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Online Original: Dan Avida


Special Report -- Silicon Valley -- The Next Generation

ONLINE ORIGINAL: DAN AVIDA

Silicon Valley got into Dan Avida's blood early. Born in Israel, he was fascinated by technology by the age of eight, when his professor-father traveled to Stanford University for a two-year sabbatical. By the time it was over, Avida had spent glorious hours playing around Stanford's world-class computer labs, tinkered with punch-card computers in his third-grade class, and read books on inventors such as Edison while his pals read up on sports heroes. And when his father, a physicist, returned for another sabbatical a decade later, a 17-year-old Avida took to building his own electronic gizmos using components purchased at local computer stores. "I never had this phase of scratching my head about what I wanted to do. I always knew I wanted to build stuff," he says.

It was no surprise, then, when Avida left his native country for high tech's mecca the day after finishing his mandatory military service in 1989. Why so quickly? Because noted Israeli entrepreneur Efi Arazi, who had founded graphics pioneer Scitex Corp. two decades earlier, had asked him to help start a new company. "In Israel, you can't not know Efi," says Avida, 34, who after graduating summa cum laude from Technion-Israel Institute of Technology went on to work on some of Israel's most classified surveillance technology. "Efi's like Steve Jobs is in Silicon Valley."

If the new company, EFI, for Electronics For Imaging, was a play on its founder's name, Avida is the main reason it's one of Silicon Valley's hottest -- albeit least well-known -- high-fliers. The company, which makes hardware and software that lets graphic artists use their color copiers as high-speed printers, grew from $190 million in revenues in 1995 to $298 million in 1996, and is on pace to hit $400 million this year. And because Avida has figured a way to outsource every bit of manufacturing, it's hugely profitable, with each of its 450 employees contributing more than $200,000 to profits each year. Where most PC companies are now happy with 25% gross margins, EFI's were 55% in its most recent quarter.

Apart from his academic brilliance, Avida also brings a tireless work ethic and break-the-rules approach to management. He still checks out the performance review of every employee; that takes him six full days each year. And he has put in an innovative compensation plan designed to keep top-notch people. The secret: Rather than throw huge option grants at new arrivals, as many high tech companies do, EFI doles out more options with each passing year. So far it's working; EFI's turnover, at 5% per year, is well under the industry average of 15%.

While most Silicon Valley companies are forced to pay exorbitant rents to find office space as they grow, Avida decided a year ago to buy enough land for EFI's future needs. After reading up on the local real estate scene, he soon outbid seven real estate companies for a 35-acre plot along San Francisco Bay that was being auctioned off by the town of Foster City. The land, still under development, has already doubled in value, he claims.

If Avida has plans beyond EFI, he's not saying. For now, he's focused on building his family with his wife Daphne Koller, a Stanford computer science professor who earned her masters degree at age 18, on his beloved sailing, and on keeping EFI on the growth path. "I work harder than I did four years ago, and I thought it was impossible then. But growing 50% a year when you're tiny isn't that hard. To grow [fast] at our size is getting pretty tricky." Tricky for lots of execs. Maybe less so for Avida.By Peter Burrows in San Mateo


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