direction, as far as we're concerned, and we're working to be able to provide specific solutions to some of these applications."
"Right now we're at 27 people, of which 19 are essentially doing technology developing. Everybody's working hard there's no office manager, no secretarial support staff. We're all very engineering driven right now developing products for customers."
"At some point we want to take the advances we're developing at Arithmatica and push them even further. That's where the design automation background that I bring to the company is helping. We've spent a lot of time developing our IP in a way that we can reconfigure it, and formally verify it, so that there's a significant amount of scalability in the business. Ultimately, of course, that's always the challenge. How do you scale a business?"
"Clearly in the IP business, it's a mix between offering products and offering services. Most companies start in services and move to products. Arithmatica started the other way around. Here it's about the IP, and then what we need to do to customize it. We don't do any services work that's not related to our core technologies. In other words, we don't just stumble onto our IP by doing generic design services work."
"Should a technologist or a business expert lead a technology company? Well, I've joined several companies where the technologist/founder claimed he wanted to give up the reigns, but it wasn't true. In the case of Arithmatica, however, one of the co-founders was acting CEO prior to my arrival, and he knew that his job was to find me, or someone like me, to serve as CEO."
"Now it's my job to try to make sure that I don't put too many processes in place too fast, but rather to let the company grow at an appropriate rate. As opposed to Aart de Geus, for instance, I don't have a PhD in a technical topic, but I try to understand the technology at Arithmatica to the level that I can present it to a customer in a way that they can relate to."
"It's important to understand how a customer uses your technology, and what the barriers to adoption are. That information can only come from the outside. From the inside, it's my job to make sure that my team is always developing the technology with both the customer and the economics of the product in mind."
"There's a lot of great technology that you just can't build a business around, and there's also a lot of great technology that can't be adopted because it doesnt recognize the customer's inability to adjust fast enough to adopt the technology. And of course, it's always important that your technology offer some differentiation over the competition or alternative approaches to solving a problem."
"For me, leadership is always about honesty. It's always served me well to get the bad news out on the table and try to deal with it, with the team. To pretend that everything's okay doesn't work in my opinion. You can't just be rah-rah about a business, without being honest. That only works for a short amount of time because you need to a) recognize the problems, and b) work to have a plan to deal with it. If you can see to do those things well, your people will see your enthusiasm for the market and follow your lead."
"I'm a strong believer that in a small company you need to communicate to the entire team. We share all of our information here with everybody within the company our wins, our losses, our financial information. You've got to try to explain to the team what's happening, and put it into a larger perspective of where you've had wins, and where you are in your development cycle with respect to growing the company."
"We work in an industry where people are extremely bright, and not just in the technology. They're bright in picking up on business issues as well perhaps not all of the business nuances, but a lot of them. You have to be open and encourage conversation. That's why my number one recommendation to anyone in a leadership position is, always be honest with your team."
Peggy Aycinena owns and operates EDA Confidential. She can be reached at email@example.com