The New Imperialists 0735203172, 2002051047, 9780735203174

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IMPERIALISTS HOW FIVE RESTLESS KIDS GREW UP IRTUALLY RULE Y WORLD n

MARK LEIBOVICH National Technology Reporter for The Washington Post 1

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NEW

The

IMPERIALISTS

M

A H K

I.

K

fall

1

BO

Press

V

I

(

Library of Congress Cataloging-in-Publication Data Leibovich, Mark.

The new

imperialists

/

Mark

Leibovich.

cm.

p.

Includes index.

ISBN 0-7352-0317-2

—

—

Businessmen United States. 2. Executives United States. 3. Computer United States Management Case studies. 4. Computer softw^are industry United States Case studies. 5. Ellison, Larry. Bezos, Jeffrey. Chambers, John, 1949- 8. Gates, Bill, 1955- 9. Case, Stephen McConnell. Title. 1.

industry

— —

— —

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07652. Please

will be used, date needed.

In

my

memory

of

two dear

friends:

grandfather, Samuel C. Brownstein.

and

my

brother, Phil Leibovich.

For Nell

Digitized by the Internet Archive in

2011

http://www.archive.org/details/newimperialistsOOmark

CONTENTS

Acknowledgments

Preface

vii

xi

Introduction

1

CHAPTER ONE

LARRY ELLISON:

Really True?

Is It

11

CHAPTER TWO

JEFF BEZOS: Everyman, Every Man

for

Himself

55

CHAPTER THREE

JOHN CHAMBERS:

Cisco's

Dream

Seller

105

CHAPTER FOUR

BILL GATES: The Alpha Nerd and His

Alter Egos

CHAPTER FIVE

STEVE CASE: The Upgrade

Epilogue

Index

229

235

183

139

—

ACKNOWLEDGMENTS

L

ike

being a

rests heavily

CEO,

book

writing a

with the people

who

is

a lonely job

whose

surround the venture (and

about where the comparisons end). This project was

many

fate

that's

things

a pleasure, a challenge, a dream, an ordeal and, ultimately, a collaboration.

am ever-grateful to the

I

quilt of anecdotes,

who provided such a rich for me to work with. Any

hundreds

memories and

insights

errors of fact or interpretation are entirely

My •

my

own.

special thanks:

—for

To The Washington Post benefit of

working

Downie and projects that

To my

and osmosis

Don Graham, Bo

there; to

Jones, Len

Steve Coll for supporting the kinds of ambitious

would become pals

Larry Roberts, Peter

Mike

book.

this

and mentors

present and past: especially (in

Justin Gillis,

the daily kick

in the Post's financial section,

random

order) Nell Henderson,

Goodman, Tracy Grant, Jonathan Krim,

Mills, Rajiv Chandrasekeran,

Pete Behr, Jerry Knight,

John Burgess,

Shannon Henry, John Schwartz,

Leslie

Walker, Alec Klein, Fred Barbash, David Streitfeld, Glenn Kessler,

and David

research saved

Ignatius.

To Richard Drezen, whose dogged

me immeasurable

time; to

Mickey Trimarchi,

Mike

Stuntz and everyone on the financial copy desk

saved

me

Fekkak huge

great embarassment; to

in the

hassles;

Washington Post

and to

Eric

ment who saved me from

fates

I

Henry Wytko and Joyce

travel office

Lieberman

who

who

saved

me

in the Post's legal depart-

don't like to think about.

— viii

ACKNOWLEDGMENTS To Joe

Elbert,

Linda Salazar, Giuliana Nakashima,

Michael Williamson and the Post photo department. To

Glenn

Frankel

and

the

ever-hospitable

staff

of

the

Washington Post Magazine ("the Bunker"), and to the assorted lunch buddies, mentors, and resident masters

make Segal,

who

such a creative place to w^ander: Paul Farhi, David

this

Frank Ahrens,

Bill

Hamilton, Steve Fainaru, Kevin

Merida, Anne Hull, Nicole Arthur, Hanna Rosin, Joel

Mary Hadar, Tom Wilkinson, David and David Maraniss, among others.

Garreau, Perl, •

To

the subjects of this

were

all

book who,

more than generous with

culate the

Finkel, Peter

after initial reservations,

their time.

I

shudder to

cal-

CEO man-hours that have been lost to this project

and could

this explain the

technology downturn?

Bill

Gates,

Larry Ellison, Jeff Bezos, Steve Case, and John Chambers sat for, in

most

cases, multiple interviews,

and follow-up

made

e-mails.

They opened

their families available, and,

phone conversations,

their

companies to me,

perhaps their biggest sac-

rifice,

furnished embarrassing childhood photos of them-

selves.

The

profiles in this

book

much, much

are

richer for

their participation. •

To the gatekeepers like to say),

at

who were (as PR-types work with." Mark Murray, Keith

each company,

"so nice to

Hodson and Corey duBrowa and Carolyn Balkenhol at

at Microsoft, Jennifer Glass

at Oracle, Bill

Amazon, Kathy Bushkin and

Kent Jenkins and Chris Peacock •

To

Curry and Lizzie Allen

Trish Primrose at at Cisco.

a kitchen cabinet of friends, sources,

who made

AOL, and

various and vital contributions

and industry rabbis

—from reading por-

tions of the manuscript, to lending ideas (and indulging mine),

coining phrases, truth-squading tales, opening their guest

rooms, sharing meals and

essentially

performing the odd jobs

ACKNOWLEDGMENTS make

of friendship that

a

huge difference

ix

endeavors Hke

in

Shelby Barnes, Paul Saffo, Michael Maccoby, Kara

this:

Swisher,

David

Plotz,

Mark

Andreessen, Matt Glickman, Scott

Thurm, Michael Kolbrener, John Sidgmore, Jim Boyd, Ned

Zeman, Joshua Weinstein, Zippy

Doug Okun, Ken Novack, Mike Wilson, Hancock, Adam Stein, and many others. To

my

agent, Rafe Sagalyn,

Whyman,

Bill

Ellen

and Claire Smith, of the Sagalyn

Literary Agency, for their judgment, savvy,

New

Pedro Martinez,

Zeitlin,

and kindness, and

when "The

for believing in

The

New Economy

Story" was about as hot in publishing as

was on Wall never

Street.

Imperialists at a time

Without them,

this

it

book would Hkely

exist.

—Tom Power, Debora Yost, project taking Yvette Romero, and Eve Mossman —

To

the staff at Prentice Hall Press

for

on, and for seeing

The

it

this

through with such patience and care.

Best for Last Categories:

To

my

boss,

Jill

support, patience, and passion through this saga inspiration

and a godsend. And

Imperialist hero,

my

Dutt,

was both an

editor, T.A. Frail, a

who "became one

my

with"

made

this possible,

family, in

support.

Above

And

all,

to

its

assorted units

a special

humor

but also a blast.

—Pop and Ted, Sklor and Larry, Jack and Barbara — for To my

New

stories to a

degree that editors rarely do. His brilliance, trust, and

not only

whose

Betty,

Mom and

their love

and

snog for Val Tomkins.

my wife, Meri Kolbrener, and daughter, Nell, who

make waking up and coming home

the best parts of the day.

PREFACE By Paul

1.nnovation ups

and

fail,

up working vator

all

is

Most

inventions flop, most start-

but a tiny fraction of

in obscurity for

Danny

innovation

irrational.

is

Saffo

would-be entrepreneurs end

someone

As

else.

Hillis observes, "in the natural

mutation, and mostly

it is

and inno-

scientist

world, the

word

for

fatal."

But, occasionally, this huge, wasteful innovation machine

this

way we

something new that changes the

delivers

happens, there

is

live.

And when

usually a single driven individual linked to

the life-changing novelty. Bill Gates

and the PC, Steve Case and

online services, Jeff Bezos and online shopping, Larry Ellison and relational databases,

of them are as

Like

all

much symbols

ers,

DOS,

and

Bill is

Bill

Gates didn't invent the PC; he didn't even

Windows.

all

myths have a grain of

why

way.

When

it

all

I

oth-

and the truth

truth,

we

also fear

happens, but fiercely resisted

push comes to shove, we

they are. In the words of

change

was done by

in

these titans fascinate us.

Innovation fascinates us, but after

All this

simply the poster boy for the personal computer

goes to the heart of

welcomed

all

as they are business imperialists.

the predecessor to

revolution. But this case

—

symbols, no small part of these associations are pure

myth. For example. write

John Chambers and Internet plumbing

it.

when

really prefer to

Mark Twain,

"I

am

Innovation

all

it is

is

under-

keep things as

for progress;

it is

object to." These innovators fascinate us because, against

odds, they are turning our world upside down. They are cajol-

ing us to

buy into

of course our

their vision of the future

money

—and

literally, for it is

that finances their enterprises.

XI

Bill is at

best a

PREFACE

xii

by Paul Saffo

mediocre technologist, but he genius, adept at overcoming

all

an astonishing business

also

is

obstacles that might derail his par-

ticular vision.

we wrap other myths atop our misunderstanding. the person may be an arrogant jackass, but Ellison

Meanw^hile,

Larry Ellison the icon

the

is

new world

the

name,

embodiment of the hopes a century ago.

It is

myth embodied

the invention of the relative

itself

an homage to the famous port of effacing

a

charm

in the face of

who

and

very, very tough.

20 CEOs less,

to

mix of Charles Lindberg

is

the quintiessential Captain

steady-helmed

southern-gentlemanly,

have watched him bring a room of Fortune

silence

and turn them into

a

bunch of breath-

heart-throbbing groupies, hanging off his every word.

With

all

remarkably all

hushed

I

reared him, chosen as

wealth and power makes him the son

and Will Rogers. And John Chambers

—soft-spoken,

to

in his last

entry, Ellis Island. Jeff Bezos' self-

every mother wished she had reared, a

of Industry

drew Europeans

that

baggage,

this

little

it

little

is

surprise that

we know

about these world changers. Until now. Against

odds, the author has penetrated both the myths and the pub-

bubble to deliver an intimate look at these individuals and

licity

what makes them

tick.

Amazon was no "happy thinking and even

more

Despite

Bezos'

oft-repeated

claims,

accident," but the result of relentless

relentless

to talk about his personal

life

work.

may

And

Steve Case's refusal

when

not have cracked

Leibovich interviewed him, but the myriad friends and former business colleagues

Mark

tracked

down

did.

The

result

is

a

view

of Case that will surprise even industry insiders.

This book ing,

and a

is

once a time capsule of a revolution in the mak-

rare look into

change our world.

make

at

It is

what

really drives successful innovators to

thus an invaluable read for anyone trying to

sense of the information revolution swirling around us, but

also bet that

more than

a

few executives

will pick

begin to understand what makes the Titan they

it

work

up and

I'll

finally

for tick.

INTRODUCTION

B,

'ill

Gates was just kidding

when

gerous

you're

Bill

— but

"just kidding" can be dan-

Gates. This had the makings of a small

international incident.

He was

sitting in his office

chief executive

and Gates's best

burden

that,

safe to assume,

about.

When

it's

with Steve Ballmer, Microsoft's friend.

most

They were discussing

a

worry

friends never have to

foreign leaders visit Seattle, they often seek an audi-

ence with Gates. But since Ballmer replaced him as

CEO, Gates

has started delegating some of the meetings to Ballmer

obvious disappointment of some

visitors,

who would

—to

the

rather meet

with Microsoft's founder, the World's Richest Man. How,

I

won-

dered, did Gates and Ballmer divide up these meetings without

making

the dignitaries feel slighted.

"I get the

heads of state of countries," Gates explained. But

with a few rare exceptions. "Mauritius," Ballmer said smirking, "I was able to handle on

my own." was worried about

"I

They chuckled story

I

it

though," Gates said.

together, a tidy

moment

was writing about Gates and Ballmer

Post in December 2000. But a few weeks cle

for

was

to

come

out, Microsoft

PR

me

for

The Washington

later, just

chief

to capture in a

before the

arti-

Mark Murray became

4

INTRODUCTION

concerned about Mauritius. The exchange could be insulting to the citizens

and leaders of the

Did Yes, little

really

I

have to use

more

this part

plaintively.

Madagascar.

of the conversation in the story?

Mauritius was staying

said.

I

tiny island nation east of

in.

Murray asked

again, a

But after a few minutes of back and forth

on the matter, our phone

call

ended.

We

published the Mauritius

exchange. And, somehow, Microsoft survived.

These are the episodes that yield periodic reminders that the

world has changed. The recognition comes

when it suddenly ple

in little snatches, as

We are living in an age where peo-

occurs to you:

have straight-faced discussions about two slobs possibly

insulting Mauritius with a

throwaway

interlude

from Redmond,

Washington. I

have written about the technology industry for

first in

six years,

Silicon Valley during the cultural invasion of the Internet,

then in Washington at both the peak and depths of the sector's

boom-and-bust

ride. It

important and wacky

has been, and continues to be, a great,

story, rife

doses of strategic intrigue, and

heady weirdness of Like

when

I

it all

with money, ego, conflict, daily

real-life

impact. But sometimes, the

would pinch me.

would

notice that the schedule of America

Online's Steve Case matter-of-factly included breakfast with the

King of Jordan and a briefing Oracle's founder Larry Ellison

with Tony

Blair;

that

at a congressional retreat; that

had casually blown

Amazon's

Jeff

Greenspan and Jiang Zemin to be Time's that Cisco's

off a meeting

Bezos beat out Alan

Man

of the Year, and

John Chambers was discussing prospective adminis-

tration jobs with officials

from both the Gore and Bush cam-

paigns.

Who

were these men.^ They seemed to come from Oz, a

cohort of sudden tycoons

who

thrived in an anarchic economic

world where multinational corporations increasingly have supplanted national governments as sources of power.

Modern impe-

— INTRODUCTION rialism

a corporate, global imperialism

is

—a

5

world ruled by

transnational executives with extraordinary influence not only

over business issues but also things like immigration, environ-

mental and trade policy. Likewise, today's imperialists are the audacious breed of computing entrepreneurs ubiquity

corporate

their

who

with slogans

objectives,

Computer on Every Desktop" and "Get Big

Fast."

generals of the networked world's ruling empires define

them

in history

have made

whether the so-called

like

They

—and

"A

are the

this will

New Economy

is

recalled as a revolutionary phenomenon, or a delusional one.

New

These

Imperialists

— Gates of Microsoft, Case of AOL, Amazon, and Chambers

Ellison of Oracle, Bezos of

became the contemporary gance, or both. utterly

mundane

of Cisco

faces of Capitalist ambition, or arro-

They were never content

to

do something so

as "build" successful companies.

They needed

to

expand, expand, and expand through the boundlessness of cyberspace and into fresh global markets to find out exactly what they

were capable

of,

what they could

get

away

with, and

how

far they

could go.

To some

extent,

all

of

problems when they were their ages, precocious

Ellison

had

Chambers

them

battled social or developmental

kids: Gates

and subject

and Bezos were small

to bullying

difficulty telling the truth

battled dyslexia

In another time

and

and

for

from other children;

and Case was a

for a time believed he

was

loner;

stupid.

place, all five could have landed in anonymity.

Or, worse, in middle-management. Instead, they found solace in the emerging frontier of computing

they

would

—purpose

seize slices of virtual turf

in a

box

—where

and build them into com-

mercial superpowers.

They became, selves

in digital

age parlance, "brands" unto them-

—Gates: the prickly alpha-nerd;

Ellison: billionaire

bad boy,

playboy, perpetual boy; Bezos, giggly shopkeeper of electronic

commerce; Case, cunningly pragmatic leader of cunningly prag-

— INTRODUCTION

6

AOL; Chambers, messianic Southern worked possibiHty. And when the history of the ten beyond the dazzle of new technology, matic

preacher of netdigital age

—

the

writ-

is

of

titillation

overnight wealth, and the cautionary tales of subsequent loss

—the

story can largely be distilled to the lives of these five men.

Which, beyond the most

we know

sonae, are lives that

superficial of their

very

little

"brand" per-

about.

not for lack of exposure or attention. These captains have

It's

become standard magazine cover Each

profiles, interviews.

came from

backed by sophisticated public

is

tions teams, speechwriters,

fodder, the subject of countless

and message-mavens, many of

similar jobs in the political

rela-

whom

and advertising world. As

with the companies they run, the brands of these titans are scrubbed, protected, and sold aggressively. Indeed,

men

exhaustively about these studied

over the years, interviewed them,

them and wrote about them many

Yet

I

had read

I

times.

never had any real clue about what formed the desper-

What

ate edges to their ambitions.

gave them the savvy and con-

fidence to consolidate such staggering wealth and power?

childhood episodes, appetites for

conflicts,

dominance

and relationships whetted

as adults?

And what,

—to

to inhabit their celebrity lives today offices, in their set

I

homes,

simply,

was

What their it

like

with them in their

sit

in a restaurant?

out to learn their

fuller stories, as far

PR-machines, and quick-time assumptions as

I

from the

could

get.

I

cliches,

wanted

to hear the tales that, at the hyper velocities of Internet time, there

was so

little

time to find,

in

who

known

best

—parents,

alone to

2000 and 2001,

14 months have

let

I

tell

and to

reflect on.

Over

interviewed roughly 400 people

Gates, Case, Ellison, Bezos, and

former bosses, long-

siblings, neighbors, teachers,

time associates, employees, and adversaries. subjects themselves, discussing formative

Chambers

I

spent hours with the

—and

largely

unknown

INTRODUCTION from

topics

reflective, to

The

least).

They were

their pasts.

ail

7

expansive, thoughtful and

varying degrees (Bezos being the most, Case the

results

comprise the

five portraits that follow, shorter

versions of which appeared as part of a series in

The Washington

Post in 2000 and early 2001.

By

definition, entrepreneurs are bold figures, driven, often

meglomaniacal. The kings of the Industrial Age were up-fromnothing legends: John D. Rockefeller, the son of a peddler in Richford, N.Y., spent part of his adolescence working as a clerk in a produce firm.

Andrew

Carnegie, the son of a Scottish weaver,

emigrated to Pittsburgh at 12 and took a job in a cotton

Henry Ford was born on to

work

a

farm

in

mill.

Dearborn, Michigan, and went

as a machinist at 16. For them,

growing up poor was an

experience both searing and transforming. In contrast, the

New

Imperialists

emerged from the serene,

TV-entranced and non-Vietnam-going neighborhoods of the

1960s and 1970s, a world adversity

and

in

in

which the most

was boredom. They were

all

common form

of

raised with big expectations

wealthy suburban families, with the exception of Ellison

(though not to the degree that he has often claimed). Absent any pressing material needs, they nonetheless developed a hunger to

dominate the world.

do

this, to

some

I

wanted

what possessed them

to find out

to

better understand their characters, psyches and, in

cases, their

demons.

Besides the figures

I

profiled here,

but dismissed them for various reasons:

I

considered a few others,

Andy Grove

of Intel

is

the

undisputed pioneer of computer chip-making, which underpins so

much has

high-tech innovation; but Grove retired three years ago, and

little

to

do with the day-to-day operations of

Jobs of Apple

is

ferociously bold

and has

Intel today. Steve

solid inventors' cachet;

but for as iconic as Apple has been under him, the

company

is still

a niche player in personal computing, hardly dominant. Michael

Dell of Dell founded one of the

most successful PC-makers

in the

— INTRODUCTION

8

world, but his historic credential visionary

—he developed and mastered a mail-order

In a broader sense,

no experience This

came

more process-oriented than

is

possible,

it's

at all v^ith

if

not

likely, for a

New

to rule key sectors so fully that

it

contact with their products. Nearly

on Microsoft

—to

a point

pricing or

interface,

its

real effect

on the

lives

its

teller

if

of people

in, say,

have more

will likely

it

in its

Mauritius, than nearly any If

you use an

machine, make a credit card purchase, or need

humankind

next three years than

it

creates

—

is

something online,

a reliance that will

grow in the

has in the rest of

Amazon

is

its

the obvious

— and the transaction

some Cisco hardware

"man-

likely being

more new information

history, according to If

you want to buy

first

place to look for

researchers at the University of California.

If

not

week without some

W. Bush could make.

aged" by Oracle's software products

most things

difficult, if

company changes

the

employee benefits information, you're data

exponentially as

They

personal computer users

privacy code,

policy decision that George

automatic

where

all

Imperialists.

would be

impossible, for most citizens to go through a

rely

model.

an Apple or Dell product.

not true for the realms of the

is

sales

PC-user to have

will

tool within the

no doubt proceed by way of "plumbing" of the

Internet.

you're a media consumer, you will inevitably encounter

AOL-controlled outlet

—

its

dominant online

service,

its

some

CNN pro-

grams, Warner Brothers films, or Sports Illustrated, Time, or

People magazines, the ones with the

AOL

disks stuck inside.

While there have always been expansive global companies the

Coca Colas, McDonald's, Standard

Imperialists achieved their

and to

Oils

—these

New

dominance seemingly overnight,

a degree that has exploded

any previous notion of com-

mercial scope and scale. Moreover, their wired age goals go

beyond mere geographic expansion; they incorporate a kind of lifestyle

imperialism in which traditional lines of media and

commerce

are constantly being pushed. Microsoft

no longer

INTRODUCTION

wants to provide the software for the "Computer on Every

just

Desktop."

game

It

also

wants to make the software that powers your

TV

consoles, set-top

services

on

boxes, and a range of products and

AOL

the Internet; just as

shows with

its

online channels with

its

wants to meld

TV

its

magazine content with

movie promos with any mix-and-match of media "conver-

its

Amazon wants

gence" you could imagine; just as

tomers

who shop on

made

"Old Economy" companies have

offerings

to

suit

broader

tastes

lifestyle

breakfasts. But

what

distinguishes the

New

also

poignant statement, not

just of

"AOL

Imperialists

their

captured It's

a

one company's voracious aims, but

economy now

for.

Where does

On

is

is

Anywhere."

of the kinds of boundless goals that the networked allows

for

salads, desserts,

quest for total ubiquity, a sense of manifest destiny that

America Online's corporate mantra,

expanded

—McDonalds,

from hamburgers and Cokes into

instance, stretched

and

by way of Cisco products

for wireless networks.

Yes, several their

travel

to lure cus-

perhaps the same devices

cellular devices,

whose communiques might

in

9

cell

a person acquire the

phones, on dashboards, on

upon gathering data

to deepen

records of their

lives.

The more

my

this project: that in

premise for

hunger to be "anywhere?"

AOL-TV,

in Brazil?

vital to

it's

they've

grown up

know where

to be.

set

and expand on the too-glossy I

learned, the

more

its

it

reinforced

order to fully comprehend

one of the most transforming and tumultuous eras history,

I

leaders

in

American

came from, and what

^^^m^m^^^^^'mm^^^mmM^m-MiA^SikM^m.^jm

-msmM'^m^^m

CHAPTER ONE

LARRY ELLISON Is It

Really True?

—

L

larry Ellison, the world's second-richest

man, was

taining friends aboard his 243-foot yacht off Capri

yacht caught his attention.

A

enter-

when another

mere 200-foot yacht, belonging to

Microsoft co-founder Paul Allen. The world's third-richest man.

As

Allen's yacht set out

on

a twilight cruise to the village of

Positano, Ellison instructed his captain to rev his boat's three

engines to

full

speed. Within minutes, his craft overtook Allen's at

40 mph, leaving

a

huge and sudden wake that sent Allen and

his

passengers staggering across the deck. Ellison and his friends were belly-laughing as his yacht returned to

A

its

anchorage.

spokesperson for Allen declined to comment on the

episode, which occurred at the end of August 2000. "It

adolescent prank," said Ellison,

recommend This

is

who was 56

was an

at the time. "I highly

it."

the sort of thing that

cessful entrepreneur such

makes

most

suc-

the founder

and

Silicon Valley's

an easy caricature.

He

is

chief executive of Oracle Corp., the world's second-biggest soft-

ware company and

—as

businesses shift their functions online

one formidably positioned to profit from the Ellison's net

worth, which

is

Internet's expansion.

tied closely to the

performance of

Oracle stock, has ranged between $20 billion to $80 bilHon since

1999, and has sporadically surpassed

13

Bill Gates's.

14

LARRY ELLISON

Really True?

Is It

But when Ellison receives attention, irrelevant to his corporate

the

bona

three-month period

in

w^riting

I

had hired a private investigator

ted that Oracle

snoop on

to

Microsoft Corp. trade organization in Washington

work included

(this

stealing the pro-Microsoft group's trash).

days later Ellison's longtime deputy, Ray Lane, in a public spat. Ellison

left

the

curfew with

his

Gulfstream

suit that Ellison stiffed

V jet. A Florida man

him out of

he bought a $10-milhon yacht. of stealing his Rolex. His issued a fake

smog

That was Ellison's it

just

A

few

company

a

its 1 1

p.m.

alleged in a law-

$700,000 commission when

A former housekeeper was accused

McLaren El

sports car

was reportedly

certificate.

one summer.

swamping of Paul

was not

a pro-

snoop

continued a long-running battle with

authorities at San Jose Airport for the right to violate

While

in

—a period w^hich happened to be —Ellison made the foUow^ing news: In June, he admit-

middle of 2000

about him

fides. In a

often for reasons

it's

reported in the

Allen's yacht occurred in August.

news media,

the story relentlessly, to the point where Silicon Valley legend. "It

is

Ellison's friends told

it

became an

instant

great to create these artificial con-

me a few weeks "No doubt they are

frontations that are motivational," Ellison told after he'd returned

childish.

I

from the Mediterranean.

don't dispute that for a second."

By the way, he

said,

you should have seen the looks on the

faces of Paul Allen's friends as they

tumbled across the deck. Their

dinner went flying. Their wine spilled

destroyed their wa,'^

Ellison

Japanese word for tranquility.

said,

He

all

over their clothes.

explaining that iva

laughed as he said

is

"We the

this,

a

pitched, girlish giggle.

No more his

than 30 seconds

later,

Ellison

was wondering why

sweeping impact on the world had been so obscured. Oracle's

database software automates the taken-for-granted functions of

modern commerce:

It

provides unseen tools that track data in

LARRY ELLISON automated

teller

machines, ease credit card transactions, and

Few people know how

underpin online commerce. software, but Ellison,

many encounter

who founded

Silicon Valley entrepreneur

in

it

some

Oracle in 1977,

and

its

and speed

as well as

its

both the ultimate

is

consummate and

ego, hype,

to use Oracle's

indirect fashion every day.

the extremes of the technology industry:

fies

15

Really True?

Is It

its

outsider.

He

typi-

wealth, brilliance,

ruthlessness. But he did not

emerge from the privileged environment that nourished so many

New Economy sen

foil.

ambitions, the old-money lineage of, say, his cho-

Gates. "William Gates the Third," corrects Ellison, derid-

ing the only

man

richer than he.

Born to an unwed 19-year-old Ellison

was adopted

at 9

in

Manhattan, Lawrence Joseph

months by

distant relatives in Chicago.

Louis Ellison was a Russian Jew to

commemorate

ing acceptance

through

his passage

and

who had changed his Ellis Island, a

self-renewal. These

outward refinement

his

Beverly Hills nose job betrays a failing,"

—Larry

raw desperation.

it is

tege.

suits,

his

approach to business

imagine anything worse than

like

it's

all

sets

him

apart.

a friendly chess match,"

Benioff, a former Oracle executive

"Larry doesn't think

his

in Silicon Valley, there's this idea that

everyone should be playing

Marc

seek-

fail.

