Interview with

Piero Martinotti


Robert N. Blair


Silicon Genesis at Stanford Library


January 18, 2013, San Jose, California


RB:         Today’s interview for the Silicon Genesis files is with Piero Martinotti, and was made on January the 18th, 2013.  I’m Robert Blair standing in for Rob Walker, founder of the Silicon Genesis Project.  Piero Martinotti was born in Italy, was educated at Turin University with a degree in Electrical Engineering.  Throughout his career Piero has tried to do things rather differently from tradition and has always pursued new and innovative ideas.  In the 1960s Fairchild was represented in Europe by SGS, and later terminated that relationship and went direct in Europe.  Piero’s career spans both SGS, Motorola, and SGS-Thomson, the merger with the French semiconductor company which ultimately became STMicroelectronics.  While primarily a semiconductor executive, Piero spent a short period of time in the automotive industry with Weber Carburetor in Italy also.  He has lived in Italy and Switzerland and speaks multiple languages.  Now semi-retired in Italy with his family, he is a consultant to both venture capital and technology companies.  Let’s hear Piero’s stories now of his almost fifty years in the semiconductor industry and add that to the Silicon Genesis files.  Today we’re going to talk to Piero Martinotti, a semiconductor veteran, spent most of his career in Europe.  So Piero, welcome to the Silicon Genesis archives at Stanford University.  I first met you, I think, maybe forty years ago.


PM:        At least.


RB:         Possibly a little more.  We won’t discuss that.  We were both in Europe at the time.  I was at Fairchild Semiconductor in Germany at that time. 


PM:        I remember.


RB:         And as I recall, you were at Motorola.


PM:        Correct.


RB:         Probably in Geneva. 


PM:        Exact


RB:         And those were some fun [throat clearing] fun times for all of us.  Since then you actually left the semiconductor industry once in your career and came back. 


PM:        Very short, yes. 


RB:         So that will be an interesting item to talk about.  So to get started, tell us about where you were born and a little bit about your family maybe and upbringing, the schools you went to.  And how did you get into the semiconductor industry in the first place?



PM:        Okay.  I was born in Italy in the 1940, which is a long time ago. 


RB:         It is.


PM:        And I grew up over there, and I went through the schooling in Italy until I joined the Turin Polytechnic where I did graduate in well, the first in electronic engineering, because before those days it was more usual to graduate in electric engineering.  So it was the new era of electronics.  I then moved out of Italy almost immediately.  I will tell you exactly when, to join Motorola in Geneva.  But anyway, we will discuss about my pattern.  What I would like probably to underline is that I’m a veteran, as you said, which means old.  [Laughter]  Okay.  [Throat clearing]  And in fact, I’m associated with this industry since 1965 basically, after the graduation.  And just to put things into perspective, at that time the market, I  was told, (because I was not able yet to evaluate it) , it was in the range of three hundred to three hundred to four hundred million dollars,  total market worldwide, more or less.  Today everybody knows that the market is close to three hundred billion dollar size, which means that I lived through the industry and through a growth pattern of one thousand X.  So this puts things into perspectives, and also my personal life, as you were asking before.  I’m now a happy, not only husband, but father, and also grandfather.  I have three grown up children now, and five very nice grandchildren.  Now after twenty-four years living abroad, always in Europe, but abroad, I went back to Italy to rejoin my family in the mid 2000.  And now I’m based back in Italy after a long while.  And here I am to chat with you on what I lived through the past forty – forty-five, forty-six years, almost fifty.  [Laughter] 


RB:         So what caused you to leave Italy after you graduated, Piero?  Why – what attracted you to Motorola?  Did they find you, or did you find them?


