BACK in 1985, a government minister got together with the head of the IDA. They could see the future, and the future was microelectronics.

The problem was that Ireland was not attracting enough of these companies; they feared our workforce would be left behind.

So Mr John Bruton, Minister for Industry and Commerce, and Mr Padraic White, the chief executive of the IDA, decided to travel to Eindhoven in The Netherlands, home of Philips, one of the world's electronics giants and they made the pitch themselves.

The Dutch executives who listened to Mr Bruton and Mr White were impressed, but at that time Philips was cutting back on investment. There were only vague commitments.

But the Irish team had a secret weapon, an unassuming academic from Trinity College, Dublin - Prof Maurice Whelan, head of the university's microelectronics department.

Prof Whelan knew the Dutch and he knew Philips. He had worked for the company's research and development department in Eindhoven for 18 years before being headhunted by Trinity.

For years, he had kept in touch with Mr Kees Bulthuis, a senior manager in Philips who had liked the Bruton-White pitch.

"I asked Kees what happens next, and he said "Not much, but if an opportunity comes up we'll consider it. I said "Why don't I go and see what would make sense in Ireland," Prof Whelan recalls.

He came home and started planning a business that would custom-design silicon chips and the software to maximise their use. He knew his own graduates were up to the job and that the IDA was willing to support the project.

"Eventually I was wheeled in before all the other directors of Philips, and they said okay, go ahead and do it. Even then it was quite a struggle, because Philips were not jumping around the place - it took me about a year and a half."

Prof Whelan left Trinity, and moved to a tiny office in East Wall, Dublin. His new company, an independent subsidiary of Phillips called Silicon & Software Systems (S3), had two employees.

"Several people in Philips had promised us work, but Kees Bulthuis was one of the few that honoured his promise," says Prof Whelan. "We advertised for people, then we sent our first four engineers to Eindhoven."

In the meantime, be searched for new premises and kept looking for more electronics engineers. By the end of October 1987, 53 had 25 employees and new offices in the Sandyford industrial estate.

The professor had found a lucrative niche, and his young company kept growing. Many large companies need silicon chips and dedicated software designed for them. Some could do this work in-house, but would be left with a team of idle engineers once the work was finished. S3 fills the gap in the market, and charges between £80,000 and £500,000 each time.

By 1991 it had to double the size of its facility in Sandyford; S3 then had 120 workers. In 1994, Prof Whelan split the company into two.

"We have a model for the company; we don't allow any unit to grow any bigger than about 150 people. You can motivate people more easily in smaller units, and by creating a new unit you create opportunities for people to be promoted across," he says.

The second unit targets the US, with a sales force in San Jose, California, and a team of people working out of rented space in Philips in Clonskeagh.

Next year, Prof Whelan will move 53 into a newly-built office in Leopardstown, Co Dublin. From now until 1999 it plans to hire another 110 engineers.

He believes the future looks bright: "The industry is growing like hell; I thinks it's very dynamic, really going digital, the multimedia, the cordless communications, the digital television, the Internet - these are the things that will fuel demand for us."

The biggest possible drag on future progress, he says, is finding qualified people, who are willing to work for Irish rates of take-home pay: "It's getting harder. And there are also more companies setting up in Ireland so it is becoming a problem. People are being headhunted, particularly people with experience.

Apart from this, he says, he has just one worry: "How do you motivate people? How do you make them enthusiastic? How do you deal with their expectations? That's the biggest challenge."