Armani

his

he said. His willingness to say this also

"Eor as competitive as

says

—

Ellison's

"I can't

newcomer

themes he conveyed to

adopted son by assuring him that he would always

Beyond

long surname

this for a second.

and an Ellison pro-

He

thinks of himself

as a samurai warrior."

In late 1999, Benioff left Oracle after thirteen years to start

Salesforce.com, an online software service for sales operations, Ellison gave his blessing, plus a $2-million investment.

He

joined

the board. Six

months

later,

competing business. seat. Ellison refused.

Benioff learned that Oracle had launched a

He demanded

that EUison resign his board

"

LARRY ELLISON

16

"It

would sound

Really True?

Is It

a lot cooler

if

you kicked me

off," Ellison said,

according to Benioff. "It would be a better story to Ellison's version:

want

to

throw me

would

what you've been using me Both men agreed that

for

my

friends."

'Marc, I'm surprised you don't

"I said,

off. It

tell

get all

you more

publicity,

and

that's

along.'"

Ellison, while resigning, quibbled over

the Salesforce.com stock options he

felt entitled to.

THE FOG OF DECEIT two

Ellison places ging.

The

fingers

on

tongue and makes

his

topic: high-tech leaders

Good

Crusades for

—as

if

who

trumpet

like he's gag-

their enterprises as

they had nothing to do with riches and

conquest. His rapid-fire speech slows to a cadence of disdainful

sarcasm: ''Oh, well, the reason we're doing software here at Oracle

because someday children will use

want

to

I really

care about

is

making

make the

the

world

world a

bet-

why I'm doing this. And all my money's going medical research so we can help people who are sick.

ter place,

go

and we wouldn't

to leave a single child behind. If I could just

a better place, what

to

this software,

is

and

that's

At which point he gags himself again. "People say

this

and

get

away with

it,"

he says, patting his

temples with the tips of his long and manicured fingers. "I can't deal with the fog of deceit."

Deceit

is

a

complicated notion with Ellison. He's been

accused of practicing ties

it

in

many

forms: exaggerating the capabili-

of Oracle products, embellishing the meanness of his

boyhood

neighborhood, and misleading people about the academic degrees he has earned.

At the same time, the rough transparency of bravado

Ellison's

flouts the public relations obsession of his industry.

I

LARRY ELLISON when he knew

asked him

Is It

would be

the Internet

17

Really True?

big.

A

soft, fat

question.

was

It

in the early 1990s, he said.

kindergarten class, and he saw

ter's

He was

visiting his

daugh-

the 5-year-olds using

all

The PR woman who was monitoring my interview nodded

it.

reas-

suringly.

By the way,

young

single

"Really,

I

his daughter's teacher

was

in

cyberspace was

It

was

I

said to

who's that?' That's Miss Baker, Dad.'

full

lost.

The PR woman's dad

parents' day in school. "So,

into kindergarten class. ...

also the

has been thrice divorced.

frozen.

Ellison continued.

comes

incredibly pretty,

never saw a kindergarten teacher look like that before."

The image of toddlers smile

who

lady," said Ellison,

was "an

I

my

said,

daughter, 'Megan,

'Good

deal.'

She was

head of the computer lab." EUison mentions Miss Baker's

name

several times, quite clearly trying to get his esteem for

her in the newspaper. Ellison bright,

is

large,

eleventh-floor office at Oracle, a

sitting in his

and obsessively cleaned place decorated with

Japanese paintings and ceramics. His

is

one of those faces that

is

both homely and handsome at the same time, with cheeks worn red from sailing and busy smiles, squinty

when he

symmetry with

his

No

brown

talks.

eyes that turn soft

His repaired nose

in triangular

long and bearded jaw.

fan of tech-casual dress, Ellison wears a charcoal gray

sports jacket over a black turtleneck. glass table.

He

is

6 foot

1, trim,

He

rests his size- 12 feet

on

a

and somewhat body-obsessed. He

often refers to people in terms of their size

"giant"

sits

when he

— "small,"

"huge," a

—and shares a personal trainer with former San Francisco

49ers quarterback Joe Montana.

If

EUison misses a workout, he

is

prone to vocal self-loathing.

"To Larry, so much of ness,"

his

power comes from

physical

fit-

says Jenny Overstreet, his longtime assistant until she

LARRY ELLISON

18

retired at age

35

in

Really True?

Is It

He

1996.

talks

looks, Overstreet says, "like a

how

about

woman

body

his

'My

saying,

feels

and

thighs are fat

today.'" Ellison greets visitors to his office with a soft but firm hand-

He

shake and a courtly bow. that he

is

breaches no rule of decorum except

unfailingly late. Unapologetically late

—and not a

little

bit late.

"Every time we'd go to lunch, he'd be minutes calls his

thirty, sixty,

employee,

late," said Stuart Feigin, Oracle's fifth

former boss "the

utes late for

an interview

late I

two of

that Bill

did with

him

in

He did He has a

October 2000.

He was in a meeting. meetings. He is "somewhat reassured"

the people he

most admires, Winston Churchill and

Clinton, were and are habitually Still,

At an Oracle-sponsored demonstration

Defense Department

Pentagon

in a limousine.

clients in

officials

He

for U.S.

Herndon, Virginia, a group of high-

waited 45 minutes until Ellison pulled up

kept Philippines President Fidel

more than an hour arrived,

late.

there are legions of Ellison lateness tales to suggest an

edgier character.

level

who

Larry Ellison." Ellison was 90 min-

not apologize, he only explained:

hard time getting out of

ninety

in his

Ramos

waiting

When

Ellison

San Francisco mansion.

Ramos waited 15 minutes more while

Ellison

changed

clothes. I

met

experienced something similar on the one previous time

Ellison. In

November

of 1997, EUison

attend a White

House dinner

was scheduled

to

come

to

came

to interview

him

made at the

Washington to

for Chinese premier Jiang

The Washington Post

group of editors and reporters, but he canceled for reasons never

to

clear. Instead, a

Hay-Adams

I'd

Zemin.

He

for lunch with a

at the last

minute

group of us were invited

Hotel, across from the White

House. Our delegation included Post technology editor John Burgess, reporter Rajiv Chandrasekaran, and me. the lobby at the appointed hour

—3

P.M.

We

were met

in

— by Keith Hodson, an

— LARRY ELLISON Hodson

Oracle public relations man.

told us that Ellison

was run-

We

time by

ning behind schedule, about 30 minutes.

around

strolling

Hodson

was

It

killed

After 30 minutes,

street.

back to the hotel and upstairs to

led us

where we took waited.

park across the

a

on couches and waited

seats

clear Ellison

was

19

Really True?

Is It

Ellison's suite,

And

for Ellison.

an adjoining bedroom, behind

in

a closed door.

Hodson kept day

last

that

at Oracle,

would

apologizing.

He

also

and that he'd taken

start the following

a

mentioned

new

job

week, but could

—

we

at

was

this

his

Microsoft

men-

please not

tion this to Ellison.

After 15 minutes, Ellison's door opened and a willowy and fit

young

woman

with

light

brown

hair

walked

"I'm

out.

Melanie," she said, offering us something to drink. Ellison's

girl-

friend. She stood around awkwardly. Finally, after another 15

minutes. Burgess told

on

Ellison's door,

opened

then returned, saying later,

we headed

Hodson we had

it

to the

it

to leave.

Hodson knocked

and whispered something,

slightly

would be another minute.

door

Five minutes

—and no sooner did Ellison

head out the bedroom door and

yell,

"Melanie, where's

stick his

my

belt?"

Melanie returned to the bedroom, then Ellison strode out pressed charcoal

We

suit,

buckling his

are fortunate he

came out

engagements with Ellison are his scheduling

belt, ready.

at all,

it

turned out.

lost to his caprice.

As

Numerous

a general rule,

commitments come with an eleventh-hour proviso:

Larry Permitting.

bored and an

in a

He

has a 5 -year-old's attention span

ability to delve

deep

if

he cares

when

to. It suits

he's

him

to

running a company on Internet time. His mind can pinball from topic to topic

whatever

is

on

and focus when necessary. He also tends to say his

mind.

"I'm not trying to figure out what would serve print," Ellison said

what he

feels like

me

best in

on the subject of doing and saying exactly

doing and saying.

"It's

very interesting.

Some

20

LARRY ELLISON

people

who

like

Is It

me would

Other people would see third

group would

say,

say there's a high degree of integrity.

as incredibly self-destructive. Then, the

it

'I

Really True?

can't believe he's saying that,' he's just an

asshole."

He

says the

first

two groups would be

right.

Rest assured, Ellison wants to be loved, more and more as he gets older.

you want

"The reason you want to love yourself

Does he

and

feel sufficiently

to be loved," he said, "is because

feel self-esteem."

loved? "No, of course not." He's

learned this over time and struggle (therapy? "None, nada.

I

tried

marriage counseling once"), and he hates that he's perceived as

mean,

ruthless.

"I

don't think

He has tried to He is improving.

loved." tively.

mean and

ruthless people are

improve, he said earnestly, almost plain-

LARRYLAND When I met with Ellison in his office in the fall of 2000, he invited me to return to California the following week for a tour of the compound he was

building in the

hills

of Woodside, 30 miles

south of San Francisco. Six years in the making and

pated in architectural

circles, Ellison's

what Kubla Khan would have a budget that could reach

built

$100

if

the mention of

something

fetid.

23-acre complex will be

It

will serve the tidy pur-

home on Lake Washington,

which prompts Ellison to wince

He

antici-

he'd had a Japan fetish and

million.

pose of outdoing Gates's $50-million

much

as

if

he smelled

quotes his friend, Apple chief executive Steve

Jobs: "I don't begrudge Microsoft their success.

It's

just that they

have no taste."

The

chief designer of Ellison's project

is

a

Zen monk;

it

will

replicate a sixteenth-century Japanese village. Expert craftsmen

are building pieces of

it

in

Japan, disassembling them, and ship-

LARRY ELLISON

Is It

21

Really True?

ping them to California for reassembly on-site. Stones for the walls were hand-cut in the Far East ("hard to find high-quality

masons

here"). "It will be the

built,"

he says.

And

most serene

"The most important

a cultural treasure:

Japanese project to be built in the

last

environment ever

living

two hundred

when he saw

president of Oracle's Japanese subsidiary cried site,

outside of Ellison's

team have seen the compound, so the

the

100-person construction

received a call from Oracle lead the tour that I

PR

Wednesday

booked a hasty

—and

well

worth a

Two Mondays

later, I

chief Jennifer Glass. Ellison

would

at

12:30 P.M. she said.

expensive

11:30 at Oracle's headquarters in drinking bottled water in a cafeteria

was

was

invitation

return trip to California from Washington.

—

flight

and met Glass

at

Redwood Shores. We were when Glass's cell phone rang.

No tour today, they said. No reason given. my trip and we did it the next day or the day

Ellison's office.

What

if I

after?

I

extended

could do that. Sorry, they said. Larry might be going out

of town. But

I

was

would be happy

We

free to

to drive

go look

me

at the construction site. Glass

over.

rode a half-hour on redwood-shaded and winding moun-

We got lost. Glass called Ellison's directions. We turned around, got back on track.

tain roads.

utes

The

Ellison tells me.

Few people

It

years."

from the

"Larry's

on

his

When we we were

phone rang

site,

her

way

over. He'll see

cell

arrived, he

you

was already

office for better

Then, a few min-

again. Ellison's office.

in five minutes."

there.

He mentioned

that

late.

OUR PRIMEVAL ENVIRONMENT "It's

the ambiguity between inside

Glass and

me on

the tour of the

and out," Ellison said

compound. At

that

as he led

moment, he

LARRY ELLISON

22

was pointing

Is It

Really True?

to a rock that

both inside and outside a shower,

is

but he returns repeatedly to the theme of planned ambiguity.

Guests will be kept guessing. Are the trees growing out of the

main residence?

Is

the koi

the three-acre lake?

pond

"It will

body or connected

to

that structure over the lake a bridge or a

Is

bathroom

residence? Ellison pointed to a

woods.

a discrete

that opens out onto the

be like taking a bath in a redwood forest," he said.

Inside or out?

Where do you Ellison

stand?

wore dark shades, white

tennis shorts,

and a black

tank top emblazoned with the red logo of his 78-foot yacht, Sayonara. His thick arms were tanned, even slightly burned, and his black hair

was tousled

Benz S600 was parked

after a

workout. His

in back, a hairbrush lying

Mercedes-

silver

on the passenger

seat.

He

agreed to give a tour on one condition: no photographs

on the grounds. He was around the property

as

a gracious if

and eloquent

romping

host,

leading an inspection of his idealized

soul.

On a garden

a visit to

Japan

and never

felt

to recreate that feeling.

tion

site:

in the

more

mid-1970s, Ellison

at

During

home. The compound

my

visit, it

Tractors zigzagged across bare

tures stood draped in plastic. But

was

he entered

said,

intended

is

a large construc-

dirt, half-finished struc-

some time

in the

next few

could be —Ellison was noncommital on completion 2002 — comprise an 8,000-square-foot main some time

years

date;

a

in

it

it

will

house; five guest residences, an underground network of base-

ments and tunnels; a forest of cherry

trees;

high-speed streams,

low-speed streams, waterfalls, ponds, and a lake with boulders doubling as hot tubs; a tea house, boathouse, amphitheater, indoor basketball court and recreation center; a horse stable; three garages for Ellison's fourteen cars; and a sprawling garden to be

maintained by a

staff of twenty.

LARRY ELLISON The

the project

home

Japanese-style

once

is

in

finished, Ellison will sell his $30-million,

nearby Atherton. That one

modeled

is

Katsura Villa in Kyoto, where the Japanese royal family

lived.

He

will

keep

He

for entertaining.

hotel),

his $25-million

will live here

a 30-year-old writer (the

Adams

23

Really True?

lake will be filled with purified drinking water.

When after the

Is It

mansion

in

San Francisco

with his fiancee, Melanie Craft,

same Melanie from that day

at the

Hay-

an Icelandic pony, the two cats named Big Daddy

and Maggie, and indigenous bobcats,

deer,

and coyotes. His

teenage son and daughter from his third marriage will have their

He

pick of residences within the compound. friends, artists, dignitaries.

and food

click,

They

will select

will be delivered to

them by

plans an influx of

meals with a mouse boat.

Overlooking the soon-to-be garden from a second-floor noted that the great Western structures

library, Ellison

Dame, and

Versailles

designed to humble people before

king. But the goal of Japanese architecture

and familiar just

—were

moved

"By

place.

to cities a

familiar,

"You can

I

mean

is

meant

in contrast to the

Growing he says.

is

most

pine,

and

that's

our primeval environhis

and

boyhood home

glass

in

and gunshots."

up, Ellison and his mother yearned for a house.

When

thought he was says. It

"We that, we

to integrate the

and the

ambience of

distilled to "plaster

They'd always lived of,

to create a serene

God and humans.

smell the oils of the cedar

Chicago, which he

God

natural," he said.

a very reassuring smell," he said. "That's

ment,"

is

few thousand years ago. Before

were forest dwellers." The place sublime creations of

—Notre

more

in apartments. That's all they ever

EUison moved into

rich.

a

life's

But

this

dreamed

his first house, in his 20s,

compound

work. By viewing

he

transcends wealth, he

this

home,

Ellison says,

others can learn about his values, his cultural passions, his tastes.

And

this

is

am not myself an am a critic." The act

important. "I

patron," he said, "and

I

artist,

but

of creation

I

am

is

what

a

24

LARRY ELLISON

defines

humankind, he

women

have versus

Really True?

Is It

says.

men

that

is

"One

of the terrible things that

men

can't create hfe. We're stuck with

second best."

The tour

lasted

exquisite nuances

—

two hours, inadequate

for seeing the home's

speed-reading poetry," Ellison said. Every

like

time he entered a room, workers did a double take, as ing a

command. "You can

see

how

it

if

comes together

expectlike the

feathers of a bird," he said pointing to a boathouse roof. Ellison

held out his arms, embracing the

He

smiled and laughed.

"It's

panorama of what was

to come.

simply astonishing! The sensuality

is

incredible."

Upon

he will leave the

his death, Ellison said

compound

to

Stanford University, on the condition that "they don't touch anything." Ellison

is

and need

his rational bent

someone can be hensible." He's

He

terrified of dying.

doesn't get death;

how

here, then not be here," he said. "It's incompre-

more

terrified of getting old.

—which overall pales

in

A portion of his char-

comparison to Gates's^goes

DHEA, a aging. He has

to fund research at the University of California

that

mocks

for control. "I don't understand

itable giving

mone

it

some people

believe could retard

on

horalso

given substantial sums to cancer research.

For now, Ellison will bid for immortality with

pound. "Sometimes

bothers me," he said. "I think

it

it

this

com-

will outlive

Oracle."

He walks

into a

bridge connecting

bathroom next

two

residences.

He

to a hand-carved

wooden

will put a bath next to the

kitchen and dining areas so that guests can bathe and enjoy tea before their meals. Ellison explained.

It is

(On

a Japanese

a

custom to bathe before meals,

few occasions, he

said,

"We

Japanese").

Ellison chuckled, then stared and pointed with contempt at the

basin of a sink. "This Fir

wood

and pine might work

grainy.

"Get

rid of it,"

is

much

too complex for me," he said.

here, but not elm. Beautiful, but too

he said to no one in particular.

LARRY ELLISON

He

Is It

25

Really True?

a self-described "obsessive-compulsive perfectionist,"

is

and nothing

will escape his full attention here. "I

poor people crazy," he

said, laughing.

At the end of the

ment rooms

that

"They have suffered

tour, Ellison led us

would contain

have driven the

through a

mightily."

series of base-

a state-of-the-art air-conditioning

system, hot water heaters, humidifiers. "It will be a different century

down

here," he says.

He

proceeded into a long tunnel that

connected a garage with the main residence. For about 30 onds,

we were

in total darkness. Yet Ellison kept

up

sec-

his brisk

walk, getting several feet ahead before calling back to us from the

end of the tunnel. "When you get to where voice echoing, "you can see the light."

am," he

I

said, his

Then he laughed.

WHERE YOU STOOD Theories abound on what caused Larry Ellison. "I think the distant

and disapproving father created

a

mav-

erick son," Jenny Overstreet said. Louis Ellison gave his son "so

much

fuel, so

Overstreet, street

much

anger, perseverance,

who now

lives in a

from her former

and determination," said

San Francisco mansion

boss's. "It

was

great for

The trauma of abandonment.^ "So my abandoned me, and

when

my

mother

who

raised

all

there."

He

"But

just

the

of us."

biological

mother

me abandoned me

she died of cancer," Ellison said. "I've thought of

one of those things that

down

all this. It's

sounds so good, the reasons are

all

took a deep and melodramatic breath. is it

Starting

really true?"

from

his birth,

raphy has been steeped

on August

17, 1944, Ellison's biog-

in uncertainty. Errol Getner, his

next-door

neighbor in adolescence, says Ellison always told him that his father

worked

for the FBI.

Over the

years, Ellison has often spo-

ken about the "projects" and the "ghetto" he grew up

in.

And

the

26

LARRY ELLISON

gunfire.

"He used

to

Is It

Really True?

me

tell

two toughest

that the

kids

from

his

neighborhood were Cassius Clay and Sonny Liston," said Gary

Kennedy,

former

a

Muhammad Ah

top

grew up

executive

The future

Oracle.

at

in Louisville, Liston in

Arkansas and

St.

Louis. Both spent time in Chicago later in their lives, miles from

where Ellison

lived.

People from Ellison's South Side neighborhood describe a cozy, solidly middle-class

and heavily Jewish enclave. There were

pockets of Italians,

Puerto Ricans, and African Americans

Irish,

nearby. Ellison encountered anti-Semitism, but

it

was

"just

one

particular brand of anti," he said. "If

Bridge' said

you took the

TV

shows 'Happy Days' and 'Brooklyn

and averaged them, we would be somewhere

Chuck

quite as suburban as

or ethnic as 'Brooklyn Bridge.'"

and drug-infested Lillian

who now works

Weiss, a childhood friend

"We weren't

'Happy Days,' not

on Clyde Avenue near 82nd

quite as urban

lived in a

had

street,

left.

two-bedroom apartment

about one mile west of Lake

Michigan. They lived on the top floor of what was "four- flat" apartment; there

and dining room

at Oracle.

The neighborhood became crime-

in the late 1960s, after Ellison

and Louis ElHson

in the middle,"

was

a living

in back, adjoined

room

known

as a

in front, kitchen

by Larry's room, which was

always a mess. Lillian was a bookkeeper, Louis an auditor for the U.S. Bureau of Indian Affairs,

and they survive

in their son's

mem-

ory as opposites: Larry described her as a loving and committed mother, him as quiet and scornful. Louis, he said with derision,

had "an automatic and unthinking deference to authority

and

rules. ...

said a lot

He was

—was

"That was

his

a true believer."

that his son

form of

One

thing he believed

would never amount

greeting, as

figures

opposed

—or

to anything.

to, 'Hi'

or 'Good

morning,'" Larry said. Louis had a daughter from a previous marriage, Doris,

was nineteen years older than

who

Larry. She too recalls Louis as a

LARRY ELLISON remote, aloof man. "I have no

memory

ing me, hugging me, or of sitting

on

of

my

27

Really True?

Is It

father ever touch-

his lap," says Doris Linn.

and her husband, Chicago judge David Linn,

lived next door,

She

and

He would bring friends over to view David's closet of fine suits. He became transfixed by any demonstration of marked intelligence. He and Doris they served as alternative mentors to Larry.

had

a favorite

pedia to a it

game they

random

played: Ellison

would open an encyclo-

person, place, phenomenon; he

would say what

was, and Doris would throw back a quick definition. Ellison

would become enraptured by

this,

or any demonstration of intel-

ligence.

Larry defied his parents' wishes that he have a bar mitzvah,

Hebrew

signaling a lifelong indifference to Jewish customs. conflicted with his Little League practice. "I

was

a matter of giving

Ellison said. "So

about

this

I

a pitcher,

decided to go to baseball practice." recall Ellison's refusal to

mitzvah as a major act of rebellion

ened the already tense environment

at the time, at

boyhood companions

younger than but a

little

it

Jimmy

is

glib

have a bar

one that height-

8237 Clyde recall

He

Street.

of outsized

a child

dreams. "Whatever he was doing, he was always projecting ger and better," said

and

up pitching to learn Hebrew or not,"

now, but friends

Ellison's

was

school

it

big-

Linn, Doris and David's son, five years

his uncle. Ellison,

he says, was "extremely bright,

unbridled."

At South Shore High School, Ellison "always seemed quiet

and preoccupied, not part of the Gutterman, the valedictorian of

in

crowd," said Sheila Maydet

Ellison's Class of

divorce lawyer in Denver. "Usually, in high school,

where someone Plexiglas

is

now a you know

1962,

coming from. But Larry always seemed

around him. You could never

he was." Ellison was

tall

to have

really get a sense of

and awkward, with greasy

olive skin

who and

pimples, Gutterman recalls. "I don't think people were particularly nice to

him."

— 28

LARRY ELLISON

to

ability

Coleman. dency,

Really True?

had a reputation

Ellison

something

Is It

making up elaborate

for

stories,

his friends

and classmates often mentioned. "Larry's

embeUish

reality

was

amazing,"

and

to his ever-active imagination

it

with the prosaic facts of

always reading

He was

reality.

Scientific

Dennis

said

somewhat sympathetic

Ellison's friends are

owing

just

to this ten-

his

boredom

and he was

avidly curious,

American magazine. Will and

Ariel

Durant's Story of Civilization, the Bible, biographies of Churchill,

War

General Douglas MacArthur, books on World

newspaper

article he'd see

on sports

II,

and any Sandy

greats Ernie Banks,

Koufax, Mickey Mantle, Bobby Hull, or Gordie Howe. But Ellison skipped

He

earned mixed grades. ers.

and

classes, received frequent detention,

got along poorly with most of his teach-

Today, Ellison often posits them,

like his father, as

ready

foils

for his iconoclasm.

"Never do you make teachers happier than

when you do

what they

exactly

really love that.

And you

tell

you

to do," he said.

"They

just

never can succeed in business by follow-

ing the rules."

Once,

Ellison's

biology teacher,

Mrs.

Coleman, Dennis

Coleman's mother, threatened to flunk him for cutting get the highest grade

on the

Ellison said. Yes, she said,

argument with than anyone

would you

final,

and

know more about

I

gonna flunk me?" he

else in class, you're

as

It is

flunk

I

me?"

forty years later, he recreates their

a taunting edge. "If

ing his hands, smirking.

still

class. "If

if

Mrs. Coleman,

biology

said,

who

wav-

died in

1975, were sitting next to him. Right next to her teacher life.

"A

who

is

his Latin teacher, the miserable Latin

told Ellison that

if

he failed Latin,

letter in a rectangle will ruin

your

it

life? I

would ruin

his

don't think so,"

Ellison said, shaking his head. "I can imagine being hit by a car

would ruin your was

life."

quite certain that

again, a quick

But I

why would

he need to learn Latin? "I

wouldn't become a priest."

and righteous chuckle.

He

laughed

LARRY ELLISON Ellison

had

a harder time

he had been adopted.

memory was

term

that one realization didn't

tell

and Louis told him

12,

"My

was mid-argument.

it

in

short-

erased," Ellison said. "All the circumstances

remember about being

He

29

Really True?

remembering when he learned that

He was about

Or maybe

mid-conversation.

Is It

told were just whited out.

and having to deal with

I

just

remember

it."

he had been adopted.

his friends

I

was simply

It

not something he spoke about, though he spoke about most other things. Ellison

was an expert

ing your position

hood

and turning

friend Rick Rosenfield,

"He had

at banter.

who would

later start the California

Coleman

inner

circle

as pleas-

release of tension."

was steeped no females,

included

unchanged through

and the

one of

recalled

no such thing

Ellison's oft-repeated manifestoes: "There's

Ellison's social life

for tak-

into a total absurdity," said boy-

it

Pizza Kitchen restaurant chain. Dennis

ure. There's only tension

knack

a

in

male camaraderie. His characteristic

a

basically

his career in business. In college he joined a

Jewish fraternity, Tau Epsilon Pi (the Tommies), which also included his closest friends

They rode around with

— Getner,

Coleman, and Rosenfield.

1956 Dodge with

Ellison in his

downtown

button transmission. They took forays

to try, generally unsuccessfully, to pick

weights, jogged before

it

for the city of Chicago.

up

to

a push-

Rush

Street

girls.

Ellison lifted

was popular, and worked

as a lifeguard

He

titions, especially basketball

loved the certainty of athletic compe-

and

football.

"Freud defines maturity

as the ability to defer gratification," Ellison said, in explaining the

appeal of sports. "That's the reason sports

go of a

ball,

and half a second

gratified or not.

The erated

on

rest

It

was always very

was not so

so popular.

You

let

you know whether you're

clear

simple. Ellison

free-floating anguish.

—

later,

is

where you stood."

and Errol Getner commis-

They both describe times of

tion

and despair

that

seemed to bond Ellison and Getner

qualities familiar to

most teenagers especially. "It

isola-

—and ones seemed

like

30

LARRY ELLISON

we

the only time

Is It

Really True?

when we were com-

could forget our pain was

peting at something," Getner said.