PM:        I did find them.  Okay.  But let me go through what the process, because when—once I finished university I wanted deliberately to spend one year in research.  Okay.  And there is a National Institute in Turin called Galileo Ferraris, which I wanted to join then even if I had already some prospective of being employed.  I believe I wanted to do this just to get acquainted with some research program.  And I was assigned at the time. It was the very beginning of the Color TV industry in Italy.  Not even industry.  The “Color TV” transmission because this was before having the industry in place.  Okay?  And they assigned me the task to take – it was called “Color Plexer”, which is – it was a mixer of colors for the transmission station.  It was a huge room full of tubes, electronic tubes.  And the task was to convert this room of electronic tubes into a board of semiconductors, which was the new buzz word at that time, which I did not even know.  At University, I heard about semiconductors, but I was studying a lot of mathematics and a lot of electronics via tubes.   Okay?  So in doing the exercise I discovered the transistor, I discovered the RTL, the very first digital integrated circuit, okay, in the world.  And all of them we’re coming from SGS-Fairchild.  In fact, at that time SGS and Fairchild were ….  well actually, SGS-Fairchild was a company where Fairchild  owned one-third of it.  So after I finished this exercise of one year, [throat clearing] and I learned about semiconductor, I learned about SGS  – excuse me – SGS-Fairchild at that time, okay, I applied, okay,  I just called them.  I was hired.  At that time it was very easy, okay, at least for this type of specialty.  And I joined SGS-Fairchild for around three years.  Okay.  [Throat clearing]  But at that time I was an application engineer working in the consumer area, but more specifically in the RF for tuners.  And let me tell you a little story about, just to tell you how old I can be.  I was in this lab.  By the way, at that time there was a board meeting of ST.  Excuse me.  I am confused because now it became [laughter] – eventually became ST - SGS-Fairchild.  Okay.  And suddenly a couple of board members came to the lab to visit the lab.  And there was a nice American guy who stopped by my bench and look at my work on the RF for the tuner, and started asking questions.  He was very much interested.  And I discovered after, that Fairchild was absolutely the leader at that time, but for switching transistor.  They were not so advanced in RF transistors, while SGS-Fairchild brought in this type of value and it was more advanced in the RF transistors.  So the guy asked me a lot of questions.  Very nice indeed.  And he left.  Okay.  He went through the lab.  Then I asked my colleague afterward, who is this guy?  He’s a board member coming from Fairchild.  His name is Bob Noyce.  Okay.  That’s……nothing important.  But just to let you know that Bob Noyce came there and that we discussed together at that time.  It was in ’66, I believe ’67.  Okay.  That’s SGS-Fairchild.  Now, you asked me why I went to Motorola.  [Throat clearing]  It happened that at that time it was in the back of my mind that I wanted to go outside of Italy to expand my view and of my activity, etc.  And I was the one.  But once I knew that Motorola was creating a new European headquarter for semiconductor in Geneva, I simply called them, and applied.  I was interviewed and hired.  At that time it was very easy.  [Laughter]  Okay.  And since then I lived with some return to Italy, basically in Switzerland, and France. I “lived”, okay, but operated first across Europe, and second across the world in my different phases.  So this, I don’t know whether it answers your question.  But if you want, just to briefly [throat clearing] tell you about my Motorola time, okay, utilizing my experience which I’ve done in SGS-Fairchild, they put me in the consumer application and market segment.  Actually, I was a market development manager at that time, a little manager, okay, for consumer and automotive.  It’s there that I discovered automotive.  And I was very much intrigued with automotive.  In fact, I enjoyed it.  More the automotive than [laughter] the consumer entertainment per se.  I don’t know why, but that’s a fact.  And there – to tell you another story, which …. I think it’s interesting.  [Throat clearing]  In 1971 I wrote an article for Motorola  and I have a copy in some drawer at home.  And recently I took it out and I read it again forty years after.  [Laughter]  One beauty is that whatever I was predicting happened.  One drawback, is that it happened, on the average, ten years later than what I said.  [Laughter]  So this just to tell you that the technology was there, but the automotive industry was, and probably still is, very reluctant to heavily utilize technologies for improvement.  They do it.  Huh?  They’ve done it, but in a different timescale than semiconductors.


RB:         Yeah.  It certainly took them longer than a number of other industries to adopt solid-state.  But, you know, today, if you look at the cars that are out there, the electronic content has dramatically increased.


PM:        Absolutely.


RB:         It’s going to accelerate.


PM:        Absolutely.  In fact, at that time – in my time and when I was talking about, the only electronic components in the car were – it was one, actually.  It was the high-power diode rectifier in the alternator.  

 This was the beginning of electronics.  A little bit later they put an electronic voltage regulator, or semiconductor based regulator.  It was the second application, and then from there the market expanded, but with their pace. 


RB:         So what was Motorola really strong at the time when you joined?  Obviously, it was attractive to you to join.  You wanted to get out from Italy for personal reasons, for your career.  Why Motorola?


PM:        Well, Motorola …. in life you take decisions based on strange parameters.  [Laughter]  When I decided, “one”, I liked Motorola because it was a good name.  And I wanted to change.  “Second”, they were based in Geneva, which was easy for me to locate myself.  Then I enjoyed Motorola.  But I did not make the choice (when I was twenty-seven years old at the time).  I did not make the choice based on rational parameters like you would do today.  [Laughter]  You do it just on some emotional parameter.  Then I was happy. 


RB:         Yeah.  Rather like myself maybe.  I went to Fairchild.  I’d answered an advertisement in the London Sunday Times, and that’s what triggered the whole thing.  And so it wasn’t a rational decision, it was a …..


PM:        No.  Absolutely not. 


RB:         A  decision – at the time.  So how long was your initial stay with Motorola? 


PM:        Ten years.  And then I moved up in my career, and probably it was one of the most rewarding times – not the only one, but it was part of my life.  And I entered as application engineer in consumer automotive and market development, etc.  And then for the last three, four years, ’75 – ’78, I took over the VP position of marketing and sales for total Europe.  And at that level I also developed – I believe, my managerial profession, [laughter] okay,  – which was in my view very interesting, if not because of the number of nationalities, which I was required to manage, which is a tremendous school of life, huh?  Very, very interesting.


RB:         And who – who was running Motorola in Europe at that time?  Who was the ….


PM:        There was  – Bob Heikes.  But when at a certain point in time Heikes moved to the headquarter in Phoenix,  Pasquale Pistorio for few years was general manager of Europe.  And then when Pistorio moved to USA as being head of International, there was not a general manager.  I was the guy running Europe but only on the marketing and sales side, and the factories were reporting to somebody else in Phoenix. 


RB:         Did you know Pasquale before Motorola, or was that where you guys met?


PM:        No.  I met Pasquale in Motorola.  And when I joined Motorola-Geneva he was still in Milan as a sales manager of the Italian office.  And this was in ’68.  Okay.  So I met Pasquale in ’68 and I was with him, with the exception of this automotive event, until the end of my career. 


