The ecosystem and the mass market: NXP’s symbiotic relationship with startups
Sam Holland spoke to Mohamed Chemloul, VP Customer Application Support at NXP Semi Conductors about NXP's events, programmes, and other commitments to both engage with and learn from startups and other small businesses and customers.
THE ECOSYSTEM OF STARTUPS AND NXP
Just one example of NXP’s support of startups is in its partnership with Extreme Tech Challenge (XTC), the non-profit organisation which, to quote its website: "Behind the world’s biggest startup competition that aims to help startups change the world for the better". XTC is supported not only by policymakers and universities, but also leading corporations – of which NXP, a leading Dutch chipmaker, is a clear example.
In fact, both Extreme Tech Challenge and NXP (namely the company’s Executive VP and CTO Lars Reger) refer to the symbiotic relationship between established entities and startup organisations as an ‘ecosystem’ – and it is this ecosystem that is a big part of NXP’s exciting tech innovation. When asked about how some startups may be uniquely positioned to drive such innovation, Mohamed likewise referred to the two-way relationship between NXP and startup businesses: "Sometimes we are their customers, because we’re using something they’re working on. But we also have it the other way around – where we are interested in their technology. And without this intelligent ecosystem, we would not have access to the application insights of our products and theirs."
On top of this, Mohamed went on to explain that startups may even bring their own surprises when they purchase, develop, and integrate NXP’s chips for the benefit of their own technologies. "Sometimes we are amazed about what our customers do with our products – things that we have not even built those devices for," he explains. In what may seem surprising, part of the reason for this innovation is due to, rather than in spite of, the time and resource constraints that new organisations often encounter. Of course, these challenges are in stark contrast to the experience of NXP’s much bigger clients. "Those large customers have big development teams. They tend to come to us maybe two years before the product hits the market… and we work together in a system that brings us to the finished product.
"Sometimes startups do not have the time for this because of the demands of the investment that they are working to. They have to break even before that money is out." But Mohamed explains the plus side to this pressure. Those high demands faced by startups can spur within them resourcefulness that is effectively born out of necessity – the ‘survival mode’ as Mohamed calls it. "They discover that they don’t have a specific chip for a certain application, because sometimes their technology is a new extension of what already exists. But then they tend to take what is existing, take the NXP chip, and find their own solutions. It’s like a survival mode."
Mohamed went on to explain how crucial the above benefit is by explaining how the whole ecosystem allows NXP to glean from startups how their technology and applications can be enhanced further. And what’s more, the ecosystem between startups and NXP is formed of a symbiotic relationship, and what NXP has to offer startups is technology that appeals to the mass market. And it’s the ‘mass market’ that puts the ‘MM’ in NXP’s new programme: the online distribution project called MM2020.
MM2020: THE STARTUPS AND ENGINEERS’ RESOURCE
NXP’s MM2020 programme is an online distribution channel for those in the industry, which offers resources such as development tools and technical resources to customers. Such resources are referred to Mohamed Chemloul collectively as NXP’s support channels: to quote from NXP’s presentation, the project aims to achieve, first and foremost, the "digitisation of support channels, self-service and artificial intelligence/machine learning tools for instant access and scalability" to its product offering. This is particularly to the benefit of startups and other growing customers.
The service is a product of the company’s interest in working with small clients (most of which are engineers themselves) – but it’s also the result of NXP’s high customer demand from startups and other small businesses. "We have, say, 60,000 customers," Mohamed explained. "There is no way that we could offer a team that calls every customer directly. … We had to find another way to deal with those customers. Fortunately, we are in an era of digitalisation and online platforms and so on."
An innovative online distribution channel is indeed a must for small organisations and individual engineers, and Mohamed explained NXP’s interests in bringing the channel’s benefits to startup organisations. "Startups form the category of focus for us," he said. "With MM2020, we were trying to establish a means to achieve a channel that has direct, immediate access to support our smaller customers so that they can work with our products."
Although it was established very recently, namely the titular year of 2020, MM2020 has already seen notable success, with Mohamed pointing out the marked leaps that the programme has made in a poll of top distribution channels. This was especially in terms of its ability to serve the customer in an intuitive way. And a major reason for this intuitiveness is Mass Market 2020’s reliance on artificial intelligence, particularly machine learning, as a means to enhance the purchasing experience. In fact, this focus on AI was put ahead of the design considerations that would often go into more traditional online shops. "Our approach was not about the look of the web page itself. … It was more about the intelligent user interface and experience of the customers, specifically those who do not have other choices than to go with us – the smaller customers."
In fact, it was the high interest from these startups and other small clients that demanded the use of intelligent software. "They would submit to us a query online as a ticket, just as many sites use tickets. But what we realised was the influx of those tickets was higher than we expected, back when we opened these channels. We had to deal with the question: ‘How can we keep this accessibility but also make the interaction faster and more direct?’" The result was a system that took historical data, based on the interactions and user behaviour of the customers online. "We started to use AI engines," Mohamed explained. "We realised that with this solution, we become more efficient in dealing with the customer request – rather than having a kind of a linear view, where we just fulfil the tickets as they come."
Such a data-driven approach also informs how best to upsell the right products to startups and other customers, and on top of this, MM2020 provides the technical resources to the engineers searching through NXP’s available products. This, again, invites further innovation from NXP’s chips and other products that even the manufacturer itself couldn’t foresee. Said Mohammed: "By giving startups the freedom to access the knowledge database, including the technical training, they may find a different design approach to the equipment: they may combine products that NXP itself doesn’t offer as a standard combination. And that can help us too."
STARTUPS THRIVE MOST WHEN THEY’RE IN THE RIGHT ECOSYSTEM
Again, the ecosystem doesn’t just cover what tech giants like NXP can offer to startups, but what startups can offer to tech giants like NXP. And this is once more where the innovation of new businesses comes to the fore. In fact, when asked what qualities are ideal for startups, Mohamed explained the importance of being – not only intuitive – but disruptive. "The most important and interesting startup is the disruptive one," said Mohamed, "because disruptive technologies challenge big companies by being completely different."
Indeed, many startups would never go on to flourish without the right support and product offerings from larger companies. NXP’s two-way engagement with startups – owing to its partnership with Extreme Tech Challenge, its focus on Mass Market 2020, and much more – is the means by which the semiconductor giant can offer both itself and startups the right ecosystem to thrive.
This article originally appeared in the Jul/Aug issue of Startups Magazine. Click here to subscribe.