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Wipro's EnThink to seek venture capital

T O D A Y

• TRAI trouble • EnThnik to seek VC • Call-mail launched • Tektronix acquisition

Established as a typical Silicon Valley start-up, EnThink, which addresses the semiconductor intellectual property market, is working towards an initial public offering which is expected to come through in a couple of years.

CEO Dr Sridhar Mitta has said that a detailed business plan for EnThink is being worked out. By end of June, the venture capital funds would be tied up, he added.

Semiconductor IP is the software encapsulation of the hardware design. EnThink licenses such IP blocks to original equipment manufacturers. They then incorporate it into their designs for fabrication of 'systems on chip'.

The venture capital funds and corporate investments will be used to spruce up EnThink's sales and marketing infrastructure to acquire tools for engineering and to meet patenting expenses.

The company expects to get at least a couple of patents in a year. Japan and US are the main markets of EnThink that are expected to spearhead Wipro's entry into the product business.

While the company follows a direct sales channel approach in the US, it is in the process of appointing two distributors in Japan.

EnThink, which began operations about a year ago, is expected to close year ending March 31, 1999, with revenues of about $1 million. Next year, it is expected to go up to about $4 million. Wipro's initial investment in EnThink is $2.5 million.

The semiconductor IP market is estimated to grow to $1.4 billion by 2001. The product conceptualisation, architecture, marketing and technical support is provided from EnThink's US headquarter, a major portion of the design and development work is carried out in Bangalore.

As a result, the company benefits from the lower development cost in India.

Globally, the semiconductor industry is going through a paradigm shift that has resulted in the dispersion of the vertically integrated model. The design and fabrication of semiconductors are being spun off into independent and self-sustained industries leading to fabless and chipless semiconductor companies.

"Both product lifecycle and time-to-market are shrinking rapidly which has resulted in a great degree of specialisation in the semiconductor industry. For instance, semiconductor design by itself is a specialised industry,'' Dr Mitta said.

EnThink IPs will be in the networking domain where the demand is expected to be high due to data and telecommunication convergence. "Our vision is to be a leading provider of ready-to-use communication technologies to enable companies build intelligent Internet appliances,'' Dr Mitta said.

EnThink plans to enter strategic tie-ups with Wipro business units, other IP companies and partners to complement its offerings.

Being a separate company gives EnThink distinct advantages in terms of decision making and flexibility in HR policy.

EnThink has about 50 employees and all of them have been given stock options, according to Dr Mitta.

- Compiled from the Indian media

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