How do I carve out a career path?

Q: I am a physicist with diverse job experience. A copy of my resume is attached. What might be a good career path for me?

Apr 1st, 1999

Q: I am a physicist with diverse job experience. A copy of my resume is attached. What might be a good career path for me?

A: I do not see a theme in the many jobs you have had. So it is good that you are now questioning your approach and wanting to define a career path. What you do in this situation is not dissimilar to what companies do in developing a strategic plan. You first define a goal and a set of milestones. That means visualizing what you`ll be like in a 10- to 20-year time frame: what you`ll be doing, your financial and family situation, and every detail of what is important to you. Then you want to look at what is happening around you (the "environment" and the "trends") and understand what you are good at and not good at ("now" analysis).

Having done this, you`re more likely to succeed because you`ll have a realistic goal and know what you have to do to get there. You`re also less likely to be slowed down by choosing a job not in your career path for the wrong reasons, such as a shorter drive to work. Pay attention to the pleasant experiences you have had, because they provide a hint to what you do well and the environment you thrive in. You want to put all of this in writing so it will stare you in the face and repeat the process on an on-going basis to cope with the changes that are occurring.

Q: Many different businesses can be built around a technology I have been working on at a university. Some of my collaborators contribute to the technology, others contribute to a specific application. How do I divide up ownership if I start a company?

A: Dividing up ownership is often more art than science, and the decisions can be emotional and subjective. For example, it is hard not to reward a person who works hard with more shares even though in reality the contributions are neither sustainable nor strategic in the long run. So it is good to start with a set of rational guidelines. A conventional way to divide up ownership is based on positions in the company. You can also estimate what you`ll have to pay people for what they do as compensation, and then pay them in equivalent stock options. In your case, you also have to take into account the value of the core technology relative to each of the applications. For that, you might use a model based on starting multiple companies and then merge them.

Q: I consulted for a company a couple of years ago. Now I have a product idea that falls within the interest of that company. How should I handle this?

A: There is the legal issue and then there is your personal value system. The former is easy because your contract or nondisclosure agreement defines your obligations to the company. Assuming the company has no legal claims on your invention, you still want to do things that you`ll feel good about. One can assume you would not have come up with this idea if you had not worked with the company, also that the company can pursue this opportunity more efficiently than you can. It may be a win-win situation to offer the company an opportunity to license the invention.

Q: My company is funded by an overseas angel investor, and we are having difficulty getting the next round of financing from venture capitalists. Why?

A: Having starting your company with angel funding should not be a problem because most VCs prefer investing in companies that are further along than a raw start-up in technology and market validation. Having a foreign investor is also not a problem because VCs often look for overseas partners to ramp up manufacturing. On the other hand, a VC will pay a great deal of attention to the quality of your board of directors, so you may want to look into the reputations of your investors/directors. I have also seen a number of second-rate deals getting funded by wealthy individuals overseas who do not understand high-tech businesses. You will also want to look at your business case critically.

Q: How do venture capitalists view companies that are heavily funded by government contracts?

A: I have never seen any VC funding of "contract mills" that work on technologies with no commercial potential. On the other hand, a large fraction of the companies in our industry with venture funding have their initial technologies developed with government funding. Most sophisticated investors, however, do not believe that the transition of company culture from contract to commercial sales is an easy one. So there is a likelihood that a VC would require a change at the top soon after funding.

MILTON CHANG is chairman of New Focus, Santa Clara, CA. He currently sits on the boards of Arcturus Engineering, Euphonix, Gadzoox Networks, Iridex, LightConnect, Lightwave Electronics, New Focus, and Optical Micro-Machines. Send your questions on personal career matters, starting and running your own high-tech business, and manufacturing and operations to Milton Chang, New Focus, 2630 Walsh Ave., Santa Clara, CA 95051; tel.: (408) 919-1517; FAX: (408) 980-8883; e-mail: MMTChang@aol.com. Feedback is also welcome via Milton`s Colleague-to-Colleague "talk-show" at the New Focus Web site on the Internet: www.newfocus.com.

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