This day of academic ceremony must be a day of touching, personal memories. It is also a day to pause, and give honor and praise to your parents and to the good Lord for the grace to be at this place, at this time. While all of us may be seated, we’re actually standing on their shoulders, proud and thankful. Your years in college were a journey of discovery and preparation, a discovery of yourself and the gifts bestowed upon you. You’re now about to commence a new journey, of becoming an adult, of finding your place in society, of starting a future. Today, I’d like to share with you my own journey, as I traveled from being a student, to being a professional manager and an OFW, and now, an entrepreneur and corporate activist.
First part of the journey: A Student
The first part of my journey begins with my family. My lolo (grandfather) started as a public school teacher in Pampanga and Tarlac, rising through the ranks to become superintendent of public schools and, eventually, secretary of education. My dad began his career as a messenger at Philippine National Bank, and retired as president of Traders Royal Bank, one of the larger banks in the ’80s. During my elementary years, I had ten centavos to buy a bottle of Coke, five centavos for crackers, another ten centavos to take the bus home from San Beda in Mendiola, which I made sure I wouldn’t lose, otherwise I would have walked home. In college, my weekly allowance at the Ateneo was P10, and that included my jeepney fares. I have a lot of classmates who have cars and others even have their own drivers. They were lucky. Someday, I said to myself, I will reach all those. My scholarships in both San Beda and Ateneo were only my lucky charms.
In late 1965, as my own graduation was approaching, I had come home from the Ateneo one Saturday afternoon, and spoke with my dad about taking an MBA in the States. I was met with silence, which meant there wasn’t enough money for an education abroad, that if I really wanted it, I had find a way myself. Fortunately, Procter & Gamble was offering a rare scholarship to the University of Pennsylvania’s Wharton School. It was a national competition. I entered-and won. For three generations of my family, life meant coping with challenges despite modest means, relying on God-given talent, hard work and a passionate determination to succeed.
Second part of the journey: A professional manager
Let me now turn to the second part of this journey. After two years in Philadelphia, I returned home, hopeful about landing a managerial position in a large company. I struck out at first bat. My benefactor, Procter & Gamble, turned down my application. So I ended up taking the first job I was offered, as executive assistant to the president at Phinma for P1,000 a month. Without any job experience, we can’t be choosers, right? Grab the first decent job that comes your way, immerse yourself in work, and soon, you’ll find the right job, or it will find you.
After six years with Phinma, I decided to work abroad. There were the usual reasons: the glamor of being an expat in Hong Kong, the stifling staleness of my local career but, more importantly, I needed to find myself, to prove that I can stand on my own and succeed. The warmth of family ties, the comfort of an extended family system so embedded in our society were indeed beguiling, but I wanted to assert my independence.
I was recruited by Bancom International, a Philippine investment bank based in Hong Kong. It was a stimulating experience. I learned the dynamics of international finance from my Chinese colleagues, not from the Filipino executives. Thereafter, I was seconded to a joint venture investment bank with American Express. I had expected to be appointed CEO of that new bank, but wasn’t. While disappointed and even depressed, I soldiered on and, sure enough, this venture failed inside of two years. A huge dilemma confronted a young man of 30 years: return to Manila or stay with AMEX? I decided to remain a soldier of fortune in Hong Kong. Why? Because after this setback, I wanted to prove something to myself. I felt I had to prove to AMEX the Filipino can. Indeed, after four years with AMEX, I received a phone call from my boss in London. He said, “You’ve outgrown Hong Kong and are now ready for London, and to fast track your career.” After reflection, I politely said, no. I’ve proven the point to myself and to AMEX, and that had been enough. Besides, I felt Asia is my home — and so it shall be.
Third part: An entrepreneur and corporate activist
The third, and final part, starts with First Pacific. Whilst working in the region, I met some clients - foremost being Anthoni Salim - who were willing to support my idea of a regional banking and trading business. With their help, I founded First Pacific in Hong Kong in 1981. I started out with only six people, on 50 square meters of office space, and little capital. Now, the companies that constitute First Pacific have sales of $5 billion, with more than 60,000 employees across the region. But I won’t tell you about our successes at First Pacific. Instead, I’ll describe our failures - some of which indeed became total failures, but some of which we turned around and made a success.
Diosdado Banatao
Dado Banatao was born on May 23, 1946 to a rice farmer and housekeeper where he grew up in a little barrio named Malabhac in the farming town of Iguig in Cagayan Valley Province. When he was a kid, Banatao used to walk barefoot to school along the dirt roads. He then went to Ateneo de Tuguegarao and at 15 pursued college education at Mapua Institute of Technology where he graduated cum laude with an Electrical Engineering degree.
