Image source @ Visual China
China's chip industry, which is short of resources but "hot money is not reduced", has a strange phenomenon - executives "leaving".
Recently, the news that Liang Jun, CTO and core technical personnel of the "first ai chip" Cambrian (688256.SH) company, has left the company, which has triggered a hot discussion in the industry. The main reason is that Liang Jun has differences with the company's future development strategy, and his departure has a certain impact on the company's technical layout. On the day of the announcement, Cambrian's stock price fell by 18.38% in response, and the company's market value evaporated by nearly 6 billion yuan in one day.
Coincidentally, on February 28 this year, the mobile communication chip developer "Unigroup Zhanrui" suddenly announced that Chu Qing would no longer serve as the CEO of the company, and with the unanimous consent of the board of directors of Tsinghua Unigroup, Ren Qiwei was appointed as the acting CEO of the company. Affected by the bankruptcy and restructuring of Tsinghua Unigroup, the position of chairman of Tsinghua Unigroup was also taken over from Zhao Weiguo to Wu Shengwu, global executive vice president of Tsinghua Unigroup.
In fact, the "collective departure" of chip company executives is not an isolated case.
According to titanium media TMTBase, combined with online public report statistics, since 2020, domestic chip company executives have changed frequently, and at least 27 company executives and core technical personnel have chosen to leave within two years, or major changes have occurred, of which nearly six have become listed companies, including many chairman and CEO positions.
Ouyang Qiyu, deputy director of CGL (Dezhu), an international high-end headhunting company, told Titanium Media App that the main reason behind the changes in senior executives of domestic semiconductor companies, including Cambrian and SMIC, is capital and internal personnel relations.
Wang Haifeng, director of CIC's Consulting, said in an exclusive interview with Titanium Media App that the chip semiconductor industry and the AI industry will value talents higher than the general industry, and these top technical talents actually represent the company's highest technical level. For them, in addition to the salary increase that accompanies the market, what is more important is to establish their own industry status and enhance the number and weight of top scientists, semiconductor industry practitioners still value who they work with, and what they learn from working with the industry bulls is definitely a valuable asset.
Statistics of executive changes in domestic chip semiconductor companies from 2020 to 2022 (Source: edited by Titanium Media App)
Not only power and profit, capital, corporate development changes will also shake the executives to stay
Under China's "core-making fever", even if it is a star chip company, it is not an easy task to "retain" the core technical backbone.
In recent years, due to the friction between China and the United States and the global chip shortage crisis, China has begun to encourage the development of hard technology fields such as semiconductors and biotechnology. With the policy tilt, the minds of a large number of executives in the industry have begun to come alive. As the above data shows, at least 27 senior executives in the chip semiconductor industry chain have chosen to leave/change in the past two years. And these business executives, in the end, either jumped to another chip company or left their jobs to start a business.
So, why is there turmoil in the senior management of these chip semiconductor companies, and even like Liang Jun, the Cambrian CTO, there is a situation of leaving after disagreements with the company's CEO?
Recently, Titanium Media App and a number of semiconductor industry people, human resources experts, professional consulting company analysts and other in-depth exchanges, and finally believe that there are three main factors in the turmoil of chip company executives: conflict and imbalance of rights, capital intrusion and changes in the entire chip capital industry environment, and enterprises and executives themselves consider new development prospects.
The first is the conflict and imbalance of rights.
In the case of Liang Jun's departure, cambrian, the AI chip company he works for, has not been profitable for the past five fiscal years. In order to maintain rapid stock price growth, high market value, and get rid of the continuous expansion of losses, Cambrian is now constantly looking for demand to develop new products, such as autonomous driving chips, Siyuan 370 and so on. But Liang Jun is a technical engineer, but he hopes to deepen the technology to seek a breakthrough.
One person takes commercialization as the company's development direction, one person takes technological breakthrough as the direction, and the CEO and the CTO have a gap, then the right (the right to speak of the CTO and the CEO) and the profit (the commercialization of the enterprise is difficult to affect the return on revenue) are superimposed, and the conflict and imbalance of this concept divergence are revealed.
In fact, from the perspective of technical talents, the knowledge and professional skills mastered by innovative technical talents are not only an important element of enterprise innovation ability, but also a source of motivation for enterprise performance improvement.
Wang Haifeng told the titanium media App that these top talents actually represent the highest technical level of the company, these people's own technology is not progressive, the company's technical level is difficult to achieve a qualitative leap, and vice versa, for hard technology companies, in fact, it is not the thickness of the technology, not how many people there are in the technical team, but only the height of the technology, the commanding height determines success or failure.
