The business magazine, Fortune, in a Feb. 2015 article proclaimed The Age of Unicorns — private companies valued at more than $1 billion by investors. Unicorns are the stuff of myth, but billion-dollar tech start-ups seem to be everywhere, backed by a bull market and a new generation of disruptive technology. According to a recent New York Times article, there are over 50 unicorns in Silicon Valley right now.
Upcoming unicorns formed a popular discussion topic at the Confluence 2015 conference organized by Zinnov, on March 12th in Santa Clara, Calif. The conference theme was “Building the Technology Organizations of Tomorrow”.
Here is a sampling of six unicorns that have emerged as real winners using innovative strategies:
Airbnb (San Francisco) is a web marketplace for the rental of local lodging, with listings in 192 countries. It uses social media technology to conduct background checks for both providers and renters, to amplify stories, connect with travelers and ultimately drive business growth. And you thought Facebook was just for time-wasters! Watch this YouTube video to see how Airbnb leverages social media.
Uber operates a mobile-phone based transportation network using private cars and taxis. It employs just 3 people per city when it first launches operations in a new location. The teams get support from the San Francisco headquarters mainly for IT operations. The team also leverages the network of operators in other cities. In contrast, rivals employ hundreds of employees to manage a driver network. This fat-free model is helping Uber to roll out operations at a rapid pace.
Flipkart (Bangalore) is a web store and sellers marketplace in India. It was established in 2007, and is valued at $12 billion. One specific feature – “Cash on delivery” – introduced in 2013, accelerated their sales significantly. You hand over the required cash to the delivery staff, and get the product handed over to you in return, all with a human touch. They figured India is primarily a cash driven economy where plastic card penetration is extremely low in India (<1%). Why couldn’t Amazon think of it?
The high-definition personal camera company, GoPro is based in San Mateo, Calif. It raised $427 million when it went IPO with a valuation of $2.96 billion in 2014. It turned its customers into a stoked sales force, by enabling users to flood the Internet with videos of their own adventures. In 2013 alone, GoPro customers uploaded 2.8 years worth of video featuring GoPro in the title. Each video not only serves as a customer testimonial, it is guerrilla advertising, giving potential customers millions of reasons why they should buy one of GoPro’s little cameras. To learn more, read the Wired article Why GoPro’s Success Isn’t Really About the Cameras.
Pivotal Labs, based in San Francisco, offers a next-generation Platform-as-a-service (PaaS) for creating web applications in the cloud. It has grown to over 400 consultants, with an office presence in nine major tech hubs in the US and now internationally in Toronto and London. They use pair programming (agile software development) with their clients, a technique in which two engineers work together at one computer, write code, and collaborate on solutions to problems. Pair programming with the clients is the most common reason they choose to work with Pivotal since it accelerates learning and expertise. Check out this video article on how Pair Programming is the secret sauce to Pivotal Labs’ growth and success.
Zoho University, in Chennai India, started as a corporate social responsibility experiment a decade ago. The IT university has no exams, deadlines or assignments, but students are paid to attend and graduates receive a professional certificate. Zoho University is now among the largest contributors to the 2,600-strong workforce of the India-based IT company Zoho Corporation. Nearly 15%, or about 300, of the company’s employees are graduates of Zoho University. Learn more about this innovative educational institution in this video interview of Sridhar Vembu, CEO of Zoho.
So, what about the design automation industry?
First of all, startups will not have billion dollar valuations, given that market value of the whole industry is less than 20 billion dollars. So, let’s define our one-horned-wonders as the hot startups that are ready to deliver significantly superior products compared to the big 3 of EDA.
So, where are the EDA unicorns? Where will they come from?
I believe that unicorns will be the ones using innovative strategies to provide solutions that tackle a highly difficult pain-point in chip design, and prevent chip killer problems. I mentioned in my blog Redefining Chip Complexity in the SoC Era, we are dealing with chip complexity that is orders of magnitude higher than the past. The complexity comes not only from the sheer size (approaching 1 billion gates) or lower process nodes, but also the scale of IP integration, complex low power requirements, asynchronous interfaces, x-propagation risks, verification bug escapes, and so on.
EDA unicorns will create high capacity and high performance methodologies to prevent chip failures and provide a reliable sign-off solution!