RB:         The two of you had a very close relationship over several decades and –


PM:        I think – actually, thirty-five years together.  Just counted. 


RB:         We interviewed Pasquale in 2012, as you know, on the Silicon Genesis program.  So as this interview is January 2013 it’ll be interesting to listen to the two stories side by side. 


PM:        Yeah.  I’d like to try to – to avoid duplications [laughter] because obviously we were – we were together in – in many of the events.  But I can add – episodes on the side of it, which compliments what Pasquale’s said. 


RB:         So with a whole decade in Motorola, Piero, where did you go after that, and what triggered you to leave Motorola?


PM:        It was just a family problem, as many of us can have in life.  Okay.  At that point in time there were two private considerations.  One, our parents, my and my wife’s parents were becoming quite old.  And … then you decide whether you come back to get closer to them or not.  And also, my kids were reaching the teenage era.  And at that point in time normally you have to secure for them a kind of solid place to be.  Okay.  Either it’s Geneva or Italy or USA.  Motorola was calling me to come to USA because after a certain point in time it was a logical career path.  And regrettably – really “regrettably” I can tell you, even today. I was absolutely well, in Motorola Rather than coming to USA I said, okay, I prefer to go back to Italy.  So at least I would tell my kids these are your roots; your roots should be here and, etc., etc.  It happens, after that time the FIAT group, okay, was looking for Italians around the place, outside of Italy just to bring them back to Italy to “rejuvenate the management” (call it).  Okay.  And they found me.  Okay.  So they – they made an offer.  And at that time there was an open position for the general management of a company called Weber Carburetor.  So they made me their proposal.  The proposal was okay.  And – but based on the other parameters, I made the choice.  So in this case I joined that industry for around three years.  However, being electronic at heart, [laughter] okay, I realized that in my view, okay, there was a future for electronic injection, and also for converting the carburetor in being a single-point injection.  So it’s an electronic carburetor.  So what I’ve done, I decided to invest in five engineers, all electronics in this environment of three thousand people, all mechanically-oriented.  Okay.  [Throat clearing]  I organized for a partnership, again, with Motorola, Motorola Automotive Division at that time, to develop [throat clearing] this electronic injection ….. a multi-point project and a single-point project.  Single-point being – again, the carburetor for the traditional cars.  And there is another story which I think illustrates my point, on automotive.  After one year and a half, okay, the project was done, working beautifully.  So I went to my boss at that time, telling him, “listen, okay, I’ll show you what we have done with five people in a corner.  Not a big deal”.  And he was impressed.  And then he called me [throat clearing] in his office, and said, “Listen, fantastic!!!  Now you take your project, you put in a drawer, and leave it there.”  I said, “Why?”  “Because if you show it to a car maker like FIAT, etc., they get so excited and they want it.  And what will I have to do with my own investment of today to protect them.”  [Laughter]  I was shocked.  And this was one of the reasons why, when at the end I could come back to semiconductors, which is my life, so I came.  So this was the point related to automotive.  By the way, this famous application, the single-point injection, eight or nine years later went into production for a Fiat car called Punto.  Okay.  And they’ve adopted this, eight or nine years later.  It was in a drawer.  Somebody [laughter] took it out and used it.  That’s life in the automotive.


RB:         So that really caused you to move away from being in the mechanical automotive industry and come back to semiconductors.


PM:        Okay….Also … it’s all linked to events in life, okay, what has happened at that time, and that’s why I’m going back to Pasquale Pistorio. Pasquale was called by the Italian government to rejuvenate completely, a small company called at the time SGS.  Fairchild was out, etc.  It was a company which was selling at that time a hundred and forty million dollars only, and – losing forty to fifty million dollars per year.  Okay.  So when Pasquale came back and [throat clearing] - and I think he told you this story [laughter], so I’m not repeating it, what he has done, among other things, he has called four or five people from the old Motorola days, and I was one of those, just to help him.  People that he could communicate with, in the language he knew.  [Laughter]  Okay.  Not the language of the state owned company.  And …. among the others, there were five of us, I believe.  Yes.  One was myself.  So I grabbed the opportunity.  I went back to semiconductors.  And since then I spent my life in semiconductors.  And I went through what you described, which was the SGS time and then – the SGS-Thomson time, the ST times, etc., etc., until my retirement. 


RB:         Now, there’s a famous story here in Silicon Valley at Fairchild where, you know, one of the Motorola superstars at the time, Lester Hogan.


PM:        Yes.


RB:         He brought a bunch of Motorola folks to Fairchild and they became known as Hogan’s Heroes.  They came as a group essentially.  So this is basically Pasquale’s Heroes who went from Motorola to – to SGS to rejuvenate the company.


PM:        Absolutely.  And then –


RB:         So tell us a little bit about how the SGS turnaround occurred.


