The Business Journal / Serving Phoenix and the Valley of the Sun December 8, 1995
Accord SEG Fills Need of Chip Makers
by Rebecca Rolwing
Travis Wilson started two years ago with a $5000 cash advance on his credit card and the ambition to take his future into his own hands.
Now, he's president and CEO of Accord SEG, an ambitions company that refurbishes and creates custom improvements for machines used by semiconductor manufacturers. The systems cost about $1.2 million each when new. Accord SEG offers the refurbished equipment to high-tech companies for up to 50 percent below market price.
Sales for fiscal 1995, which ends Dec, 31, are on track to hit $4 million, and sales for 1996 are expected to reach $10 million.
Wilson plans to expand the company from its refurbishing niche to ultimately offer its own line of semiconductor machinery.
By mid-1996, he said, the company will begin to produce disposable products used by the industry. Also, it will begin to produce its own support products to complement existing semiconductor equipment. By 1997 or 1998, Accord SEG is on-line to introduce its own machines for the industry.
"It's aggressive," Wilson said. One challenge is that the company needs about $4.5 million to fund its growth plan.
Purchasing surplus inventory to provide a quick turnaround for orders will consume $2 million. While $2.5 million will be used for research and development and to hire additional personnel.
Wilson said he may pursue funding from either venture-capital sources, private financing or a public offering.
Also, negotiations are under way with new customers that would require Accord SEG to triple employment from 15 to 45 people by next year, Wilson said. Even without the new accounts the company is looking to hire five additional people.
One of those deals involves a major electronics firm with a local presence and a possible $10 million contract that would be spread out over seven to 10 years. A $2.5 million contract is being discussed with another semiconductor manufacturer, he said.
In addition, Accord SEG is negotiating to take over support responsibilities for a line of chip-making equipment that no longer will be manufactured.
If all the new business comes through, Accord SEG will need a second 15,000-square-foot building to handle the overflow. The company currently operates out of a 15,000-square-foot facility in Tempe.
Wilson attributes the company's growth to making aggressive and smart decisions on purchasing used equipment.
While there are no "junk yards" for used semiconductor equipment, Wilson said it hasn't been tough finding the equipment. Actually several of the companies that sell him used machines are the same companies that repurchase the equipment.
Wilson said he hired a strong technical staff allowing the company to offer solutions beyond its competitors.
Rival companies offer a garage-shop approach simply rebuilding old machines, Wilson said. By contrast, Accord SEG has the know-how to customize systems, he said.
Another ingredient to the company's success has been the boom for microchips, which are appearing everywhere these days from computers to sneakers.
Many semiconductor manufacturers underestimated the demand for chips during the recession of the early 1990s. Now those companies are scrambling to build fabrication facilities and for equipment to fill the plants.
The flurry of activity has left Accord SEG in a comfortable business spot. "We're positioning ourselves to fill the niches left open by the growth," Wilson said.
The desire to create Accord SEG was born out of a life-long dream to be a business owner and a frustration to gain control over his career.
"I need to take control of my own future. If I fail, I know why, " he recalled thinking.
So Wilson set out to develop Accord SEG with a mere $5,000. "It was all bootstrap," he said.
Before starting Accord SEG, Wilson worked in the semiconductor industry for 17 years. Most recently he worked as an account manager for IPEC/Westech in the Valley. There he developed relationships with buyers, managers at chip-manufacturing plants and those involved in research and development. These relationships proved valuable in striking out on his own in the industry, he said.
Wilson's experience in the industry also generated the idea for Accord SEG. "I knew that semiconductor processing equipment and its related peripherals had the highest price tags of anything in our industry," he said. "And I also knew that a lot of smaller fabs could barely afford the enormous cost."
Wilson quickly negotiated his first business deal with Microchip Technology Inc.
"I'm building a staff that brings a balanced combination of technical expertise, industry knowledge and academic credentials to ensure longevity in the industry," he said. |
