Micrel Semiconductor did not blossom overnight. Since the San Jose semiconductor company was founded in 1978 as an independent test facility for integrated circuits, reaching success has been a slow steady climb.

'We grew the company a little slower' than the competition, says Ray Zinn, Micrel's CEO. 'It took us 15 years to get where they got in seven.' Determined not to go the venture-capital route, Zinn and co-founder Warren Muller started the company on their own terms, paying particular attention to their employees and staying within their financial constraints. By producing high-quality products, expanding their product offerings in high-growth markets, and investing in their employees, Micrel has managed to stay on top in a high-risk, competitive industry.

Micrel makes more than 1200 varieties of high-performance standard integrated circuits. These analog, digital, and mixed-signal circuits, which made up 77 percent of the company's sales this past year, perform power-management operations in automotive, communications, computer, and industrial applications. The business also includes custom ICs for the communications, consumer, and military markets, as well as wafer foundry services.

Recently, Micrel has probed into new markets. The company's acquisition of Synergy Semiconductor in November 1998 spurred an expansion beyond the power-management area. Synerg gave Micrel the opportunity to penetrate the high-bandwidth telecommunications and data-communications areas.

With the acquisition, Micrel added more than 200 products to its lineup. Furthermore, Micrel gained knowledge in high-speed, mixed-signal, and digital ICs. This intelligence has equipped Micrel to meet the increasing need for power analog circuits, which is arising from the growing demand for battery-powered cellular phones and computing devices.

'We think Micrel will bridge the best of both worlds,' Zinn says, speaking of the analog and communications markets. Micrel's diversification strategy allows the company to capitalize on growth markets by focusing on standard products for these areas, without abandoning its power-management roots.

Micrel cites LDO (low dropout) regulators, ECL (emitter-coupled logic) products, high-speed communication devices, and PC-Card and USB devices as areas where it has a competitive advantage.

Micrel prides itself in its quest to provide its customers with high quality, reliable products. 'In today's market, customers are demanding a higher- and higher-quality product,' Zinn says.

As innovative as Micrel's product offerings is the company's culture. 'We focus on taking care of the employee,' Zinn says. 'We have a strong culture, are team oriented, and make an atmosphere of family.' Zinn himself ends weekly two-hour meetings with a motivational talk. Employees have a major stake in the success of this company--they own more than half of the company's stock.

Micrel's strategy seems to be right on target. The company reported its 16th consecutive quarter of sales growth and earnings (before charges) in Q1 2000. Sales for the 1999 calendar year also set records, with net revenues up 39 percent to $195.1 million. For the increase, Micrel credits strong demand for high-bandwidth products aimed at the fiber-optic communications market, along with the demand for standard analog products in the telecom, computer, and industrial markets.

The outlook seems equally bright. The company predicts $1 billion in sales by the end of 2003. The challenge, Zinn anticipates, will be achieving this level of growth within the next few years without becoming a beauracratic organization.

The future growth and endurance of Micrel, as always, will be a combined effort. As Zinn puts it, 'Our theme for 2000 is 'We're All In It Together.''