I met up with two semiconductor industry friends recently. They were thinking of quitting their jobs and starting a company that would focus on Semiconductor IP. They wanted my advice on how they should go about doing it. Déjà vu! This wasn’t the first time someone had come to me with that idea. My advice was "Don't do it. Keep your job".
Entrepreneurs (and would-be entrepreneurs) expect support and encouragement. I could sense that my friends felt disappointed in me. So I gave them a glimpse of reality. In this post, I am summarizing the main reasons why I would advise bright engineers against starting companies that develop IP or VIP for open standards.
In fact, for 3 years, my company, Arrow Devices successfully developed and sold Verification IP (VIP) to some of the top 20 semiconductor companies. In mid-2015, we divested our VIP business to a top EDA Company for the same reasons I am summarizing below. (BTW, more on what we are doing now, later in this post)