Life Across the Chasm – the Evolving Role of the VCP
The rumors and results of consolidation are everywhere. Ever since Avago acquired Broadcom the semiconductor world realized that anything can happen. And it will. One of the results is the change in the definition of the “little guy.” It wasn’t that long ago that a company with revenue of $250M was considered reasonably independent. Today, anything under $1B is bite size. So, what does that mean for the value chain producer (VCP) that has enjoyed a historical domain of startups and entrepreneurs?
Well, two things come to mind. The first is that while the numbers have decreased, eSilicon stills sees a steady stream of the best and brightest inventing VC-worthy technology – and we’re adding them as customers regularly. However, the second is less intuitive and an unexpected phenomena. Specifically, if we are to help the little guys, we better be working daily with the big guys.
That’s right. Without understanding the FinFET market it is nearly impossible for us to advise and develop for those companies who wish to participate there today, or see themselves heading there tomorrow. In short, the absolute value of the investment needed to develop a chip with any complexity requires that there is a plausible and realistic path to the most advanced technologies. Otherwise, that chip runs the risk of being technologically supplanted, or in commercial terms, no acquirer will value the contribution to its portfolio.
The role of the VCP has evolved dramatically. Once the source of design and manufacturing expertise for an evolving Moore’s Law, today’s VCP is the escort of the quantum leap from non-FinFET to the FinFET domain. That can’t happen if the VCP doesn’t play on both sides of the chasm. It doesn’t happen if the VCP is not experienced in the full spectrum of technical, quality and reliability issues for the world’s most prolific sockets. Said differently, how can we lead our start-up customers to a technical frontier if we don’t know what their competitors and future acquirers expect? Simply, we can’t. Therefore, it’s imperative that the VCP has the dual vocabulary of the start-up and the market leader.