Guess who this guy is? Hint: the photo was taken 24 years ago. Answer after the jump.
I’m not one to butter up multimillionaires, but this story about the history of Sun and cofounder Vinod Khosla is notable for breaking stereotype. Rather than being the technical brains behind the startup, Khosla was the hard-charging dealmaker cajoling his future cofounders to join the company.
Khosla said the McDonald’s meal took place just after he and McNealy met with venture capitalists and got Sun’s first funding commitment. “We went out and sat in the parking lot. Scott said to me, ‘I don’t know if I really want to do it.’ So I took him to an upscale dinner at McDonald’s on Page Mill Road” in Palo Alto, Calif., he said, where he put the screws on McNealy to resign from his $40,000-a-year job at Onyx Systems.
“Vinod asked me, ‘When are you quitting?'” McNealy recounted. When McNealy balked, Khosla countered, saying: “‘You can’t back out on me now. You’re a founder.’ “I said, ‘Oh, OK.’ It was that quick,” McNealy said…
Khosla had to convince Bechtolsheim that he was more interested in the computer engineer than the software he was licensing from him. However, Bechtolsheim was reluctant because his licensing business brought in $500,000 a year and Bechtolsheim had a year to go before finishing his doctorate, Khosla and Bechtolsheim said.
Convincing Joy wasn’t easy either. McNealy said he and others piled into a rattletrap of a car to visit the Unix wizard across the San Francisco Bay in Berkeley, Calif., but they got the cold shoulder. Later, he asked Joy, “Why didn’t you talk to us?” and was told, “I was waiting for top management to show up,” McNealy said. [Link]
<
p>The respected technologist in this case wasn’t the desi guy:
Customer: “Is Bill (Joy) onboard?”
McNealy: “Yeah.”
Customer: “I want two of whatever you got. What are you selling?” [Link]
<
p>Khosla was legendary for his sales aggressiveness in the early days of Sun:
Sun bid with its new Sun-2 workstations, which were lauded by Computervision’s engineers, but Apollo landed the contract. Khosla got the bad news in a phone call from a Computervision purchasing agent. In a move that has achieved legendary status among Sun old-timers, Khosla and McNealy grabbed a red-eye flight from San Francisco to Boston and showed up uninvited at Computervision…The two young Sun cofounders “planted themselves in the plush lobby of Computervision’s headquarters. From there they called everyone they knew inside Computervision, asking for another chance, demanding an opportunity to revise their bid.” It was a classic example of the win-at-all-costs West Coast approach versus the more polished, mannerly East Coast mentality. Apollo and Computervision figured they had a deal; Computervision staff members tried to shoo Khosla and McNealy out of the lobby. Nothing doing. Finally, a Computervision vice president cut a deal with Khosla and McNealy: Get out of the lobby and Computervision President James Barret will call you at the local sales office.
According to Sunburst: “When the call came, Khosla knew it was his last opportunity to sell Sun. So he sold hard. Winning Computervision . . . would prove to industry watchers that Sun was real . . .” Sun virtually gave the machines away at cost…
“I remember being in Apollo meetings where people would laugh at Sun and say, ‘It’s a bunch of kids at Stanford,’ ” he recalls. After Computervision, “they changed their tune.” He adds, “Basically, Sun sold its soul to get the deal. But we didn’t laugh at Sun anymore…” Apollo’s traditional management team was unprepared for Sun’s aggressive, unruly approach, and didn’t know how to react when Sun snatched the deal away. Apollo’s executives could only fume that their rival hadn’t played fair. [Link]
whoohoo, go stanford 😉
and here i thought you were a hater, manish. jk. khosla went on to be a prolific venture capitalist too…. his life would make for a pretty cool biography
Thanks to desi pioneers like Khosla, retarded runts like myself could come(legally) into the US and settle down. No amount of thanks will repay that debt.
M. Nam
That is true.
I thought it was Borat.
There was an odd story about VK some years ago:
Yes, I agree there is no need to butter up mulltimillionaires….
Same here.