Yet both

men speak

On warm summer 82nd and

Jeffrey.

of their adolescent days with nostalgia.

nights, they could

walk

to Carl's

Hot Dogs

at

For 25 cents, they purchased a hot dog on a

steamed poppy-seed bun with kosher pickles and a bag of greasy fries. Later,

they

would put on $10 Converse

long runs through dark Chicago streets

All-Stars

late at night.

and take

They would

then walk two blocks to South Chicago Avenue, where they would

And

purchase twelve glazed doughnuts and a half-gallon of milk. they would talk, talk, talk

night about books, about

all

girls,

about making money.

"Your deepest

friendships,

and sometimes your most pro-

found emotional experiences, occur when you're a teenager," Ellison said.

"You were so emotional, and

revealing itself to you. Sometimes painful.

And sometimes

it's

the

it's

the world

beautiful

was

and sometimes

just it's

same thing."

RECONSTRUCTION Ellison's

most profound teenage relationship was with Karen

Rutzky, his girlfriend from age 15. Rutzky's parents did not like

him, and "Larry was devastated by that," Doris Linn said.

But Ellison and Rutzky attended three proms and owned three matching shirts. Lillian gave her son money,

take Rutzky out, and buy her

gifts.

He

gave her a

and he would

Mary Poppins

book. The inscription: "To Karen, a supercalifragilisticexpiaHdocious date and a truly tolerant person. Love always, Larry."

Their relationship continued after she of Michigan.

He

and he asked her

left

for the University

told her that he planned to

go to medical school,

and become

a secretary to support

to quit school

LARRY ELLISON

Ls It

31

Really True?

him. She refused, just as she would refuse two marriage proposals in their five years together. Ellison

remembers

As with many relationships from differed starkly

from the other

and unimportant. In sum:

Karen Rutzky Back,

now

one proposal.

just

memory

his past, Ellison's

The

person's.

"I cared deeply

ago

details are long

about Larry," said

of Los Angeles. But he lied to her

seri-

she said. 'T got tired of being a detective about everything he

ally,

said."

Ellison said the notion that he lied to her

taking."

He

five years

said.

is

added: "The fact that

I

"really breath-

is

stayed with Karen Rutzky for

one of the worst things anyone can say about me," he

"Forget about always being late." Ellison rooted against

University of Michigan sports teams for twenty-five years. In the middle of the tour of his future

pelled to

tell

me

home,

com-

Ellison felt

that the best-looking girl in his high school

had

a

crush on him. But he did not go out with her because he was loyal to Rutzky.

"The

single stupidest mistake

made

I

in

my

entire life,"

he said. Over several hours of interviews, no subject animated Ellison

more than Rutzky. For

her parents' dislike

made him

feel

—seemed

unworthy.

It

success, her rejection

all his

embodiment of

a lingering

also served as a ready

—and

all

that

benchmark

for

his life's piece-by-piece reconstruction.

"You know,

I

was named one of Playboy's top

dressed people recently," he told late

2000.

"I think

my

me

in a

ten best-

phone conversation

in

journey from those stupid matching shirts

with Karen Rutzky to Playboy's best-dressed

list is

a

more heroic

journey than going from the South Side of Chicago to running Oracle." In 1962, Ellison graduated

and enrolled

from South Shore Fiigh School

at the University of Illinois in

Urbana-Champaign. He

followed the same basic scholastic method he did in high school: a subject interested him, he

worked hard;

of his chief accomplishments

came

in

he didn't.

if it

didn't,

an

intra-fraternity

If

One "Car

LARRY ELLISON

32

Is It

Really True?

Bash" competition: The broad and muscular Ellison helped

team smash the guts out of At the end of

his

sophomore

ney cancer. Crushed, Larry cried for weeks.

In the California.

He

summer

his

a junkermobile with a sledgehammer.

left

year, Lillian Ellison died of kid-

school, returned to Chicago, and

never returned to Urbana-Champaign. of 1964, he and

They spent time

Chuck Weiss

visited

Northern

in Berkeley, at the beginning of the

counterculture movement. Ellison was not of the drug or protest realms; he registered for the draft and said he

would have gone

Vietnam

long and strummed

a

little

if

called.

But he "grew his hair a

little

to

Jimmy Linn recalled. Ellison was captivated by

guitar,"

California, "the promised land."

It

seemed wild, open, and warm,

a perfect place for escaping cohabitation with Louis.

many

But he returned home to Chicago, where

He

were attending Northwestern University.

of his friends

enrolled as a part-time

student at the University of Chicago, where he spent one semester.

He told friends that he had gotten into medical duced an acceptance

letter.

"The

remembered

that

Ellison's

Southern California. recalled Ellison

"It

letter

says

Northwestern. Coleman

at

was from

the

University

was very short and had typos." Rutzky

showing her an acceptance

of

also

letter.

Ellison never applied to medical school, he says now.

He

What about said. He asserted

the

didn't graduate

acceptance

from

college, or

come

letter? "It just couldn't be,"

logical impossibility of the premise

there

He even pro-

didn't look legit,"

letter

Dennis Coleman, then an undergraduate

school.

was an acceptance

ance medical school cated a

letter,

—

it

close.

he

just "couldn't

the

be" that

because there was never an accept-

— and ignores the charge that he ever

fabri-

letter.

In the overall

scheme of Larry

Ellison's success, lying

about a

not that relevant.

One can even

understand his impulse to embellish credentials

in the achieve-

medical school acceptance

is

LARRY ELLISON

Is It

33

Really True?

ment-oriented worlds of Karen Rutzky, Dennis Coleman, and his other friends. But the lengths to which Ellison has perpetrated the

notion of this acceptance

him of

—

remarkable.

is

them

still

When I

this day,

recalled

and to the people

had been accepted

at

medical

David Linn's dismay when Ellison said he

wouldn't be going to medical school: "You'll be the five

closest to

spoke to Doris and Jimmy Linn, both

believed that Ellison

They

school.

—to

who was

thousand years of the Jewish religion

man

first

in

accepted to

medical school but refused to go," he said. Ellison

Instead,

bought

Thunderbird and drove west.

himself

He had no

idea

1964

turquoise

a

how

he would sup-

port himself, but in an undergraduate physics class he had

some aptitude

shown

computer programming.

in

BREAKAWAY Silicon Valley

still

sprawled with cherry orchards in the summer of

1966. But some early

were

in

place:

pillars of the future high-tech

metropolis

Stanford and the University of California at

Berkeley were turning out

litters

of engineers,

many

of

whom took

jobs at local computer hardware makers such as Hewlett Packard

and Fairchild Camera and Instrument Corp.

A high proportion of

Bay Area business were using mainframe computers. Carrying a programming manual, Ellison

moved from

nical job to technical job at banks, insurance

small businesses.

He made enough money

the notion that he In 1967, he

was "amounting

companies, and

to live on,

to something"

met Adda Quinn

at a

tech-

and he loved

on

his

own.

San Jose employment

agency, and they married after a few months, both at 23. Quinn's

brother was his best man, and no one from Chicago attended the

LARRY ELLISON

34

wedding, except for Weiss,

seemed to

Really True?

Is It

who was

drop out of

sort of

living in

San Francisco. "Larry

sight for a while,"

Jimmy Linn

seemed determined to break clean from

Ellison

although Quinn says he often mentioned Karen Rutzky.

said.

his past,

He got

his

nose fixed, smoothing out the lumps from long-ago basketball

games. But he couldn't go to

on the

biggest

name

Nose Doctor." As

just

any

plastic surgeon; he insisted

in Beverly Hills, Dr.

Maury

Parks, aka "The

she turned the pages of old photo albums,

Quinn compared EUison photos

pre-

this," she said, pointing to the

crooked and knobby nose from

their

wedding

day,

sion a few years

"and

later. "I

and post-nose

this," as she points to the

Nor could

"Look

at

renovated ver-

paid for that nose!"

The Elhson-Quinn household could not Parks.

job.

afford Dr.

Maury

they afford Larry's $1,000 racing bike or

$30,000 sailboat or the $100 a month he needed to repair

his car

or the expensive wallpaper for the house they bought in Oakland in

1970. But Ellison insisted on

all

of them, and

Quinn

paid.

Ellison kept talking about getting better-paying jobs to support his

champagne

tastes,

but he

made

a series of lateral career

moves,

and some backward ones.

When Ellison

his

beloved cat, Yitzak (for Yitzak Rabin), died,

was so distraught

always loved

cats,

home

that he stayed

and took death

for a week.

He

—any death—exceedingly hard.

His employers had limited patience for his needs and desires. So, increasingly, did

Berkeley, but

Quinn. Ellison enrolled

would never

from an obscure college

finish.

in

"He

told

Sheffield,

Quinn

told

said.

me

these big,

whopping

"He could follow

"I've never

these

lies,

lies

graduate classes at

me

that he graduated

England," Quinn

"Now, where do you suppose he dreamed

"He

in

that up."

and he stuck

He

to them,"

for years."

been to Sheffield, England," Ellison

that's very peculiar."

said.

said nothing about whether that's

he had led Quinn to believe.

said.

"So

what

LARRY ELLISON Ellison's lack of a college degree puts

among

high-tech entrepreneurs.

To succeed

finish college, either.

tional degree

genius

is

is

Bill

him

in

superb company

Gates and Steve Jobs didn't

in Silicon Valley

without a tradi-

—proof

something of a credential

itself

above convention. But Ellison hardly w^ears

schooling as a badge of renegade credibility. Indeed, point of recurring shame in his

There tell

is

no

35

Really True?

Is It

it

that a

his limited

has been a

life.

better indicator of this than Ellison's refusal to

his ov^n wife that

he did not have a bachelor's degree. They

were married seven years.

Why did he never tell her?

Because they met at an employment

agency, Ellison explains, and he told people there he had a degree in

order to get jobs.

And

he could never bring himself to come clean

to his wife. "I lied," he said.

Quinn boring says,

calls Ellison the

man

she has ever

yes, and, a

later,

would spend

When he was home,

bad

most charming,

known. He

brilliant,

and non-

also gave her an ulcer, she

and changing moods.

interests,

a delinquent notice

would come

in the

large stretches of time out of the house.

he and Quinn would argue.

and Quinn said she feared

sive temper,

thing. I'm embarrassed."

he paid their real estate taxes, he would say

if

few days

mail. Ellison

in a

a

with his deceptions, darting

She would ask him

riage

"It's

He had an

explo-

for her safety as their

mar-

—they rough part of Oakland and had been burglarized — and she was ending. The couple kept guns

in the

thought Ellison was becoming increasingly "I don't

Ellison said,

know how

and

she ever thought

calls I

house

lived

erratic.

she could have feared for her safety,"

himself a nonviolent person. "The fact that

could shoot her

is

a

little

bizarre."

In 1971, Ellison invited his aging father to live with him.

was

a kind

and unexpected

gesture,

Quinn

It

says, but their strain

Hngered. Louis was not disapproving, she observed; she never

heard him

criticize his son.

But neither was he supportive, and

Larry took that as disapproval.

"

LARRY ELLISON

36

Is It

Really True?

"Louis would kind of look down, with said.

"It

would

when he

1974,

it

entered a nursing home, and died soon afterward.

He badgered

to.

Quinn

drive Larry absolutely crazy." Louis stayed until

marriage to Quinn ended the same year.

Ellison's

want

this expression,"

He

didn't

her for several nights in a row, not letting

her sleep, pleading with her. He, like Quinn, was unhappy in the marriage, but something about tried counseling.

Ellison said.

"I

"And

its

remember

appealed to him. They

stability

how

asking,

does

this

work?"

got this amazing gibberish answer. I'm

I

like,

okay, great, thanks. Uh, no."

"He was chiatrist

what

so smart, he could almost outguess

would

games, because

say,"

Quinn

him with mind

recalls. "I didn't trust

he's the best.

And

I

think that's

the psy-

why

he's so

good

in business."

In one counseling session,

she stayed with him, he

Quinn

would make

says, Ellison

vowed

a million dollars.

It

that,

was

if

the

first

time she had heard him speak of becoming rich. "I said to

him,

I

what

hope you become a millionaire," Quinn

it

make you happy. EUison bought Quinn

said.

"Maybe

that's

will take to

Years

later,

a

$50,000 Mercedes, and

he paid the mortgage on her parents' house.

husband battled cancer, Ellison gave him a

good terms with

all

When

Quinn's second

lucrative job.

He

is

on

three of his former wives, he said.

Despite his scattershot job history, Ellison was becoming a

good computer programmer.

Ampex,

a

computing firm

In the mid-1970s, he landed at

in Sunnyvale,

many compacontract work for the

which,

nies in the early days of Silicon Valley, did

like

federal government. Ellison contributed to a database project for

the CIA.

Code name:

Oracle.

At the time, databases were usually "hierarchical." They organized data according to a "hierarchy" of information.

American flight

Airlines

wanted

to keep track of

its

flights

If

Pan

(What are the

numbers? Where are they going?) the information would

LARRY ELLISON flow

downward from

would

marked

a master heading

work

top of a chart and

start at the

the information they were looking

Is It

their

Really True?

37

"flights." Users

way down

to find

for.

But database technology was nearing a breakthrough. In

Codd

1970, International Business Machines Corp. researcher Ted

published a plan for a "relational" database, which could discern fluid connections

a

between

bits of data.

Pan American employee could

Flight

With

say,

tell,

a relational database,

how many

passengers on

209 had ordered vegetarian meals. Chrysler could

models were

selling best,

and who was

selling the

see

which

most. Codd's

paper prompted a race to create the best relational database. The

key players were a group from IBM, called System R, and another

from Berkeley,

Ingres. In 1976, the

plan and published

it.

IBM

scientists

completed

That would be unthinkable today, but

their

in the

1970s, software was a largely academic pursuit. The satisfaction of

and authorship were viable currencies. There was also a

prestige

Utopian ideal, a virtue in sharing information because

"Our feeUng was,

enrich the larger academic village. lifts all

was

ships," said

Michael Blasgen of the

the biggest ship,

No

we

IBM

it

would

the rising tide

team. "Since

IBM

stood to benefit most."

one benefited more than Larry

Ellison.

AGGRESSIVE PROMISCUITY "We can do the

first

this,"

time,

EUison thought as he read the

someone had applied

IBM

paper. For

a mathematically consistent

impressed. Yet he wasn't thinking

He was amazed and about the paper so much as an

intellectual challenge to replicate.

Foremost

means

of

that this

finding

was

and

retrieving

data.

in Ellison's

mind was

a business opportunity.

In 1977, at age 32, Ellison

had

ment consultancy with two former

started a software develop-

colleagues,

Bob Miner and Ed

LARRY ELLISON

38

Is It

Really True?

Oates. As in school, Ellison had struggled with traditional tenets

—things

being on time, keeping a boss happy.

like

"He never seemed

to care that

manager of

said Irv Tjomsland, the ect that

ElHson worked on at

one of those people where, problem, lem,

it

it

was

work

much about

a software development proj-

Ampex

in the early 1970s.

someone

if

other people,"

on the team had

else

that person's problem. But

"He was

had

Ellison

if

a

a prob-

was everybody's problem."

Ellison

was much

would allow him

boss.

had with a manager

worked

Omex,

briefly in the 1970s.

by a manager for coming "So, are any of

at

my

It

He

to operate at Larryspeed, in Larrytime.

recalled a dispute he

firm where he

own

better suited to being his

a Silicon Valley

He was admonished

in at 1 1 A.M.

projects late?" Ellison recalled saying.

"No." "Are anyone

else's

projects

on time?"

"No." "Well," Ellison said, his voice rising again at the recollection,

"maybe everyone should

get

some extra

sleep.

You

clearly

have a

decision to make." It

phone

was around call

business,

this time,

1977, that David Linn received a

one night. Ellison needed some money to

and Linn agreed

to write

him

start his

own

a check. "Well," Linn said

as he got off the phone, "there goes $6,000."

The same year

that Ellison, Oates,

sulting firm. Bill Gates

and Miner

and Paul Allen

started their con-

started a

Micro-soft in an apartment in Albuquerque,

company

New

called

Mexico. While

Micro-soft would transform computing for individuals, Ellison's team

focused on businesses. Their goal was to build the viable relational database. felt

With IBM's paper

that they could develop a better product

letter

from

commercially

as a blueprint, ElUson

and

Ellison did nothing to hide his reliance

Blasgen recalled getting a

first

Ellison:

sell it first.

on the

"He

IBM

team.

basically said.

LARRY ELLISON give

me

few

a

details,

I'll

Is It

39

Really True?

copy them, and that way our systems

will

be the same," The request was ignored. Ellison, Miner,

and Oates had limited resources; venture

capital did not flow then as

had no

it

interest in diluting his

does today, and besides, Ellison

ownership

began as a bootstrap operation: sign

money, develop size

and limited resources,

do work, get

clients,

And

their database product.

company. They

in the

Ellison, Miner,

despite their small

and Oates were well-

positioned to thrive in a wide-open market. Since they had written

products in IBM's

their

language, as opposed to Ingres's

from

a

1986 decision

to

SQL

QUEL

make SQL

language, they benefited

the industry standard.

independent consultancy, Ellison's team could

from

direction

programming

("Sequel")

client to client, all the while

from each contract. They worked on

As an

shift its strategic

amassing funds

a range of projects.

When

they decided to build and patent a software product, they

designed

it

to be "portable,"

meaning

it

would run on

computing platforms. Ellison liked to say that

different

their software

was "promiscuous." They named

1979

the market in the

company

the product Oracle

that

initial

would become known

version on five years,

as Oracle Corp.

On March

was gen-

12, 1986, Oracle

public offering. Shares debuted at $15 and closed

that day at $20.75. Ellison's 34-percent stake lion.

first

—three years ahead of IBM. Within

erating $12.7-million a year in sales.

held an

and put the

was worth $93

mil-

Microsoft, which had since eliminated the hyphen from

name and

held

its

IPO

the next day, priced at $21

and closed

its

at

$28, putting Gates's stake at $300 million.

As Oracle grew, so did notion fostered on frequent

Ellison's craving for

visits to

"In Japan,

we

He once met a who mocked his

the Far East.

Japanese businessman, a Fujitsu executive,

American counterparts

dominance, a

for voicing "great respect" for their rivals.

believe our competitors are stealing rice out of the

— LARRY ELLISON

40

Is It

Really True?

mouths of our children," the businessman

said.

"We must

destroy

our competition." ElHson returned to Oracle and made reference to that conver-

He

sation repeatedly. petitors

and ending

spoke of "cutting off the oxygen" of

his

meetings with a chant of

his

com-

"kill, kill, kill."

While much of Oracle's success was a triumph of technical skill

and raw competitiveness,

most aggressive

sales forces in

also

stemmed from one of

computing

history.

were pushed hard and paid well

sales reps

was making $300,000

"Go

The company's

—Marc Benioff,

a year in 1986; top-flight sellers were

When

I

mentioned Oracle's vaunted

he scrunched up his

face. Sales,

last.

"sales culture" to Ellison,

while the lifeblood of any business,

carry a stigma in Silicon Valley, where innovation rules.

you want

it

because you sold

it

better.

they keep buying?

Would

pitches over a golf

game?

Ellison.

"Could our

sales force

We

says.

"Maybe. Would

must have pretty good technology."

no one

else

was

market was

relational database

selling

in a

harder than

land-grab period,

1990s. Getting market share was everything, even slashing prices to nearly zero.

enue

sales

suc-

convince someone

analogous to what Internet commerce was undergoing

and keep

you

they keep being influenced by a salesman's

in the late 1980s,

The

If

to be because you've built something better, not

buy a product that wasn't any good?" he

But

mak-

missed their numbers, which usually meant

doubling sales every year, they wouldn't

to

at 25,

out and don't come back before you have a signed con-

tract." If sales reps

ceed,

the

"The management theory was simple," Benioff

ing seven figures. said.

it

It

bonuses coming

in

when

it

—even

would be

of winning an account. "Ellison

if

it

meant

would undercut competitors if it

later on. Several sources recall Ellison

software could do and

in the late

was

might cut into rev-

exaggerating what his

ready,

all in

the interests

perfectly willing to

lie

to cus-

tomers," says Michael Stonebreaker, the former chief executive of Ingres,

which would be Oracle's chief competitor

in the 1980s.

LARRY ELLISON "Were

we promised

there things

Is It

41

Really True?

our early years that

in

we

couldn't do?" Ellison said. "I'm sure there were."

"Larry always said, Benioff recalled. believed

problem with

little

When Ellison promised a

at that

it

have a

'I

moment,

said

tenses,'"

customer something, he

Gary Kennedy, who oversaw

much

Oracle's sales operation in the late 1980s. "Larry wasn't so

dishonest as he

was imprecise

to gain

an advantage."

Customers would become enraged. But they needed Oracle's

make

software to

their

companies more

efficient;

and

to find a

—given the complexity involved replacing an elaborately customized system — would be massively disruptive new database vendor

One

to a business.

in

more popular recources

of the

for frustrated

customers was to sue Oracle. They did so in large numbers.

(When ets

on

I

went to the San Mateo County Courthouse

suits filed against Oracle, the records clerk said, "I

you have staff,"

to see dock-

all

day.") Ellison didn't care. "That's

he would

say,

and

was emblematic of

it

why

I

have a

the company's

hope legal atti-

tude toward customers generally. "There was always e-mail floating around Oracle about said

Unang Gupta,

how

stupid various customers were,"

Oracle's seventeenth employee

and

a longtime

executive. Ellison could be brilliant in one-on-one sales meetings with

customers; he could speak the language of engineers and marketeers alike.

meetings, getting a

But scheduling these meetings, and getting him to these

was always

him

to

a

monumental challenge

the truth in these meetings.

tell

team of executives from

from Peoria

to

Ellison not

show

weeks

Ellison didn't

work

for.

major customer.

San Francisco to meet with up.

show up

this

Kennedy remembers Caterpillar, traveling

Ellison, only to

The meeting was rescheduled

The executives returned

later.

During

a

—to say nothing of

to

for a

San Francisco

have

few

— and

again.

period Ellison could be inspiring or abusive to

"You would spend

a lot of time anticipating

what Larry

LARRY ELLISON

42

would do next,"

Is It

Really True?

said Gupta. His hiring

and

firing patterns

were

unpredictable. Ellison viewed business relationships as transient, a

phenomenon

that extended to wives,

and went before 1986. Whatever justify

them by

when

base software at a time

information technology. Valley.

But Ellison never

the

Bill

whom came

and methods, he could

dominant maker of data-

businesses were pouring cash into

He was an got as much

ware mogul to the north. In 1989, with

his behefs

was

success. Oracle

two more of

overnight king in Silicon attention as the other soft-

Gates.

more than 4,000 employees, Oracle moved

a verdant sprawl of

ponds and

cylindrical glass towers

to

on U.S.

101 twenty-five miles south of San Francisco. In a valley dominated by beige office parks, the lush campus became

known

as

"the Emerald City" (also "Larryland"), with Mercedes-Benzes, Jaguars, even Rolls-Royces lining the parking

lots. Ellison,

who

drove a red Ferrari to work, began boasting about the hours of

on company

tennis he played

women, some at

whom were

of

his

dated a procession of

employees. His rare appearances

headquarters were dubbed "Elvis sightings."

The good times came

more

millionaires than

at a price.

anyone

1984

to 1990.

This

is

"And most

who

perhaps overstated, and

ple

fallen out

who

mate

did

Valley," said Igor

work

for Oracle

from

of them wind up hating him."

feeling that Ellison incites in people.

have

"Larry Ellison has created

[else] in Silicon

an executive search consultant

Sill,

in

He

time.

it

ignores the ambiguity of

Many

former employees

who

with him speak generously in retrospect. "The peo-

dislike Larry, of

which they are

his brilliance," said

legion, tend to underesti-

Gary Kennedy, who

left,

on bad terms,

1990.

Ending

life

at

Larryspeed can be disorienting.

"When

doing anything so passionately, so emotionally, ending said. "I left in the

Jenny Overstreet

and

it

took

me

six

months

to

come

most

positive

it is

way

you're

hard,"

possible,

to grips with not being there."

LARRY ELLISON

It's

sible

rare that relationships end in the

when

works with

it

comes

worse

it

who

company was about

left

Ellison speaks well of

betrayed

when he

A

left

way

pos-

positive

employee

John Luongo,

from

its

a longtime

where the

at a point

excesses.

Luongo, and says he did not

the company. "I

felt, if

feel

anything, abandoned."

NEAR CORPORATE DEATH

In 1990, Oracle started paying

would be

43

closer the

on good terms, but

to implode

Really True?

tends to get. "Larry takes anyone

leaving as a personal betrayal," said

Oracle executive

most

The

to leaving Oracle.

Ellison, the

Is It

some

sales

commissions

company

the final indulgence of a

that

in gold. It

seemed to be on

a perpetual joyride.

Years of sales discounts, coupled with sloppy accounting methods, led Oracle to record revenues

it

had not

received.

reported nearly $971 miUion in sales in 1990

proportion of uncollected in

September 1990, and

bills. It

after

was forced

The company

—and yet had

a large

to "restate" revenues

more than a decade of doubled

sales

each year, Oracle posted a loss of $12.4 million in 1991. Several

The com-

executives and top managers fled. Ellison fired others.

pany's stock value

November

plummeted from $3.8

$700

million. In

of 1990, shares of Oracle reached their all-time low,

$4.88. Ellison's stake in the

down from

billion to

company was then worth $164 miUion,

nearly a billion the previous spring.

Things were so bad, Ellison says, that at one point,

his chief

accountant, Steve Imbler, walked into his office and said that the

company would soon be unable entity.

to function as an independent

"Steve said, 'We could go bankrupt.

selves at

an auction

But for Ellison, professional

life.

price.' Fortunately,

this

When

was by

far the

We'd have

to

sell

our-

he was wrong."

most

difficult

period of his

Oracle laid off 500 employees in 1991, he

LARRY ELLISON

44

Is It

Really True?

was too depressed,"

couldn't bring himself to leave his house. "I

he said. "I

let

everyone down." Ellison takes any loss and any

appointment brutally hard,

dis-

One compares him

his friends say.

with an alcoholic

who

bottom. "Larry

not very good about rolling up his sleeves and

is

can't bring himself to

change

he

until

hits

going back to work unless he has completely analyzed the reasons

why

he needs to do

said Jenny Overstreet.

it,"

What had happened discern: Ellison

to Oracle

had spent most of

issues, neglecting

was

his

easy,

though unpleasant, to

mental energy on technology

such business fundamentals as finance and day-to-

day operations. After a period of soul-searching, he resolved to run Oracle

ment.

like

It

whom

an "adult" business. This meant

also

meant bringing

in

his

renewed engage-

seasoned executives,

like

Ray Lane,

&

he hired in 1992 from the consulting firm Booz- Allen

Hamilton to shore up Oracle's operations. Lane, and new

financial

chief Jeff Henley, spearheaded Oracle's return to health in 1992.

company earned $61.5 Ellison survived

on

million that year,

sales of

$1.2

what he calls "my near corporate death"

The

billion.

in the early

1990s, and a series of near-real ones as the decade wore on.

He

broke his neck in a body-surfing accident and endured four major operations on his

left

arm

after a bike accident.

headlines for matters unrelated to software: the Bureau of Alcohol,

MiG-29; thwarted, he

He

An

He

regularly

made

avid pilot, he battled

Tobacco and Firearms to import a Soviet

settled for

an

Italian jetfighter, a Marchetti.

appeared on "Oprah" and made a public plea for a wife.

He

tried to

become

a

more

respectful leader. There

was no

specific incident or revelation, he said, although the financial crisis left

him humbled.