PM:        Okay.   It occurred because Pasquale, thanks to him, okay, he’s very keen on one parameter, on several, but one specific, which is called “profit”.  [Laughter]  Okay.  And he cannot admit, correctly so, that a company survives without making some profit.  Then you can enter into the cash generation issue etc., which is not to be discarded.  But the profit is the first – very first one.  So what – what he has done through us five, but also with others that intelligently followed him,  he tried to install this culture of making profits, okay, reducing cost, increasing sales, etc..  In fact, when we merged with Thomson, at the point before the merger, okay, from the numbers I gave you before, one-forty million sales and forty to fifty million losses, the company (SGS) was four hundred and fifty million dollar sales and few dollars profit.  So within, I think it was six, seven years, this was done.  In the meantime he rejuvenated the manufacture machine, which is very instrumental for that, etc.  So this was, simply speaking, what Pasquale has brought into the company as a “culture”.  A few managers of the prior SGS did not follow it and they were out.  [Laughter]  The ones buying into this concept remained in, and they went through even the ST time eventually.  The point is that – I don’t want to repeat what Pasquale said.  If I’m doing it, just stop me.  [Laughter]  Okay.  Because it was an Italian government-owned company, SGS, and the government, every time there was need for cash it was providing the cash to do it, but in terms of loans to the company.  So the company …… at the end was profitable, but was heavily into debt.  Okay.  And I think, if I recall correctly, out of four hundred and fifty million dollars revenues and some profit we had two hundred million dollar debts. They really were just guaranteed by the government, but they were debts. 


RB:         As I recall, that seems to have been maybe a typical problem with European semiconductor companies, as opposed to American semiconductor companies.  And so Pasquale’s experience there and – and focus on those parameters was probably, you know, the beginning of something big.


PM:        No. If I can – I can – if I can dissent for a second, and I know it from experience, … when we merged with the – the Thomson Semiconductor, the situation there was absolutely reversed in the sense that they were more or less the same level of sales.  This is what I’m talking about – 1987 now.  They were at four hundred and fifty million dollars sales, like – like SGS, making a lot of losses, I think more one hundred million dollar losses, and zero debt.  Because the (French) government every year was just fulfilling their debt by  – by providing whatever equity that was necessary.  So on – on paper – on paper we had, at the moment of the merger an SGS, with reasonable sales, some profit, heavy debt.  A Thomson Semiconductors, reasonable sales, bad losses, no debt.  Going back to the SGS time ’81-’87 prior to the merger, I think it was an interesting period for – for me and for the company, etc., beyond the fact of getting to profit .  In fact, we started building up a network of alliances with other companies, and specifically I had the experience personally and directly with two companies.  One was Toshiba, okay, with whom we discussed … well, we concluded a few agreements, and the other was LSI Logic.  In fact, at that  time we – SGS entered also the semi-custom type of business via those two alliances.  And in terms of episodes, normally I like to tell that my most interesting experience has been the one working with Japan.  And I’m very pleased to recall that, by the way.  But for instance, [throat clearing] I remember when I was negotiating with – with Toshiba a partnership or an agreement concerning – I think it was a three-point-five micron technology, if I recall correctly  [Throat clearing]  and also, a joint design of a new standard logic family in CMOS, which was the – the second major element.  So I was there [throat clearing] negotiating with them, and then – I took the – I brought with me the intelligent guy, the guy knowing everything about technology, etc.  So I was well, I was not the intelligent one, but fine.  [Throat clearing]  And in front of us we had for two – for two solid days, ten Japanese, okay, by the way, on a rotating basis, and not even the same ones.  And one guy better, two guys on top of the group coordinating the event.  And I was impressed, and even a bit sometime embarrassed….  The two of us, okay, and those ten Japanese … going around etc.  And [throat clearing] the first day I made a mistake.  And the mistake was that those Japanese were keeping very silent. So I was putting a question through, etc.  And then being Italian I cannot seem to accept people very silent.  [Laughter]  So I was the one providing the answer in advance …. just to fulfill the silence somehow.  [Laughter]  Then I realized that night that [throat clearing] in doing so I was discovering totally my position.  Therefore, my negotiation  weapons were finished.  So the day after I told my colleague, the intelligent one, [throat clearing] okay, let’s do something like that.  We put a question (through) and we keep silent.  Even if we have to stay minutes silent, we do.  And we utilized that technique.  And finally after few minutes the Japanese started speaking.  So I could understand their position.  [Laughter]  Okay.  And we learned.  In fact, we should be quiet, avoid to speak a lot, okay, be factual, and they – then they appreciate it.  And then – then we had  the agreement done, etc.  But that was an interesting life experience for me in the terms of negotiating with different type of cultures and nationalities, etc. 


RB:         Was that a period, would you say, where SGS was a technology follower, or was SGS an innovator in certain areas?


PM:        Okay.  SGS was a follower in the MOS arena, but was still a leader, or already a leader in the analogue power area.  In fact, this was not my domain, but the company, yes.  In fact, the company had tremendous technology in that area and not fully exploited at that time.  And eventually we did exploit it.  In fact, even today they are – they are still a leader in the power integrated area.  In the power in general, but in primarily in the power integrated area. 


RB:         Hmmm. 


PM:        And this – okay, this was just an episode of my SGS time.  But I have several, but this is one that view as quite interesting. 


RB:         So was the long-term relationship with Toshiba, did it pan out as – as you had expected.


PM:        Absolutely, yes.  In fact, [throat clearing] we have done agreements with other companies in other countries, but this was one of the best working relationship at the point that it was not only the best in – in terms of results, but it was absolutely the best in terms of relationship.  In fact, this agreement expired I think in ’88, ’87 with the merger basically.  However, just to tell you, every time I was going to Japan, myself or Pasquale or – other people of the team, independently from the end of this agreement, they were inviting us to meet them to – for dinner.  So we did create a tremendously good relationship, which was almost unique, I would say.  Okay, also with the others.  [Laughter]  But this was kind of peculiar and unique.  So we were happy in all respect. 