Well, Joy is from Cal, as is the Google CEO 😉
too bad schmidt’s been owned by ballmer before and it could happen again 😛 to argue google’s a cal thing is pretty off… a good 30-40% of the people there are stanford alums, including larry and sergey, the guys who built the company. too much about google tho… co sand hill road ugh
sorry man, the valley’s mostly run by the cardinal 😉
Actually, the small minority of pedigreed and venture-funded startups written about in Red Herring are done by pedigreed and venture-funded people. And venture-funded (vs. angel-funded and bootstrapped) are < 10% of the total. So you’re going to get a very skewed view of things if you go by tech media, which is like reading People magazine.
A few of the Cal alumni in tech:
Andrew Grove and Gordon Moore, Intel cofounders Steve Wozniak, Apple cofounder Floyd Kvamme, National Semiconductor cofounder Ken Thompson, Unix cofounder Van Jacobson, networking pioneer Douglas Engelbart, mouse inventor BSD Unix
venture funding and angel funding are part of a lifecycle. nearly all projects start out with angel sources or are self-funded and most require venture funding at later stages. is it incestuous? sure, but no more incestuous than referring friends for jobs at companies. i haven’t heard/read of a single startup that’s “made it” solely based on angel funding. it’s typically not even in the business plan for startups to establish their market and turn a profit until they’ve secured some venture funding. the idea is to generally create as much value as possible until reaching that stage so you don’t have to sell any significant equity stake to a vc. google worked it this way for example. some of their angel sources were professors at stanford, but they knew, even with a product like google’s, that they needed vc money to make it big time.
i could list some stanford alumni in tech and we could turn this into a pissing contest but it’s not worth it. cal’s definitely had some notable luminaries in tech and there’s a decent amount of cross-pollination between the two schools. but it’s a pretty safe statement that stanford’s responsible for more companies and more wealth generation in tech than any other university in the world. compare silicon valley to the tech loop, rtp, etc and then take a look at where silicon valley IS and it’s even clearer imo.
Utterly wrong. The strongest biz models are revenue-, customer- and partner-funded. For example, Microsoft took angel funding from Bill’s dad and was pretty immediately revenue-funded. I’d say they’ve ‘made it,’ wouldn’t you?
It’s typically not in the biz plan for the companies you read about in venture pubs. Big difference.
Google had to take VC because they didn’t have a biz model for a couple of years until they figured out they could pinch Overture’s. Risky approach.
Read this, this, this and this.
* Microsoft did take a small amount of VC as a personal favor shortly before IPO, 10 years after founding, and did nothing with it except give August Capital a guaranteed payoff
** Fixed HTML in the previous comment
i skimmed all the articles, and their points are interesting. i’m not a huge fan of vc’s either. regardless, they are a necessary evil in the startup world. i don’t actually read many startup/vc pubs and when i do, sparingly. most of what i know is from personal experience with small-time entrepreneurs i know. you’re right, a strong biz plan is based on generating revenues in addition to getting $ from partners and customers. getting to a point where revenues can sustain the company, however, typically requires vc $ earlier in the lifecycle (if it’s a hw startup, vc funds are absolutely necessary). sometimes partner/customer funding is a proxy for vc funding, but i look at this as effectively vc funding. for example, motorola has partnered with nearly every subsidiary they have acquired and made investments through Motorola Ventures. the use of vc’s or partners who are effectively vc’s is pretty standard and i’m surprised you find this point so contentious.
btw, google took money to build up an infrastructure, as one of your links points out. but who knows, maybe they were doing that to buy time while they figured out a business model 🙂 sadly it looks like google is to overture as ms is to apple.
I’m not talking partners investing through official VC arms, but rather partners advancing money for development.
It’s only standard for certain types of startups: high-gloss or high expense. People’s view of venture finance is like the world’s view of America filtered through Hollywood. Only a small number of startups take venture funding– less than 10% is the figure I’ve heard.
I want to contact Me Vinod Khosala Regarding Ethanol Plant set up in India Please kindly me contact information if you can at sai_infosun@yahoo.co.in