Aemulus: 'Where miracles happen all the time'
By Karamjit Singh April 12, 2013
- Penang company claims to build best RF Front End testers in the world
- Combination of luck, sheer determination and zero tolerance for office politics
NG Sang Beng professes to be surprised at the success Aemulus Sdn Bhd has had in the testing space of the semiconductor world. “It is very rare to find small companies like us in a space dominated by big players,” he says of the company he launched in 2005.
Most small companies do not last beyond three years, with many fading away and closing down, while others may be acquired by the larger players.
Hardly any make it to become medium-sized companies like Aemulus, which is into its eighth year of operations. “But we are still considered a new company as our competitors have been around for about 40 years,” Ng says.
He attributes the success to a combination of luck, sheer determination to succeed and realizing the importance of creating the right environment, where office politics in particular is totally not tolerated. “A colleague shared with me the other day that the only thing he is not learning at Aemulus is office politics,” says Ng, visibly pleased.
Determination came in handy especially when neither Ng nor any of his start-up team had any tester background. His young team had less than two years’ experience when he hired them from his ex-employer Alterra where Ng was a manager.
“But somehow we just kept at it until we produced a product that was the best in the world,” he says unabashed. This keeping at it included using Google to source for information on RF (radio frequency).
Testing in the semiconductor space is a highly intensive field, with testers having to remain constantly ahead of technology trends. For instance, all those phones which promise 4G speeds on Long Term Evolution (LTE) networks? Testers have to get in very early into the development cycle to ensure that the chips that sit in the phones and perform all the complex, behind the scenes tasks, are up to delivering the promise shouted by marketing.
And here’s a vivid picture of just how tough this space is: China just counts two companies that are in this space. “It is inconceivable that there are only two testers in China with no spawning of copy-cats, but that just shows you how tough this space is,” says Ng.
That was also why his friends questioned his sanity. “They said I was crazy to want to get into the testing space as it was very challenging. Plus, I had a customer who wanted a product in six months, but they said it takes up to two years to build a tester,” Ng recalls.
But build it they did and since then, Ng often urges his colleagues to think out of the box, to work closely as a team and not be afraid to fail because it is this combination that creates the environment in which “miracles happen all the time,” which is an unofficial credo of the company.
Surprisingly, the company has been entirely funded by cash-flow plus the early start-up capital put in by the founders. But in 2010 they finally took some money from venture capital firm Teak Capital run by Chok Kwee Bee.
Ng explains that he has known Chok since 2005 when he first came out, and she has been regularly spending two hours a month offering him guidance and strategic counsel.
Having seen the growth of the company, which now averages 60% a year, she decided to come in in 2010, and even though Ng acknowledges that Aemulus did not really need the money, he did it partly in appreciation of the time she had invested to guide him.
“But she has added a lot of value in us since then, ensuring we act like a listed company with full transparency and processes in place,” he says, declining to talk about any potential listing timeline nor sharing any revenue figures.
A niche within a niche
In the US$5-billion Automatic Test Equipment (ATE) market, Aemulus plays in a niche within a niche. The ATE market consists of memory, digital, mixed signal, SOC or system-on-a-chip and analog processors.
Aemulus plays in the US$300-million valued analog niche, and within that niche, it plays in a space called RF Front End devices. To be even more precise, it tests integrated circuit (IC) chips that go into wireless cellular devices.
Yes, think smartphones, think tablets. There are also new products coming out that are in other areas of the analog world.
If Aemulus is at the leading edge of what it does, that is down to the technical excellence of the engineers it has, with Ng very proud of the fact that it is an entirely locally educated team. “Aemulus is living proof that Malaysian universities do produce good engineers,” he says.
The engineers sharpen their edge at Aemulus in record time too. Ng claims that they will learn in one year at Aemulus what takes their peers at global companies take three to five years.
“And that is actually a problem for us,” he says. Much to his chagrin, Aemulus regularly loses staff to the multinational corporations which have caught on that it is an environment that breeds very good engineers. This is a serious problem for him and he has personally brought it up with Penang Chief Minister Lim Guan Eng.
“The state government keeps pushing for multinationals to come in, expecting they will transfer technology to us, but they actually take away our technology when they come in and start pinching staff from local companies – this prevents us from growing as we keep losing our best people,” claims Ng.
The pressure is thus on Ng to keep hiring good engineers. But good engineers have options and a visit to Aemulus’ office in a row of four-storey shop offices in Penang is not exactly inspiring, this writer observed.
Ng handily agrees but says that the humble beginnings of Aemulus have served to inspire some of the young graduates he interviews to look beyond the creature comforts and staff facilities that are missing at Aemulus, and appreciate the strong collaborative culture that has enabled the company to punch above its weight.
“They realize we are different and are not your typical local company,” he says.
Often times Ng challenges the young kids who sit across from him to try and get at what really motivates them. He once threw a résumé across the table, hurling an expletive at the young engineer who was looking for his third job in two years.
“It is very hard for us to survive, but we do produce the best testers in the world here. But we cannot afford any redundancy and if you just want to play around, go join an MNC.” Ng challenged the young engineer to get serious and be part of the team that is building the best testers in the world.
This direct approach, when needed, according to Ng, helps open up the conversation to get real with the true motivations of the interviewees coming out. Human resource professionals may have something to say about this approach, but it works for him.
With a headcount of 50, he wants to expand but knows he has to hire right.
Fortunately, with Aemulus now having a reputation as a company that has built a world-class product with great engineers, Ng says the task of hiring has become easier – but the occasional résumé-throwing still comes in handy.