Ozark IC Finds Niche in Extreme Circuits

The devil may be in the details, but that’s never intimidated Matt Francis and his team at Ozark Integrated Circuits Inc. Understanding the intricacies of complicated technology is their job. And, if contribution to a reference book on the topic is any indication — they’re good at it.

It was only natural for Francis, Ozark IC president and CEO, and Jim Holmes, integrated-circuit technologist and secretary, to employ a similarly calculated approach to running their business.

The company has done well, but since it was incorporated in 2011, it has also taken it slow, leveraging its unique skillset and making some unconventional decisions early on that laid the groundwork for what the team planned to be a larger payoff down the road.

It’s like painstakingly assembling an elaborate domino display. Ozark IC put in the extra work to align the pieces and has now incited the toppling process.

If all goes as planned, 2015 will be a big year for the company, as Ozark IC looks to double its staff size and launch its first commercial product.

Although it will not yet release specifics on the technology it plans to license, Holmes intimated that the product is designed to be used in vehicle drivetrains and that the company is in talks with major automakers.

He believes Ozark IC is just starting to reap the benefits from its smart decisions, and, unlike the anticlimactic conclusion of a dominoes display, the team expects only to gain momentum.

 

Nanoscale Niche

One pivotal piece for Ozark IC was its choice to take on an obscure specialty.

“We didn’t want to make Happy Meal toys,” Holmes said.

To that end, the company opted to specialize in “extreme” integrated circuits, computer chips that can withstand extreme environments, including very high heat, very low temperatures, high electrical voltage and radioactivity.

Its integrated circuits range from sensory chips that measure temperature, light or vibrations to actuation chips that, for example, control motors.

Applications for extremely low-temperature chips are limited. Information-gathering sensors on satellites in space are one of a few examples. However, the market for technology that can operate in high-temperature environments is vast.

The team has designed circuits that can handle temperatures as low as -356 degrees F and up to 662 degrees F, with applications in power electronics, aerospace, automotive, and down-hole (the oil industry).

Having set up shop far away from the country’s major technology hubs, Ozark IC needed an edge to set it apart, and extreme circuits was it.

And Francis and Holmes wrote the book on it — at least part of it. Both men were given writing credits for chapters in the reference book/graduate school textbook “Extreme Environment Electronics,” published in 2012 by CRC Press.

“More importantly, we know pretty much everybody that contributed to this book. That should tell you how small that world is,” Francis said.

 

CAD Cram

Another of the company’s innovative practices was born of necessity, Holmes said.

In the beginning, Ozark IC did not have a lot of money to spend on enterprise-class design tools, which cost about $85,000 per user license, or per employee, annually.

“For small IC [integrated-circuit] design companies, this high cost of tooling is a daunting barrier during the startup phase,” Homes said.

Ozark IC ventured into somewhat uncharted territory by creating its own computer-aided design tools through adapting open-source software to function as complete, integrated-circuit design flow.

Crafting the tools was a feat that required a unique skillset, refined expertise, and plenty of sweat equity.

Holmes estimates the team did about 18 months of work in six.

“It was one of those, we’re-going-to-do-this-or-die-trying situations,” Francis said. “We pulled it all together and it worked.”

The financial savings (potentially millions per year) makes Ozark IC’s productivity very high, allowing it to compete with much larger design centers, and its customized tools make for “our own special sauce for analysis,” Francis said.

 In the company’s early stages, the extra money helped make ends meet.

Holmes said the team had the choice to “either buy enterprise-class software or put shoes on our kids’ feet.” 

He added, “I bought my daughters several pairs of Toms and sparkly high-top Converse sneakers, and they confirmed it was money well-spent.”

Now, using open-source design tools means the team does not have to choose between buying enterprise-class software or hiring its next brilliant mind. 

“We have no regrets making that investment [of time and effort],” Holmes said. “The return on that investment is a competitive advantage to expand Ozark Integrated Circuits here in the Natural State.”

 

Grant Gains

To get started in the business, the team did plenty of government-funded work. Francis and Holmes did not want to go the route of venture capital or angel investing and relinquish a stake in the company.

Their first contract was with NASA, and although Ozark IC did not get the second funding round that would ultimately lead to utilization of its product, Francis and Holmes seized the opportunity to help get the business started.

“We made a lot of hay,” Francis said.

However, it was never the plan to rely solely on government grants for their work, as other companies have done.

“Government contracts are more about subsistence. It’s hard to grow a business that way,” Holmes said.

So, the company has been tapering off its government-grant projects and ramping up its commercial work. In 2014, for the first time, it took on more commercial contracts than government. 

Meanwhile, Ozark IC enjoyed the benefits of their chosen route.

“We have zero debt, three years in,” Holmes said. “That is not lost on us.”

And neither is the abundance of resources to which Ozark IC has had access.

The company is located in south Fayetteville at the Arkansas Research & Technology Park, operated by the University of Arkansas Technology Development Foundation, where Francis said the team has access to world-class amenities, including the High Density Electronics Center.

HiDEC gives the staff at Ozark IC access to specialized equipment, resident experts and, at times, extra hands for jobs including packaging and assembly.

In addition, Holmes expressed gratitude for a lot of entities and programs that have helped Ozark IC along the way.

“It’s great to have people looking out for you,” Francis said.

 

Student Access

Ozark IC’s link to the UA does not stop with its presence in the research park. Francis and Holmes are both adjunct professors in the engineering department and the company has collaborated with the UA and helped shepherd along the commercial development of several of the research department’s projects. 

Collaborating with the university affords Ozark IC the opportunity to try new things in a low-risk way and can also lead to breakthroughs, Francis said.

“Students will try something because they don’t know any better,” Holmes said.

This sort of experimentation and thinking outside the parameters of conventional knowledge can provide a unique perspective that is not always available to technology veterans like Francis and Holmes, who have years of experience and a wealth of knowledge in the industry.

In addition, the two can take advantage of the firsthand observation of rising talent in graduate and Ph.D. programs.

Unlike the typical interviewing process, Holmes and Francis can watch how students engage long-term and how they work as a team, especially under pressure.

Ozark IC looks for students that go above and beyond and exhibit professionalism, and personality is key.

“In integrated-circuit design, you design your small piece and it all has to work together,” Holmes said. “It’s like [the team members working on a project] are all in a canoe for the first time and they have to paddle the same way.”

The company has been working with the UA for years now and is only now beginning to offer jobs to some of the graduates.

If all the current contracts work out, the six-employee company (five local) will double in size this year, Holmes said.

 

Work at Home

Francis said, “There’s not a talent shortage in Northwest Arkansas,” but there is a need to retain more of it. And a lot of the “mass exodus” of engineering students after spring graduation could be curtailed if the students had somewhere to work in Northwest Arkansas.

Francis came for school in 1998 and never left.

“I realized there was no reason we couldn’t start a successful integrated-circuit company here. All you need is a computer and the ability,” he said.

He and his wife recently started a family and don’t plan to leave the area anytime soon.

Before coming to Arkansas, Holmes worked 14 years for Texas Instruments in Dallas, where he said his two young daughters would have to cross six lanes of traffic to walk to a park.

When the family visited Northwest Arkansas while Holmes was considering the Ozark IC job, he said he liked that the two kids would come home dirty and sweaty after a long day of playing outside — and they didn’t have to cross six lanes of traffic to do it.

He and his wife decided the region was an excellent place to raise children.

“That’s the thing about Ozark IC is we all want to be here,” Francis said. “It’s a great place to live.”