The Top 25 High Tech Leaders in Dallas

Tom Engibous, Chairman, President and CEO, Texas Instruments

Texas Instruments, the world’s leading maker of computer chips for mobile phones, has found the sweet spot. “The two most important technologies for the Internet age are real-time signal processing, or DSP, and analog semiconductors. We’re the world’s leader in both,” says Tom Engibous, who has spent his entire 25-year career at TI. “We’re building the brains…for the mobile Internet generation. We have the opportunity to be the semiconductor company of this decade, much like Intel was in the last decade.”

The Dallas-based company, which dominated chips for personal computers in the 1980s, is hell-bent on keeping its lead this time around, pouring $1.6 billion annually into R&D for DSP and analog; unveiling a new technology called Optical Wireless Solutions that cuts the cost and complexity of high-speed data rates for optical networking; and investing $100 million over the next 18 months in startups with killer apps for the mobile Internet. “When you’re the leader, it’s easier to widen the gap between you and your competitors when the economy is tough,” he says. “People who aren’t totally focused in DSP and analog generally cut back on their investment. The strong get stronger, and the weak get weaker.”

Dick Brown, Chairman and CEO, EDS

A word of advice to those seeking services from EDS: get in line. The seemingly bulletproof tech consultant and systems integration firm—whose new business grew more than 40 percent in what was a tumultuous first quarter 2001 for many tech companies—has a business backlog of approximately $80 billion. Economic slowdown? What economic slowdown? “We just completed our ninth straight quarter of record contract signings,” says Dick Brown, a former H&R Block CEO.

Officials for EDS, a 39-year-old, Plano-based powerhouse with revenue last year of $19.2 billion, estimate the global IT services market at nearly a half-trillion dollars and growing steadily—as much as 16 percent annually. “And EDS is gaining market share,” says Brown, who previously guided London’s Cable & Wireless to annual sales of $12 billion. “Our opportunities have never been greater.”

The company’s secret to perennial success? “We’ve got our spotlight aimed squarely on the client,” says Brown. “Currently, four out of five clients will serve as a reference for EDS; our objective is to improve that to five out of five.”

Ross Perot Jr., President and CEO, Perot Systems

One man’s tough economy is another man’s good fortune. At least, that’s the positive spin at Perot Systems, which provides information technology services to more than 400 clients worldwide. “This economy is good for a company like ours,” says Perot Jr., who took over the company’s reigns from his father last August. “This is when customers really need us to help rationalize their costs and grow their business. When times are tough, they need to change their culture, the way they do business, and their processes. But they’re far more open [now] to taking that tough medicine.”

Perot Systems has swallowed its own bitter pill in recent months, laying off more than 500 employees. It suffered a first-quarter net loss of $7.7 million this year, compared to a profit of $38.1 million this time last year, due in part to restructuring costs. “Anything that wasn’t strategic to us was shut down,” says Perot.

Still, several healthcare acquisitions and $653 million in new long-term contracts signed in the past 12 months have Perot feeling good about the future. “I’ve been on the board since the company started in 1988, and I’ve seen it go from 10 founders and zero revenue to 7,500 people and $1.1 billion in revenue,” says Perot. “So it’s been a great story.”

J. Michael Turner, President, SBC DataComm

The Internet revolution will not be televised; it will be pumped into homes via broadband. And one of the key commanders in the uprising is Mike Turner, who led the charge for SBC’s Project Pronto, a $6 billion investment across 13 states to build a broadband infrastructure for homes and businesses. “The industry’s biggest challenge is execution,” says Turner, who began his Southwestern Bell career 30 years ago. “There have been questions raised about customer service and quality of applications.”

Turner now helms SBC’s 1-year-old DataComm division, which specializes in networking services and integration. He has 6,000 employees throughout 36 states and Canada, including more than 700 Cisco-certified experts. “We’ll be a core asset of SBC within five years, certainly,” Turner predicts. In the past year, the company has opened two multimillion-dollar data centers: one in Irvine, Calif., the other in Dallas. “They’re more than 100,000 square feet, and they host Internet applications,” he explains. “They’re very much the communications hubs of the future.”

Cynthia L. Patterson, President of the Central Texas region,
Verizon Wireless

If you think people who talk on their cell phone while driving are scary, just wait until they start downloading documents from their office network while zooming through traffic. Get used to it. The movement to integrate data with wireless voice communication is revving up, promising to render the term “cell phone” obsolete in favor of “data-capable wireless handset.” In the last quarter alone, Verizon Wireless data customers grew 33 percent to more than one million. “We’re seeing a paradigm shift in how people use handsets,” says Cynthia L. Patterson, who presides over an area that includes Dallas, Fort Worth, and Austin. “It will become the primary device for sending and receiving all forms of communication and information.”