It

was something

and, his friends say, loneliness. tive

him

about being disliked by so

that just

came with age

He also became increasingly sensimany people who had worked for

—something that he had taken some perverse pleasure

ing Oracle's outlaw days in the 1980s.

When I was

his office, Ellison recalled a conversation

in dur-

visiting

he had with his

him

in

sister.

LARRY ELLISON

He was

Doris.

walked

in

bedroom on Clyde

sitting in his old

and posed

45

Really True?

Is It

Street

when

she

a question.

"What's more important to you, to be admired or to be loved?" she asked him. "That's easy, to be admired," he said.

"Wrong."

more important

"Doris, you said what's

to

ME, and

I

answered." "Yes, Larry, you did, and

"Get out of She

told

you that you were wrong."

room."

left.

Ellison

His

later.

my

I

was contemplating

sister

was

right,

exchange

this

And

he said now.

what

of his past behavior. "I used to practice as

'management by

to

come

ridicule,'"

he's I

vowed

to be

jokingly referred to

gracious,

life.

spoke

briefly.

New Haven,

After years of

Connecticut.

bought her a house

Larry's life,"

Adda Quinn

college tuition.

He

They kept

in California. "Bringing her out here

said. Ellison

real

watersheds in

paid Spellman's daughter's

in contact until she died in

1999.

Ellison said he absolutely forgave Spellman for giving for adoption. "She

ElHson

said.

infant, he said, but

was very young

herself

was too

him up

and she wasn't mar-

She tried to take care of him it

called

She had no idea what her son had become.

and having her be proud of him was one of the

ried,"

which

he hired a private investigator to locate his biological

mother, Florence Spellman of

Ellison

been taking stock

more

coincided with another turning point in his

her; they

years

he said. "People would be terrified

into meetings." Ellison

curiosity,

forty-five

when he was an

difficult.

We were sitting in his office, and Ellison was smiling, and the PR woman was nodding sympathetically again, and the situation reflected nothing but resist

warmly on Larry

Ellison.

Then, he couldn't

spinning the moment. "I'm just grateful she didn't have an

abortion," he said grinning.

LARRY ELLISON

46

Is It

Really True?

LOOK WHAT

reunion with Florence Spellman led to another revelation.

Ellison's "It

was very

my

real family

pletion in that

Each and winter flies

them

I

were the people

knew

exactly

year, Ellison invites

cruises

my real

my "My real mother was the woman who raised

clear after meeting

real mother," he says.

me,

for

flies

mother that she wasn't

who

who my

raised me. ...

I felt

Jimmy Linn

on the Mediterranean and

in the

Atherton

at his

On a whim,

summer

for

Caribbean.

He

mark

the

to California to attend his annual party to

commercial.

com-

family was."

Doris and

blooming of the cherry blossoms ever

DID

I

Neither

estate.

Ellison once sent Doris a check

$5,000 to pay for damage he'd done to a black Oldsmobile she

drove

many

decades before. In the years before he died, in 1996,

David Linn rode to limousine.

had

He

his judge's

chambers

in

an Ellison-sponsored

helped fund a dot-com venture that Errol Getner

started (and later ended) in Arizona.

"Everything that Larry has accomplished has had two psychic purposes," said one longtime friend.

people people

who believed who didn't."

in

him.

And

"To say thank you to

to say [expletive]

you

to the

Ellison said one of the reasons he kept his distance

childhood friends and relatives when he

first

was

wanted

that he

wanted

to succeed

people and say, 'look what in

touch with

join

many

him on one of

competitions.

I

first. "I

to be able to call

did,'" he says. Today, Ellison keeps

where they

They play basketball

at the

on the South Side of Chicago, except bounces overboard and a deckhand net.

arrived in California

of his old pals from Chicago.

his yachts,

from

will

They sometimes

replicate old banter

hoop on board,

and

just like

that sometimes a ball

have to retrieve

it

with a

There are cutthroat games of poker, with dollar antes, but

a pot gets too big, Ellison, a horrible bluffer, will declare for his

blood and fold

his

it

if

too rich

hand. Rick Rosenfield remembers

LARRY ELLISON

Is It

Really True?

47

one summer as they were cruising from Capri

Ellison saying this

to Sardinia at about 1 a.m.

occurred to him then that the boat

It

was probably burning between $50

$100 of

to

fuel per minute.

At times, Ellison seemed to get emotional when he spoke about

his

about

his children.

His voice softened, almost quavered as he talked

life.

"My

son

is

on the basketball team.

My

daughter

equestrian in the country. But

I

six-foot two, good-looking, smart,

probably the best young

is

don't care about

They

all that.

are

unbelievably nice people. They are just genuinely nice people.

Which

is

the

As he

most important thing

said this, there

was

whether Ellison was serious

some

in life."

a point

when

—whether

started

I

he was just dabbling in

softer version of himself, not just for

my

benefit, or

the benefit of his portrayal, but for the purposes of

Larrycentric game.

and

I

Or maybe he was

was overly spooked by

Ellison's

company runs on

in the world; the next day, for

some kind of

fondness for planned ambisaid to me, that the

rhythms and bents. One

Ellison's characteristic

day, Ellison will be the warmest,

even for

being completely sincere,

what an Oracle manager

guity. It recalled

wondering

most caring and charming boss

no apparent reason, he

will stop

talking to you.

Where do you

The perpetual questions

stand? Inside or out?

infuse Oracle's culture with a primal insecurity that mirrors that

of Larry Ellison's.

THE ONE CONSTANT Erom its

Oracle's beginnings, Ellison has always drifted in

and out of

day-to-day decision-making and strategic planning. His level of

engagement depended on "Larry factors" pened to be

in

—how

what Oracle was building and

or what else in his

life

interested he hap-

selling at a given time,

he had going on. Oracle executives can go

LARRY ELLISON

48

year-by-year,

Really True?

Is It

from 1980

now, and point to "Larry Years"

till

(years

he was engaged), and "non-Larry Years" (years he was not):

1987-1989 were non-Larry

when he

1990-1992 were Larry

Years;

company from

focused on saving the

its

Years,

financial ruin.

After Lane and Henley were installed in 1992, Ellison backed away.

But Ellison again racheted up

Oracle

his

activities to greet the

popular arrival of the Internet in the mid-1990s. Nothing held greater potential for Oracle's corporate legend than the Internet.

Before there

was an information

age, Oracle dealt in

mation, and as companies produced oceans of data

Amazon ers

tracking

its

The company owned

a lock

central to

the market share of

He wanted

how

him

irritated

its

closest competitor,

just a stranglehold

omnipresence.

on

would bombard

his friend

a single,

He wanted mainstream

Maybe

ers themselves.

they

But

work,

his

knew him

his software

"Steve sometimes accuses says.

it

was

restricted place.

still

When

with Steve Jobs, and people

me

in all its candy-like colors.

as a rich guy, or as

was

the

happy sharehold-

domain of back-office

types.

of having hardware envy," Ellison

His software, he would often

world." But

built. It

with love and praise for their cherished

Macs. They could envision Ellison?

IBM.

that relatively few people ever touched an

He would walk around

Oracle product.

was

business gets done.

audiences to understand what he had done and what he had

always

it

on the database software market, with

But Ellison wanted more than lucrative sector.

—whether

infor-

customers or Ford processing bids from suppli-

—Oracle had never been more

more than double

managing

a niche,

say, "is the

and

software that runs the

Ellison always gets bored in a

the Internet came, the niche blew wide open

with potential. The Internet offered Ellison a chance to subvert Louis Ellison's prediction for his

"Larry told Internet

is

me

son in the most extreme way.

once, 'Yes, [Oracle] missed on PCs, but the

going to change

Computing has been

all

that," said

decentralized.

Unang Gupta.

It

has.

Data has never been more per-

vasive. Neither has EUison at Oracle.

LARRY ELLISON "It's total

49

Really True?

Is It

immersion for Larry," Steve Jobs told me, some-

thing people close to Ellison say repeatedly. (One former Oracle

executive said he planned to

Woodside compound

would be spending touches.)

He

sell his

company

all

of his time micro-managing

The

centerpiece

ness suite," a single product that Oracle

allows them to

manage

all

stems from another difficult life.

He

his pain over

Ellison to lack control. So

much

his fortunes

commitment

failure.

to Oracle

nature of so

many

in

His terror of death and

how

untenable

Larryland

—has been so

to build in his image.

—

The stock might

it

it

for

is

his interests, his

volatile.

been the one constant. For twenty-four years,

falter,

an "e-busi-

has always considered his inability to stay

broken bonds speaks to

and

is

to businesses that

sells

reality: the fleeting

married to be a crushing personal

omy might

finishing

data-related operations online.

Friends say that Ellison's full-on

steer,

its

from a pure database company

to a provider of "software services."

friendships,

CEO

has overseen the development of nev^ softv^are prod-

ucts that are transforming Oracle

things in his

stock w^hen Ellison's

w^as near completion because the

But Oracle has

has been

his, to

fluctuate, the econ-

but Oracle won't be going anywhere, and

Ellison won't be either.

"AHHH, WELL" He

almost was gone in 1998. Another near-death experience,

this

time at sea. Ellison led his 78-foot craft Sayonara to victory in the

famed Sydney-to-Hobart yacht tal to the

race, but his victory

was

inciden-

hurricane that swept in unexpectedly during the race,

killing six sailors in the race. Ellison recalled the

morning

after the

storm, as Sayonara sailed up the Derwent River, on the

way

to

Hobart. There was an extraordinary sunrise. "The sky was amber, a prescient blue, yellow,

and green," he

said.

The boat was greeted

LARRY ELLISON

50

Is It

Really True?

by the somber sound of bagpipes playing.

on the boat.

We

were tacking back and

"It

was absolutely

forth,

silent

and everyone was

looking at the sky and just marveling at being alive." In

The Proving Ground, G. Bruce Knecht's book on the

why

Sydney-to-Hobart race, Ellison explained

"There are two aspects of speed," he

says.

he loves to race.

"One

is

notion of speed. Then there's the relative notion faster

than the next guy.

interesting."

race ("This

doing

and

it."),

He is

I

think

1998 would be

said

—trying

the latter that

it's

his last

the absolute to

go

much more

is

Sydney-to-Hobart

supposed to be fun. You're not supposed to die

but Ellison's

life

remains a perpetual quest to prove

assert his speed in the world.

goes beyond the pedestrian

It

notions of "competing" in business, or even being an adrenaline junkie.

There seems some deep psychic imperative to

Ellison.

He

speaks of "winning" and "losing" interchangeably

with terms such as "success" and "failure." of failing, he betrays a kind of soulful

form of immortality. Failing

more

this for

resilient

when he was

And when

fear, as if

he speaks

winning were a

gets harder with age, he said.

He was

Now, he feels he's running many at-bats you get." So he's much less than ever in his office.

younger.

out of time. "There are only so leaving less to chance, delegating

In June 2000, Ellison's hands-on fervor claimed a predictable casualty:

Ray Lane. With

the exception of Microsoft's Steve

Ballmer and America Online's Bob Pittman, there was no hightech deputy

who had

1990s than Lane

did.

jobs; Ellison always

onto his already

a better reputation or a higher profile in the

fat

He was mentioned

managed

to keep

him

for

an array of

at Oracle

CEO

by heaping

package of stock options.

But Lane's great reputation became increasingly irksome to Elhson, friends said, especially given EUison's checkered one. Ellison hated

the perception that

Lane

—not he—had

Oracle around in the early 1990s, and that Lane was

was running Oracle while

turned

the one

who

Ellison did the nonsoftware-related

LARRY ELLISON

Is It

51

Really True?

things that get written about everywhere but the business section.

Rodney Dangerfield

a classic

"It's

weeks

he

after

left

Lane told me

thing,"

Oracle and went to work at the Silicon Valley

Venture Capital firm Kleiner-Perkins. "Larry doesn't gets

few

a

feel like

any respect. But he wants to be the guy who's seen to be

he

driv-

ing the industry."

Tensions over credit are hardly unique in the corporate world, especially in cases that involve a powerful deputy and a

CEO who

does not lack for ego. Such cases are generally not hard

The deputy

to resolve with grace:

somewhere

CEO

the

else;

way with

sends him on his

leaves, usually for a

an effusive public thanks and

issues

a vault-full of stock options.

But the Ellison-Lane parting was strained

and

Lane.

It

was

He made

anyone

clear to

classic

Oracle

—

that's to say,

Lane out of meetings, according

public. Ellison froze

to sources close to Lane.

CEO's job

big decisions without consulting

company

inside the

that

Lane was on

the outs, but Ellison said nothing to him. For as tenacious as Ellison is,

he does not

possible.

He

like confrontations.

Ellison

—one

no. Lane said.

much

it

in

asked his boss

ting

resentment

lets

Lane saw

if

coming.

March

of

He

resists

He

initiated

for as long as

combusts.

two conversations with

2000 and one

in

May— in

which he

he wanted him to leave. Both times, EUison said

Then

the

problem only got worse. Lane started

get-

of his information about Oracle from the press. In the

end, he had no meaningful responsibility resign,

them

build until the situation

left.

him

Ellison asked

to

and he obliged.

Shortly after Lane's departure, both he and Ellison took part in a petulant

debate about their break-up in the pages of the Wall

Street Journal.

so

It

was

much gentlemanly

that

Lane

left

would have left

terrible

PR, but

pretense

is

that's life in Larryland,

filtered out. Ellison also

where

saw

to

it

Oracle a few days before $70 million in stock options

vested.

When

on good terms, he

I

played

just smiled

dumb and and

said,

asked Ellison

"Ahhh,

if

Lane

well. ..."

LARRY ELLISON

52

Lane ascribed

Is It

his

acrimonious end at Oracle

And

"Larry being Larry."

Really True?

part to

in

he will certainly not be the

Oracle

last

executive to leave on bad terms with Ellison.

But what was unique about personality clash per at the so-called

wave coming as the

Lane

guy

said.

dawn

that

who

se. It

his departure

was simply

is

that

was not

it

of the Internet Age, where Ellison

was too

built the

a

a time in Oracle's evolution,

saw

a

big to share. "Larry wants to be seen

most valuable company

"This was his chance to go

This was his chance to beat

Bill

down

in the world,"

in history."

Gates.

VERY PECULIAR I

was with

Ellison in his office in

Forbes published

was

listed at

its

October 2000, a few weeks

after

annual rankings of personal wealth. Ellison

number two, behind

skeptical of the rankings

''Forbes spots Bill as

Gates, and

it

galled him.

He was

and smelled a conspiracy.

many

billions as

he needs," Ellison said,

sighing, resigned to the injustice.

Yes, this

was important.

At one point sumptive "Richest

I

misspoke and referred to Ellison as the pre-

Man in the United States,"

and

Ellison

promptly

corrected me. "It's

not just the wealthiest guy in the United States.

world, the planet."

He paused

to

weigh the notion,

as

It's

if it

the

had

never occurred to him before. "I'm the wealthiest guy on the planet," he said again. "That's very pecuhar."

He added

that of

course this paled in importance next to Oracle beating Microsoft, "the biggest race of

Even

in this

all."

phase of

full

Oracle immersion, Ellison's world

was running wholly on Larrytime. He worked

at

home

starting at

— LARRY ELLISON

gym

7 in the morning, went to his

He

lunch.

got to his office around

At 7:30 on

Wednesday

a

Is It

at 10:30, returned

1 P.M.

and

is

53

Really True?

home

for

usually gone by 7.

night, after a three-hour interview

that included quick-hit visits to Freud, Gates,

God, and Ernie

Banks, Ellison stood and walked out his office door empty-

handed.

He

carried

no

no laptop, no papers. He did not

briefcase,

check e-mail or voice mail, or consult with any of his secretaries

whom

all

of

up

to leave.

had

anyway.

left

He

As he strode out the door, Silicon

Valley through a

just finished speaking, then got

Ellison's long visage

panorama of

eleventh floor: San Francisco

tall

was covered

loomed over

windows on

the

in fog to the north; a

clean orange sun set over the Bay to the south; red headlights flashed

up and down Highway 101

to the west. Ellison

seemed

morning-fresh in the elevator, discoursing on his sweet Chicago Bulls

and the basketball court on

would announce

that

his yacht.

from the

profits

its

The next

last

jump would again

briefly

—

more

quarter had

than doubled from the same period a year before lion, beating Wall Street's expectations

day, Oracle

—to $501

mil-

and the ensuing stock

make Larry ElHson

the richest

man

in

the world, the planet.

He walked stainless steel

had

left

door that looks as

the building,

gle mysterious

who

slowly through the darkened lobby past a big

man

if it

belonged on a

safe.

and Ellison was home alone except

Everyone for a sin-

—presumably a security guard of some kind

did not speak and trailed three feet behind. Ellison

walked out the door and began to disappear into the

dark and empty parking intently

back

the lobby?

brushed

lot.

at the building.

The building

his hair

But suddenly he pivoted and looked

Was

itself?

he looking at me? Something in

It

then became apparent as he

with his hand: Ellison was gazing back into

Oracle's emerald glass, at the reflection of himself.

chapii:r

two

JEFF BEZOS Everyman, livery for

Himself

Man

R

.ow

Jeff

work

to

business

onhne

many

gas stations are there in the United States?

Bezos hkes to put at

Amazon.com.

—petroleum

retailer

this It

question to executives

has nothing to do with Amazon's

among

the

few things the

— but everything to

do with Bezos's

products are

does not

sell

who want

assessment of raw intelligence. Bezos does not care about the exact

number of gas

stations, only the back-of-the-envelope cal-

culation that the candidate devises:

of

how

the prospect's brain

While

all

is

The process

yields a snapshot

wired.

corporate chiefs want to hire

Amazon's founder

bright

people,

prizes "genius" as a gold standard, to a

some-

times unforgiving degree. Amazon's screening process occasionally includes

asking younger job candidates for their

Bezos's appreciation for powerful

of privileged environments

—

in

funds.

the

He was 30

years old

dominant online

as skepticism

retailer.

minds was fostered

magnet programs

tary school students, at Princeton, at

one of Wall

He

scores.

in a series

for gifted elemenStreet's elite

hedge

when he founded what would become As

the era of dot-com indulgence ended,

mounted about Amazon's

resolutely confident.

SAT

was, after

all,

The philosophies Bezos applied

prospects, Bezos remained

invested in brilliance. at

Amazon

follow a principle

he has long embraced: Intrinsic ability rules, trumping acquired skills

and accumulated experience. One of Bezos's former Wall

57

58

JEFF BEZOS

Everyman, Every Man

Himself

dubs him "a Master of the Universe for the

Street co-workers

Internet Age,"

for

meaning he has the same blue-chip

marked Wall

sense of invincibility that

and

credentials

Street in the 1980s. Bezos's

designs and intentions seem to argue against the idea that Internet

commerce

a

is

newly leveled

field

where anyone can play because

the costs of participation are so low.

Bezos spends utives.

One

much

of his time recruiting and screening exec-

of his standard interviewing techniques

is

to

pop odd-

common practice in high-tech companies. Bezos's favorite is the one about how many gas stations there are in the United States. He asks it sheepishly, often apologizing. "I realize it's a little weird to ask things like this to people who have 800 ball questions, a

people reporting to them somewhere," he said in an interview

conducted with him

in

June 2000.

Bezos would draw on his

3,000 people

mers with

own

If

I

the question were put to him,

experience: He'd figure there were

in Cotulla, Texas,

where he spent

his grandfather. Cotulla

his

had two gas

boyhood sumstations.

"I'm

going to say there's a gas station for every 1,500 people," he said.

"And now

I

know

that by 1,500,

there are

and

That figure

is

there's

280 million people

my

in the U.S.

Divide

guess."

186,666. The American Petroleum Institute

said there are 175,000. Off the

back of

his envelope,

Bezos came

within d.l percent.

JEFF THINGS In the shorthand like this:

a

He

mythology of the

invented

borrowed Chevy

Amazon.com during

Blazer.

business plan on a laptop.

bookstore. As

Internet, the Bezos story goes

While

He

a cross-country trip in

his wife drove,

he tapped out a

envisioned a small, profitable online

Amazon.com soared and

Bezos's paper wealth shot

into the billions, he cultivated the persona of an

Everyman

for

— JEFF BEZOS

Giddy Times. He spoke of

Everyman, Every Man

his

for

59

Himself

company's fortunes with the

awestruck enthusiasm of a lottery winner. This was just a happy accident, he said. The

snowball doesn't ends up as one didn't

aim

set

out to be an avalanche

—and a

static

way

a

random

— but sometimes

just

landscape gets buried. No, Bezos

to build a retail empire in 1994,

any more than he

set

out to be valedictorian of Miami's Palmetto High School Class of

1982. But as soon as he saw what outsized goals the Internet

would allow

for

and what

addiction kicked

became

in.

his corporate

He

its

investors

would fund,

his achiever's

couldn't help himself. "Get Big Fast"

mantra. Buoyed by a geyser of stock gains

and sustained by a heap of debt

—Amazon's

virtual bookshelves

swelled with compact disks, videos, shaving cream. Legos, lawn furniture,

He

and dinosaur

couldn't just

fossils.

sell

books. Bezos needed to overhaul com-

merce to turn computer screens into the new store windows. Stores

would

survive only

replicated online

He was

if

they provided something that could not be

—physical ambience, beauty, entertainment value.

not hostile to traditional

Strip malls, he

would

say,

retailers,

would not

survive his uprising.

But Bezos hates the notion that prefers the explanation of a if

anyone could do

this,

only to their mediocrity.

he's

on

a crusade; he

company founded on

much

a road trip.

and Amazon were some fluke of the

As

times.

Bezos carries a tiny Elph camera with him everywhere, snapping

photos to chronicle this all

it

ends tomorrow.

How did

happen? "We were hoping to build a small, profitable

company," he said is

his joyride, in case

at the time.

"And

of course,

build a large, unprofitable company."

what we've done

Then he would boom

forth with his trademark laugh, a bray so startling that his

younger It

siblings used to refuse to sit

comes with

ulated

a resounding hiccup in

"hahs"

together

with him in movie theaters.

which Bezos

strings six artic-

— hah-hah-hah-hah-hah-hah! — "like

jackass gargling bumblebees," says one friend.

a

JEFF BEZOS

60

When person

met Jeff Bezos,

I first

was

I

Everyman, Every Man

with,

in

for Himself

Washington

upon hearing him

was "disturbed." He vowed

to

laugh,

wondered

Amazon

sell his

1999, the

in early

Bezos

if

stock that day.

If

he did, he would have been sorry, at least in the short-term. By year's end,

Amazon was

may

or

may

of a time

limitless.

company had come

embody

He was named

limitless.

By June 2000, when

to

dot-com exu-

for 1999, the personification

seemed so

possibility

was not

It

the

when

to a

not have been rational.

Time Magazine's Person of the Year

All the while,

flyer.

became the background Muzak

the Bezos laugh

berance that

the Internet's highest

all

I

next saw Bezos,

was precarious

that

Amazon was

(if

not

in the

midst of a

brutal run of tough projections, executive defections,

and stock

still

possible) in Internet business.

deflation.

I

Bezos at Amazon's headquarters, a

visited

twelve-story converted hospital southeast of

had

all

downtown

stately,

Seattle. It

the democratic trappings of a typical dot-com: casual

dress, a foosball table in the reception area,

and

requisite toys

how

nutty and young-

certificate to

mark Amazon's

placed prominently on desks to underscore at-heart the corporation surely was.

In the lobby

was

framed

a

$1.25-billion debt offering, declaring

Debt Offering

ment

like this

played at

all,

prominently.

in History."

it

"The Largest Convertible

This baffled me.

Not

just that a

docu-

—proof of massive corporate arrears—would be but that someone at Still, it

was

Amazon

decided to display

a great token of a time

disit

so

when massive

debt became something to celebrate, a testament to corporate

chutzpah, to the conceit that a wild idea

like

Amazon was

being

sanctioned by a solemn Wall Street institution, in this case,

Morgan

Stanley.

me to the bathroom, I an Amazon PR woman in a small cafeteria

After a security guard escorted for Bezos with

lobby

floor.

We

waited off the

stood next to a fully assembled dinosaur

that Bezos purchased at an

Amazon

fossil

auction. "Please don't feed

JEFF BEZOS

the

Cave Bear,"

on the

a sign

Everyman, Every

Man

for

The words on

fossil said.

61

Himself

the sign

flowed from a photo of Bezos. laugh preceded his

Bezos's

"Ah-hah-hah-HAH-

arrival.

HAH-HAH"

rollicked

moved

"Hi, Jeff Bezos," he said, between sips of a cup of

closer.

down

growing louder

a hallway,

He wore

Starbucks coffee, his fourth of the day in mid-afternoon. a blue dress shirt

— acknowledgment "Nice

including one employee

badge

sit,

hat"

who wore no

at security checkpoints, as

dentials.

We

and khakis, the everyday Bezos uniform.

walked the grounds seeking a place to natured

as he

if

and Bezos offered good-

—to

shirt.

everyone he passed,

He

showing

eagerly flashed his

his

normal-guy

cre-

You'd never know he was Time's Person of the Year,

except that the framed cover of the issue was displayed prominently in the

No pioneers.

main reception

area.

brooding nerd, Bezos

He

smaller than

is

is

a rare extrovert

among

high-tech

5 feet 8 and 170 pounds, but he seems endearingly

life.

At one point during our meeting, he spoke

unabashedly, though apologetically, around a mouthful of peanut butter crackers.

He fumbled

with his

cell

phone when

his wife,

MacKenzie, called to remind him to bring something home will.

.

.

.

("I

Love you, too"). At 36, Bezos had thinning brown hair

and puppy brown eyes that invited a mothering impulse. Several of the seventy people

I

interviewed about Bezos said they

felt

very

"protective of Jeff."

Encounters with Bezos, or discussions about him, often include descriptions of "Jeff Things."

an agreed-upon term of

mer

girlfriend,

and

art

It's

not clear whether "Jeff Things"

among Bezos

several friends

"things") to describe

all

fans.

But

his brother, a for-

invoked "Jeff Things" (or

some kind of Bezos

behavior.

that

had happened to him. Or something that they've

Jeff

Thing because

ethos. Like the Jeff

its

Or something just

deemed

perfect absurdity so captured his aura

Thing

in

1997,

is

when Bezos and

his father

a

and and

brother cased and stormed a 7-11 store in Florida pretending to be

JEFF BEZOS

62

Navy

Seals.

the car.)

Everyman, Every Man

for

Himself

(They each carried walkie-talkies;

Or when,

mom waited

Jeff's

in

to celebrate his 35th birthday, he planned an elab-

orate scavenger hunt for his closest friends in the Metropolitan

Museum of Art. Or the pocket-size tool kit he started carrying everywhere after the World Trade Center was bombed in 1993. He purchased a "World Trade Center Escape Kit" for every family. (This, obviously,

was

well before the

member

of his

World Trade Center was

destroyed by terrorist attacks in September, 2001.)

mundane

Certain Jeff Things exist within

Such as the asides that wend into tial

his discourses.

conversations.

They

are tangen-

to the conversation, but they are not parenthetical asides.

implies an idea delivered as an afterthought

— and Bezos speaks

and with a buoyancy, that makes nothing sound

a volume,

That

like

at

an

afterthought.

was

In the middle of an explanation he

mentary school days, Bezos got going on

giving about his ele-

how

always easier to

it's

shave with a cold razor and a hot face than the opposite. clear

how

when

it's

sharper.

this topic

came

more conducive

to

face

is

hot,

makes

It

the razor

your pores open wider. This

good shaving. He pantomimes

with his hand, dragging two knuckles up and

"A

not

up. But, for the record, metal shrinks

cold, he explained, his voice rising.