"The CEO of a hard technology company always has a lot of business things to deal with, can not be intoxicated with technology research and development, that turn to let people who are more willing to study, unwilling to do business to do CTO, in fact, more beneficial to the development of the enterprise, CTO led the company to climb a higher peak of technology, CEO led the growth of the company's scale, this is a company development trend." In his view, the Cambrian event is not necessarily an inevitable conflict between the CEO and the CTO.
Cambrian issued an announcement about Liang Jun's resignation
The second type of factor is capital intrusion and changes in the overall capital market environment.
According to Wind statistics, Dongxin shares and core original shares disclosed the announcement of the departure of relevant core technical personnel in January this year. Launched on December 10, 2021, TEX focuses on the development, design and sales of small and medium-capacity general-purpose memory chips. From the perspective of time, the departure time of the core technical personnel is only two months after the listing of Dongxin shares.
In an exclusive interview with the Titanium Media App, Zhao Yan, general manager and chief consultant of Shenzhen Yiweixun Information Consulting Co., Ltd., said that although the specific situation is analyzed, the vigorous development of China's chip industry and external capital are generally one of the important reasons for the rise in the turnover rate of chip talents.
"From the perspective of common analysis, the flow of executive talents in these companies is also an important part of the semiconductor industry. As we all know, the capital market environment of the semiconductor industry in the past two years is very different from before, and the role of capital in it cannot be ignored, and they are promoting the rapid changes in the entire semiconductor industry. Zhao Yan believes that technology, capital and talent have created huge variables in the surging semiconductor industry.
In fact, unlike zhang Rujing, the founder of SMIC, who left his post simply because of the settlement terms of TSMC, the capital environment of the industry has long been turned upside down under the "core-making fever". According to a set of data from industry analyst ic insights, capital expenditures on the semiconductor industry will reach $190.4 billion in 2022, a record high and an 86% increase from three years ago.
In addition, capital intrusion and cash-out may also be the reasons why executives choose to leave.
Taking Zhan Rui as an example, due to the restructuring of the largest shareholder of its holding, the connection between capital and the company itself is too close, and the management of Tsinghua Unigroup Zhan Rui has to face many challenges. Chu Qing said at a forum at fudan university's school of management at the end of last year that Unigroup's bankruptcy reorganization had brought many troubles to Zhan Rui, including the bank debt guaranteed by Unigroup.
In addition, the Titanium Media App also exclusively learned about a typical case of capital intrusion into chip companies.
It was learned from a number of independent sources that there is now a unicorn company specializing in domestic AI chips (which has not yet launched a chip), and there is a conflict between the company's founder, chairman and CEO, and the investor, mainly because the founder is not from a technical background and is better at capital manipulation, and the investment institution behind it plans to oust the founder due to unequal share of shares, and proposes to let the co-CEO who has just arrived at the company for less than half a year come to power.
Negotiations are currently under way between the two sides. According to one of the people familiar with the matter told the Titanium Media App, the founder may fade out of the company's operations before and after the new product launch in the second quarter of this year, and focus on new corporate projects, which have received the first round of financing, and the investment institutions that have previously clashed have not participated in investing in the founder's new projects.
This is one of the important examples of a typical capital intrusion into a chip company and changing the direction of the enterprise. The perspective and interests of the capital side are not the same as those of the entrepreneurs, and once there is a conflict, the entrepreneurs will lose their leadership. Of course, this is not only in the field of chip semiconductors, including big health, sharing economy and other fields have also appeared in similar situations.
The last one is for companies and executives themselves to consider new development prospects.
From the perspective of enterprises, with the continuous changes in the market, companies also need to constantly change new development directions, resulting in the flow of talents.
On the other hand, Wang Haifeng believes that the core reason why many executives of overseas chip giants jump to domestic start-ups must be that they see future opportunities for domestic manufacturers, and the executives themselves are also measuring new development prospects.
"When a large amount of capital support, the national policy is fully green light, the market demand is strong, and the market such as Xinchuang urgently needs to be met by domestic manufacturers, but all industry insiders who aspire to start a business have to admit that this moment is the best moment." So we have seen a large number of people from foreign factories outflow, return to China, job hopping, and the flow of talents in the industry has never been so prosperous. Wang Haifeng told titanium media App that for this kind of talent loss, overseas chip giants do face many difficulties, including the dilemma of The surge in Chinese competitors.
