Cadence and Dassault Systèmes Expand Relationship. But Will They Ever Commit?

Dassault Systèmes makes a role for Cadence but both companies continue to play the field.

Dassault Systèmes announced this week that they have expanded their partnership with the EDA (electrical design automation) software vendor Cadence Design Systems and will be selling Cadence’s Allegro software along with their own. The Allegro PCB design software will be part of the Collaborative Designer for Cadence Allegro “role”—as Dassault Systèmes chooses to call its application bundles.

Cadence Allegro PCB application saves to the Dassault Systèmes 3DEXPERIENCE platform. (Picture courtesy of Dassault Systèmes)

Cadence Allegro PCB application saves to the Dassault Systèmes 3DEXPERIENCE platform. (Picture courtesy of Dassault Systèmes)

The joint company press release announces an expansion of a relationship and a “multi-year collaboration.” Back in 2011 there was an announcement of a partnership between the two companies when Dassault Systèmes’ ENOVIA was incorporated into Cadence’s semiconductor design software. Like a Russian doll, the 2011 announcement also mentions a “longstanding relationship,” though we found no earlier announcements. Could the previous relationship have consisted of  the companies selling to the same customers, Dassault Systèmes selling mechanical design and PLM software and Cadence selling EDA, and helping to translate between them?

At the risk of sounding like old-fashioned anxious parents of kids that have been dating forever and just will not tie the knot, let us review the sequence in a typical corporate courtship.

  1. The dance. The couple have mutual attraction.
  2. Dating. They are seen together but have may still be seeing others.
  3. Engagement. It got serious. There is an announcement.
  4. Marriage. An acquisition or merger.

What stage in the courtship in when a company selling another’s product? Seriously, is this relationship going anywhere?

Being in a relationship doesn’t mean we can’t date. Cadence continues

Being in a relationship doesn’t mean we can’t date. Cadence continues “collaboration” with all MCAD applications with its IDX. (Picture courtesy of Cadence)

As other CAD companies have been, Dassault Systèmes appears to be the more active suitor in this relationship — and has more to gain. Cadence, on the other hand, seems more casual about the whole affair. There is nothing to indicate that Cadence is interested in monogamy. The announcement contains no hint of an exclusive relationship for either company. Dassault Systèmes continues to offer a Collaborative Designer for Altium role (Altium Designer is a PCB modeling application, a competitor to Cadence’s Allegro) and Cadence continues “collaboration” with various MCAD applications with its IDX importer.

Let’s Get On With It

What is taking so long for Dassault Systèmes and Cadence to commit? Two generations of engineers have graduated into a world with inter-disciplinary products, combinations of mechanical and electrical design. The last generation was told products also had to be smart and connected, adding software to the mix.

But EDA companies have kept to their disciplines. But on occasion, they are noticed and chased by CAD companies.

Siemens, maker of MCAD applications NX and Solid Edge, chased and caught EDA vendor Mentor Graphics. Sold for $4.5 billion in 2016, it was the biggest deal ever in the CAD or EDA space. There had been forays into the EDA space before by CAD companies but here were two leaders in their respective spaces getting together.

Minor deals preceded the Mentor Graphics acquisition. SOLIDWORKS, a division of Dassault Systèmes, had assimilated elecworks from Trace Software in 2019, a deal so small that it required no financial detail. Autodesk picked up the also-ran EDA application, EAGLE, in 2016 for an undisclosed amount which ended up a nameless extension to their do-everything Fusion 360 design platform. Autodesk tried but failed to land the big fish, however, when their 2021 $3.7 billion bid to buy Altium was spurned.

PTC is the only member of the Big Four CAD vendors that has not made a serious attempt to hook up with a major EDA player. PTC’s ambitions for electrical and electronic design may have stopped after its acquisition of OHIO Design in 2004—a company we never heard of for a price never disclosed.  PTC is the last to have enterprise-level EDA in its product portfolio—odd for the company with the most diverse collection of design technologies. How PTC can ignore electrical and electronic design in the day of smart, connected products is puzzling. 

About Cadence Design Systems

Cadence is one of the last few gems in EDA not in an engagement ring. Founded in 1988, Cadence grew to be a EDA leader in market share and mindshare. The company’s annual revenues have been rising for the last 5 years. It had a 15% growth in revenue in FY2020 to $2.7 billion. 

Dassault Systèmes is the bigger earner in this relationship, posting a $5.7 billion in revenue, up 13%, for FY2021. Cadence was named as one of the 100 best places to work by Fortune in 2021, the 7th year in a row. Dassault Systèmes has also made this list.