And when your

It's

a shaving

down

is

motion

his right cheek.

cold razor after a hot shower, that's your best bet," Bezos said.

"You want any other body hah-hah-hah."

Another

He

care tips,

you come

to

me, hah-hah-hah-

then said he needed a bathroom break.

Jeff Thing:

the south of France. Bezos

There was

and

his pal

this

one drunken evening

in

Tom Karzes wandered away

from a wedding reception and came upon an abandoned hotel on a

hill. "It

was wild and overgrown with

safe," said Karzes,

who

wisteria

and

it

hotel

was precarious." Bezos found

and

didn't look

used to work with Bezos at the Wall Street

hedge fund D.E. Shaw. "Part of the enjoyment of that

it

insisted that they explore.

this for Jeff

a

way

inside the

It

was

like a

was

abandoned

dark maze, but

JEFF BEZOS

Everyman, Every Man

Bezos managed to lead them up to a

an object lesson

no

will allow

in the

commissions," Bezos

Make

code of Bezos: You must

"Most

regret.

regrets in

life

ness. There's also

ple

for

whose being

own

Jeff Force

that

is

it's

the

word people

not quite goofi-

no

single

own weather

creates his

Jeff. is

There's

one of those peo-

system. Like a mountain,

Amazon. You could probably say

or a lake, or the in their

way

live in a

riski-

or combination of words. Bezos

it,

and

an element of obsessiveness, stubborness,

randomness, and imagination to things

word

tiny victory,

said.

memorable. And goofy. "Goofy"

it

63

Himself

are of omissions, not

use most often to describe a Jeff Thing. But

ness,

A

flat roof.

for

that

people,

all

way, create a force around their personality. But the

—an

attendant

phenomenon

to Jeff Things

—

more

is

powerful, more far-reaching, and more easily distilled than most. Plus,

it

disrupted the world

—massively.

STAIRSTEP OF ACHIEVEMENT

A

Amazon.com

is

company was

a wild idea, taken to an extreme that

rampantly on

its

the corporate

embodiment of

chosen ecosystem

—

a Jeff Thing.

imposed

in this case, the retail

and stock market. Bezos was indulged by

The itself

world

all

the necessary support

networks he needed to succeed: by investors,

his family, his friends.

The company became both is

also built

Nearly

on

a kind of

all

into

macro

and playground.

It

Jeff Thing: achievement.

Things involve some hellbent pursuit of

Jeff

achievement, even at

Amazon moved

a Bezos laboratory

its

its

most routine, day-to-day

current headquarters, Bezos

level.

When

vowed never

to take the elevator to his fifth-floor office. Fie'll adhere to this

vow

even

"Now flu,

I

it's

when

he's sleep-deprived, jet-lagged, late for a meeting.

like a

winning streak," Bezos

would

still

says. "If I'm sick

take ten minutes to walk up to

my

with the

office rather

JEFF BEZOS

64

than throw

Everyman,

away.

it all

Man

Ever)^

depend on a

Himself

you have

It's like, if

high school, you don't want to blow "Jeff's goals

for

it

perfect attendance in

after a while."

stairstep of achievement,"

said

Charles Ardai, the chief executive of Juno Online Services

who

worked with Bezos

when little

you're a

more

go with

little

1990s

in the early

at D.E.

Shaw.

kid and you're blowing bubbles.

air left in

your lungs, you want to see

If

how

"It's like

you have a far

you can

it."

Jeff

Things tend to be packed

in a little kid's imagery.

School

metaphors, playground games. The laugh, the curiosity, the excite-

make him one

ment. They define the Bezos brand,

Economy's most infectious of loyal friends and the

But

it's

figures. Is

New

genuine, or the handiwork

Amazon image machine?

I'd

venture both.

also easy to mistake Bezos's ebullient, accessible per-

sona for egalitarianism,

just as

it's

easy to mistake Amazon's mass-

market appeal for a populist streak is

it

of the

in its founder. Bezos's reality

steeped in the blue-chip performers he has always played with.

To

exist in the Jeff Force

elitism. It helps to

To work with

be

is

to experience the

paradox of lovable

brilliant.

the Jeff Force,

a requirement.

it's

Bezos works maniacally to enforce the

strictest

admissions

standards in corporate America. In rewriting the rules of industry,

he has nurtured a culture that can be strikingly akin to a traditional high school.

slackers are sent

It is

a place in

home, and middlers

tribution warehouses

"There's nothing

and

rule,

are kept back, usually in dis-

call centers.

wrong with asking

Several of his employees blew

minor metric

which the superachievers

away

in Bezos's elaborate

for

his

SAT

scores," Bezos says.

1450, in

fact.

SATs are one

assessment of job candidates.

JEFF BEZOS

Everyman, Every Man

for

Himself

65

Bezos declares them "a terrible data point, very noisy." But the degree to which adults talk about their SATs at

Amazon

is

extraordinary. Employees there seem to have easier recall of their scores than you'd expect.

They

also

seem to

knov^^

how

their long-

ago scores compare with their colleagues'. At one point interview, Bezos turned to his personal

and mentioned with wonderment that

named

Allison

During

had scored "at

least

in

an

PR woman, Lizzie Allen, some Amazon employee

1550" on her SATs.

a three-hour conversation in

June 2000, Bezos pro-

claimed nine people as "brilliant" or "a total genius." In mid-

an

interview,

who was

Amazon

named

engineer

HB

walked up to Bezos,

sitting at a picnic table in a courtyard,

and mock com-

plained that he could hear Bezos laughing from his office on the eighth floor.

way

"HB

is

of introduction.

one of our resident geniuses," Bezos said by

HB

is

standard for the rest of the "If "If

you Is

the

you

out with

A

student," the kind

who

sets the

class. A's,

you

get to keep A's," Bezos said.

start hiring B's, B's hire B's."

there a place for the

answer

ident.

start

"an

is

"But

yes," said

B student

at

Amazon.com? "Certainly

David Risher, an Amazon senior

at the leadership level, the

answer

is

vice pres-

no, in part

because that person would stick out like a sore thumb, and frankly

would not

interact very well with Jeff."

1996 Bezos interviewed Joy Covey, a candidate to be Amazon's chief financial officer. He noted that she had finished In

second in a

field of

CPA exam. "Why who had law and

27,000 the year she took her

not first?" Bezos asked, half kidding. Covey,

business degrees from Harvard University, said she didn't study.

She got the job, and remained at

Candidates for top ous, Socratic tests.

If

Amazon

someone

is

Amazon

until early

2000.

positions are subjected to ardu-

interviewing for a high-level mar-

keting job, Risher said, Bezos might

fill

a whiteboard with thirty

marketing techniques and then instruct the candidate to "force

JEFF BEZOS

66

Everyman, Every Man

for

Himself

rank" the techniques from top to bottom for a designated marketing initiative.

"He would

say,

'What would you do

would you do second, what would you do That would provide instincts, discipline,

first,

what

third?" said Risher.

a close-up, real-time look at the candidate's

and

focus.

Senior managers are also subject to five to ten reference checks, which Bezos often conducts himself.

They can take 60

minutes each and include a battery of twenty-three questions, including:

Can you

think of a problem that everyone thought

was

unsolvable that this person solved? "If this

person were really

you can remember these

brilliant,

things," Bezos said. "If they can't think of anything,

mean

they're not brilliant. But

it's

Many

a

like

highitera-

them graduated from the

of

same schools and worked together

many New Economy

Amazon,

managers from

tion of the old boys' network.

doesn't

certainly a negative indicator."

Since superachievers often cluster,

tech firms, tends to recruit

it

same companies.

the

at

Program manager Jonathan Leblang graduated from Palmetto

High

in

class).

the

Miami with Bezos

in

1982 (Leblang ranked seventh

Risher attended Princeton with Bezos and was a

same eating

club, where, he recalls, Bezos

player of beer pong. Risher, like several

from Microsoft Corp., admired for

its

skill,

One

is

is

not

Amazon

executives trumpet

a top-caliber meritocracy, an institution

all

he cares about, and that Amazon's hir-

of the quirks of Bezos and his start their

pause or say "Well," or to

studied closely and

not one-dimensional.

always seem to

come

a ferocious

commitment, and drive matter most. Bezos says that

brilliance alone

ing process

of

Amazon managers, came

company Bezos

technology leaders,

their organization as

where

member

rigorous hiring practices.

many

Like

a

was

in the

work

at

Amazon team

is

that they

answers with the word "So." They don't

"Umm."

But,

when

Amazon, one manager

I

asked what

said,

it's

like to

"So Amazon

is

a

JEFF BEZOS

Everyman, Every Man

dynamic environment," and when

how

asked Risher

I

67

Himself

for

Bezos

expresses anger, he said, "So he tends to be melodramatic, he might

put his head

gonna have

down on

to

kill

I

myself.'"

and

The

If

say.

I

hear that idea again, I'm

"so's" imply the instant certainty of

The answer you're about

their positions.

"So"

the desk

to hear

is

simply so.

also used to veer a question to opposing logic.

is

When

asked Bezos about the apparent lack of racial and gender diver-

Amazon, he

sity at

said:

"So

I

with the premise of

totally disagree

your question," and he jumped into a defense of the diverse interests, sexual orientations,

staff's

Even

histories.

as

hometowns, and job

top executives and board of directors are pre-

its

dominantly male and white

(a profile

common among

technology

on "the

diversity of

firms), Bezos's idea of diversity tends to focus

He

genius."

committed to assembHng a collection of

is

minds that are variously wired. Amazon does not provide graphic breakdown of

"There page on the

its

Web

site.

'type,'"

it

says

and speak

worked

Gamble and Microsoft

ure skater

...

a

demo-

on the "our culture"

who have people who have

"There are Amazon.com employees

three master's degrees at Procter &C

a

stellar

employees.

no Amazon.com

is

Amazon

Rhodes

five

scholar."

languages

One

.

.

.

... a professional

of his employees

fig-

was

a

National Spelling Bee champion, Bezos says. "You can shout out

'onomatopoeia' in the hallway, and you'll get an answer." Fie

is

looking for "a superstar dimension" in every job candidate, he said. If

know

there

is

him, and

a recurring criticism of Bezos

who

have worked for him,

it is

among

people

that he can be impa-

This became increasingly difficult as

Amazon grew

tient

with

into

an organization with thousands of frontline employees

of

whom,

frailty.

inevitably,

were

brilliant.

who

—not

all

They often worked 55 or 60

hours a week for $11 to $14 an hour, with small grants of stock options that have lost value as Amazon's stock price has declined.

The employees' output and performance

company has

struggled with

are monitored closely.

The

low morale and high turnover among

JEFF BEZOS

68

some customer

Everyman, Every

service

and

Man

for

Himself

distribution center workers.

A

union-

uncommon at Internet companies, sprouted. "I found the culture at Amazon to be terribly unforgiving," Julie Drebin, who worked as an Amazon customer-service

organizing campaign,

says

representative for

two years

until she left in

dared to raise issues about the company, defying these people

When

questioned."

I

who were

so

elite,

it

May was

2000. as

if

"If

you

you were

they were beyond being

read this quote to Bezos, he did not respond.

This tension goes to the crux of conflict between the Bezos per-

sona and the Bezos value system.

Everyman, or every man for himself? "Bezos has obviously worked hard to construct himself as this

easygoing guy and accidental capitalist,"

who Amazon

said

Gretchen

Wilson,

has helped organize a union campaign with a group

of

customer-service

employees for the Washington

Alliance for Technology Workers. "But

world he

is

creating,

it's

this incredibly

if

you look

harsh and uptight place

based on these weird, traditional notions of

who

is

adds a former colleague

"I love Jeff Bezos,"

closely at the

worthy."

who worked

with him in the early 1990s at D.E. Shaw. "But he has bhnd spots to certain realities, especially

when

it

involves the limitations of

other people."

Bezos himself has always inspired enormous faith parents, bosses,

and

financial backers

—and

the experience has

nurtured in him an unusual sense of possibility. His in a series of intellectual

—from

rise

has

come

wonderlands where he has had to con-

tend with few limitations.

MINI-ADVENTURES One day when

Jeff

was

6,

he was playing with a friend and men-

tioned that he had attended his parents' wedding. That's impossi-

JEFF BEZOS

ble, the friend said.

You weren't born

When

yet.

had

a question for his mother. "I explained

that

made me comfortable,"

maybe dancing around

Man

Everyman, Every

he got home, Jeff

it all

to

him

says Jackie Bezos, "which

the subject."

What

69

for Himself

terms

in

meant I was

she explained

was

that

it didn't work out, and she and Jeff Nanny and Pop. Jeff looked up and quietly went back to live with asked, "You mean you got a divorce?" His mother nodded.

she had been married before,

1964, two weeks

In

turned

she

after

Gise

Jackie

17,

Jorgensen gave birth to a baby boy. She was a high school student in

New

Mexico. Eighteen months

later,

her marriage ended. She

and her son moved back home with her parents.

"From wanted

to

the minute

do was be

a

community

Jeffrey to her

lunchtime.

I

He was

a

knew

Jeff

was going

good mother," says

to be born,

all I

Jackie. She hauled

college classes, changing his diapers at

wondrous-eyed boy with huge ears and

bright blonde hair.

When

Jeff

New

Bank of

was

2, Jackie

missile crisis in

Operation Pedro Pan, a

who had fled 1962. He came relief

few months before the

a

to

Miami

at

16 as part of

program devised by a Catholic

to bring teenagers to the United States

Miguel and a cousin moved school.

priest

and out of Castro's Cuba.

briefly to

Delaware to

Then o Washington D.C. where he held

finish high

several jobs,

including working at McDonald's. Miguel ultimately

New

at the

Mexico. There, she met Miguel Bezos, a recent

immigrant from Cuba

Cuban

took a job as a bookkeeper

moved

to

Mexico, where the University of Albuquerque was offering

scholarships to

bank of

New

Cuban

refugees.

He took

a part-time job at the

Mexico.

Miguel says he

fell

in love

with Jackie at the same time he did

with her son. With his Cuban accent, he pronounced their names "Yackie" and "Yeff."

Miguel

legally

"Daddy."

He and Jackie

adopted

Jeff,

married

when Jeff was

who'd already been

4,

calling

and

him

70

JEFF BEZOS

When

Jeff

Everyman, Every Man

was 5 and

for

Himself

6, his sibHngs, Christina

were born. Miguel took a job as an engineer Houston, working long hours. "He

know,"

at

and Mark,

Exxon Corp.

the least lazy person

is

in I

would

Jeff said of Miguel. Often, at the last minute, they

have to cancel family vacations because Miguel would have to

He imbued

work.

the household with an exemplary

and the kids learned to

own

Miguel's

Cuba and

set their

father

ethic,

vacation expectations accordingly.

and uncles had emigrated from Spain to

lumber business

started a

work

in Santiago de

Cuba, on the

south coast near Guantanamo Bay. At an early age, Miguel was

made ing or mill

wood

to haul

how

at the mill,

hot the sun.

When

no matter how

said,

decree.

and the experience bred

patriotism for his adopted home. limit,"

Miguel

said. "That's

morn-

Castro came to power, the lumber

was closed by government

Miguel

early in the

what

in

"We

him

"You come this

lost everything,"

a fervid immigrant's in

and the

sky's the

country allows, and

I'll

for-

ever be grateful for that." Jeff

had another

Lawrence Preston

sky's-the-limit role

Gise.

model

in his grandfather,

"Pop" Gise worked on space and defense

technologies for the government and, in 1964,

was appointed head

of the Atomic Energy Commission's Albuquerque office.

aged a

staff of

summer ther

was

at his

26,000 and a huge budget.

almost every

ranch in Cotulla until he was a teenager. His grandfa-

his best friend,

person he ever knew. ble.

Jeff spent

He man-

he says, the most resourceful and

He had

self-reliant

expansive notions of what was possi-

Bezos was also struck by his grandfather's completely unfuzzy

notion of right and wrong. In 1968, Gise

He had no

wanted

patience for inefficiency.

to close a factory in his jurisdiction,

but a group of politicians insisted that

it

remain open. Rather than

abide an inefficient plant, which employed 2,000 people, Gise retired to his ranch.

Gise was an intellectual mentor to Bezos.

He and

Jeff

invented things together, like an automatic gate opener that did

— JEFF BEZOS

not use

He

electricity.

for

71

Himself

taught Jeff to weld, to lay pipe, fix wind-

and bulldozers, and to

mills

Everyman, Every Man

He took

castrate bulls.

Jeff to the

Cotulla Public Library, which had an unusually large collection of science fiction books.

A

and Bezos read them

all.

view immensely.

local

was

"It

man had donated

his big collection

Science fiction formed his early world

way

a great

of expanding your ideas of

what's possible and what's not," he says. Gise only stoked

He

this.

told stories about missile defense

systems, outer space, the wonders of nature. ject

some of these

of

ranch. so

It

mad

a metal gate

at himself, he took the part of the it

tale.

also the sub-

Once, Pop Gise

and a fencepost

thumb

ripped the fleshy part of his right

and hurled in the

has a favorite

stories. Jeff

thumb caught between

got his

He was

thumb

off,

that

at the

and Gise was

had come

away. Then he drove himself to the emergency

nearby town of

Dilley.

The surgeon could not sew

the

off

room

thumb

back together without the part that Gise had thrown away. Thus, the surgeon

had to

From then have to shave

onto his thumb.

on, every morning in the kitchen.

Pop Gise would

his

thumb.

explained. Really, he said,

more proof

from

Gise's buttocks

graft skin

that Bezos

"It's

butt skin, so

who

else ever

comes from

grew

it

hair,"

Bezos

shaved his thumb?

It's

a family of pioneers.

Gise also exposed Jeff to a stringent approach to competition.

He

taught Jeff to play checkers and always beat him. Jackie

pleaded with her father to his confidence.

He was

would have none of me," he would If

say.

Pop was

let Jeff

so young,

it.

win it

occasionally. Just once. For

was

"He'll beat

painful to watch. But

me when

he's

Pop

ready to beat

Eventually Jeff did, over and over.

Jeff's

mentor and

idol, Jackie

was

his

foremost

protector and all-purpose support system. She ran a household

steeped in board games, science projects, and storytelling. She

spent hours playing with letting

Jeff,

talking to him, indulging his joys

him watch "Speed Racer" and

the "Three Stooges" every

morning, "Star Trek" every night. Each night

at dinner, Jackie

72

JEFF BEZOS

Everyman, Every

would commence the

Man

"Interesting

for

Himself

Thing of the Day" game,

which everyone shared an example of something

happened

them

to

of cool things, mini-

full

adventures to be seized. Life need not be

—nor should be—pro-

She never collected a single quarter. She supported

tiple trips to

Jeff's

geeky hobbies and

Radio Shack

would omit something from dier

interesting that

that day, or risk a quarter fine. Implicit in this

was an expectation: The world was

saic.

in

made mul-

curiosities,

for his assorted projects. Often, he his parts

and she'd have to

list,

back to Radio Shack. She couldn't stand depriving

tools to

push a day's

She would do

what was obvious

three children, but

now becoming

possibilities.

clear to everyone

to

all

who met

of

him:

this for Jeff's

sol-

Jeff the

any of her

teachers

He was an

was

excep-

tional child.

A

MODEL

This was confirmed by a standardized parents enrolled

him

in the

when

Vanguard Program,

for gifted students at Houston's River

twenty miles from their home. teletype

test

One

Jeff

was

a pilot

8.

His

program

Oaks Elementary School,

of his early feats involved a

machine that could be connected to a mainframe com-

puter by a

modem. None

the computer, but Jeff

of the teachers

a "Star

drew

program

a

model

a procession of visitors

educators from other areas

it

out.

Trek" game.

The Vanguard Program became It

to

and a few other children figured

They spent hours playing

in Texas.

knew how

for gifted education

—scholars,

politicians,

—and Bezos was inevitably trotted out

as the program's prize student. Cute, precocious, super-bright, he

always put on a great show.

But Jackie worried that he was spending too much time outside of class. "I

was

afraid that they might be pushing

him because

"

JEFF BEZOS

Everyman, Every Man

for

he was their Httle token," she says. The issue came to a head

JuHe Ray, the author of a book on special education asked

if

she could write a chapter

from the River Oaks Judy." At

ally agreed, after getting several

agreed not to use

Jeff's real

Jeff, identified as

Jeff.

"It also said

I

joke

—^Judy

assurances from Judy Judy.

Ray

name.

"Tim," was described in Turning on Bright

and a boy of "general

serious," "courtly,"

in Texas,

was too much. But she eventu-

A Parent Looks at Gifted Education in

Minds:

when

Jackie received a call

woman named— no

principal, a

Jackie said no, this

first

on

73

Himself

had no leadership

Texas as "friendly but

intellectual excellence."

skills

whatsoever," Bezos

"Hah-hah-hah-hah-hah-hah!

recalls.

As

a child

and young adolescent,

Jeff

was

He was

bullied.

nei-

ther shy about demonstrating his brilliance to people, nor about telling

them

in the

head with a lunch box, drawing

if

he believed they were not

brilliant.

tears,

One

kid hit

him

but no blood. Jeff

once called a big tough classmate "stupid," and Stupid responded

by punching him

in the

mouth and knocking him

Another big kid demanded Jeff's rather gotten beat Jeff got his

up than

to the ground.

lunch money, and "he would have

forfeit his

lunch money," Jackie said.

head slammed against a soda machine for

his troubles.

Jackie says the bullying never became too problematic. learn something

from being picked on," she

sense, however, she

was concerned

that Jeff

says. In a

"You

broader

was becoming too

"egg-shaped." She and Miguel pushed him to go beyond his geeky

comfort zone, signing him up for a youth football league fying notion to Jeff, like legs. "I

had no

who was

was dead

small for his age and had

set against

interest in playing a

—

a terri-

little stick-

playing football," Bezos says. "I

game where people would

tackle

me

to the ground."

But he approached

it

as

an

intellectual exercise,

compensat-

ing for his small stature by memorizing his team's offensive plays

and defensive formations. The coach charged him with

calling

JEFF BEZOS

74

plays on the

gave

way

Everyman, Every

field.

to fascination, and,

With every game

When

the

He named

Rams

his

for

more important, Jeff

a craving to win.

became more competitive. championship, he sobbed.

lost to the Jets for the

The move brought

Himself

Jeff captain. Jeff's anxiety quickly

Rams won,

Exxon

In 1977,

Man

transferred Miguel to Pensacola, Florida.

the possibility that Jeff, then 13

middle school, would not be

in a

program

and entering

for gifted children.

new

Pensacola required a one-year waiting period before

kids

could be admitted to their program. At least in the beginning, Jeff

would have

To

to attend classes with "average" or sub-average kids.

was unthinkable. She

Jackie, this

Judy and

Jeff's

Pensacola

still

"We said.

solicited letters

from Judy

teachers in Houston. But the administrators in

said no, invoking "standard procedure."

don't have time for standard procedure," Jackie Bezos

She convinced the administrators to at

least

meet her son and

review his work.

Standard procedure was promptly waived. "You just don't

go away," Jackie

says.

"You

don't go gently.

You

just

keep trying

to convince people."

EARTHLY PURSUITS By the time he reached high school,

Jeff

Bezos needed to convince

people he was a normal teenager. After two years in Pensacola,

Miguel ascended to an executive job

at

Exxon and moved

the

family to the affluent Palmetto section of Miami, where they lived in a

four-bedroom house with a pool

in the back. Jeff entered

Palmetto high, "the kind of school where the cars lot are

much

in the student

nicer than the ones in the faculty lot," says

Massimino, Palmetto's director of student

Andy

activities.

Early on, another student asked Jeff what radio station he

tened

to.

This

is

always a trenchant question

among

lis-

adolescents,

JEFF BEZOS

a

window

for

Himself

75

listen to the radio or particularly like

music.

failed coolness.

Next

vowed he would do

time, he

better.

lacking in this," he told his mother that night. to every radio station

and

Man

into musical tastes and, ultimately, a person's coolness.

But Jeff Bezos did not

He

Everyman, Every

on the

"I'm obviously very

He

started listening

and memorized

dial

their formats

call letters.

Palmetto was

rife

with high-achieving kids, the sons and

He

daughters of executives, doctors, lawyers.

group of about nine or ten their

elite

students.

gravitated to a

They wended through

days together as a roving clique of achievers:

first

period,

honors English; second period, honors calculus; fourth period, honors physics; science club station

wagon with no

Cadillac-

drove a blue Falcon clunker next to his

and Mercedes-driving classmates. His clique often gath-

ered at the Bezos house.

and where they and Jackie engaged

after school. Jeff

air conditioning, a

—

homecoming

built the in their

still

was where they met before

It

mid-30s

float.

— by

They

their first

the

called

prom

Miguel

names. They

such as breaking into the school before

in gentle hijinks,

dawn and hanging yarn from classroom lights. "There was mischief we felt we could get away with," said Jonathan Leblang, an officer

with Bezos in the Palmetto honors society. "Are they really

going to suspend the top whatever of the class for doing this?" In twelfth grade, Bezos lost his library privileges for laughing

too loud. ing,"

He was

once cited by a police officer for "careless driv-

and Miguel grounded him

mandated

for a

a relatively early 10 P.M.

month. Jackie and Miguel

curfew that Jeff would often

challenge but rarely violate.

"He always

tried to push, to see

Miguel told me. "I'd 'Why?'

I'd

say,

what

the limits were,"

'You gotta be in bed by

12.'

and he'd say

say 'Because.'"

"There was a

"As quick as

Jeff

fair

was

amount of teenage exchanges,"

at assessing the

whole

said Jackie.

picture, he could ring

76

JEFF BEZOS

your

bell,

Man

for

Himself

challenge you with something, with

very quickly. If Jeff

Everyman, Every

He was

was ever

not a problem kid.

guilty of anything,

it

He

some statement,

didn't get in trouble.

was crimes of

the mouth."

Bezos's disdain for limits reflected a bent for adventure. fixated

on outer space, an

Trek,"

and a

NASA

interest first stoked

space

camp he

—he had

visited

by Pop Gise, "Star

attended in Huntsville,

Alabama. He had always been taken with magical kingdoms

far-off exploration

start a shuttle service that

nies the cost of launching a booster rocket.

low Earth "Jeff

orbit

and geosynchronous

was dead

It

orbit,

sector,

would spare compawould

travel

between

23,000 miles up.

serious about his space tug business," said

Carolyn McDaniel, a friend from high school. "He thought thing could work, that companies

make

a lot of

money doing

some model scenario

and

Walt Disney World seven times.

Bezos believed that space travel would soon be a booming

and he wanted to

He

it.

would want

Knowing

it

Jeff,

this

and that he could he probably had

in his head." Bezos confirms that yes, he did,

but the business proved unfeasible in the end.

Bezos also remained hyperfocused on earthly pursuits.

was

fiercely competitive,

winning,

among

other competitions, a

Florida- wide science fair prize for a project

gravity

on the common

He

on the

effect of zero

housefly. In his school career, the only

competition Bezos remembers not caring about was in fourth grade, a contest to see

who

in class could read the

most books.

(He also remembers finishing "in the 75th percentile"

in that con-

test.)

He was ically

not unpleasant about winning. "Jeff could be hyster-

funny while he was trying to beat the pants off you,"

McDaniel

said.