RB:         Yeah.  I remember that – during the same decade at LSI Logic I think we would characterize our relationship with Toshiba at that time as being very good. 


PM:        Absolutely.


RB:         And I remember the – the person in charge of the semiconductor activity at Toshiba was that kind of person that was very open and easy to have a good relationship with. 


PM:        Okay.  At that time there was Mr. Kawanishi on top.


RB:         Kawanishi.


PM:        On – on top of the group.


RB:         Exactly.


PM:        By the way, I think you ….. I’m saying you from LSI Logic, you told us to go to Toshiba, I believe.  


RB:         Could be.  Yes. 


PM:        Yeah.  Because – because you had already with them an agreement.


RB:         At LSI, Wilf Corrigan established the relationship with Kawanishi - san.  And that was a – that was a good relationship.


PM:        There was another great – great guy that eventually died, Mr. Egawa.  In fact, when we were negotiating the agreement, Mr. Egawa was the guy sitting on top without speaking for the two days of the negotiation, but watching [laughter] – watching the troop, etc. 


RB:         Yeah.  I remember him.  Yeah.


PM:        And very, very … nice fellow. 


RB:         So how long were you at SGS during this period, Piero, and…


PM:        From ’81 through the merger.  Then obviously I remained there through the ST time.  So if you want, if you put together SGS and the ST time, ’81 through 2004


RB:         So tell us how the ST era began and how the name emerged and how that was different from the SGS era.


PM:        Okay.  Here I’m running the risk to repeat Pasquale Pistorio.


RB:         Okay.


PM:        But fine – I then give you also some of my views.  Together we were looking at the possibility of growing inorganically, because we felt that the organic growth with one shareholder, even if it was the rich state - government, was not the way to go.  Okay.  And we were looking into a few possibilities ….  all around Europe, which were not very many.  And finally we found – or they found us, I don’t recall, okay, the Thomson Semiconductors.  And primarily for the initiative on Mr. Gomez, which was the president of Thomson at that time.  Very brilliant person.  Okay.  The fact that merging the two companies would have created a company of almost one billion dollar, or eight – eight hundred to, nine hundred million dollars, which we could have rationalized and made viable, okay, what was then done.  Okay.  Just following this type of concept.  Okay.  “We can not grow, probably, only organically”.  We have to create this group, and then find a way of financing it.  [Throat clearing]  And let me talk about the first years of the new group, which are important.  And again, I have to refer [laughter] to Pasquale Pistorio again, but that’s just the fact.  First of all, I think it was good for the company that among the two leaders of the two companies at that time, Pasquale was chosen, because they had the choice between Pasquale and the guy running Thomson Semiconductors.  They’ve chosen Pasquale.  Fine.  This was good.  Okay.  [Throat clearing]  Then myself, apart from the initial period, when I was running the new semi-custom division, which was a merger of two or three divisions [laughter].  I say three divisions because I want to recall that before the merger, SGS – no, excuse me – Thomson Semiconductors bought Mostek in USA.  Mostek was an important player in the area of Dynamic RAM’s.  Okay.  That – just for recollection, and then we can come back to it.  So at that point in time we had to clean up this new setup.  And after one or two years after I ran this division, Pasquale asked me to take over the Strategic Planning for the corporation, plus some other ancillary type of function, but the key one was this one.  By the way, strategic planning in the new ST group was a key function, because vis à vis the board … these were – there was the CEO, Pasquale, the other two key functions were the CFO, obviously, and the strategic planning.  At the board meetings the three of us were always there.  All the others are equally important.  But vis à vis  the shareholders, those were the key functions.  And the strategic planning that I  took over for three four years was done in a not easy period.  Okay.  Because, yes, we merged the companies.  But first we had to rationalize tremendously the product portfolio, which was not easy because when you have to chop some product people cry.  We had to rationalize the factories.  In fact, all together because of a long history primarily from the Thomson side. From the Thomson side, it was a kind of merger; a successive merger of around ten companies, I believe.  We had twenty-three, twenty-four sites, okay, [laughter] of factories.  And all under the critical mass.  So we had to really modify them, reduce five to six sites, so “rationalization of the manufacturing machine”.  There was also an issue of unifying the cultures, which is very important, okay.  At the time not only we had an SGS culture and a Thomson culture, but within SGS we had a Motorola culture, an old SGS culture.  Within Thomson we had the TI culture, and from people coming from those companies, a Sesco-Sem culture, and an F6 culture.  Incredible.  Okay.  And … there Pasquale was beautiful, in my opinion.  There he was – he was able to force in a very fast time a common culture in the company.  This probably has been, in my view, the most crucial parameter for success.  If you don’t uniform the culture, okay …. Let me tell you another story, if you do not mind.  Once I came to Dallas in the old Mostek site.  Okay.  We used to have every month a “communication meeting”.  Okay, with – with all the managers and even beyond that.  And I was there to present my case.  Okay.  And a smart American guy raised his hand and asked me a question.  And he said, [throat clearing] “How can you, being Italian, manage an American, a French, and a Swiss guy?”  And my answer was “honestly, I don’t understand your question.  If you would have asked me, “How can you, ex-SGS, and ex-Motorola, manage an ex-TI, an ex-Sesco-Sem?”  Then – that’s the question – that’s what is difficult.  It’s not the passport”  [Laughter]  Okay.  And the guy, he kept silent.  But this was actually what was happening.  To really create a common culture out of people from so many sources.  Not nationalities.  And I insist on that. 


