That Time I *Almost* Negotiated a Deal to Sponsor the Ferrari F1 Team

November 8, 2021

As you’ve probably noticed, I’m a huge racing fan. Huge. I hate to admit the number of hours I’ve spent in front of the TV watching cars go round and round, but if you made one of those pie charts that shows how I’ve spent my life, there’d be sleep, work, eating, and “watching car racing” would certainly represent a chunky slice.

For me Formula One is the top level of racing. At the tippy, tippy top is Ferrari. Undoubtedly the biggest, most popular, and most revered team in motorsports -- and likely in all of sports. The Ferrari brand is a powerhouse and the F1 team is the crown jewel. 

My story begins at the end of the 90s. I’m working at a hot semiconductor startup called Pixelworks. To illustrate what we did, I’ll make a guess that you are reading this on a flat-screen display like a computer monitor, laptop or smartphone. While those 2D miracles are ubiquitous today, flat screens barely even existed and were a burgeoning new tech advancement. Pixelworks’ electronics were partly responsible for making that world a reality.

Pixelworks chips powered HDTVs.

It was a very cool place to work, and we had great success, including an IPO in May 2000. The founder and CEO Allen Alley was a car nut like me, and it was common that we would debrief F1 races on Monday mornings over coffee. 

At that time, Formula One was getting much more data driven. So much so that the teams started to put bulky data monitors on an articulated arm to haul big CRT screens in front of the drivers. They could look at timing and data while sitting in the cockpit in the garage. 

These things were huge, but we knew they could be much smaller, sleeker, and more modern. While PIxelworks didn’t make the flat-screen TVs themselves, we worked with every consumer electronics manufacturer in the world and our chips were in a fair number of them.

In one of our “debriefs,” we commented on these big ass TVs and how they should be flat screens. An idea was born: what if we made it happen? Even better, what if we made it happen with Ferrari? Pixelworks could design the monitors and provide them in exchange for having “Powered by Pixelworks” on the back side -- you know, the one that was on worldwide TV every single race weekend!

So I decided to see if it was possible and, to his credit, Allen let me run with it. While it would have been hella cool, it actually made sound business sense. Our little brand would be associated with the best of the best. Remember, that was a time when Schumacher was winning world championships with seeming ease.

Our main customers were huge consumer electronics manufacturers based in Asia and Europe, and this association could help us break through the noise. Plus, how better to build a lasting bond with a customer than to invite them to a Formula One Grand Prix, especially when you have the clout to take them “back stage” into the hospitality areas hosted by the teams? That would close a LOT of deals. 

It was a “skunkworks” effort. Think it’s hard to make contact with Ferrari? Guess again! I did a little research, found the contact information and sent a succinct but well-crafted pitch by email to a generic email address. Quite unexpectedly, a day or two later, I actually got a response. Ferrari was interested. This went from “wild ass fantasy” to “kinda possible” in no time flat.

I set up a call with Tommaso Gelmini, who worked at Ferrari to develop sponsor relationships. (Incidentally, Tommaso left Maranello some time ago and now runs GPS Classic, a wonderful vintage car restoration company outside of Parma, Italy). I had no idea what I was doing, but Tommaso was helpful.

We discussed what it would take, both technically and monetarily. I said we could help design and provide the screens to their specifications, so technically it was quite easy for us given our expertise. On the money side, we could become a Ferrari Technical Partner and get our company logo prominently screen printed on them for about $200,000 a year for three years. I gotta admit, I was genuinely shocked. That seemed remarkably reasonable! 

The next chance I got, I grabbed Allen and gave him the run-down. He had some questions and we weighed the pros and cons. While it had merit, it was not a small commitment for us, and would have actually compelled a much higher travel budget to take advantage of the sponsor opportunity. Fantasies are fun, but this had to stand in the stark light of board and shareholder consideration.

After a few days, it was decided that now was not the right time to take this on, so after just a week or two, we shut down all efforts and moved on. Even with 20/20 hindsight, it was absolutely the right decision. I can tell you this: it was fun while it lasted, and I still have daydreams about what could have been!

A message to Allen: Thanks again for playing along, it was a rewarding fantasy that makes for pretty entertaining story after all these years!

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