He seemed

to take

his competition, friends said, but

no particular joy it

was

in

pummeHng

also absolutely essential

that Jeff Bezos be the one to set the standard.

He found first

an

intellectual

serious girlfriend

match

in

Ursula "Uschi" Werner, his

and the valedictorian of the Class of 1981.

JEFF BEZOS

They would play

Everyman, Every

Man

word game Boggle and argue

the

77

Himself

for

incessantly

over the legitimacy of certain words. Werner excelled in literature,

Bezos in math and science, and Boggle involved an opportunity to prevail in Werner's strong suit. "Chess

strength," said Werner,

"We

who

now

is

didn't even try to play chess.

Werner matriculated

On

ior year.

at

would have been

a writer living in Washington.

It

would have been

ugly."

Duke while Bezos completed

his sen-

Werner's birthday, Bezos arranged for 200 large signs

to be plastered all over

campus, "Happy Birthday Uschi," the

"Hey Duke

signs said along with a detailed description of her.

Keep Your Hands Off Her,

guys.

Jeff's

Mine."

She's

Bezos applied early action to Princeton, the only college he

wanted

to attend. ("Einstein

He

said.)

suffered daily

was

there, for goodness' sake," he

agony waiting

accepted, he travelled with Werner to

her to

Windows on

reservations in jeans

the

World

and a

for the mail. After he

New York. He

for dinner,

T-shirt.

Upon

was

tried to take

showing up without

being refused seating by

the maitre d', Bezos stormed out.

He

kept studying and competing in high school, despite his

early acceptance to college.

He

realized he

dictorian of the Class of 1982.

It

had

a chance to be vale-

was an unusually

gifted senior

with more National Merit Scholarship semifinalists that

class,

year than any other public high school in the Southeast. Bezos

up

sized

his

competition and, to bolster his rank, piled on as

honors classes as he could honors classes and liked

On the day class

fit

onto

his schedule.

on

it,"

Bezos

aced

all

of his

his chances.

ranks were given out, seniors were called into

the principal's office, their fates inscribed a one

He

many

recalls.

"And

it felt

on index very

cards.

gooood

.

"Mine had

.

.

hah-hah-

hah-hah-hah-hah!"

Bezos first

time.

left

Miami

He made

for Princeton,

away from

a point of entering

wrought-iron gate off Nassau

Street.

his family for the

campus through

He

the main,

planned to study theo-

JEFF BEZOS

78

retical physics.

Everyman, Every Man

for

Himself

Like Albert Einstein and Stephen Hawking. Outer

space was not yet reaHstic, cyberspace not yet accessible, so this

would be

his frontier of choice.

But the dream ended

arrived at Princeton. Suddenly, Jeff Bezos in the

was not

after he

the brightest kid

room.

VERY, VERY TROUBLING One

night during his freshman year, Bezos

partial differential equation he

mechanics

class. After a

partner visited the

was

struggling over a

had to complete

for a

few hours of frustration, he and

dorm room

of a classmate,

who

quantum his study

glanced at the

equation and said, "Cosine." "After

we

expressed some incredulousness," Bezos says, "he

proceeded to draw three pages of equations that flowed through

and showed that

it

was

cosine."

It

led to a realization:

There were

people whose brains were wired to process abstract concepts in a very graceful way, and Bezos was not one of those people. "It was initially

devastating," he says, "very very troubling."

Over time,

his devastation

way

gave

dash of pragmatism. Bezos switched cal engineering

and computer

himself safely to a realm's

He

awe and

a

his concentration to electri-

science.

elite.

to a state of

He

studied avidly, restoring

compiled a

final

grade-point

average of 3.9, 4.2 in his major. (A-pluses counted as 4.3.)

Bezos took his

first

entrepreneurial foray that summer.

and Ursula Werner started the Dream that taught a

compendium

dren, ages 8 to 12. ing

Mark and

Institute, a

He

summer school

of science and literature topics to chil-

They drew

Christina Bezos

six students at

$600 each

—includ-

—and they were profitable. Bezos

does not recall the venture as essential to his development, but beat his previous

on U.S.

1.

summer

job,

working the

fryer at a

it

McDonald's

JEFF BEZOS

Everyman, Every

Man

for

Himself

79

His relationship with Werner lasted three years, ending with a difficult break-up.

of both of them.

It

was

the formative adolescent relationship

They owned

similarly high-octane minds, but

they held very distinctive worldviews. "Even though Jeff

was

a

bigtime dreamer, he had very rigid ideas," said one friend of Bezos

who

"He had

attended high school with both him and Werner.

tendency to get a

little

harsh and stubborn. Ursula was

a

softer,

more psychologically focused." Like

For the

mother.

college students, Bezos grappled with questions of

This led him back to the silent issue of his biological

identity.

father.

many

first

time since age 6, Bezos raised the topic with his

One summer day he asked

does not share.

"You did

When

a great job.

which she

a series of questions,

he was through, he gave her a hug and said,

Mom."

In telling the story, Jackie chokes up.

Bezos says the only time he ever thinks about his biological

when he's asked a genetics-related question on a medical form. Or when someone reminds him of it. A New York Times magazine profile referred to Mark Bezos as Jeff's "half-brother," father

a

is

term of great

irritation within the family. "I guess

it's

an ade-

quate description of our genealogical relationship," says Bezos,

who

has a marketing consultancy firm in

our familial relation,

as far as

it's

New

are you,

and which half

am

is

and declare

his father,

Or

is it?

end of There

this

is

is

among

life.

Miguel

Jorgensen grew up to

Bezos's friends that a source

the need to prove himself to the there

someone who may or may not

billions.

half

his biological father, Jeff

"a total non-issue" in his

a theory

him behind. Somewhere,

amass

"Which

story.

of his drive to succeed left

is

Whenever

I?"

To people who ask him today about will shrug

York. "But

totally inacurate."

they hear that term, he and his sister Christina ask,

Mark

make

man who

man named Ted Jorgensen, know that the former Jeffrey is

a

history in the corporate world

and

JEFF BEZOS

80

Does

Everyman, Every

motivate Bezos?

this

Man

for

He

smiles, then does a clearly

nervous rendition of the laugh. "Let's

my

ability for introspection,"

v^here you'll have to this

time with a

more

just say

he says.

me what

tell

little

Himself

"It's

it's

one of those things

really think."

I

nothing v^ithin

He

laughs again,

ease.

Miguel and Jackie Bezos give the impression of a happy couple

who

They

years.

We

have lived

met

in

are

still

well and settled comfortably into their

life

just in their

many

Aspen, where they spend

July 4th weekend, 2000.

breakfast at a rustic inn

my

monitor

in to

mid-50s, and they look younger.

I

downtown; was

visit,

them

joined

vacations.

It

was

were finishing

as they

who had

Lizzie Allen,

the

flown

Miguel and Jackie wore

there, too.

bright white tennis wear, with sunglasses resting next to their glasses of fresh-squeezed orange juice.

Over strong

several years spent in Texas

Cuban

and Florida, Miguel's

still-

accent has acquired a Southern U.S. twang. Jackie

—almost a perfect female analogue, espe-

looks strikingly like Jeff

and round brown

cially her big

when

The

unusually close, so

of Bezos

girlfriend

"momma's

is

whom

I

eyes turned adoring

when he spoke

she spoke of her son, just as Jeff's did

Their bond, even now,

mer

eyes.

much

interviewed called

boy." She meant this fondly, but said

of her.

so that one for-

it

him

a

could at times

lead to a problematic expectation that they be his caretaker.

Both Miguel and Jackie seemed even there interviewing them.

What

slightly

befuddled that

I

was

could possibly be relevant,

let

alone interesting, about the long-ago times of their son? "You

look back, and

it's

said. In giving

answers to questions, he

just a very

secret to Jeff Bezos's success

ordinary

life

we've

said,

was foremost

it

in his

all

had," Miguel

implied that the

mind. Or some-

thing that he even thinks about.

Yet there rience.

They

is

something unusual about the Bezos family expe-

are unusually close,

seem stunningly

free of conflict.

all

of them, and the relationships

They

still

vacation together sev-

— JEFF BEZOS

"One

eral times a year.

They

for

me to do He v^as

after he

81

Himself

Tom

Karzes.

not a dependency

"It's

genuinely enjoy each other's company." Bezos

just

"Knowing

adds:

for

of the strongest family bonds I've ever

seen," says Bezos's friend thing.

Everyman, Every Man

I

had a strong support netw^ork made

it

possible

something crazy." seeking something crazy

graduated

summa cum

—or something unusual

laude from Princeton in 1986.

He

w^eighed job offers from several large and prestigious organizations

—

Intel Corp.,

took a job

Andersen Consulting, and

New

at Fitel, a

Bezos was

Fitel

boyant domain of challenge and office space

settle

cross-border equity

employee number eleven, entering the flam-

New

deemed

York finance

in the

the founders brilliant.

1980s.

He

with one of them, Geoffrey Heel.

He

liked the

recalls

looking at

was

a compli-

It

lost.

When

they

and got into a cab, Bezos noticed Heel drawing on

a pad.

"He

cated space, the kind where you immediately get left

But he

York start-up that was building a

global telecommunications network to sales.

Bell Labs.

drew the

entire floor plan

from memory on the pad," Bezos

says,

shaking his head.

"WE'RE THE MAMMALS EATING THE DINOSAURS' EGGS" He

slept

on People Express

planes.

He

At 24, he was head of customer

service

and those divisions were based

in

shuttled across the Atlantic.

and software development,

New York

and London, respec-

For six months, he spent nearly every weekend

tively.

and weekday

in

New

in

London

York. People Express had two 747s that

crossed the ocean, and Bezos became so familiar with them, he

could

tell

It

immediately which one had the thicker foam in

was

customer

its

seats.

a logistical grind, especially after Fitel recruited a large

in

Japan and Bezos moved into Tokyo's Hotel Zeneco

— 82

JEFF BEZOS

Everyman, Every

Man

what he

for three months. Bezos took

for Himself

calls

"a visceral physical

les-

son" from the experience that he would apply to Amazon: the

importance of being close to the customer. Fitel also offered

an early look

at

how

connected computers

could automate a business process. Bezos, adept at both debugging

code and schmoozing with

what was

was part of

a

team that

built

essentially a mini-Internet for investors, sellers, brokers,

and banks. But those

new

adopting

clients,

clients

tended to think conservatively about

technology, and Fitel struggled to attract

tomers. In April 1988, Bezos

left

new

cus-

for a job at a financial services

powerhouse, Bankers Trust Corp., where he developed software applications for the company's pension-fund clients. After ten

months,

at 26,

he was

made

As

a vice president.

at Fitel,

however,

Bezos faced resistance to the technology he was developing.

"There was an old guard inside Bankers Trust that saw no reason to change anything," says Harvey Flirsch, a former executive

who

BT

ran Bezos's division. Bezos was not shy about advo-

cating personal computers, but several colleagues scoffed, saying that

PCs did not have

memory

to handle elaborate

frequently

dubbed members of

sufficient

financial data.

He was

He

not diplomatic.

the old guard "brain dead." Office diplomacy

anyway, and what's the

assumed

his brilliance

intellectual

would

Bezos's closest friend at

get

BT and

was

use of that?

him ahead,"

just politics,

"He always

says Kelsey Biggers,

a fellow proponent of speeding the

pace of change within the company. "We'd

say, 'We're the

mam-

mals eating the dinosaurs' eggs.'" Outside of work, Bezos and Biggers caroused, sometimes prodigiously.

They

traveled often, spending

memorable

nights

such as the one in Los Angeles, which included dinner at Spago,

two women from wear by Hotel.

a disco,

and Bezos getting busted

in his under-

security guards at 2 A.M. in the pool of the Beverly Hills

On

the night the Gulf

War began

in 1990,

Bezos sipped

JEFF BEZOS

Everyman, Every Man

martinis at the Princeton Club of

for

83

Himself

Manhattan and was transfixed

by the video game aspect of the spectacle on TV.

The more wanted

a

new

few weeks

stifled

job.

Bezos

He

in 1990,

felt at

Bankers Trust, the more he

explored starting his

Bezos even

left

BT

a

ing

fell

Web

site

CNET,

tired of being a technologist at a

nontechnology com-

ensured that his role would always be subordinate to the

It

prime mission of the company (financial services Fitel

to start

service for financial professionals. Their fund-

through, however, and Bezos returned to Bankers Trust.

He was pany.

For a

to join Halsey Minor, the

eventual founder of the technology news

personalized news

own company.

in the case of

and BT). He embarked on a job search. He was seeking a job

that involved "second-phase automation,"

which he defined

as a

technology application that allowed businesses to revolutionize their operations.

For example, a "first-phase" automation

push-button phone, a more ing practice.

A

efficient

"second phase"

how

a complete overhaul of

is

is

means of performing an

epitomized by the

Fitel

the

exist-

network,

equity transactions were executed.

Bankers Trust was attempting the same thing with data distribution.

But in

his

tural barriers

work

at Fitel

and

at BT,

Bezos came up against cul-

— both inside the company and with customers—and

he was eager to find a second-phase technology that people were

prepared to embrace.

He

said explicitly to his headhunter that he

financial services.

The headhunter then came back and urged him

to consider just one more: D.E. Shaw.

the

was done with

most technically advanced

It

had

a mystique as

one of

financial shops in the world.

The

founder, David Shaw, had a Ph.D. in computer science from Stanford.

He was

was an expert

interested in both technology

in devising

new

and finance, and

trading strategies based on complex

mathematical formulas. "I it

immediately

was enough

to

fell

in love

with David Shaw," Bezos said, and

make him break

his

vow

against financial serv-

84

ices

JEFF BEZOS

and take

Everyman, Every Man

for

Himself

company. Shaw was a "true genius,"

a job at the

Bezos said, a person unusually adept at using both sides of the

and small

brain, seeing big pictures

practices Bezos later adopted at

patterns.

Amazon

Many of the

he learned from Shaw,

Shaw

beginning with hiring. Senior job candidates at

interviews before they are hired. Just one out of every cants are hired.

Shaw

said.

"We

business

face ten

400

appli-

don't always recruit for specific positions,"

"We're happy to warehouse a truly gifted individual on

may someday make us money." After two years, Bezos was named a senior vice president, at 28 the youngest of four at Shaw. He spent much of his time exploring new business opportunities for the firm. Bezos spent many nights in a sleeping bag and foam pad he kept rolled up in the assumption that they

the back of his 39th-floor office.

He

found time for mini-adventures. In 1992, Bezos and

still

Biggers drove to

New Hampshire to volunteer for President George

Bush's re-election campaign. neither

was

terribly passionate

inert

from Boston," said

Biggers.

New

about

and stodgy,

Bush headquarters

back to

They did

They

"filled

left.

to invent? "Jeff

became

was

how

holes round?"

To pass

If

the time

you were

what would be

the

on the

ride

in outer space

thing you'd try

first

Microsoft asked job candidates,

on how

they do this?

What

to best discover it

are

man-

could they deduce?

and gauge a

He was

a salary in the high six figures,

devised a principle called

"Why

brilliant

He

mind.

constantly.

Bezos was also seeking a wife.

He

with yuppies bused in

fascinated by these questions," Biggers says.

Why did

fixated

air,

Friends say he talked about

making

But they found the

York, they thought up offbeat interview questions,

and you could walk on

spoke of

mostly as a curiosity;

politics.

things they might ask a job candidate.

He

this

"woman

in his late twenties,

to settle

down.

flow," a variation

on the

and ready

Wall Street term "deal flow," which ensured a stream of potential deals or, in this case, miserable blind dates.

JEFF BEZOS

Everyman, Every

Man

But some delicious Jeff Things happened

for

in the process.

There was an infamous night at the Princeton Club. Bezos

wine

all

Valesca.

over the plate of his date, this exquisite Spanish

"Not

a

little bit

85

Himself

spilled

woman,

of wine, like a half-inch of wine," Bezos

says.

But what was really amazing, Bezos declared over a decade

later,

was

And

the grace under pressure that Valesca demonstrated.

her resourcefulness

and transferring incredibly nice

it

—picking up the

entire fish with her fork

to the safety of her butter plate. "She

and gracious about the whole

was

situation, too,"

Bezos says. But not so nice to go on another date with him. "I'm not the kind of person says. "I

grow on them

who grows on women

quickly," Bezos

slowly, like a fungus, hah-hah-hah-hah-

hah-hah." In the end, Bezos

Princeton graduate and D.E. in his group.

When

it

in

fell

MacKenzie

love with

Shaw

research associate

There was no mutual

interest

Finally,

approached him. They were married

Palm Beach,

drawn by

Upper West Side of Manhattan. directly

tunities online. After

first

West

moved

into an apart-

In early 1994, Bezos

the advent of the

World Wide Web.

used the Internet in 1985, in a Princeton astro-

the spring of

Bezos and

its

1994 while working

Shaw met

for a

commercial

possibil-

for Shaw.

few hours each week to brain-

storm ideas. Bezos would then go off on

He

laugh, she

decades on the esoteric fringes, the Internet

physics class, but he never thought about

them.

for fear of

with Shaw to investigate business oppor-

was coming mainstream with

ities until

his

hired.

Florida, in 1993.

began working

Bezos had

it

was

at the Breakers resort in

After the wedding, Jeff and Mackenzie the

a

who worked

she

developed, Bezos was terrified of acting on

a sexual harassment claim.

ment on

when

Tuttle,

his

own and

research

isolated twenty products that could be sold online,

among them software, trading services, compact where down on his list, books.

discs and,

some-

JEFF BEZOS

86

Everyman, Every Man

But books kept

rising.

Himself

for

They could be

There were about three million books times the it

number

The

of CDs.

easy to "browse" by author,

arduous process

in print at the time, ten

made

Internet's search capabilities title,

publisher,

and keyword

—an

in a physical bookstore.

Bookshops

Literacy

Sunnyvale had begun

the

in

Silicon

Valley

of

city

customers by electronic mail, a

selling to its

viable proposition because so

Two

sampled online.

books online was not completely untried. In 1991,

Selling

Computer

easily

many

of

them were

early adopters.

others followed suit, BookStacks Unlimited in Cleveland and

WordsWorth

in

Cambridge, Massachusetts.

But those were niche markets, the preserve of hobbyists.

What

captured Bezos's attention above

Internet use

all

was growing by 2,300 percent

bubble that had seemingly even believe the figure the methodology,

and

infinite

when I saw it

became

room

it,"

was

a study that said

annually.

It

was

a small

for expansion. "I didn't

he recalled. "I read through

clear to

me

that this

was

a rea-

sonable methodology." Bezos's research coincided with another realization:

He was

ready to start his

own

business.

He had

con-

templated possibilities for years, increasingly as he approached 30.

He

told

Shaw he was

thinking about starting an online book-

store himself.

They took

a

two-hour walk together

told Bezos he could have a bright future at the firm stay.

Shaw

in Central Park.

But he also said he understood his desire to

if

he chose to

start his

company, something Shaw himself had done when he

Morgan

Stanley in

decision.

He

1988. Bezos took 48 hours to make a

contemplated

mization framework."

in a

paradigm he

He imagined

own left

final

calls a "regret-mini-

himself in a rocking chair at

age 80, asking what he would regret more: leaving a job that

came with perks on the chance

like a six-figure

Christmas bonus, or missing out

to settle the Internet.

Bezos gave Shaw his

final

answer and planned a road

trip.

JEFF BEZOS

Everyman, Every Man

for

87

Himself

THE MAPPED-OUT JOYRIDE Amazon

In

Bezos and MacKenzie

lore,

and headed West with no

fact, the

couple flew

his

company

before he

had

a large reservoir of tech workers

from the

largest

factors

York

—sup-

convenience of that

won, beating out Portland, Oregon, because

city's airport. Seattle it

many

New

left

plier proximity, labor pools, state sales taxes,

to Texas to

first

pick up Miguel's 1988 Blazer. Bezos scrutinized

about where to base

York

and veered sponta-

specific destination

neously toward Seattle. In

New

out from

set

book

Company name?

and

it

was

few hours

just a

distribution center in the country.

Bezos liked Cadabra, as in "abracadabra,"

conjuring his fondness for the magical.

"Cadaver?" asked the

Seattle

lawyer

who

helped him incor-

porate the company.

Bezos buried that idea and moved to his next: Amazon.com.

He

didn't have a single customer yet, but he loved the

Something huge. With no

would allow him This

Amazon.

is

to

move

Amazon would

any product,

it

the business in any direction.

no small point

Selling

specific reference to

name.

in

rise

of Bezos and

limiting.

Even though

understanding the

books forever seemed too

be introduced to the world as an online bookstore,

Bezos preferred the term "book service." "Thinking of yourself as a store puts

you

in a

box," he says. "Services can be anything."

The company was launched

in

1994 with

a

$300,000

ment from Miguel and Jackie Bezos and loans from

his

invest-

own bank

account. Beyond that, Bezos scrambled to raise $1 million from

twenty local investo/^

few people

"He came

in Seattle

—a major accomplishment, since Bezos knew and the Internet was still unknown to most.

off as this likable

he was doing," says

Tom

guy with an unshakable

Alberg, an early

Amazon

belief in

what

investor

and

longtime board member. Nonetheless, Bezos was telling prospective investors that there

was

a 70-percent chance the

company

JEFF BEZOS

88

would

Everyman, Every Man

and they would

fail

ble hedging, but also a

roughly 95 percent of

for

lose all their

Himself

money.

It

was

a responsi-

supremely hopeful assessment given that

all

start-up

companies wind up

failing.

Bezos worked out of the garage of his rented three-bedroom

ranch house in Bellevue, Washington.

was important

"It

started out in a garage," Bezos said. "Hewlett

gave us start-up legitimacy."

in a garage. This

degree of irony, aware that riches story.

He

Amazon

falls

that

we

and Packard began

He

says this with a

quite short of a rags-to-

could never have done this without his

own

or his

money.

family's

The garage was snaked with extension cords and cramped with a potbellied stove, three large computers, and three engineers

—the founder and

show

that this

new

his first

two

Their

hires.

first

goal

industry could be self-sustaining.

company could

come

to

Growth

would be steady and methodical, and funded by whatever the

was

muster. Other outside investments

profits

would

later.

That was the traditional

retail

Amazon opened devised a way for

model. But the plan changed

One

almost as soon as

for business in July 1995.

of the engineers

a bell to ring every time a sale

was made.

It

starting ringing almost immediately, then a

little

And from strangers. Everyone looked around at one another when the bell rang. "Is that your mom? It's not my mom.

more.

I

don't recognize this person.

this

was one of In

the

Amazon's

Is

that a friend of yours?" Bezos says

most emotional experiences of

first

life.

week, the store processed $12,438 worth of

orders. Within the first thirty days, fifty states

his

it

sold books to people in

all

—without advertising. Internet commerce was becom-

ing a gold rush overnight. But Bezos

commerce required

a leap of faith

by

was

also

users.

aware that Internet

It's

one thing to com-

municate with words online, another thing to supply a credit card number. to

win

He

stressed that the

company had

to take extra measures

that trust, such as sending instant e-mail to confirm pur-

JEFF BEZOS

Everyman, Every

chases, digitally holding the hands of nervous

on

insisted

Man

for Himself

89

He

also

newcomers.

a liberal return policy of thirty days.

Above

all,

held an

initial

bled on

its first

Amazon had to grow^. On August

public offering

—

and

9,

trading day, even though the

1995, Netscape

more than dou-

share price

its

company had no

The much-hyped IPO confirmed what was becoming clear

its.

Internet's first

ness

—and

profto the

movers: The rules of starting and expanding a busi-

raising

money

Bezos's mind, pivoting

for

it

—were

from turning a

changing. This meant, to

profit anytime soon.

It

was

not a bold choice, but an obvious one, he said: "To have thought otherwise would have been

For a brief period itable, a

1995,

late in

Amazon was

slightly prof-

milestone Bezos would later renounce as "unfortunate."

meant

Profits

management malpractice."

stinting

on marketing,

advertising,

and

infrastruc-

Now, those three elements formed a tripod supporting Amazon's new corporate mantra: "Get Big Fast." Amazon finture.

ished 1996 with sales of $15.7 million

over 1995. in

Its

losses

—a jump of 3,000 percent

were $6.2 million, compared with $303,000

1995. But by this time, investor trepidation about the Internet

had succumbed

to early-stage hysteria. "I

would

them

give

pieces

of paper with our weekly sales growth," Bezos said, "and they

would

say,

"Where do we send the check?'"

He took $8 capitalist still

million from the Silicon Valley's flagship venture

group, Kleiner Perkins Caulfield and Byers, but Bezos

owned 42

percent of his growing empire, with his family

holding 10 percent more.

But traditional book

It

had the

retailers

early look of a certain fortune.

always loomed

close.

Namely,

Barnes and Noble. It

was

Internet

—how hard could

this upstart

nificant

inevitable that they

whose

it

would

figure out

how to

be? At which point they

giggly founder

and

CEO

was

still

sell

on the

would quash spending

amounts of time packing and shipping books

sig-

himself. In

an oft-quoted phrase coined by Internet guru George Colony, the

90

JEFF BEZOS

Everyman, Every Man

company would be and Noble went

for

Himself

declared "Amazon.Toast" as soon as Barnes

online.

Bezos was unconcerned. In a secret dig at Goliath, Bezos held

many

early meetings with his staff

Seattle Barnes

and Noble

store.

and investors

in the cafe of a

In a not-so-secret dig, Bezos

arranged for

Amazon

Noble

"Can't find that book you wanted?" the signs said.

stores.

He

billboards to be driven past Barnes

was, however, a reahst. So in

1996,

late

and

when Barnes and

Noble's two top executives, Len and Steve Riggio, came to Seattle,

Bezos agreed to meet with them over dinner at

Lounge

Dahlia

restaurant.

Most people in a

Seattle's

in this situation

would

seize the

few years' work for a few hundred million

chance to cash

dollars.

You could

be secure in a job well done, a risk worth taking, and a preposterous fortune to spend the rest of your

wouldn't be so memorable.

It

would be

life

enjoying. But this

trivial. It

could lead to

regrets.

"The Riggios let's

do

a deal of

basically said,

some kind,"

you guys have done

said

Tom

Alberg,

a great job,

who accompanied

Bezos to the meeting. Bezos, in a congenial way, held firm. Barnes

and Noble was

was

Internet don't.

He

certainly the signature

different. Subtext:

again saw himself as a

"The Riggios were Alberg

said.

in three

"They

in bookselling, but the

Bezos knows

mammal

sort of like

how

to

do

this,

you

eating a dinosaur's eggs.

New

York

street fighters,"

started saying things like, we're going online

months and we're going

and returned

brand

to crush you." Bezos shrugged

to his office.

"READY, FIRE, STEER" In the mid-1980s, Apple's

ing alternative to

IBM,

Macintosh offered a popuhst comput-

the industry colossus that Apple

dubbed

JEFF BEZOS

"Big Brother" in

OnHne

TV ads.

Everyman, Every

ket in

America

derived motivation from the perceived hipness of

became

its

chief

users brov^se the Internet

let

a jihad against Microsoft v^hen

91

for Himself

In the early 1990s, Steve Case's

Prodigy. Netscape's crusade to

rival,

Man

joined the browser mar-

it

1996. Netscape v^as one of numerous technology firms that

isolated Microsoft as their designated Evil Empire: Oracle, Sun,

AOL, Apple, IBM, Intuit, and others. They had, at various times, made a corporate imperative of villifying the world's biggest software company

—usually through

Gates.