RB:         Well, Pasquale has, you know, a very strong and lively personality, of course.  And I agree.  I think he was the perfect candidate to bring that, you know, widely separating group together.  And obviously as we saw, he did that successfully. 



Then I have another story which I think I would like to tell; this story because [throat clearing] that’s the time.  [Throat clearing]  The other point, which I did not mention before, was not only rationalization.  The other point was to recapitalize the company.  Because, fair enough, okay, on the French side there were zero debts, on the SGS side there were two hundred million dollar debts  Together [laughter] it’s the sum of  those two.  [Throat clearing] and we had to go through to convince first the two governments, the French government, and the Italian government, to pour into the company which we did at the end, half a billion dollar of new capital, fresh capital, which was not easy.  But before doing that, [throat clearing] some smart fellow in the French government [throat clearing], the Italian was very quiet.  Normally they’re – okay, they come up occasionally, [laughter] but the French were ( I respect them),  they’re very correct, but very keen in getting into the details and almost managing what you are doing.  [Throat clearing]  And they decided that, before thinking to recapitalize the company, they would have thought even to explore if the company could have been sold.  Even at one dollar nominal, which we didn’t like obviously.  [Throat clearing]  And suddenly I’m telling a story which I would love to give a title to, which is My Longest Professional Day in Life - Together with Two Lobsters.  [Laughter]  And [throat clearing] I tell you the story now.  I was working in Paris.  Paris was my reference location.  I was a French resident at that time, with an office in Paris, and it was a Monday.  I  remember that day – I do not know which one, but  Monday.  It was a Monday.  Around noontime on Monday we received a call from … somebody in the Ministry of Industry in France through somebody else.  They said, hey, gentlemen, we want to explore, okay, the possibility to sell the company, and we have organized for you a meeting tomorrow morning in New York with a big group.  I would not mention the group, understandably .  Okay.  And on Tue (this was Monday), and on Tuesday (actually Wednesday) another big group in California.  And you should go there and try to present the company obviously with the purpose of selling it.  Okay.  This was Monday at noontime for a meeting, okay, in the New York area – on Tuesday morning, ten o’clock.  There was no way to go there because …                                                                                                                                                                                                                                                                                                                                         all the planes leave more or less noon – noontime from Europe to come in this area.  Probably some plane at four p.m.  I don’t know.  But, I told him there’s not even time to prepare … we had all the slides possible, but …. you were to put them together coherently.  Okay.  At that time there was not a PC like today.  So  you’re preparing transparent foils, if you recall.  Anyway, there was only one way to come over, okay, which was to take the Concorde (at that time there was the Concorde) the day after.  The Concorde was leaving at eleven, also remember that.  With the beauty that with Concorde you can go straight to the plane.  Okay.  The process to get in is absolutely simple – was absolutely simple.  So from noontime on Monday through Tuesday morning we were there – I was there to prepare this damn presentation.  [Laughter]  Okay.  [Throat clearing]  So I was – and I’m telling you this story of the Tuesday;  on Tuesday morning at seven a.m. I was in the office preparing the – the presentation, finishing it, etc.  In due time a driver – a very fast driver took us to the Concorde.  We arrived at ten to eleven.  At eleven we got on the plane, and then we took off.  And the Concorde was landing in New York at eight-thirty the same morning, well, because of the (time lag) okay.  So we played on that.  Concorde, I wanted to let you know it was an interesting trip, but very uncomfortable.  Seats like that for guys – big like myself - it was not easy.  [Laughter]  But fantastic meals.  In fact, champagne, caviar, and a lobster.  I want to let you know also   (probably not of great interest), that I love a lot of fish.  Lobster is not my priority.  I prefer cod, I prefer sea bass.  Okay.  If I have to – to eat it, I eat it.  No problem.  And we had – we had caviar, blah, blah, and this lobster.  Fine.  Okay.  Accept the lobster.  Arrived eight-thirty in New York. At ten there was the meeting somewhere with this company.  The driver took us there.  Three minutes before ten, we’re – we were there.  Perfect.  The meeting went on, etc.  So, consider I was working from seven a.m. Paris time, now in the meeting with this company in New York.  Since at four o’clock (pm), okay, we finished, etc. Rather than sleeping here, which was the plan “Why  don’t – we take (a plane) if there is a plane, to go to San Francisco the same day?”  Okay.  There was a plane which landed – (it was last one, I believe) – in San Francisco at ten p.m. San Francisco time, nine hours after Europe.  I rented a car and I drove for almost an hour to come to San Jose.  I went to bed – boom.  So this was my longest day.  The point that I did not tell before, but I’m telling you now because of the title’s Two Lobster.  When we were in this company in the New York area.  Okay.  Obviously we had the meeting, and then we were invited in the VIP room for lunch, and they served us the second lobster.  [Laughter]  So that day [laughter], okay, I ended (with two lobsters) – In my life I had probably three lobsters.  Okay.  Two of them the very same day.  Okay.  Sorry.  It’s a bit funny story.  But I think this illustrate the mood of that time of at least to try to sell the company.  Fortunately it did not happen.  Then we went through and there was, in this case, I was really [laughter] …. I was the one on the front of the organization to negotiate with the two governments a – a total package of half a billion dollar, which at the end we did.  Okay.