Patterson, who started her telecom career in 1987 with Motorola, says products that combine voice, Web access, and PDA functions are just a glimpse of what’s to come. “Soon, you’ll be able to use your handset to communicate with a store’s point-of-sale system and pay for groceries,” Patterson predicts. “If a restaurant has empty tables, it can send a message to all phones within a certain radius, telling customers about its dinner special.”

In April, Verizon Wireless inked a deal to open more than 4,000 stores-within-a-store at RadioShack locations across the country. In Patterson’s region alone, the company opened 22 stores in the last six months and expects to open another 20 before year’s end, a testament to the telecom industry’s strength. “Dallas is growing like crazy, and every time we develop a new community, Verizon wants to be there,” she says. “People are still buying wireless phones because they’re a necessity now, so our sales are growing despite the economy.”

Krish Prabhu, Chief operating officer, Alcatel

As any British band knows, you haven’t conquered the world until you’ve conquered America. Understanding this, in 1997, Alcatel commissioned former Rockwell VP Krish Prabhu to mastermind its stateside invasion. And thanks in part to his guidance, the telecom equipment manufacturer—which traditionally generated two-thirds of its sales in Europe—now garners 23 percent of its revenue from the United States, making America its largest telecom market.

“I don’t want to be immodest, but in 1997, we were doing about $1 billion in the United States. This year, we may approach $7 billion. We’ve clearly emerged as one of the top players,” says the Indian-born Prabhu, who credits Alcatel’s dramatic U.S. growth to internal technology development and $17 billion in acquisitions. Alcatel also recently bid on Lucent’s fiber-optic business.

Prabhu arrived in the country in 1975 with only $25 and no friends. “People say it’s a great country, and I don’t want to sound trite, but it’s the truth,” he says. “It’s about merit and being willing to work hard, and if you do both, you’ll get your chance.”

Kari-Pekka “K-P” Wilska, President, Nokia (Americas)

When you’re the world’s biggest mobile phone supplier, you don’t let a little thing like economic uncertainty slow you down. Nokia (Americas), whose handsets are widely heralded for their stylish innovation, is on track to improve its market share to 40 percent from 32 percent last year. “If your plans, products, and logistic network are in good shape, the economy really doesn’t change anything,” says Kari-Pekka “K-P” Wilska, president, adding that his focus is long term. “If you’re trained for a 100-meter dash, you don’t want to run the marathon.”

Wilska, who joined Nokia in 1973, is credited with the company’s steady rise in the wireless world. Even in the face of a cooling economy, he led the company to $7.2 billion revenue in 2001’s first quarter, compared to $5.9 billion in 2000’s first quarter.

Nokia (Americas), which has more than 5,000 North Texas employees, shifted some of its manufacturing from two Fort Worth facilities to Korea and Mexico earlier this year, resulting in layoffs of about 800 full-time employees. But that’s no indication of waning affection for the area, Wilska insists. “Dallas plays an important role in our company,” he says. “North Texas is the right place to locate manufacturing. There are lots of high-tech industries, good schools, and good people available for hire.”

Peter Skarzynski, Senior vice president, Samsung Telecommunications America, wireless terminals sales and marketing

Given the choice between smart and sexy, what would you choose? Samsung Telecommunications America (STA), a relative new kid on the U.S. wireless telecom block since launching in Dallas in 1996, is betting that customers want both. While industry leader Nokia turns heads with its trendy colors and interchangeable faceplates, Samsung has pinned its hopes on being first to market with new features, a point in which Peter Skarzynski takes great pride.

“We lead in the introduction of new technology and convergent capabilities,” says Skarzynski, who has spent nearly a quarter century in the telecom industry. “It’s a very competitive industry, so you have to find a way to get people to try your product.” Samsung was the first to integrate wireless browsers into a handheld device and the first to introduce voice-activated dialing, he points out. “Wireless data applications will explode within five years,” he says. “Anything you can do on your home computer, you’ll end up doing on a handheld wireless device.”

Jeong Han Kim, STA president, credits the enthusiastic Skarzynski with the division’s burgeoning success. “It has experienced enormous growth due to Peter’s dedication and hard work.”

Robert Paluck, Managing general partner, CenterPoint Venture Partners

Some people just know how to pick ’em. Like Robert Paluck, a venture capitalist with a history of high-tech hits. His most recent successes include Active Power, a battery-free power products maker; and Silicon Labs, makers of mixed-signal integrated circuits. The latter of the two has annual revenues exceeding $100 million, and both successfully went public last year, even as countless other startups went belly up.

Paluck’s string of launches includes his own pet project: he co-founded Convex Computer Corp., which raked in nearly $250 million with its new breed of supercomputers before merging with Hewlett-Packard in 1995.

“We look for a product, not a service, that can change the marketplace dynamics,” Paluck says of CenterPoint’s investment philosophy, to which the company held firmly throughout the dot.com rush. “During the craziness of the Internet era, when everybody was investing in all the dot.coms, we still just invested in product technology companies,” he adds. “[Others] were doing crazy things, investing in companies that, at the extreme, didn’t really have the slightest chance.”