Bill

Through

their exter-

nal animosity for Microsoft, these companies achieved a greater

measure of internal cohesion. They became largely defined through their

rivals.

Bezos never bought

this notion.

speak too much, about a singular the online auctioneer, eBay.

my

senior year,

I

worked

really

He drew

I

would be

hard to make sure

Barnes and Noble, or

a parallel to high school. "In

the fact that

if I

could get

valedictorian," he said. I

"And

got those grades." But even

though he was aware of what Linda Fetko salutatorian of Palmetto's Class of 1982)

took no particular delight

not to obsess, or

tried

rival, like

was very conscious of

perfect academic grades, I

He

(the

West Point-bound

was doing, Bezos

in defeating her.

here," Bezos says. "I ask people to focus

says he

"There's a parallel

on our customers, not

competitors."

Which

is

not to say Bezos

is

averse to sharp elbows.

the firms he emulated were Microsoft

Amazon to be an "intense" and "friendly" company, much sooner give up "friendly" than "intense." In early 1997, Kelsey Biggers

boiled

went

starting

of Bezos's philosophies into a

staff. "Jeff believes

business," Biggers wrote in the

wanted

but he'd

an Internet busi-

to Seattle to study his old friend's

down some

pared for his

was

of

and Disney, two of the

hardest-hitting in corporate America. Bezos says that he

ness and he

Two

company.

memo

taking calculated risks

He

he preis

good

memo. "As an example, he has

JEFF BEZOS

92

Everyman, Every Man

forecast that in five years,

Amazon

for

Himself

will be defending itself against

about twenty lawsuits a year." Bezos denies having said

When Noble

asked Bezos

I

offer,

why

down

he turned

this.

and

the Barnes

he became oddly quizzical that such a question could

even be asked. "Because," he said, "we just wanted to build something special and innovative." Barnes and Noble might have

seemed Hke a powerhouse, but

in the context of Bezos's appetites,

they weren't nearly so big as he gle

person

said

I've

Amazon's

met

was

thinking.

"Almost every

world has some

in the business

sin-

set of limits,"

chief information officer. Rick Dalzell. "There

some paradigm they abide

by.

But for some reason,

gifted with the belief that there are

is

been

Jeff's

no bounds."

Bezos wanted to use technology to change not only the deliv-

model of shopping. Amazon's

ery of products, but also the basic

engineers developed "collaborative filtering" software that

customize the shopping experience to each user's this as a crucial

achievement.

He

tastes.

would

Bezos saw

disputed comparisons between

Amazon and established retailers such as Wal-Mart Stores Inc. No matter how huge they might have seemed, bricks-and-mortar superstores were intrinsically limited.

"You can subdivide

demographics of these stores into maybe said.

But

Amazon

eral million of

caters to segments of

one

segments," Bezos

—each customer,

sev-

them.

Once Amazon had passed

a threshold of viability, Bezos pro-

ceeded with the happy desperation of a super market, madly

filling his cart

out. Selling out to the Riggios

end to

fifty

the

his spree.

Amazon

man

racing the aisles of a

before his time and

would have

money ran

signaled a premature

sold stock to the public

on

May

15,

1997. By the end of the year the shares had risen 233 percent. The

media loved Bezos

as

much

as

Wall Street

did. Jackie

Bezos

perused newsstands, found magazine stories on her son, and

them open

to that page.

left

JEFF BEZOS

Everyman, Every Man

for

93

Himself

Nearly every story mentioned the laugh, a tidy metaphor for the

company, and the

disruptive,

Internet.

came out of nowhere,

It

and packed uncertain meaning.

It

w^as

big

and

more compli-

cated than joy. Bezos deploys the laugh to convey a range of messages.

"He

laughs

when

he's really

"Sometimes

really frustrated," said Dalzell.

laughing and

closed,

Amazon had gone

Bezos's vision of anything, anytime. instant online empire

the code phrase for

ness

—such

the day

it

went

Bezos

It

far

was

after year. "Getting

what could happen

as Barnes

Amazon's stock

ask

he's

toward

fulfilling

a hallmark of his

—with 20 million customers, and growing

84 percent year

a rate of

I'll

he's

'Because I'd be crying otherwise.'"

he'll say,

As the century

when him why

happy, and he laughs

and Noble

price hit

$113

to

at

Amazoned" became

any established busi-

—that didn't "get" the

Internet.

1999, up 6,500 percent from

in late

public.

filled his

shopping cart with other dot-com companies,

purchasing stakes in Pets.com, Living.com, Drugstore.com, and

He

Amazon

many

others.

tions.

Where was he going with

was

a question

much about stock. "Jeff tion, but

ventured

many were

all this,

and what was

his plan? It

asking, but few people seemed to care

getting an answer. is

into videos, tool supplies, auc-

Or

care

enough to stop buying the

launching this giant cruise missile in a general direc-

he doesn't

know where

it is

going," said Paul Saffo, direc-

tor of Silicon Valley's Institute for the Future. "He's inaugurated a

business

model of 'Ready,

When

Bezos was

Fire, Steer,'

named

not 'Ready, Aim, Fire.'"

Time's Person of the Year for 1999,

one analyst dubbed him the author of "one of the smartest business strategies in business history."

The Person of

the Year dis-

tinction ensured Bezos's credentials as an Internet pioneer

made

his

mom

cry. It

was now

certified:

Bezos and his super-

achievers had started a revolution in electronic commerce.

But

how

and

long would they be around to rule?

JEFF BEZOS

94

Everyman, Every Man

for

Himself

YO-YO TIME Amazon

reflects the

innumerable

wrote

"financial characteristics that have driven

retailers to disaster

throughout history," Ravi Suria

in a financial analysis for

2000. "The party

Lehman

Brothers Inc. in June

over."

is

Suria's report, w^hich v^as widely read, also predicted that the

company would run out

of cash by the end of that year. While

agreement was hardly general, the report signaled that the rules

were changing again: Old indicators were being applied to Internet businesses.

Amazon.

On

It

marked

summer

the beginning of a long

for

July 25, President Joe Galli quit, leaving a void of

The next

"professional" executives around Bezos.

day,

Amazon

reported lower-than-expected revenue, suffered a 45-minute outage,

of

and was subject to another

from many

former Wall Street supporters. Shares dipped to 30.

its I

spoke with Bezos several times that summer. The profile

was writing about him lished

in

September.

was

It

I

The Washington Post would be pub-

for

Amazon's fortunes seemed visit

string of harsh reports

a

difficult

story

to zigzag every day.

to

On

do because

the day of

my

to Bezos in June, an analyst said something nice about

Amazon and

the stock rose.

The next

A

day, Suria released his report

few days

later,

analyst

Tim

and

it

cratered.

Albright of Salomon Smith

Barney issued a positive report on Amazon, and shares gained

back the 20 percent they

Then

Galli quit,

Then Amazon which Wall

lost following the

and the stock

struck

some

fell

Lehman

report.

again

distribution deal with Toys

R Us,

rewarded as "responsible" and the stock

Street

bounced back again. In

was

all, it

market. But

it

Amazon were

a typical yo-yo time in a ridiculously volatile

was

a

summer

in

taking on urgency.

which core questions about

Now

that the shopping spree

JEFF BEZOS

was

Everyman, Every Man

handpicked Einsteins ever figure out

over, could these

95

Himself

for

how

to

Would more deals with brick-and-mortar giants like Toys il Us follow? And did such deals spell a reining in of Bezos's pay the

bill?

revolutionary ideal?

Every Internet wiseguy had a different opinion of what

Amazon was doing, or needed to be doing. And to try to capture a story on Amazon in a daily newspaper over a two-month period was

like this

But

like trying to

catch a

with chopsticks.

fly

also offered a chance to encounter Bezos during a

it

period of adversity. Such times have been rare in his

me

he kept insisting to

Amazon was accustomed

that

and skepticism. That summer, he

when he had

with 1994,

was

"We've seen

glib.

The only thing

this

to turmoil

raise a million dollars in a

that

was

different

now

was unconcerned,

that people were paying attention. Fie

almost

even as

was nothing compared

said,

somehow

to

strange city for a crazy idea.

life,

movie before," he

said.

"We're sort

of inured to that here."

24

interview, after putting

it

asked Bezos his

least favorite question:

When would Amazon

In a July I

profitable?

He

And

for as

weary

as he

impressively adept at not answering

become

higher than

be

has been asked this several times a week for nearly

three years now.

will

off as long as possible,

profitable

new

"when

(its)

businesses." There

it.

was of

he'd

become

Amazon

Bezos said that

ratio of

was

it,

mature businesses

is

a long pause before, pre-

sumably, Bezos would explain what this meant. But after several seconds,

A

all

that

few days

came was "Hah-hah-hah-hah-hah-hah!" on July 28, Bezos wrote

later,

"We're putting a stake

in the

become

The

profitable.

.

.

.

a

senior

team met

for three days last

2001." By that time, the

expected to have sales of $5 gross profits,

and achieve

to his staff.

ground," Bezos wrote. "We're going to

and created the outline of a plan that takes us to [the fourth quarter] of

memo

billion,

week

profitability in

memo

said,

produce more than $1

"solid operating profitability."

Q4

Bezos

billion in

96

JEFF BEZOS

memo

The it?

Man

Everyman, Every

for

Himself

seemed to declare an end to Get Big

The company

is

making

a big

electronic

did

memo

push to "Go Global," the

on the explosion of

also said, to capitalize

Or

Fast.

commerce

in

memo

Europe and Asia. Bezos declined to comment to me on the

but acknowledged that the efforts to "go global" and "put a stake in the

ground" did seem to contradict each

other.

many conversations I had with He seemed genuinely untroubled by the

This was emblematic of so

Bezos that summer.

apparent contradictions of his plan, in that he even had a plan. "This

company has never been

repeatedly.

He sounded

in a better position,"

sudden rigor that was

indifferent to the

being applied to Amazon's financial predicament.

acknowledge that building an online empire ence, that Paul Saffo's assessment that

"Ready,

Fire, Steer"

stage of history

was

he said

is

He was

quick to

hardly an exact

Amazon

is

sci-

a study in

basically right. Online business at that

demanded

risk-taking. Getting

bogged down

in

"aiming" could only stunt innovation. His message: Trust This was

why

us. We'll figure this out.

was so important

it

to create the highest

admissions standards in corporate America. E-commerce was in "the Kitty

Hawk

still

age," he said, and his faith in brilliance rep-

resented the ultimate long-term investment. Bezos wanted a com-

pany that could follow and pushing

Amazon's

it

fate

hubris, the line

to

his life's pattern of taking what's available

extreme.

its

on the its

was

It

a philosophy that placed

between hope and

intellectual fault line

founder had straddled for

much

of his

life.

Employees are more than workers; they are inventors. "The smart people

we have

here don't

sit

around thinking about what

"We sit around trying to We and we give them that.

the stock market will do," he told me. figure out

what

the customer likes,

.

.

.

have to invent on their behalf."

He

cited

an everyday example of what

liance could achieve.

A

his

assemblage of

bril-

customer-service representative suggested

JEFF BEZOS

Amazon's

that

Everyman, Every

include a help page in Spanish.

site

on her suggestion, so the rep used her fluency For her

herself.

Do

It"

award.

Man

in

"We

97

Himself

No

one acted

Spanish to do

an

efforts, the service rep received

for

Amazon

it

"Just

gave her a used Nike tennis shoe," Bezos says,

laughing.

Bezos seemed completely at ease in his position. The master of a universe that he himself created.

maybe

in

some

He

v^as slightly weary,

and

denial, but at ease, seemingly with everything.

Except one thing.

JEFF'S EVIL EMPIRE Ravi Suria. The rile

Lehman bond

Bezos above

all

performance, but

gamesmanship analysis.

a

name

its

a topic that

some parlor game of

some 28-year-old

Suria,

for himself

was

seemed to

had not questioned Amazon's

This was more than intellectual

viability.

to Bezos, not

Here was

analyst

others. Suria

by taking potshots

conflicting

upstart, trying to

make

at the valedictorian of e-

commerce. Bezos kept complaining that Suria never even called

Amazon before he issued Amazon responded thing companies rarely Bill

Curry called

it

his report.

to Suria's conclusions publicly,

do with

"hogwash," which Bezos

"pure, unadulterated hogwash." that Bezos

analysts' reports.

would invoke

Suria's

some-

Spokesperson

later

amended

to

One Amazon executive told me name all the time, even when the

conversation was elsewhere. Suria became a fixation of Bezos's.

He became

his Evil

Empire.

Bezos made a point of

telling

me

that Suria sent a

compH-

mentary e-mail to Amazon's head of investor relations on the day the

company announced

its

quarterly earnings that July.

"Wow,"

Bezos says, quoting Suria's e-mail, "you guys are really tightening

your

belts." Suria

confirmed that he sent the e-mail, but main-

JEFF BEZOS

98

Everyman, Every Man

for Himself

tained that the quarterly results did not in any

way change

his

assessment of the company.

When

I

spoke to Bezos again the following week, he men-

He

tioned this e-mail from Suria, again.

hang

it

In

in his office,

the subject of

was

that period, but Suria at

a recurring

Amazon. Bezos kept mentioning

sold 800,000 shares of

Amazon

a copy of the report before

his

stock

name. In February, Bezos

—worth $12 million—the

it

was

analysis. Bezos

released.

The

had seen

Securities

Exchange Commission began an investigation of Bezos's possible insider-trading infractions.

Amazon's stock gained

released, the

day

from "Get Big Fast"

to

Wall Street changed

He

said he did nothing

in value the

day

and

sale for

wrong,

Suria's report

was

Bezos sold his stock.

after

All the while, Bezos

"Internet Poster

and

many harsh reports during nag. He kept blasting away

day before Suria issued yet another harsh

that

it

he said, seemingly as a point of vindication.

Amazon was

all,

planned to frame

was changing

"March

his corporate

to Profitability."

buzz phrase,

The media and

Amazon had gone from the words of board member

their tunes, too.

Boy

to Piiiata," in

John Doerr. Suria

Capital

As

many

left

Lehman

Management. I

profiled Bezos,

I

was struck by

the fervor with

which so

people held their opinions of him, and of Amazon, espe-

cially as

it

struggled. There

schadenfreude in

was

Brothers for a better job, at Duquense

this.

On the

was

a high degree of predictable

day the SEC's investigation of Bezos

reported, one friend of mine said, with

some

satisfaction: "I

can see the headline now: 'Princeton Goes to Prison!'" But there were also a very high number of people rooting for

Amazon. They e-mailed me en masse whenever Amazon. Usually they were customers. They had

I

wrote about

visited the site,

bought a book or something, and the experience seemed overwhelmingly

positive.

It

held an enduring sort of magic for them.

It

— JEFF BEZOS

represented a kind of great

computing

in general.

nice about fixing

It

Everyman, Every

first

was

Man

for

99

Himself

date with the Internet, or even

easy,

and

wasn't,

if it

Amazon was

it.

This reaction was a testament to Bezos's success at building

one of the few

"lifestyle

brands" of the

warmly about

rarely feel this

a

indeed, users of Microsoft and

and

services because they feel

They have,

default brands.

with dropped

AOL

much

AOL

inevitably,

because they are the

had multiple experiences

Windows programs.

powerhouse, seemed to

retail

higher proportion of customer goodwill.

tomer-service reps

who were

answer customer e-mail

tomer e-mails,

to,

connections and crashed

unhappy Amazon employees, usually

felt

seem to use those products

compelled

There was another side to this

ference they

Customers

dominant technology company

But Amazon, the singular online generate a

digital age.

—the

calls

received from

I

the low-paid ones, the cus-

driven hard by their managers to

at a grueling rate.

They spoke of the

indif-

from Bezos, except when he saw a backup of cus-

at

which point he became

frustration at not being able to

move

irate.

They spoke of their

into better-paying jobs at the

we work in his sweatshop or not," one customer-service worker told me. "He just wants us to answer e-mail until our fingers fall off. Or we can do something else. He'll company.

"Jeff doesn't care

if

keep laughing either way."

When Bill

Bezos came to Washington in October 2000,

Curry invited

me

to Bezos's hotel suite for a quick

PR

chief

visit.

His

schedule was packed with interviews, meetings, and an awards

dinner he was scheduled to attend that night. in the

He had

15 minutes

middle of the afternoon.

As Curry

led

me

into his suite, Bezos lay

on

a big

bed

in

an

adjoining room, sprawled on his back, napping with the door

open. His

mouth was open, and

ing slightly.

(It

sleeping before.

occurred to

They seem

me

his top front teeth

were protrud-

that I'd never seen a billionaire

to sleep like the rest of us, only richer.)

— 100 JEFF BEZOS

Curry placed

Everyman, Every Man

his

for

Himself

hand on Bezos's shoulder and the CEO's eyes

bugged open. Then

body whipped upward

movement

I'd

never seen before: His shoulders snapped up, he sprang into a

sit-

ting position,

his

and then to

his feet

—

all in

in a

a single motion. For a

second, Bezos's body was touching nothing except the surrounding

air.

He

extended

hand

his

to

me

as he landed

on

his feet

with

a thud.

Bezos had

Jeff

bounced out of bed.

literally

PINATA By mid-2001, Bezos was

He

profitable by year's end.

while Amazon's stock was

December 1999

Amazon now

billion in

lion

annual

is

day

said this roughly 6,000 times a

down 85

percent in

May

from

its

not the stock" became the newest Jeff

consisted of twenty "stores" with nearly $3

sales. It

more than when

lowered

expected to be

high.

"The company Thing.

Amazon

insisting that

its

had 25 million customers, about 10

stock

was

at its peak,

2001

his sales projections for

mil-

although Bezos has

—from $5

billion to $3.6

billion.

What's been the most

When I asked Bezos this rect"

CEO

in spring

answer: layoffs.

them enough, last

difficult part of

2001,

CEOs

1

Amazon's pinata year?

expected to get the "cor-

can never publicly bemoan

how painful they are to execute. Since I'd Amazon had cut 15 percent of its workforce

talk of

seen Bezos,

about 1,500 jobs. But over lunch, he said nothing about

He had

several openings

In one year's time lawsuits,

and

a

layoffs.

and took none of them.

—a year of SEC investigations, shareholder —Bezos had some His

Wall Street

freefall

eyebrows had merged. But he

still

lost

hair.

did not appear beleaguered.

JEFF BEZOS

This

is

PR

the right

better!"), but the

Everyman, Every

face ("We're

Man

working hard,

for

Himself

101

optimistic, never

adventure seemed as fresh and authentic as

ever.

Bezos spoke excitedly of the mathematical formulas and

computer models is

his staff w^as building

how Amazon

to quantify

product

best to squeeze every drop of profit

sold

— by

human

MIT

run by Dr. Russell Allgor, an

One I

about

its

my

first

choice,

I

is

to be a physical explorer. "If a physical explorer in the

much

of the Earth

Not now, though. "Only some and some deep lakes

the ocean

The team was

mathematician, and Bezos was

would be

nineteenth century," he said. So

uncharted.

inefficiencies.

work.

of Bezos's lifelong wishes

could have

from every

streamlining inventory, eliminating

"loss leader" products, killing

clearly excited

and deploying. Their goal

in

was

still

of the deepest parts of

Russia have not been properly

explored," he said. Otherwise, the whole Earth's been claimed and

named. There's not today

is

a lot left to find. "All physical exploration

contrived, like breaking a landspeed record.

It's

not

real.

You're not discovering anything really surprising."

But there are uncharted parts he

is

in a

still

left

virtual

worlds

left

and conquer. Bezos says

to discover, decipher,

new phase

many

to be explored. So

of cyber exploration.

He

expects to be at the

center of change for the next five to ten years.

Likewise, Bezos

from Exxon Jackie

moved

is

in a

new phase

after thirty-two years.

who

life.

Miguel Bezos

retired

At the end of 2000, he and

to Seattle to be closer to Jeff,

18-month-old son, Preston, Gise,

of

MacKenzie, and

who was named

for Preston

their

"Pop"

died in 1995 at the age of 80. Bezos wakes each morn-

home on Lake Washington. He "architects" two hours each morning to spend with Preston, when Preston is at his most energetic. Preston calls his father "Da" and echoes his laugh. Bezos leaves for work at 9:30 A.M. while Preston waves to him as he drives away. Bezos doesn't return home most ing at 7 A.M. in his $10-million

nights until 9:30 or 10.

— 102 JEFF BEZOS

He was

Everyman, Every

Himself

for

work when an earthquake shook

at

January 2001.

Man

He was

meeting with four

Amazon

Seattle

engineers on

when

the fifth floor. Everyone dived under the table. Then,

shaking stopped, they rushed for the seconds to see It

if

the

Web

site still

did, but the building

work needed climb to his

to fix

it

worked.

was damaged. The construction

not an

was hurt

Amazon

stories to Bezos's daily stair-

40 percent more

Bezos says. His winning streak's building

the

pausing only for a few

exits,

would add two

office. That's

in

No

in the earthquake, except for

He

employee, by the way.

problem,

one from the

one

broke

ing out a basement window. Bezos laughs

Something about the absurdity of

No

exercise.

intact.

still

dumb guy

his ankle

when he

jump-

tells this.

guy jumping out of a base-

a

ment window. Earthquakes make for great Bezos

theater.

An

Act of

God

a Jeff Thing. Such acts are rich in chaos, weirdness, upheaval, ingenuity.

Everybody comes away with a story to

tell.

is

and

"You

should stay indoors, by the way," Bezos says of proper earthquake safety behavior.

"The big problem

falling debris. Bricks fall,

is

loose bricks fall."

This could be a metaphor for Internet investing.

Only writers say

stuff like that, he said.

"Ah-hah-hah-hah-

hah-hah." Writers always try to says.

It's

distill

people into a single image, he

do

pretty strange. People try to

now that he's

famous.

It's

an enjoyable part, but

still

meal.

in

this,

hands and

face.

And

Jeff.

Even

It

Bezos was in the midst

was June 2001.

midtown Manhattan,

The waiter came over with

grabbed one, unwrapped

the time,

all

strange.

of just one of these distilling moments.

an Indian restaurant

with him

part of the adventure of being

Also strange: As he was saying

in

it

it,

We were

just finishing a

a tray of hot washcloths. Bezos

and worked

he couldn't stop.

He

it

furiously over his

ran the washcloth up

JEFF BEZOS

Everyman, Every

and over

his forehead, into his hair,

placed

under the front of

it

chest, then his left armpit.

tables stared, but Bezos

his shirt. Fie

He

was

down

grunted

Man

for

the back of his neck. Fie

massaged the top of

slightly.

and

his

oblivious.

regrets,

sapped

was waiting

dry, as

for him.

Fiis

head bobbed up and down. Fie discarded

the washcloth onto the table with a satisfied

no

his

People from other

This was a Jeff Thing. Fie had a full-gusto expression. eyes were closed

103

Himself

flip.

Fie left

it

with

he rushed outside to a limousine that

CHAPTER THREE

JOHN CHAMBERS Cisco's

Dream

Seller

L

one night

late

Systems

Inc.,

John

was strolhng down

at

the San Jose headquarters of Cisco

Chambers, the company's chief executive,

T.

a hallway, sleepily hitting a balloon in front of

him.

"Hey, what's up?" said Ray

"Oh, I'm

just really

another Cisco executive.

Bell,

happy," Chambers said. "Just happy," he said

again. "Really happy."

And

down

he disappeared

the hallway,

patting his balloon.

was

It

like a

dream sequence emblematic of the

the height of the technology

maker of equipment Internet, billion,

faster

was on

$200

billion,

$300

1990s, at

boom. Cisco, the world's

that connects businesses

a run that

late

would propel billion,

$400

its

largest

and people

to the

stock value to $100

bilhon,

and $500

billion

than any other firm in history. The streak culminated in

March 2000,

at

$532

billion

—making Cisco,

briefly, the

most valuable company. Chambers was hailed

world's

as the ultimate

executive pleaser, pleasing Wall Street with growth and profits,

customers with pampering, employees with golden stock options.

He

signed autographs for shareholders,

idea

what Cisco

did.

He was

floating

Until

it

whom

had no

a Silicon Valley rain god, the execu-

tive personification of all the Internet's

man

some of

promise and prosperity, a

on the new-economy balloon. popped.

107

JOHN CHAMBERS

108

Then Chambers became amid

Dream

Cisco's

the

Seller

most

watched executive

closely

high-tech's boom-to-bust whiplash in the early twenty-first

century. In a matter of weeks, his

of the

NASDAQ

would

get.

$13.63

in

much

company went from

blue chips to the bellwether for

From

its

March 2000

high of $80.06 in

2001, the company

lost

how

$424

billion in

the bluest

bleak things to

its

low of

paper value. For

of 2001, that loss exceeded the total value of General

Electric,

Wall

Street's

most valuable

firm.

Chambers became something of

manage

in a

harsh environment?

creation of the

boom? As good

questions went to the heart of to the career of Internet's

Like

most

Was

a

CEO

test case.

he a business pioneer, or a

as he seemed, or just lucky?

all

the

The

post-boom uncertainty, and

John Thomas Chambers, who remained the

fervid cheerleader at a dispersing

many

Could he

pep

rally.

technology magnates. Chambers was raised in

suburban affluence,

household headed by two doctors

in a

in

Charleston, West Virginia.

But among high-tech captains. Chambers Unlike Microsoft's

Bill

is

an anomaly.

Gates, Oracle's Larry Ellison, America

Online's Steve Case, or Apple's Steve Jobs,

Chambers

is

neither a

technologist nor an entrepreneur. While Gates, Ellison, and Jobs left

college to start companies.

Chambers earned

nine years and began his career at IBM. as a sales genius

—

He

fast-talking, evangelical,

three degrees in

distinguished himself

and adamant, "proba-

bly the

most dynamic technology salesman who ever

former

FCC

chairman Reed Hundt,

who

has

lived," says

known Chambers

for several years. Sales

prowess can have low-rent connotations

where the brooding nerd

is

in

an industry

the ruling archetype. Salespeople are

tolerated as accessories for Silicon Valley's garage prodigies.

make

They

business contacts, not revolution. Six of the sixty people

I

interviewed about Chambers independently described him as

JOHN CHAMBERS "polished." sure

if

Is

you're looking at a

who

In an industry

us"

is

Dream

Chambers

left in

diamond or cubic zirconium,"

said a

early 2001.

whose icons have been defined by

their icono-

want our competitors

displays none. "I

something he has said repeatedly, and few

him

who

have

to like

known

and worked with him can

recall

ing, or, in Cisco parlance,

"showing any negative emotion."

ever raising his voice, swear-

During a 90-minute interview

I

had with Chambers

February 2001, he said, "Treat others as you'd

wears a

suit to

Chambers's to Silicon Valley.

in

be treated

like to

yourself" nine times. He's one of the few Silicon Valley still

109

Seller

he for real? With Chambers, "sometimes you're not

Cisco executive

clasm.

Cisco^s

CEOs who

work.

style

is

senatorial,

While he works

more akin in

to

Washington than

an industry long averse to

government, he has strenuously courted politicians, none more so than George W. Bush. Shortly before his inauguration in January

CEOs

2001, Bush hosted a group of technology

mansion

in Austin.