Dado was then offered a job after graduation at Meralco but then he turned down the offer after knowing the starting salary. He instead applied as a pilot trainee at Philippine Airlines, which paid much more. Little did he know that a turning point of his career will come when Boeing pirated him as a design engineer and brought him to US.He then enjoyed engineering and later on pursued further studies taking a Masters in Electrical Engineering and Computer Science at Stanford University, which he completed in 1972 to be trained properly on his craft.
After graduating with his Masters degree, Dado then worked at some of the leading-edge technology companies that include National Semiconductor, Intersil, and Commodore International where he designed the first single chip, 16-bit microprocessor-based calculator. In 1981, while he was working at Seeq Technology, the inventor of Ethernet approached the company to look for a more efficient way of linking computers. Banatao was then assigned with the task that led him to his breakthrough discovery of by putting the Ethernet controller on a single chip instead of big boards. That was then the first 10-Mbit Ethernet CMOS with silicon coupler data-link control and transreceiver chip.
With that breakthrough discovery, Dado then decided to start his company and be his own boss. With US$500,000 seed capital that came mostly from friends, he put up Mostron i 1985 to develop chip sets. As a start up company, he had to be cost efficient and resourceful. He then used equipment from another company that wasn’t used on weekends to debug chips. Later his hard work and dedication paid off when his company developed the first system logic chip set for the PC-XT and PC-AT, which lowered the cost of building the personal computer and made it much more powerful.
About the same time, Dado started his second company named Chips and Technologies (C&T), which created enhanced graphics adapter chip sets. With its success, sales during the first quarter amounted to US$12 million. In less than a year, the company went public by listing its shares in the stock market and the market’s response was remarkable. It was one of the fastest Initial Public Offering (IPO) listings in the history of US stock market. In 1996, multinational semiconductor giant Intel bought C&T making Banatao richer by US$430 million.
But even before this huge success, Banatao had already reached millions when he started his third company named S3. It was a company that pioneered the local bus concept for the PC in 1989 and introduced the first Windows accelerator chip in 1990. Way back in 1993, S3 was then considered as the third most profitable technology company in the world when it went public having an IPO worth of US$30 million.
Dado Banatao is now a multimillionaire investor. He invested in a lot of networking companies that were eventually sold before he joined the venture capital firm Mayfield Fund in 1998. After two years, the company offered him to promote to a general partner but Dado refused it and instead decided to start his own venture capital firm named Tallwood Venture Capital with a capital of US$300 million, all of which came from his own pocket. He then believed that independence is more important than security.
Today Dado Banatao manages several businesses. His Cielo Communications is developing the vertical cavity surface emitting laser or Versel, which speeds the transmission of data along optical lines. His SIRF Technology is designing a chip for a global positioning system which utilizes satellites to locate objects. His Marvell Technology had a highly successful public offering with the stock price soaring more than 300% during its first day of trading. He has proven to be a master investor and venture capitalist. He invests, oversees, and sells several companies that include Cyras Systems acquired by Ciena; Newport Communications acquired by Broadcom; Acclaim Communications acquired by Level One; Stream Machines acquired by Cirrus Logic; Marvell Technology Group and New Moo software.
He has more than three homes in the US, including resort properties in Lake Tahoe and Sonoma San Francisco. From his childhood roots of walking barefoot, he now drives his high-performance luxury cars and he flies his own fast jets. Yet despite these blessings, Dado Banatao still contributes to the society and to the country. His Banatao Filipino American Fund assists Northern California high school students of Filipino heritage in pursuing a college education in engineering. Aside from this, he also went back to his childhood town of Iguig in Cagayan Valley where he built a computer center at his grade school making it the only public school with the most modern computer network.
Truly Dado Banatao has come along way being a veteran entrepreneur and venture capitalist of Silicon Valley. May his successful life story continue to inspire us to pursue our dreams, ambitions and aspirations despite adversities in life. Keep the fire burning. As this blog says, Dream… Believe… Act… Achieve.
Peter Valdes
Peter Valdes is one of a handful of highly successful Filipino techno-entrepreneurs, people who engage in a business anchored on new and emerging technologies and products such as software development, the Internet or biotechnology. He is a unique Filipino technopreneur who maintains both business and personal connections with his homeland and his adopted country, the U.S.A.
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A passion for excellence and a winning attitude has powered his drive to succeed. In 1971, he graduated valedictorian of his high school class at Holy Angels College (now University) in Angeles City. He completed the five-year Industrial Engineering course at the University of the Philippines in 4-½ years, graduating also at the top of his class.