RB:         Pasquale and your team was obviously not in favor of selling the company.


PM:        Absolutely not; absolutely


RB:         He wanted to grow it to a large consolidated company.


PM:        Absolutely.  In fact, as consequence the first half a billion dollars was put in after obviously some struggle.  But then we convinced (the shareholders) to go public.  And the two governments ten years after, since they had put two hundred million dollar each, more or less I think they have recovered more than ten times what they put in.  And in fact, there was a minister at the time, prime minister; “Giuliano Amato” was the name.  He was I think – he went to visit ST and in front of everybody said “I want to thank this company because this has been one of the major [laughter] income I had since I was prime minister, because of the ….”


RB:         Unusual returns for [talking over each other].


PM:        Unusual return for the government. 


RB:         So towards the end of the ST era then, Piero, what did you do – when you sort of approach retirement and ….


PM:        Okay.


RB:         Did you leave before Pasquale?   I don’t remember.


PM:        Yes.  Before Pasquale.  I think, one year before.  Now, this is a more interesting part of my history also because it brings me into the today type of work.  Well I spent three years in this strategic planning, corporate strategic planning , a very interesting, very rewarding  it opens your mind etc.  I was touching all the parameters [laughter] of the business, etc., but I was at a certain point tired because I am – I believe I am, an operational guy.  So I asked Pasquale to go back to operation, okay, which he accepted.  [Laughter]  And we have (Pasquale and myself) “invented” a new division called NVG – New Ventures Group, but which was basically an incubator of new business.  So I was assigned a few projects.  Okay.  I was trying to see whether they were feasible for the – the organization.  And my role was that … then I asked Pasquale (and Pasquale accepted it, okay), “if you give me a project, give me one year and one million dollar, and don’t bother me for that one year”.  [Laughter]  I will prove it, okay.  Then there are … three possible outcome.  One is that it’s not valid.  Okay.  I spent a million dollar.  One, if it is valid, let’s then try to launch a business unit out of it, and create something which was passed maybe in  some other part of the organization.  And in one case, which is very real, I said, hmmm, interesting, but it’s not for the business model of ST.  Therefore, the only way to really feed this project is to spin it off.  And this, there is one case which is absolutely real.  One of these projects was concerning biometrics, and specifically the sensor for fingerprint recognition, which we developed internally.  We felt it was an – an interesting pattern, but it was – okay, the point was that if you sell it as a semiconductor – you don’t create value.  If you sell it as a solution, you create value.  But ST was, probably still is, structured as a mass production company crunching out millions of devices per day, and making profit out of the margin of those devices.  If you have to add other pieces of technology, like software, like – like algorithms, etc., it becomes more difficulty.  If it’s software in ST, at least in my time, it was utilized as a tool to serve semiconductors rather than combining it with semiconductors and selling solutions.  And in biometrics you have at the end to provide solutions.  Okay.  It’s not a component business per say.  Okay.  This being said, I convinced the company, but primarily Pasquale, because not everybody was in tune with that.  They said if it is profitable, let’s keep it.  If it is not, let’s chop it.  [Laughter]  I said no, no, we can make it profitable by providing solutions.  So I convinced Pasquale and he gave me the blank paper to go ahead, and my idea was that ST should have stayed in the spinoff, but its contribution was only the IP created at the time, no cash, and we should have found investors to compliment it.  And then with the help of the inventor of this technology who is Mr. Alan Kramer, who lives, by the way, not far from here.  Okay.  All together we went around, we found, after some struggle, a syndicate of interested investors that believed in the project, and they put quite a bit of money there, okay, and we started a new company called UPEK.  UPEK stands for “Universal Personal Electronic Key”.  Just – an acronym.  And this company was launched.  Okay.  We had couple rounds of financing.  For the first three to four years, it went beautifully up.  But the company was started.  By the way,  the company got all the relevant IP from ST which was the big value, and the money from the investors.  The company was created in 2004 with sales of four million dollars.  Four years later it was reaching sixty million dollar sales.  But then in the crisis of 2009 – the sales went down dramatically because of several reasons.  At that time the company was … and by the way, I was at the board with the company.  Initially I was at the board representing ST.  But ST sold it’s part – it’s share one year later and they asked me to stay as independent member of the board.  So I followed the UPEK time totally to the end as independent board member.  Then when the company was “in trouble” because – this has happened, we found a way to merge them with AuthenTec, which was the other major contender on the marketplace.  There were probably three or four, but two very small, and AuthenTec and UPEK at least were of comparable order of magnitude in size.  Recently, which was  … I mean September, October last year, there was an announcement that Apple bought the new merged company, AuthenTec and UPEK, (public figures) in the range of three hundred and sixty million dollar.  And so the famous fingerprint (sensor) which was started in my incubator at that time with – with Alan Kramer, okay, went through this piece of history and today is an Apple technology – Apple is not a small [laughter] outfit.  It’s kind of number one – and that’s fine.  So this is – okay, the history, it is one of the outcome of this incubator project which [throat clearing] I ran.  The side effect of this is that from the starting point of creating the company and attracting investor, I knew quite a bit of a venture capital and their world.  So myself, I retired formally in 2004.  But then some venture capital asked me to join them as a consultant, and to even help them in some of their portfolio companies, which I enjoyed.  So now, as a retired man, okay, … I continue to be linked to semiconductors, [throat clearing] by at least half of my time. I don’t know what.  Okay.  In fact, when I retired I’ve taken a decision.  Okay.  I wanted to do three things.  One, to devote more time to my family, which probably I did not do much before.  And I think … “second”, to devote myself to some “humanitarian” project, which I’m doing, okay, in countries like in Africa and Asia.  And the third, to be linked anyway as long as I can with the industry, but with another type of objective now.  What I would like to do, okay, via my friends in some venture capital area, but primarily looking for interesting startup companies and bring in there the experience of an old man, which I think sometime helps.  I’m not pretending to be competent in any of those type of technology in any of these companies, but I realized that this can help quite a bit.  And …… in fact, I did – and to give you [throat clearing] another piece of information, I was invited one day in a seminar of venture capital as the example of a corporate guy that has – has joined somehow, okay, their world.  And they were kind of skeptic about the fact that a corporate guy can join their world.  And somebody asked me – it was a smart question – in the room,  – “listen, listen.  Just to understand who you are.  Can you describe yourself in twenty seconds?”, which is not easy.  And there was a ….. I took ten seconds to think about, and then I said, “you know, I am an old man who now knows basically nothing of almost everything, and has a lot of scars on the skin.”  Okay.  [Laughter]  The audience did appreciate that.  And I have examples of the contribution I can bring to the venture capital.  I’m not a venture capital animal.  Absolutely not.  I understand their world.  Okay.  I think that my contribution is primarily a long and wide operational type of experience.  And I can have several examples, but this has proven to be very interesting for them.  In the venture capital world that I know of at least, they are very smart in financing type of strategies and operation.  Most of them, if not all of them, they pretend they are fantastic in marketing.  Here I have some doubt.  But almost none of them has an operational experience.  Okay.  And if they accept that I can compliment them, and that I respect their contribution, it’s a fantastic way to work together. 


