DownStream Acquisition Fits Siemens’ ‘Left-Shift’ Model

Estimated reading time: 7 minutes

I recently spoke to DownStream Technologies founder Joe Clark about the company’s acquisition by Siemens. We were later joined by A.J. Incorvaia, Siemens’ senior VP of electronic board systems. Joe discussed how he, Rick Almeida, and Ken Tepper launched the company in the months after 9/11 and how the acquisition came about. A.J. provides some background on the acquisition and explains why the companies’ tools are complementary.

Andy Shaughnessy: Joe, you recently sold DownStream Technologies to Siemens. How are things going? You must have some conflicting feelings.

Joe Clark: “Bittersweet” would be a good description. We created and built Downstream to bring to market our vision of a better design flow, and because we enjoy doing it. However, It just made sense for us at this point in the life of DownStream Technologies to merge with a company that can take the technology to the next level.

We started DownStream in one of the worst times to try to start a company. Our official starting date was Jan. 1, 2002, just after the tragedy of 9/11 and in the middle of the internet technology bubble crash. We left InnovEDA with the CAM350 technology because, at the time, for whatever reason, InnovEDA had decided to kill the product. We believed this to be a mistake and a missed opportunity. We had done something similar when we were at PADS; we bought the HyperLynx signal integrity product because we believed that signal integrity analysis should be part of the design flow, not an afterthought. With the right tool, a designer could do signal integrity analysis while doing the layout rather than waiting until the end when the cost of fixing problems is highest. So, with the support of InnovEDA management we acquired the CAM350 technology and, along with some key employees, started Downstream Technologies.

Shaughnessy: Did you see that the same idea would be applicable to the DFM space?

Clark: Yes, absolutely. Our thought was, “Why wait until we send the information off to the fabricator before we do any kind of a design for manufacturing” analysis? Let's do it in line with the design, similar to signal integrity analysis.” It meant we needed to have a tool that fit the designer user profile. It had to be easy to use, priced appropriately, functioned appropriately and so on. It was the same vision as in our PADS days: The designer doesn’t need the full 100% of checks and capabilities of the existing high cost of ownership tools currently in use to verify their design can be built.

That was our vision, our gamble, you could call it. We left InnovEDA with the CAM350 product, enhanced it, and developed our DFMStream product. But we weren’t done. Again, from our PADS days, we recognized the need for a tool dedicated to creating PCB documentation. Designers were typically using their PCB CAD tool, or a mechanical tool, to crate their fabrication and assembly drawings, neither of which was very good at the desired task, So we developed BluePrint-PCB. We believed that this was an underserved but critical area of PCB design where there was a high demand for a solution.

We had found that many customers had created their own custom documentation software, but the critical information was stuck in the EDA tool, locking them to a specific PCB CAD tool. The onset of intelligent design data formats—ODB and IPC2581—was the enabling event for the creation of Blueprint-PCB. Now, here we are, 23 years later. While we have enjoyed great success over these years, we recognized that to take the technology to the next level would require some kind of new investment. We either needed to significantly invest in the company or find a partner like Siemens.

Shaughnessy: I thought that you all would have been acquired 15 years ago.

Clark: Well, truth is, we thought the same thing. I remember thinking, “There will be ample opportunities. Somebody in EDA will want to acquire us as their customers look to re-integrate with manufacturing, captive or external.” But its been 23 years. That's not to say that there haven’t been some overtures over the years. But at those times, the market conditions weren't quite right.

Some of this timing is due to COVID-19. During that time, my partners Ken Tepper, Rick Almeida, and I began thinking about what we should do next for our employees, our customers, and our legacy. COVID had shut the world down, and made it more difficult to get in front of customers, even today. We agreed that it was time to find a bigger partner.

Shaughnessy: We all had time to look ahead.

Clark: Exactly. We think it was a win-win all around. Siemens is very focused on the manufacturing phase of the new product development process, and our fit is perfect for that. We provide complementary tools to their existing technology. They're very keen on our technology.

Shaughnessy: How many employees do you have now?

Clark: We have 12 employees in the U.S., and just like we did with PADS, we have offshore developers who have been with us for the full 23 years. They are our primary coders—very talented, capable, and dedicated coders. Our overseas coders are the cornerstone of our success, because they allowed us to compete in this business where a lot of young engineers coming out of school were being sucked up by the bigger companies in the warmer climates.

Shaughnessy: What’s in your future? Are you going to be VP of documentation at Siemens?

Clark: The important thing right now is to integrate and transition DownStream into the Siemens family. That's the most important thing. What comes after that? I would say, “To be determined.” But I’ll probably relax for a while. It’s been a busy and fulfilling 23 years.

Shaughnessy: Do you think Siemens will integrate your technology into Xpedition, or offer it separately, or some combination?

Clark: Again, to be determined. Obviously, it’s technology that crosses the full market spectrum. Every PCB design requires documentation. This would be a useful product for any company doing electronic design—at the high end, the middle, and at the low end. DFMStream is a tool for the designer, just as Hyperlynx was. So there will probably be different flavors of the tools.

Shaughnessy: A.J., good to see you. How are things going?

A.J. Incorvaia: Things are going well. We’re really happy with the DownStream acquisition. This is a big thing for us, and it’s part of the whole left-shift at Siemens. We’re trying to get these tools onto the engineer's desktop. They have to be easy to use. They have to be intuitive. By enabling that, we can help them find problems much earlier in the design flow. Then you can find and fix problems early enough in the design flow when it's inexpensive to fix them, rather than waiting till the very end. Then you have to spin an ECO, or spin an entire design cycle.

DownStream and Siemens have a common vision: shift-left. We want to provide all the technology necessary to not just design the board, but also to prep the board for the manufacturing environment. If you look at the investments we've made over the years, we have Valor’s technology, and we now have DownStream’s technology, all of which plays very well with our technology.

We have that entire portfolio and over time we'll be adding more technology to fill out that portfolio of manufacturing tools. Our vision is to provide the engineers with everything they need to get these designs done right the first time, whether it's simulation, design, or going into manufacturing.

Clark: And let me add her that one of the most important issues for us was that our technology is appreciated, built upon, and grown. This why Siemens was the best fit.

Incorvaia: This really is the perfect time and the perfect marriage. For us, too, one of the things that we wanted to provide DownStream with is an opportunity to tap into our sales organization. We have a very large sales organization, both direct and indirect, worldwide. We can take these products now and have much greater reach than we had in the past. You guys did a great job, Joe.

Clark: Without doubt, we've got a great partner, and we couldn't be happier. And the employees needed to be included in this. That was a key part for us as well, to provide our employees a safe landing zone.

Incorvaia: Absolutely. They’ll probably see familiar faces. It's surprising how many Siemens employees once worked for DownStream. It’s a small industry.

Shaughnessy: Thanks for your time, guys. Congratulations, Joe.

Clark: Thank you, Andy.