IN THE EARLY EIGHTIES, when the rest of the world was just waking up to the thought of owning PCs, Ajay Chopra went off to Switzerland to work with a Zurich-based watchmaker to design a computer mouse. Today, he is the co-founder and chairman of the board at Pinnacle Systems, a Silicon Valley company that is the premier supplier of tools for the creation of audio-visual content. Convinced that the user will live by the principle of I create, I store, I stream, Pinnacle Systems provides tools geared toward seamlessly integrating audio-visual content, straddling the consumer sector and the corporate media broadcasting sector. Evidently, markets love it; Pinnacle Systems now occupies 53 percent of the market for content-creation tools. It creates digital video-editing products that target professional videographers and camcorder-toting dads capturing their baby’s first steps on tape. Emmys grace Pinnacle’s lobby, lending evidence of the products’ strengths.

“I guess my claim to fame in the Valley would be from the games I developed for Atari, way back in the eighties. That was when computer graphics was a nascent invention,” reminisces Chopra. A few years later, he left Atari to join Mindset, a start-up headed by his previous boss at Atari. “We were trying to develop a graphics computer, just as Compaq was tooling around with a portable computer. The idea was to take the platform of Atari’s graphics and integrate it into regular computers,” recalls Chopra. They realized that they were too far ahead of their time since they lacked applications. “CAD was unknown, as it was just coming in. There were dedicated CAD stations, but AutoCAD was still a couple of generations away. Graphics-creation packages were rudimentary, and video was still analog. This was before the Mac, and our products were ahead of their time. We went around trying to get application companies to write to our products, and that was simply starving us,” says Chopra.

As Mindset was struggling, Chopra was asked to put together a strategy for a particular segment: video production. The graphic capabilities of the computer had elicited interest in the video community, and Chopra directed Mindset to add some features, one of them called GenLock, to the computer. GenLock allowed external video signals to be locked to the computer, synchronizing the input and eliminating jittering. Pretty soon, the video business grew to around $6 million, yet it was still too early. Investors were losing interest, and eventually, Mindset sold the video part of the business to JVC.

Chopra finally left Mindset, and started out on his own. “A few of us met in my living room, trying to figure out what to do next, and eventually put together the plan for Pinnacle. In 1986, we raised some seed money and started off,” recalls Chopra. With a quarter-million dollars in capital, Chopra and his team remained frugal, and worked out of a 3,000 sq.ft office space in Santa Clara. In October of 1986, Pinnacle launched its first product, took it to a trade show and landed their first million-dollar order. The PC-based video manipulation system was well-received by the television market. What it did was to take video input signals and manipulate the images: shrink them, rotate them, move them, and so on. These “rudimentary” special effects were simple products, with simple interfaces, and were sold for about $25,000. Broadcasting companies were fighting to order the products, and Chopra landed a million dollars’ worth of business, and no support to meet those orders.

Pinnacle hit the roads for some serious capital, and managed to raise about $2 million. As Pinnacle’s products began to win awards, Chopra found it easier to raise further rounds. Pinnacle turned profitable in a very short time, and built up a stable market space for itself. In 1994, Chopra took Pinnacle public with a well-received IPO. “In those days, it took a company about seven years before it could go public—a time-frame that shrunk to about 2 years in the 2000-era. And now, this time frame is being rolled back...people need to be more mature in their expectations,” says Chopra.