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Daring to dream BIG

ComSOC Tech founder James Jeong tells CHEN HUIFEN how he made the leap from employee to CEO of a $42-million chip design firm

KOREAN entrepreneur James Jeong may be considered foreign talent, but of a different sort from the recent string of highly-paid CEOs who came and went in a flurry of publicity.

The 42-year-old Mr Jeong is the founder of ComSOC Technology, a company that designs chips for major electronics manufacturers. His company employs 28 staff - mostly engineers - at its International Business Park office. Of these, about half are Singaporeans and permanent residents (PRs). Mr Jeong himself is a PR here. There are plans to increase headcount to 78 by 2005 as the company expands overseas.

ComSOC Technology, one of this year's winners in the e50.startup category, began as an integrated circuit (IC) chip design centre for Samsung Asia. Mr Jeong himself was from Samsung and helped set up its Singapore operations in 1990. For almost 12 years, he was in a comfortable job that could have taken him to retirement. But, there was the urge to launch out on his own.

So he quit Samsung in 1999 and set up ComSOC. Building on his electronics engineering experience, he established an ASIC (Application Specific IC) and SOC (system on chip) design centre with two engineers and won exclusive status as Samsung Electronics's ASIC design centre in South Asia. It is capable of taking design services from specification to sample chips, from design capture to sample chips, and from specification to prototypes.

'It's an area I am familiar with and I had confidence to succeed,' he said. 'There was some risk, but if it failed, I thought I'd just start again as a salaryman. It was my dream to be an entrepreneur anyway.'

His customers are mainly producers of electronic goods who need specific chip designs to fit their gadgets. Some do not have in-house designers and need to outsource the work to companies like ComSOC. Some may have in-house designers, but require a higher level of outside expertise.

'ComSOC is like the middle channel between customers and foundry,' Mr Jeong explained. 'We provide R&D engineering, design, development, debugging, verification and qualification, sometimes even doing sales for them (customers).

'After we complete the design, the customer must buy through us. That is the arrangement. And by doing so, the fab foundry also pays us a commission to take care of engineering after-service.'

However, chip design is a time-consuming process. It takes at least six months to modify a chip from one fab foundry to suit a chip from another. For an infant company, it would take at least one year to reap sizeable revenues from IC design, according to Mr Jeong. So the company also distributes electronic components to keep up its cashflow.

Within the first year of operation, ComSOC had a turnover of $24 million and a net profit of $1.6 million. The number of staff also rose from three to eight.

Now, into its fourth year, ComSOC's list of strategic partners include big names like Creative Technology, Hewlett Packard, Celestica, Venture Corp and IBM. It registered a turnover of $42 million in 2002.

The company also set up sales and marketing offices in Hong Kong and Shenzhen last year. It is now developing digital TV solutions that it hopes will be its future cash cow. Next year, it will venture to Japan, Korea, Shanghai and Beijing. Beyond that, ComSOC is eyeing a listing in Singapore in 'a couple of years'.

Mr Jeong attributes ComSOC's steady growth to his staff.

'People are most important to the business,' he said. Yet, they are the hardest to manage. Mr Jeong has faced difficulties keeping good employees in the past. Some, he lost to bigger organisations. So this year, ComSOC started awarding staff share options that can only be exercised after listing. Hopefully, this would focus them on the listing goal and help retain staff, said Mr Jeong. To date, ComSOC has a staff turnover of under 10 per cent.

But while Mr Jeong treats his staff like family, his own family is barred from participating in the business. 'I will not let my family to be involved in any part of our company's business. If my family is involved, management will not be seen as transparent,' he explains.

'Maybe every place has a different business style. But I want to emphasise to our staff here that they should work like it is their own company. We need to share information and profits and not keep everything in our own pockets. If we can share, eventually we can get more too,' he said.

Mr Jeong's open management policy extends even to himself. 'Being the founder doesn't mean I get to keep my position as CEO always. I could give way to any employee able to rise up to the challenge.'

- The Business Times -


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