Paluck worries those bad deals may have given venture capitalists a black eye. “Firms that didn’t get all balled up in the dot.com era will still give spectacular returns,” he says, “but so much money will be lost because of irresponsible investments.”

CenterPoint, for one, is taking a long-term approach to weather the weakened economy. “Our investment perspective is much longer than before,” Paluck says, “and we assume we’ll have to put more cash in for more rounds, over a longer period of time. On the other hand, that’s what we’re here for—to help them.”

Scott Grout, President and CEO, Chorum Technologies

If you can’t build a better mousetrap, stuff more cheese in the existing ones. That’s essentially the approach of Chorum Technologies, a rising player in the fiber-optics arena. The company, founded in 1996 and led by CEO Scott Grout, makes products for companies like Nortel and Tycom that increase the transmission-carrying capacity of existing networks.

Chorum—which received $42 million in first-round funding from Sevin Rosen Funds and CenterPoint Venture Partners, among others—joined the increasingly crowded fiber-optics market early enough to become a major player. “I’m hoping we’re the optical Intel,” says Grout. “This industry is young, and it will consolidate. It’s my intention to be one of the companies that dominate.”

Chorum’s ascension may be slowed by the economy’s downturn, which prompted the company to halt its IPO plans in March, but it won’t prevent it, Grout predicts. “Carriers’ spending has dropped off very dramatically, so everyone in the food chain feels that,” he says. “It’s an opportunity to hunker down, deliver new products, and as [the economy strengthens], to be in a strong position.”

Grout, who spent 15 years at AT&T/Lucent before joining Chorum in 1998, says his confidence has been buoyed by the company’s early successes. “The first few months here, I didn’t have that kind of courage built up,” he says. “We ran into the kind of challenges that keep you up all night, wondering if you’re going to live or die. When you go through a couple of these rock-your-world problems and get through them, it builds up a lot of confidence in the team and your ability to take on anything.”

Sanjiv Sidhu, Founder and chairman, i2 Technologies

Sanjiv Sidhu could be the poster boy for tech startups. This chemical engineer’s son from India left the safety of his lab job at Texas Instruments in 1988 to start i2 Technologies out of his apartment—with no venture capital. The productivity software maker landed big-name clients like Barnes and Noble, Panasonic, and Procter & Gamble, and it made a huge splash when it went public in 1996, with Sidhu’s personal stake in i2 hitting a high of $8.1 billion last year.

True, the company’s fortunes have slipped since, with public complaints from customer Nike, the release of more than 600 employees this spring, and a net loss last year of $1.75 billion. But like any good entrepreneur, Sidhu knows when he can use some help. He stepped down in May as CEO and promoted former Oracle exec Greg Brady to take his place, giving Sidhu more time to spend with customers, partners, and his 5,000-plus employees. And Sidhu’s goal remains intact: to deliver $75 billion in value to customers by 2005.

Jackie Kimzey, Partner, Sevin Rosen Funds

Jackie Kimzey has seen the wireless world from both sides—as an exec responsible for turning ProNet into one of the country’s largest pager companies, and now as one of the new whiz kids on the block at Sevin Rosen Funds, an early-stage venture capital firm behind some of tech’s hottest players, including Compaq, Lotus, and Capstone Turbine. The latter had its IPO last year “in a very rocky market,” says Kimzey, “and it continues to hold a $2 billion valuation. Certain sectors perform well in spite of the marketplace.”

Those sectors include optical networks, wireless Internet, and e-commerce infrastructure, all of which Sevin Rosen focused on while others dumped money into doomed dot.coms. “It was unbelievable the number of business plans we got,” Kimzey says. “Everybody wanted to have the next dot.com or telecom startup. After the go-go days of the last couple of years, this is a time that’s well suited to us. You can get in, get to know the management teams, and look at businesses a lot more thoughtfully. Business plans are better prepared. They know it’s a tough market, and if they can raise money in this environment, they’ve got something of value.”

Sevin Rosen’s most recent fund closed at $875 million, bringing its total capital under management to nearly $2 billion. Recent investments with Kimzey at the helm include Austin’s Traq-Wireless and Tonic Software, and Globe Ranger, located in Richardson’s Telecom Corridor. “Dallas is a great place to do business,” says Kimzey, “and I would expect it to only get better.”

Per-Arne Sandström, Executive vice president, Ericsson North America

Apparently, being the world’s biggest producer of mobile networks isn’t enough for Ericsson. The global powerhouse in wireless network infrastructure recently partnered with Sony to take on Nokia in handsets, a well-timed joint venture that gives Ericsson access to Sony’s expertise in consumer electronics just as the 3G (third generation) wireless wave gains momentum.

“We’ve been suffering for some time [in wireless handsets], but now we’ve found the ideal partner,” says Per-Arne Sandström, who joined the company in 1988.

Although slowing mobile phone sales have prompted Ericss