After college, rather than land a good-paying cushy job at a top 1,000 corporation, he chose to teach at the university, to his mother’s chagrin. Peter wistfully recalls, “I kept convincing my mother that I took the teaching job to further refine my knowledge of Operations Research, which was my passion at that time. Of course, she would not understand what I meant by Operations Research.”
Industrial engineer Peter Valdes eventually got a good-paying job as Operations Research Analyst at Petron in Makati. He continued teaching O. R., this time, at the De La Salle University College of Engineering. He shares, “Teaching has its own satisfaction, since you are able to share knowledge with younger students. At the same time, it reinforces your understanding of a particular field.”
Two years later, he was offered a graduate teaching scholarship at Syracuse University in New York. He went on to finish his master’s degree in Industrial Engineering and O. R. and an M. S. degree in Computer at Syracuse, and then continued to complete all the requirements for his doctorate degree.
From IBM to Tivoli
After getting his green card, he worked as a software engineer for a start-up company that led to a software-architecting job at IBM in Austin, Texas. During his stint at IBM Austin, he met Bob Fabbio who was his supervisor in the System Management Architecture group and two of his friends, Todd Smith and Steve Marcie. Sometime in 1989, the four of them decided to leave IBM and founded Tivoli Systems.
Peter recalls, “We called the company Tivoli because Tivoli means a fun place. We just wanted to have fun doing what we wanted to do which is innovative software development and hopefully make money along the way.”
They took the risk of establishing a startup with no assured revenues based on a vision that there would be a need for software that would simplify the management of a distributed set of computers interconnected over a local and a wide area network. Peter reasons, “We felt that we have the technical expertise to solve that (massive enterprise system management) problem. We also felt that there was no way we could do it inside IBM given the bureaucracy that we would have to go through. Plus, we figured out that it would be much more fun and rewarding doing it on our own.
To support themselves, the Tivoli partners took a bootstrap approach by taking a couple of software consulting jobs in other companies and did them under Tivoli. These consulting projects enabled the start-up firm to pay its owners a basic salary plus rental and maintenance for a small office in Austin.
Fresh funds
After more than eight months of working on a prototype of the core product, Tivoli attracted the interest of a famous venture capital firm based out of Silicon Valley. The venture firm has funded a number of successful startups including Sun Microsystems and Google.
The infusion of fresh funds enabled Tivoli to expand operations and accelerate product development. In 1994 and after two more rounds of venture capital funding, Tivoli had a successful IPO on the NASDAQ in the U.S.
A year later, IBM, on a buying spree for software companies that would complement its product offerings, grabbed the opportunity and bought the entire Tivoli company for $743 million. Tivoli is considered one of the most successful software startup companies not just in Texas, but in the entire United States and possibly worldwide.
Peter’s Philippine-based company, Vinta Systems. licenses Intellectual Property rights from Vsoft, his U.S. IP holding company. Vinta Systems develops innovative software products for the banking and media industries. These software products embed artificial intelligence algorithms to help optimize risk decisions in a bank and to enhance the effectiveness of media planning in an ad agency.
MOAS, for instance, automates the media planning process and significantly improves the development of media plans. Valdes claims that with MOAS, a media planner can put together an optimal plan under five minutes, which traditionally would have taken hours or even days to complete.
MOAS is powered by artificial intelligence inside named Vinta Intelligent Optimizer (VIO) that makes all the difference. MOAS, which stands for Media Optimization Administrative System, has been instrumental in helping a large ad firm capture one of the biggest accounts in the industry. It helped slay one of the bigger names in the field.
No shortcuts
Vinta itself is in the thick of a major bid to supply credit risk software for Malaysia’s largest government-owned savings bank with more than 300 branches nationwide. The proposed computer application would help bank personnel manage the risks in extending loans and significantly reduce losses arising from bad debts without sacrificing potential revenues.
The company is also in the process of implementing an innovative business intelligence layer for a major bank in the Philippines. For its innovative products, Vinta has started to catch the attention of major business software developers in the Asia Pacific region.
Peter Valdes has been named one of the 10 Most Inspiring Technopreneurs in the Philippines in 2006 for his achievements. He and STI’s Gus Lagman have provided funding for a scholarship program for IT students in U.P. Valdes is also one of the first technopreneurs to support the Brain Gain Network, an online networking tool that connects talented professionals and students interested in helping increase the global competitiveness of the Philippine high-technology industry.
Peter tells this lesson learned well: “Despite the huge success of Tivoli, there were no short-cuts or magic formula that can be learned from books. We encountered difficulties and failures along the way. If we did not have the determination and passion in executing our vision, we could have easily given up even very early in the process. We took the risk, trained ourselves technically, stayed focus on our goal, and never gave up when faced with obstacles. If we didn’t have the support of our families, we could have also failed.”
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