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Today, Cadence has a new CEO as Anirudh Devgan takes the baton from Lip-Bu Tan. In some ways, this is a big change. Anirudh becomes CEO today, and Lip-Bu transitions to being executive chairman of the board. In other ways, it is not as big an event as it looks. Lip-Bu and Anirudh have jointly led the company over the past four years and they will continue to partner closely. This transition is more of a formalization of their current responsibilities and there will be a lot of continuity going forward

Lip-Bu has served as CEO of Cadence since January 2009 and has been a member of the Cadence Board of Directors since February 2004. He served as president of the company from 2009 to 2017. He also serves as chairman of Walden International, a venture capital firm he founded in 1987. Prior to joining Cadence, Lip-Bu was Vice President at Chappell & Co. and held management positions at EDS Nuclear and ECHO Energy. Lip-Bu was born in Malaysia, received a BS from Nanyang University in Singapore, an MS in nuclear engineering from the Massachusetts Institute of Technology, and an MBA from the University of San Francisco. 

Prior to becoming CEO, Anirudh served as president of Cadence since 2017 and has been a member of the Cadence Board of Directors since August 2021. As president he oversaw all business groups, research and development, sales, field engineering and customer support, strategy, marketing, IT, mergers and acquisitions, and business development. Prior to joining Cadence in 2012, Anirudh was general manager and corporate vice president of the Custom Design Business Unit at Magma. Previous roles include management and technical positions at IBM, where he received numerous awards including the IBM Outstanding Innovation Award. Dr. Devgan is an IEEE Fellow, has written numerous research papers, and holds several patents. He was born in India and received a Bachelor of Technology degree in electrical engineering from the Indian Institute of Technology, Delhi, and MS and PhD degrees in electrical and computer engineering from Carnegie Mellon University. As of today, of course, he is CEO of Cadence.

Lip-Bu's Tenure

In 2009, Cadence was in crisis and Lip-Bu became the acting CEO. The plan of record was to identify a new CEO, but a better idea soon emerged. Lip-Bu became the permanent CEO and led the company out of that crisis to become the successful company that it is today. Of course, a new challenge came along early last year, when overnight we switched from in-office to work-from-home, but with the technology environment and Lip-Bu's leadership, Cadence only got stronger.

There is more to measuring the success of a company than the stock price, but when Lip-Bu took over, the Cadence stock price was under $4. Today it is $177, an increase of a zillion percent (joking, obviously!). On a more personal note, I worked in Cadence from 1998 to 2002, and then rejoined in 2015. It felt (and feels) a very different company under Lip-Bu's leadership.

Anirudh Takes the Reins

Today is Anirudh's first day as CEO. It is a very different transition from last time since Cadence is in a very good place. Although the pandemic has been pretty damaging for broader society, semiconductor and EDA have benefited greatly from the increase in demand for electronics in general. More importantly, the electronics sector has risen to the challenge of enabling a switch of work, school, and pretty much everything else, to an online format. If anything personifies the last eighteen months, it has to be the Zoom call. I can't do better than to quote Marc Andreessen:

Depression was very real, as reflected in the stock market collapse of early 2020. But then, a miracle happened—a technological miracle. Much of the economy kept operating, and in fact many parts of the economy started operating even better under lockdown than before. The primary credit for this goes to the American worker, but almost as much credit is due to the technology that made this miracle possible.

The obvious question to ask is what Anirudh plans to do differently as CEO. This is an orderly transition that has been planned for a long time. Cadence has a very compelling strategy, great products, and has been executing very well, with Lip-Bu and Anirudh jointly leading the company the past few years to deliver outstanding business results. Given this success, you can expect a lot of continuity going forward, with Anirudh focusing on aggressively accelerating growth in the core business and in our new expansion areas, particularly, the systems space, through both organic means and strategic M&A. Anirudh will continue to drive to deliver strong business results and delight our customers with breakthrough innovation, execution, and unparalleled support. Having said that, he will also be pushing to take Cadence to the next level, driving to perform beyond the "rule of 40" that says a company's growth rate plus profit margin should sum to more than 40.

The Old Order Changeth

"The old order changeth, yielding place to new" is one of the most famous lines written by Alfred, Lord Tennyson, appearing in Morte d'Arthur (the death of [king] Arthur). These days, it is a phrase that is often called up, as today, when a major change in leadership is in progress. No kings were harmed in the making of this blog post!

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