I wrote recently about my experiences Running a Salesforce , and one of the key aspects of marketing in City Slickers Marketing . Today, it is time for my thoughts on application engineering. Application Engineers Application engineers are the unsung heroes of EDA. They have to blend the technical skills of designers with the interpersonal skills of salespeople. Most AEs start out as design engineers (or software engineers for the embedded market). But not all design engineers make it as AEs, partially because, as I’m sure you’ve noticed, not all design engineers have good interpersonal skills! There’s also another problem, memorably described to me by Devadas Varma when we were both at Ambit: they’ve only been in the restaurant before; now they’re in the kitchen, they’re not so keen on what it takes to prepare the food There is a remark attributed to Otto von Bismarck that it's better not to see laws and sausages being made. EDA tools can be like that, especially during the time before they are mature. Being an AE means cutting more corners than being a design engineer, and some people just don’t have that temperament. A pre-sales AE usually has to produce a 90% solution quickly; a design engineer has to take whatever time it takes to produce a 100% correct solution. AEs have a lot of options in their career path. As they become more senior and more experienced, they have four main routes that they can take: They can remain as individual contributor application engineers and become whatever the black-belt AEs are called in that company, be the guy who has to get on a plane at one hour's notice, and fly to Seoul to save a multi-million dollar renewal. They can become AE managers, and run a region or a functional group of AEs. They can move into product marketing, which is always short of people who actually know the product. Or they can move into sales, and stop resenting the fact that when the deal closes, for which they feel they did all the work, the salesperson makes more than they do (and usually then discover sales is harder than they expected). Startup Application Engineers However, in a startup, nobody worries much about career paths. I like to say that in a startup, the organization grows downwards. If you get there early, the way you get a promotion is that the people who come later work for you. In an EDA or IP startup, the first few AEs hired can be the difference between success and failure. The first release of a product never works properly, never quite matches what the market need is, and is simply immature. The AE has to keep the customer happy by substituting their own expertise for the deficiencies of the tool, while at the same time conveying back to engineering the improvements that are required. Most startups are attacking some sort of walled city, in the sense that there is an incumbent tool/methodology that is already in use, and the startup has to prove that they are better. In fact, not just better, compellingly better. The initial value proposition for most startups, when you look from the 10,000 foot level, is that it is riskier to stick with the existing methodology rather than trust the startup and try the new technology. Getting the customer decision-maker to that point is a mixture of technology (it has to work well enough) and trust in the AE (whatever happens, this guy is going to be there for me). Both factors have to be there to close those so-important initial orders because no matter how good the technology looks in demos, the customer knows that the tool is not mature and might fail at any moment. AEs are really hard to find for a startup. Good AEs are pretty highly compensated, and so it is hard to match their salary, and it takes a lot of stock to make up the difference. I did some consulting for a semiconductor equipment company once, and they developed an EDA product. But they failed to hire any good AEs since their own AEs were paid less than a black-belt EDA AEs, and their salary policies were too inflexible. Good AEs are like gold, and if you don’t have them you don’t get any gold. Automobiles It was interesting watching the downsizing of GM and Chrysler’s dealer network during the last recession. It seems that part of the reason that car companies sell through independent dealers is that in the early days, nobody would buy a car from halfway across the country without a local guy in-town they trusted. In effect, they needed a local application engineer, not just a sales guy. It didn’t matter how good Ford’s car appeared to be in the showroom, in 1910, nobody trusted it not to break frequently (a good assumption) and they needed to trust that their investment was going to continue to be good. So Ford and GM (in the early days, their predecessor companies like Studebaker and Oakland) never set up direct sales. By the way, the reason that closing dealerships is so hard, is that those initial dealers were the first guys in town to get rich, so they got the states to pass laws that they could never be designed out: in all 50 states, it is illegal for GM to sell you a car directly. In many states, the dealers left a loophole that Tesla has driven through (on batteries, of course), which is that the law didn't actually make it illegal for a car company to sell directly, just that it was illegal to bypass existing dealerships...Tesla didn't have any. Sign up for Sunday Brunch, the weekly Breakfast Bytes email.![]()
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