AVANTEK

Various posts celebrate and document early silicon valley history. These deal with transistors, diodes, and the beginning of analog and digital IC development, in germanium and silicon.

Not discussed so much is the development of RF and microwave components which deal with frequencies that are above those of the silicon valley devices during their early development.

Early on, tubes were used to amplify and generate microwave signals. Later, with the advent of semiconductors, transistors were developed which operated at high RF and microwave frequencies. Materials other than germanium and silicon were used, in particular III-V compounds such as GaAs, InP, and GaN, then SiGe (not a III-V compound).

Companies that built products based on solid state microwave devices included Varian, Plessey, Hewlett Packard, Watkins Johnson, Texas Instruments, Hughes Aircraft, Dexcel, and Avantek.

Avantek was a small, then medium, sized company with a fast growth rate.? The name was derived from the phrase Avant-garde Technology similar to Intel (Integrated Electronics).

The founders were?

James Sterrett, Franz McVay, Leonard Seader, and Lawrence Thielen, who came out of ATI (Applied Technology Inc.).?

?The company focus was on technical excellence combined with a return-on-investment focus through promotion and selection of promising products and efficient, controlled production processes. Through the years, in the 1970’s and 1980’s,? many of the better engineers in other companies slowly disappeared into Avantek. One of particular note was Ference Marki, a section head at Watkins-Johnson, and mixer expert. He started a mixer line at Avantek, then years later founded Marki Microwave, which produced mixers and baluns. Marki Microwave is now run by Marki’s son, who has expanded the product line and developed methods to print the mixer circuits on IC’s to reduce labor content.

Early on Avantek developed their own bipolar transistors to support the RF/microwave component product lines. Later, GaAs MESFET’s were developed and produced, then MMIC’s.? The progress, problems, and problem solutions of the FET’s were published in the industry literature in the 1970’s.? Divisions were established for digital radio products, and for commercial satellite TV reception, TVRO (TV Receive Only).

The success resulted in the mention of Avantek in a Barron’s article that featured companies that were defining their market by developing new, advanced products that effectively changed the market demand (similar to Apple’s new products that established new consumer paradigm).

?

MICROWAVE JOURNAL EXCERPT:

“Avantek

In the mid-'60s, Applied Technology INC (ATI), out of Palo Alto, had been working on countermeasures. ATI generally worked on secret "black" programs and built specialized equipment in small lots. James Sterrett, a Senior Engineer at ATI, had developed a proprietary wideband UHF transistor amplifier line. ATI's Director of Marketing, 38 year-old Larry Thielen, quickly noticed that the devices were easy to sell to a wide customer base, simple to manufacture and had a large profit margin. Thielen had wanted to start his own company ever since he was Western Sales Manager at Ampex in Redwood City and now he saw his opportunity. Thielen, along with Sterrett, McVay and Seader (both ATI Engineering supervisors), announced they were leaving to form a startup called Avantek.

The company launched in 1965 with a line of solid-state RF components, quickly expanded into the microwave range, started in-house manufacture of Si transistors and GaAs FETs, and in 1972 introduced a 2 GHz digital radio product line using these devices until 1988 when this product line was sold to Telesciences (later sold to California Microwave in 1993). The company started with five people, used office furniture, their own money and no known orders. After 19 profitable years, they had 2500 people, total capitalization of approximately 380 million (19 million shares x $20/share) and have produced over 25 millionaires. They shipped $160 M in products in 1984 and finished 1984 with a backlog of $100 M. By 1991, Avantek's RF devices division was acquired by Hewlett-Packard, which became part of Agilent. As of December 2005, the Avantek division of HP that spun off to Agilent Technologies was sold and morphed into Avago.”

From Microwave Journal, April 1, 2010

Note:? Avago became very successful, and eventually combined with Broadcom, resulting in Broadcom’s stock symbol to be AVGO.

Avantek product guide, 1988:

https://www.artisantg.com/info/Avantek_AM_4060M_Manual_201622493619.pdf?srsltid=AfmBOopWGM6mQ-89j779CVJopD6KLcnpdxcCyVHxNZxKMDPoD8YBpvOo

https://archive.computerhistory.org/resources/access/text/2013/04/102723408-05-01-acc.pdf

Financial Performance:

Avantek had exceptional growth from inception to about 1980.? The numbers are shown below.? Characteristics of Avantek compare well to those that are good for strong, growing modern companies.? Return on equity was good, and debt was low. Not surprisingly, the stock did well after it went public in the fall of 1978, until 1983.