RB:         So going back in time, Piero, you’ve had a long and full association with the semiconductor industry.  And it turns out that most of that time has been spent with two companies, Motorola, and earlier SGS, and later ST. 


PM:        Correct.


RB:         So let me ask you, if you had to do it again, would you do the same thing basically?  And also, let me ask you, if you’d had the opportunity, would you have moved to the US as a semiconductor guy rather than stay in Europe?


PM:        Okay.  For the first part of the question, no, you’re driven by events in life, even if, okay, I had some clear objective.  So the fact that I was in Motorola was almost incidental. The fact that I went backto SGS, blah, blah, blah, and ST, it’s almost linked to the fact that Mr. Pistorio called me in, otherwise I don’t know what I would have done.  So I consider this, yeah, probably … I’m happy with what has happened, that’s for sure.  Would I do the same?  I don’t know, because this depends on events.  On the other question, yes, I regret I wasn’t able to really live here.  And in fact, the moment when I was asked to be here was in the late ‘70s, when, for family reasons, I decided to go back to Italy.  It was just for that.  In fact, … I can tell you, when I resigned, but I resigned not because I was nasty with  Motorola.  Because of this very reason I was called in Chicago by Bill Weisz, who used to be the president of Motorola.  Well, the prime shareholder was Bob Galvin.  But the president of the corporation was Bill Weisz.  And we spent together half a day and he offered me a plant to run, a plant in Anger France of

another Motorola division.  He also offered me to come to USA.  And the point was okay, yeah, but this was not fitting unfortunately with the family parameter.  But I would have liked it, because in fact I think I missed not to be here as a resident for at least some good time.  In fact, when I come here I breath, in the Silicon Valley, the smell of semiconductors. I’m happy.  [Laughter]  Okay.  This is true.  In fact, even if I don’t have any special need to come here, once a year I think I want to be here to contact the people like yourself  and – and other friends I have in the valley.  Because here you breath this type of technology, etc.  If you go in Asia you breathe the manufacturing.  [Laughter]  Okay.  So … also Asia, I like it as an environment.  In fact, I’m pretty much linked with Singapore for several projects, etc., etc.  I even had some consultant project in Singapore for a few years.  But, yeah.  The fact of not being able to come over here resident for a while …. if I can go back in my life and have the freedom to do it, I will do it. 


RB:         Okay.  Well, Piero, I’ve certainly enjoyed working with you over all of these decades where we’ve come together in the deals we’ve done and so on.  And I certainly appreciate you coming here today and recording your European life in the semiconductor industry.  And I thank you for allowing us to record this on Silicon Genesis.  So Piero Martinotti, thank you very much.


PM:        Can I just add one bit –


RB:         Please do.


PM:        Okay.  I’m most qualified to be a European – I am European.  Okay.  [Laughter]  But in the industry I would like to redefine myself as being a European based international element.  I think  – probably this categorizes better my history in the industry.


RB:         I think all in the semiconductor industry, which is clearly a global industry, we all come under that title.


PM:        Absolutely.


RB:         We’re all based somewhere originally, we’re all based somewhere now, but we’re all international because that’s the nature of the business.  So –


PM:        Absolutely.  Thank you all for this very nice chat.


RB:         My pleasure.  Thank you, Piero.


PM:        Thank you.