Going back to your comment on the business model, is the business proposition where the vendor has ten different products but if the customer makes a major commitment, then the customer can mix and match over the term of the agreement to meets his changing needs?
Yeah. This idea rather than emphasizing a value proposition associated with each product and the technical advantages of each product, you are dealing more with the business aspects as you described where we are going to give you everything in our portfolio that will allow you (as you said) to mix and match according to your needs and requirements. This pretty much dilutes the value proposition associated with each technology and each product. Whereas as a startup when I am off talking to customers, what I am trying to do is convince them that the specific technology I am delivering has a need and we can satisfy that need with the technology.
How do you convince or persuade prospects that your products do what you claim they do?
Again, I think one of the things that drew me to Calypto was the sheer fact that we are driving methodology and introducing products that do not fit into the same slot as the products that perhaps other guys are driving to the market. Out SLEC product is able to verify a system level model versus an RTL model. No other company in the world offers that capability. We are very unique in that way and our customers recognize that. As a matter of fact, if you look at the high level synthesis world where we are providing verification for the likes of Cadence, Forte and Mentor, customers really see us as the de facto standard formal verification tool. When it comes to power, again we deliver a very unique value proposition in that we are the company that can take in a customer’s RTL and produce power reduced RTL that looks identical to the original RTL with the inclusion of additional logic to reduce power. By delivering a unique capability we are able to avoid any competition with the big deals or situations, where customers are focused more on business aspects rather than technical aspects. At some companies it is interesting that the CAD organizations are focused on the business aspects of EDA. Perhaps our biggest challenge is dealing with companies who look at the larger companies to potentially develop the same sort of things we have and get it for free.
How big a company is Calypto?
We have about 70 employees?
What about your revenue stream?
We do not publish anything in terms of our revenue. We are still a private company.
How do you demonstrate to a prospect or how does a prospect convince himself that your products do what you say they do?
There are a number of ways. On the verification side, we have some customers who actually put bugs in their design. We have to basically find those bugs. In some cases, the customer will tell us in fact here is the RTL and here is the system level model, please verify it without knowing that there is a bug in it. That’s one way. Another way is we simply find a bug. The customer looks at it and thinks there is no problem between the system level model and the RTL and just wants to see that it runs through our tool. In fact that happened just last week with a major high level systems company. On the power side, it is a little bit easier to demonstrate the value proposition. The customer provides us with RTL. We run it through our product and we use power analysis to verify how much power we actually save.
Is that verification performed using commercially available 3rd party tools?
Exactly! In the case of power, we do not have a power analysis capability today. So we want to make sure that there is a power analysis tool out there that is saying the same thing, that in fact we are reducing power. So we use generalized third party tools, for that matter we do not do the analysis, the customer actually does it.
Calypto has two sets of tools. Does one account for a greater percentage of revenue than the other?
The two sets of products are the SLEC and PowerPro families of products. Today, because SLEC has been in the market longer, SLEC is the dominant product from a revenue perspective. But we think that PowerPro actually serves a larger market. PowerPro serves essentially the RTL market. Anybody designing RTL is potentially a customer for PowerPro. So we think eventually PowerPro will be a higher revenue base for us. Both product, however, are very important. The PowerPro product use power reduction to create new RTL. We also use our SLEC products to verify that PowerPro has not in fact changed the functionality of the RTL.
Does Calypto sell direct or through distributors?
We do both. Across North America we have direct sales as well as in Europe, central Europe. We have distributors in Israel, Taiwan, and the Nordic region of Europe.
What about Japan and China?
Japan is direct. We have A KK in Japan. Currently we don’t sell or actively market our products in China.
Is that just a matter of time and resources?
I think it is a matter of time. The rest of the world offers enough opportunity to keep us busy. I think we will allow the company to grow at the pace it needs to grow.
Would you give us an expanded view of the two product lines? I believe there are multiple modules in each one.
Our SLEC System product can essentially verify that a system level model is in fact equivalent to another system level model where the second model is perhaps refined in some way from the original model. That refinement is reasonably common and is done when customers have high level synthesis flow. You have the original C model and then you create a new C of system model that incorporates some of the data types and some of the requirements to actually get the best QoR out of high level synthesis. That is the first place where SLEC Systems plays. The SLEC System product contains a C level model, I should really say a system level model (C, C++ or SystemC), and compares it to an RTL model that is generated from a high level synthesis product. Doing that, we effectively create the bridge between the original model and RTL and thereby eliminate the need for customers to re-run all of their system level simulation at the RTL level.
Our SLEC RTL product allows customers to verify that two RTL model are equivalent. The uniqueness of SLEC RTL is that those two models that we can verify can in fact have sequential differences. One model can have additional pipeline stages instantiated. Or it could have re-timing done at the RTL level. It could have a new finite state machine or be a new micro architecture, where you want to verify at the pin level of the model of the block that the models are equivalent. We can verify that those two models in fact have the same functionality. It is very different from other formal verification products in the market, where you are relying on a one-to-one mapping of registers between the two models. We do not rely on that.
Our third SLEC product is called SLEC PG. What it is able to do is verify that the input to PowerPro product and the output of our PowerPro PG product are equivalent. What PowerPro CC does is essentially take in an RTL model. It does a sequential analysis of that RTL and generates new RTL that has new constructs instantiated in the RTL that downstream tools convert to clock gates, thereby reducing dynamic power. PowerPro does that without increasing area and in any way impacting performance. The new RTL looks identical to the original RTL with the new constructs that are very clearly delineated in the new RTL. If you look at the product lines, what we are essentially doing is using sequential analysis to a) create a whole new generation of verification products and b) attack power in a very different way then it has been attacked before. That is by looking at the sequential operation of a design and figuring out where you can shut off parts of that design to reduce dynamic power.
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