In general, the common characteristics of the core capabilities of the enterprise include: the continuous development of the enterprise, the steady growth of performance, the considerable return of investors, the financial stability of the enterprise, and the continuous growth of corporate value. Then the only reason for the departure of senior executives is that the core capabilities of the enterprise have deteriorated, so the idea of leaving has been moved.
Enterprise core competency model (Source: A thesis study on executive departures from Jinan University)
Zhao Yan pointed out that although the executives of several representative companies mentioned above, such as Cambrian and SMIC, have undergone major changes, the impact on the company itself will not be too large in the long run.
"It's just that these companies are more representative in the industry, and in a period of more concentrated outbreak, it will cause this phenomenon-level discussion." But several of their companies have belonged to the more mature and large platform in China's chip industry, so this kind of talent flow, I personally think, will not have much impact on the company itself, but the impact on the industry is there. Zhao Yan told the Titanium Media App.
Enterprises accelerate "salary increases" to rob people
The huge gap directly leads to the enterprise robbery war. The secretary general of the Shanghai Integrated Circuit Industry Association once pointed out that due to the rapid development of the industry and the huge talent gap, domestic chip companies are trying to attract high-end talents.
It is reported that in 2021, the fixed salary of TSMC employees has been raised by 20%, and it will increase the salary by another 8% in April this year, higher than the level of 3% to 5% in previous years. For this news, TSMC said that it will routinely raise salaries in April every year, but there is no public salary increase figure yet. Lithography machine giant ASML was also exposed to internal salary increases in July last year, and at the beginning of this year, it raised salaries again, according to agency statistics, the company's salary increases in the past six months have reached 15% to 19%.
According to the 2022 Talent Trends Report released by talent solutions company Hudson earlier this year, the chip industry will have the highest salary increase in 2022, more than 50%, while consumer application developers, big data scientists, and business intelligence analysts will rise by more than 40%.
(Image source: report)
However, this salary increase has not allowed domestic chip technology talents to remain.
According to the statistics of China Semiconductor Industry Association, in 2020, there are about 541,000 people directly engaged in the integrated circuit industry in China, and it is expected that by 2023, the demand for talents in the whole industry will reach about 766,500 people; while the practitioners with master's degree or above account for only 6.53%, and there is a serious shortage of experienced industry experts and application technology research and development talents.
Wang Haifeng told the Titanium Media App that there are two reasons for the shortage of core technical talents: First, the general environment, Sino-US relations have made the importance of semiconductors rise rapidly, large semiconductor groups have been injected with a large amount of capital, developing new products, new production lines, new start-up companies have emerged, there is a lack of new people everywhere, and a large number of talents have been dug.
Second, the education in the semiconductor industry was too weak before, before the integrated circuit industry could not open such a high salary as the Internet industry, now many universities have opened integrated circuit majors, which is to make up for this talent gap, but in the short term, it is certain that this talent gap will become larger and larger.
In addition, in the past two years, there is a phenomenon worth paying attention to, that is, companies such as TSMC and SMIC have set up positions such as co-CEO, basically two executives serving as CEOs at the same time, mainly to prevent the loss of executives and the balance of the company's business.
Ouyang Qiyu believes that although this kind of co-CEO situation does exist, there are also many hard technology companies that do not have a co-CEO system and can operate very well. She doesn't think it's necessarily a good business balance and a way to address executive changes.
"I think different companies may have different views on co-CEOs. For example, some companies have co-CEO positions, one of which is better at internal organization management and product design, and the other CEO is responsible for external business strategy, capital relations, etc. Each has its own strengths and complementary capabilities, which is one of the main reasons for establishing a co-CEO. Ouyang Qiyu told the Titanium Media App.
In fact, at present, there is a structural imbalance in China's semiconductor and integrated circuit talents, there is not a sufficient number of large companies in the large market, the attraction of talents is insufficient, the integration of production, education and research needs to be enhanced, and the small and scattered enterprises lead to frequent talent flows.
"This may be related to the late start of China's semiconductor industry." Looking at the world, whether it is talent management, capital, technology, and talent, these changes are a process that the industry must go through. Under the complex changes in the international environment, opportunities and challenges coexist in China's semiconductor industry, and the continuous accumulation and long-term accumulation of technology and talents are also needed. Zhao Yan said in an interview with titanium media App.
She stressed that semiconductors and integrated circuits are a slow industry, which requires some patience to accumulate and wait, time, talent, funds, policies, time and place, and long-term role, rather than short and fast can be achieved overnight.
"The industry is good, even if there is a shortage of talents, it takes time to cultivate." In addition to the United States, only China in the world is seriously making chips. Wang Haifeng said. (This article was first published on titanium media App, author | Lin Zhijia)