Chambers cut

a

at the governor's

madly ubiquitous

figure there,

zigzagging through a procession of interviews, showing up at both press conferences (the only

prominent placement

in

Internet's transformative its

CEO

to

do

so),

and angling

his

way

to

group photos. He harped on the

power

in the world,

and Cisco's

role in

construction. After one of the meetings.

some

point, I'd like to talk to

tant to us," invited

Chambers

Chambers

Chambers approached Bush. "At

you about a few

said to the President-elect,

to a private dinner at his

two men had spoken

issues that are

who promptly

mansion that

night.

several times, including the previous

when Chambers hosted

a fundraiser for

Bush

impor-

at his

The

summer,

home

in

Los

Altos Hills, California that raised $4 miUion, double the record for a Silicon Valley fundraiser. But the Austin dinner

chance for John to position himself as the

New

was

different, "a

Economy's ambas-

110 JOHN

CHAMBERS new

sador to the

whom

Chambers

Cisco's

way

to

tell

Clinton. Jiang a half hours,

Mr. [Tony]

Blair,"

Zemin

which

the

Chambers went out of

me. "I've had multiple meetings with President

Our conversation

of China.

is

unheard

CEO

as

lasted

two and

of."

how Chambers

in

and how he wants badly to be viewed:

trial leader,

Duf Sundheim,

called excitedly after his meeting with Bush.

Such contacts are instructive self,

Seller

administration," said his friend

"I talk regularly to

his

Dream

head of

as a

views him-

new kind

of indus-

CEOs

strive for

virtual state.

Salesman as statesman. a transformation that

It is

many

high-profile

after they achieve a certain stature in their industries

—or believe

they have. For many, especially introverted computer types, this

an awkward transformation. Not for Chambers. His a virtual

charm

school, steeped in Southern

life

is

has been

manners and perfected

over years in the happy-talk waltzes of American sales culture.

But all

it's

a great

much easier to

company needs

be diplomatic in flush times. "Sometimes

for a leader

is

a great salesman," said Paul

Johnson, a computer networking analyst at Robertson Stephens

who

has followed Cisco since 1992. But a slowdown requires tough

measures and places Chambers

worked

to avoid: bearer of

in

an awkward role he had always

bad news.

PLEASANTVILLE A

few years ago, some Cisco executives were meeting with a

group of key customers raucous night out,

Don

at the Ritz-Carlton in

Cancun. After a

Listwin, then Cisco's vice president of

marketing, playfully slapped marketing director Nick Francis on the back of the head.

Francis wheeled around and non-playfuUy slapped Listwin in the face. Within seconds, the play fight

became

a brawl, with

JOHN CHAMBERS

Dream

Cisco's

Seller

111

Listwin and Francis wrestling on the lobby floor, staining the carpet with blood, and

dumbfounding

The

their customers.

fight

ended with Listwin pinning Francis on the ground, refusing to

him up "It

let

until Francis said, "I give."

was

a classic instance of

how

competitive Cisco can be,"

who is now CEO of Tavve Inc., a North Carolina software company. He spoke of the fracas with nostalgia and added: "Thank God John wasn't there." Listwin, through a recalled Francis,

spokesperson, declined to talk about the incident.

many

Like brash, life

Type-A

at Cisco:

hard-driving firms, Cisco has always employed

executives. But this vignette distills a basic rule of

The contentiousness so

basic to business success

CEO. "When you

play out at a safe distance from the tional, you're

Chambers

said,

and he noted with pride that he had never

lost his

in a business situation.

"Just like Larry Ellison's reflected in Oracle's

and

Bill

and Microsoft's

Gates's rough edges are

cultures, Cisco tends to be

Ray

polished, like Chambers," said

who

Bell,

companies and went on to be the

for all three

emo-

not very effective in your communication style,"

temper or yelled

more

get

must

CEO

has worked

of Smartpipes,

a Silicon Valley networking firm.

"He always

tried to find the

people happy," said Listwin, to

CEO

become

company based This

is

of

in

who

compromise that would make

left

Cisco in 2000 after ten years

Openwave Systems

Redwood

Inc., a

wireless-software

Shores, California.

manifest in Cisco's San Jose headquarters, a sprawl-

ing cubicle phalanx with a Prozac-in-the-water degrees, a shiny, firms, but Cisco

happy ambience is

is

feel.

evinced at

To varied

many

Internet

a study in the extreme. In the cyburbia of

Silicon Valley office parks, Cisco

is

Pleasantville.

Candy bowls

sit

on counters. Receptionists are "lobby ambassadors." Employees' children play at a nearby day-care center equipped with

so their parents can watch from their desks.

webcams

CHAMBERS

112 JOHN

Cisco's

Dream

Seller

Every building on Cisco's campus green

window

rooms and

in the

an orangy beige color with

frames. Every floor in every building has break

elevator banks set in the

on the same kind of deskset, type on sit

is

same kind of

same

location.

Employees work

same kind of computer, and

the

chair. Cubicles are

adorned with nods to

individualism: Etch-a-Sketches, Pez dispensers, Elvis photos, and the

random can

of Starkist chunk light tuna. But the standard-issue

trappings are geared to a happy collective. Employees wear badges

way we work,

imprinted with the "company vision" ("changing the live,

play and learn"), tenets of "Cisco Culture" ("empowerment,

teamwork,

and "FY2001

stretch goals")

Initiatives" ("leadership in

partnering/ecosystem" ).

Chambers

presides as Pleasantville's mayor, smiling

from a

procession of framed magazine covers near his office in Building 10.

He

sweets.

regularly tours the

He

is

campus

distributing ice

revered by Cisco employees in the most flattering

new-economy language: They speak of ity,"

his

cream and

"empowerment

skills,"

his "partnership mental-

"win-win" approach

his

"incentivizing" his workers. "He'll always force

me

to

to think out-

side the box," said Senior Vice President Sue Bostrom. "He'll say: 'Well, that's not

gonna

differentiated

we do

if

scale. it

How will we

really be competitively

that way?'"

Bostrom, whose professional lineage includes Stanford Business School, and stints at

AT&T, McKinsey, and

Digital

Equipment Co., was on the dance card of PR-sanctioned views that were arranged for in

me

inter-

during a visit to Cisco's offices

January 2001. She has bright and plaintive blue eyes that make

her seem six or seven years younger than her age, 40. She

made

perpetual eye contact, smiled throughout the interview, and was

remarkably upbeat even by Cisco's standards of remarkable upbeatness.

It's

always a good career move to say glowing things

about your boss to reporters,

Chambers approached

but

idolatry. Like

Bostrom's

affection

for

Chambers, she spoke with

JOHN CHAMBERS

Cisco

s

Dream

113

Seller

exclamation points. "At the end of the day, what John has ized

is,

real-

we're here because there's some mission we're trying to

achieve! Something big!

And

we're going to enjoy the challenge!

will often say, this will be really challenging, but isn't

John

it

really fun?!"

Bostrom gushed that one of her recent join Cisco because

interview.

When

I

Chambers smiled asked

for

recruits decided to

50 or 75 percent of

their

she had a telling anecdote she could

if

share about Chambers, she thought for a second and stared at the floor before she smiled widely

and nodded with

a satisfied look of

revelation.

Yes, she did have a

good anecdote.

happened a few months

It

a speech at the Churchill

Club

earlier.

in

She was scheduled to give

San Francisco to a group of

1,000 Cisco employees, media members, technology analysts, and, generally speaking, smart business types. The topic was:

companies could save money by streamlining using the Internet.

introduce

her.

how

their operations

by

Chambers spoke before Bostrom and would

They drove up together from San Jose

in

Chambers's blue Jaguar convertible. She was anxious and told

Chambers she would do her

best.

Before the program began. Chambers walked up to Bostrom

backstage and looked intently at

her.

"You know.

you're really nervous about this," she said

Sue,

Chambers

I

know

told her.

"But when you get up there, what you might want to do

is

take a minute and think about the opportunity that you have.

And

that Cisco has.

place in time. this

just

how

And

enjoy that. Just think, we're at a special

The customers need

a certain thing,

and we have

opportunity to share this information with them.

about

just

And

think

special that is."

Bostrom gave her best presentation

ever, she said.

She got a

standing ovation. Forbes wrote about her. She was almost wistful at the retelling.

R

CHAMBERS

114 JOHN

As

Bostrom's

left

I

Cisco

office, she

day," as did nearly everyone

A

Dream

s

I

met

Seller

me

urged

"Have

to

a great

that day at Cisco.

CAL IB RATED SENSE OF WON D E

Cisco Systems began in 1984 as a husband-and-wife team of Stanford University professors Leonard Bosack and Sandy Lerner.

They invented

the "router" as a device to allows the university's

computer systems to

interact.

Routers serve as

traffic

cops along

computer networks, analyzing the "packets" of data moving through and directing them to the best path to their destinations. Cisco w^as an instant

hit.

Chambers took over

as

CEO

in

1995, as the Internet w^as

rushing into the mainstream of American Internet "sv^itching" equipment Cisco's revenue.

markets

still

account for 75 percent of

Chambers has moved

—apparatus for

and telephones. He has

While routers and

life.

company

the

fiber-optic netw^orks, built Cisco into the

and

into other

w^ireless devices

dominant provider of

the unseen "plumbing" for communications tools.

Under Chambers, Cisco has bought over seventy companies and absorbed them a

team

fills

terhead.

building

in

an elaborate integration

ritual.

Overnight,

the acquired firm's copying machines with Cisco

A

Cisco sign

is

repainted in Cisco

is

hung on

the building,

teal.

The

let-

and sometimes the

coffee in the

break

room

is

replaced by Superior coffee, Cisco's brand of choice. Employees

from one acquisition wore

T-shirts that said,

"We've been assimi-

lated."

Around that's also

the Valley, Cisco

a

known

as "the Borg," a

term

been applied to a handful of dominant and fast-grow-

ing companies or organizations is

is

reference

to

a

—Microsoft, Oracle, and

"Star Trek"

humanoid drones joined

race

in a vast "hive

Intel. It

of half-machine,

mind" under

half-

the control

JOHN CHAMBERS

Cisco

of a single authoritarian ruler. Borg spaceships

Dream

s

Seller

115

wander around the

galaxy forcibly absorbing other civilizations, destroying their free

and turning them into automatons. The cold, mechanistic

will,

chant by which the Borg announce their arrival Borg.

.

.

You

.

will be assimilated.

.

.

.

— "We

Resistance

is

are the

futile."

—has

entered the lexicon of technologists everywhere.

At Cisco, assimilation is

to ease

all

the friction

His negotiating

style

is

starts

from the disruptive process of

Chambers

body language

level of unease,

will often invite his

talk outside, at

which point he

—the

will

CEO

counterpart for a private

deploy his mastery of business

hand on the back; the

soft

home

If

which they inevitably

walk; the Clintonesque knack for knowing required to drive

acquisition.

described as "solicitous" and "smooth."

merger negotiations reach a do.

with Chambers, whose endeavor

his sincerity.

He

slow, avuncular

when

eye contact

is

also has a proclivity for

breaking an impasse by focusing the conversation on points of agreement. "John

is

the ultimate closer," said Carl Russo,

CEO

of

Cerent, an optical networking firm that Cisco acquired in 1999.

"He You of

is

always working an agenda, moving things forward.

can't leave a meeting with

what you've

just

.

agreed upon and what you're gonna do next."

called "the crucial trait in

all

skills,"

successful salespeople."

which he

Chambers

is

accommodator," said a top executive of another Cisco-

acquired company. This

is

a notion underscored

prices that Cisco has paid for companies.

stock for Cerent, which had not held

At the time, the

$900

.

John without having an agreement

Russo said Chambers had superb "empathy

a "great

.

It

paid $6.9 billion in

its initial

largest acquisition of

by the generous

public offering yet.

any private company was

million. Yet, in a sales setting,

WorldCom Chambers

Chambers

"is utterly relentless," said

Vice Chairman John Sidgmore, the recipient of a sales pitch that lasted several

over dinner at Washington's

Red Sage

hours

in

restaurant

1999.

It

began

when Sidgmore

116 JOHN

happened

CHAMBERS to

Cisco's

Dream

Seller

mention that WorldCom was suffering outages on

network. Chambers then launched into a sales pitch for

their

Cisco's

equipment that lasted through the two-hour dinner and

into the Bruce Springsteen concert they attended afterward at the

MCI

Center.

"We were

Sidgmore

wall,"

and he had me up against a

in this suite,

"The other people there were

said.

sort of

freaked out."

Even

in

one-on-one situations. Chambers speaks

in

buoyant

proclamations, riffing hyperbolically with matter-of-fact assur-

The

ance.

first

time

I

interviewed him

was

in the

summer

of 1999,

a time of fevered enthusiasm for the Internet, not to mention the

stock prices of

We

juggernaut firms.

its

met

cramped space adorned with family photos and

a

in his

Duke

a

office,

University

basketball poster, and scattered with several recent magazines that

featured

him on

speech to

me on

"the

same phrases he had

month

before.

Chambers

the cover.

New

in

Economy," using

Internet

an appearance he'd made

"We can

world," he was saying.

company

be the one

maybe

"It's

the

such a company." Chambers struck day, but I'd never before seen

"We can

be the one

Chambers was saying

home

in

delivered a passionate

to

February 2001.

me "It's

me

him up

company

first

Washington

a

that can change the

time there's ever been

as unusually ecstatic that

close.

that can change the world,"

again the next time

maybe

in

a lot of the

the

first

I

saw him,

at his

time there's ever been

such a company."

What about nology, he said.

change the way

Microsoft or Intel? No, they changed the tech-

They

we

played, didn't

change education," he

way we worked, change the way we lived,

"didn't change the

said.

"Cisco

is

didn't didn't

in the position. This

is

the

Internet revolution."

Chambers spoke with

a calibrated sense of wonder, as

were sharing these ideas for the n't

first

dropped 13 percent on the day

time, as

this

if

if

he

Cisco's shares had-

conversation took place.

r^f^.

ixiri llison, toj) left,

bore

with classmates at South

High School

t-^

^ori

Ellison, with his first wife, Ackia Quinn.

in Chicago.

^ ^

:p

V

FITJSON

delivers his keviiole address al (loindcvx. NoNcinher

1.').

'_!()()()

in

Las

Veas.

Jeff

Bezos as a

liioh school

ezos

demon stralcs an educational

lov "Gus's Guts" to talk

show

host Jay Leno.

\iruAMDrD'

John Ciliambers,

problem

at

blackboard, helps fellow nienibers of the school math club figure out a

Joliii

senior

(

ill

!liainl:>ers,

^hamlxMs. on a ho\lioo(l vacalioii ero Beacli. Florida

as a high school

(iharleston.

West Viroinia

vvilli liis raiiiiK

Bill

Gates at 13, standing with classmate

and future Microsoft co-founder Paul Allen (seated)

Steve Ballmer in his high school

yearbook

A

vouiio

Bill

Gate^

m,

ates with Steve BalliTiec.

Iiis loriiitiiiie

corporale

allet-eiio. in

l^)!)."").

Steve Case, approximately

age 5, growing up in Hawaii

The Case children Dan and Carin

in the 1970s,

QTFiri^

from

left,

Steve, Jeff.

'

f

Case, with mike in hand, performed a one-night stint with his Williams College band.

The Vans

JOHN CHAMBERS

Dream

Cisco^s

117

Seller

NAIVE FAITH Chambers

Way"

lives

on

His house

in Spanish.

Xanadu, with an intercom

He

pool in the back.

and made the

is

He gave me

"Happy

wrought-iron front gate and a

at the

greeted

Feliz,

a typical Silicon Valley nevs^-money

me

requisite inquiry

out a problem.

road called Via

a small private

at

my

my

hand,

found the place

w^ith-

rental car,

on w^hether

I

shook

the soft-hand-on-the-back as he led

me

to his front door.

everything was

Inside,

bananas in a

—about twenty—lined

arrayed just so. a kitchen counter.

Bright yellow

The

toilet

paper

downstairs bathroom was folded into a crisp triangle. The

den shelves held impeccably aligned books, including World Book encyclopedias, a Spanish dictionary, an unauthorized biography of Bill

Chambers with

Gates, and separate photos of

Presidents

Chnton and Bush. Like

and

many

charismatic leaders.

Chambers

easy to be with

is

know. The interview was planned

difficult to

as a relaxed,

casual meeting in his den over Diet Cokes. Chambers, feet tall

and has thinning, wavy blond

ning shoes,

new

in a corner chair, a

tions aide

and

jeans,

few

hair,

is

six

wore bright white run-

a blue dress shirt.

feet

who

He

sat cross-legged

away from where Cisco

public rela-

Kent Jenkins was monitoring our relaxed and casual

conversation. I

thought

it

was

a

good time

get to see the unflappable

announced that Cisco

man

as

CEO. He struggled

aged

five hours,

flustered.

meet Wall

The day

before, he

I'd

had

expectations for

had never happened

in his six years

to sleep that night, he told

me

later.

He man-

He rode his basement treadmill from watching CNBC. At 7, he left for work in his

waking

6:15 to 6:45 while

meet Chambers. Perhaps

Street's

failed to

the previous quarter. This

to

at 6.

Jaguar and listened to thirty-five voice mails from his car phone

118 JOHN

CHAMBERS

on the 30-minute office,

made

he

Cisco

s

Dream

Seller

from Los Altos

ride

San Jose. At the

Hills to

a series of rigidly timed

phone

hosted a

calls,

breakfast for Cisco employees with birthdays that month, walked the halls,

and stoked morale. He returned home by 5:30 to meet

me, ebulHent again. "I believe we're

two quarters ahead

of everyone else as far as

understanding the issues," Chambers said a few minutes into our discussion.

"When we

said this

economy

is

dropping

faster

than

anyone understands, most people didn't grasp what we were saying

in

December. But our customers were

Chambers, sounds

who

telling

us

that."

speaks in a high-pitched Southern accent that

and almost

slightly effeminate, never clears his throat

never says "Uhhh."

He

has a batch of favorite words that he uses

often and pronounces like this: "pay-shin" (passion), "im-par-

ment" (empowerment), "cain-didly" ayshin" (education). first

name

He

and

(candidly),

"idjic-

often punctuates his sentences with the

of the person he's speaking to. ("Caindidly,

I

have a

payshin for idjicayshin as a means of imparmint, Mark.")

Chambers blamed

Cisco's struggles

on "macroeconomic" and

"outside" issues. As he often does, he posited himself as a kind of private-sector minister of

from

economic information

his elaborate contact

—

a cachet acquired

with corporate customers and Cisco's

advanced systems for analyzing "real-time" data. This

Chambers theme:

that the

is

a recurring

power of "the network" exceeds

ditional abilities of government.

It falls

upon him,

the tra-

leader of the

"network revolution," to unite the two bifurcated species of the ital

age: the people

who

Nothing seems with world leaders. taken recently:

"get it" and the people

to excite

He

who

don't.

Chambers more than

recited a fast

list

dig-

his dealings

of the meetings he had

with United Nations Secretary-General Kofi

Annan, Chancellor Gerhard Schroeder of Germany, Prime Minister Jose Maria Aznar of Spain, Prime Minister Atal Bihari

Vajpayee of India. They want to meet with him, he

said,

because

JOHN CHAMBERS

Cisco's

their ability to prepare their countries for the

omy"

will

candidly,

enhance the standard of living

Dream

"new

Internet econ-

in their countries

those people's ability to stay in power."

Chambers's imperative

is

simple.

119

Seller

— "and,

Likewise,

he can inspire a foreign leader

If

to invest national resources in

network infrastructure, Cisco's

market stranglehold

it is

practically guaranteed sub-

sense,

Chambers appears awed by

is

such that

stantial contracts.

Plus, in a

more pedestrian

these meetings.

Virginia

"Who would

have thought someone from West

would be running Cisco?"

is

a refrain, asserting his small-

company

he's

Chambers's self-ruminations are stubbornly upbeat.

He

town humility while underscoring

the high-level

keeping.

mother "wonderful," and

called his father his "best friend," his his

two younger

"fantastic."

Of

sisters "great."

betrays

now grown,

are

Elaine, his wife of twenty-seven years, he said,

"The longer we're married, the

He

His two children,

closer

and

closer

no complications or anything

we

get."

like angst.

He

stays

on-message, carries a thick briefing book for that day's meetings.

While many executives do striking.

this,

Chambers's reliance on

his

book

is

At the Davos World Economic Summit which he

attended in January 2001, the book was five inches thick, and he spent eight hours a night drilling himself for the next day's meetings.

He

prefers tidy synopses to heavy helpings of data.

ers speeches

without

scripts,

Friends and Cisco's

Chambers has remained

PR

is

deliv-

memorizing key points beforehand. staff strain to

as a celebrity

compensation totaled $157.3 million options, humility

He

a principal

emphasize

how modest

CEO. Although

in salary,

his

2000

bonus, and stock

theme of the Chambers brand. He

own parking space, friends and associates note; he washes his own car, he always holds doors open, he greets support staff, he eschews the honorific "Mr.," and takes out his own trash. "My office is twelve by twelve," he said. "We don't build doesn't have his

CHAMBERS

120 JOHN

monuments

Cisco's

Dream

Seller

to ourselves." Everyone at Cisco

though Chambers pays for a Falcon 2000

An

avid tennis player.

that he only plays doubles. to

shows that

coach, he said,

he's

much more

explained to

Alto lawyer

attuned time

we

and John

me why it was his fault," says Duf Sundheim, a Palo who is Chambers's doubles partner each Sunday at

the University Club of Palo Alto. Chambers, he said,

net player

first

hit the first three balls into the net

I

use.

strains to point out

team achievements than individual ones. "The

played together,

own

jet for his

Chambers often It

flies

who

exceedingly generous on line

is

a tenacious

is

calls.

In ten years

playing with him, Sundheim has never heard Chambers swear or

scream.

He

once spent 15 minutes hunting for a

bushes. This

is

not normal

CEO

ers

some

modesty, Sundheim said.

But Chambers cares deeply about

worked hard

lost ball in

his public image.

He

has

to position himself in the firmament of tech lead-

—Gates, Jobs, former

Intel chief

have received better press coverage.

New Economy

Andy Grove

He became

—and few CEOs a cover

boy of a

magazine genre whose enthusiasm for Internet

own brand of breathless gentility. became CEO, Chambers was blissfully

businesses mirrored Chambers's

When

he

first

unaware that the media could be anything but sunny message. After one interview with The Larry Fisher in

1995,

Chambers

hope

said, "I

Chambers smiled

you'll let us see a

a conduit for his

New

York Times's

earnestly.

"Larry,"

copy of the ad before

printed." Fisher doesn't recall this exchange, but the Cisco official

who

sat in

The misstep

on the interview does

reflects

how Chambers

it's

PR

vividly.

views the world. "John

has a lovably naive faith that he can inspire anyone, anytime," said a Cisco executive figures

if

pitch, he

who

left

the

company

last year.

Chambers

he prepares enough to master his material and hone his

can win over the most cynical audience.

Chambers

studies diligently for even the

most casual contact

with the media. In preparation for our interview at his home, Kent

— JOHN CHAMBERS

Cisco's

Dream

121

Seller

Jenkins prepared Chambers an elaborate paper for Chambers on

what

and casual conversation.

to expect during our relaxed

was

It

part of that day's thick briefing book, which happened to be rest-

on

ing

a footrest next to

where Chambers was

my visit in his

could see the page devoted to

how much

been talking about

was

relevant,

making

a quick

"Uhh,

asked

briefing book.

his

book, so

I

We had

figured

book

the

would hurt my

feelings.

it

to

my page

and studied

view

Then he passed

it

and Cisco's

belief

briefing paper

—

in openness.

was

sud-

Information wants to be a single

—with bulleted points

several impressions

listed

beneath them.

had shared with Jenkins

I

record talks we'd had in previous weeks. of an enigma"

handed him back I

was one thing his

wasn't offended.

smiled,

the

free.

— page "thumb-

"key issues," "reporter background," and "likely ques-

nail,"

bit

my

consistent with his belief

The paper included four headings on tions"

it,

to me.

who was

not do that," muttered Jenkins,

my

it

contained anything sensi-

denly staring at his lap. Chambers overruled him, saying that right to

if I

But Chambers clearly wasn't

judgment of whether

let's

on

I

like this.

He opened

hesitated.

tive or that

relies

slightly self-centered.

if

accustomed to a request

He

he

sitting.

I

in a series of off-the-

"Mark

recall the

also contained

thinks you're a

paper saying. After

I

book. Chambers cackled, nervously, hoping

He

then smiled, and Jenkins smiled, and

I

and Chambers told a joke about something or other and

moment passed and the message was This man is happy. "I think people

Russo,

It

now

a Cisco

lessly positive,

at times

reinforced:

struggle with John,"

group vice president. "Because

people wonder,

is

said Carl

he's so relent-

he actually human.^"

One

friend

spoke admiringly of Chambers's "genuine polish," attuned to the seeming contradiction. "I think,"

a lot

more

Russo

said, "that the veneer

closely aligned in

and the substance are

John than any of us know."

122

JOHN CHAMBERS

Cisco's

Dream

Seller

FRIENDS FOR LIFE "I

can do

know I can do

it, I

better,"

Johnny Chambers would

say.

He was the most determined student his tutor had ever worked with. He was 7 and couldn't read. "Small" read like "Hams" on the blackboard. "John thought he wasn't as smart as the other kids," said his father.

Worse, he thought he was stupid.

Few knew

the

Lorena Anderson ing disorders

John by

word

did.

who

She was an early expert in the

lived near the

home

visited her at her

feel,

"dyslexia" in 1950s West Virginia, but

Chamberses' home

after school.

move

not phonics, drilling him to

of learn-

field

in Charleston.

She taught him to read his

hand

left

to right

a plate of sand. She kept repeating "left to right, left to right,"

would drag

his

paper.

Some

would

call

who

hand from

left

to right with a crayon

tough days

nights, after particularly

in class,

John

who

get through

this,"

have a good day today," the blond, blue-eyed, and

grinning Johnny would often say

home. "But

it

was

a better

the teasing

it

critical experience,

would mark

arrived at Anderson's

He

his dyslexia as scarring.

brought. But people close to him say

it

plays

was

a

an early source of the blazing ambition that

his career.

else to

when he

day than yesterday."

Chambers does not portray

everyone

a news-

said.

"I didn't

down

and

her at home, seeking support and advice. "The kids

can stay positive are the ones

Anderson

on

on

He vowed

to

outwork and outprepare

avoid the daily humiliation he faced in

class. It

wasn't enough to simply learn to read; he needed to become the best reader in class. like that,

you

"When you

feel like

overcome an experience

you can do anything," Chambers told me.

Chambers rooted

for the nearby Cleveland

admired the Boston Celtics for

He competed

learn to

their

fiercely at basketball

Browns and

teamwork and dominance.

on the family driveway and

in

JOHN CHAMBERS Charleston's church leagues (he

remembered when he

was

all

"a

"John always

Jim Buckalew. neighborhood of

Kanawha

City section of

Donna Reed,

'Leave

It

to Beaver' world,"

said Buckalew, one of Chambers's three closest friends.

through

Cub

They went

Scouts, double-dated at the bowling alley, hunted fowl,

fished for bass,

home on

123

Seller

lived in a flat, tree-lined

ranch and Tudor-style homes in the It

Dream

a Methodist).

is

lost," said a neighbor,

The Chambers family

Charleston.

Cisco^s

and caught bullfrogs

the Elk River.

Charleston High School

at the

Chamberses' summer

They rode together with

prom

their dates to the

(held in the school gym), then

afterward at the party at John Walsh's house on the west

met up

side.

June Chambers, a psychologist, was an outgoing and attentive

mother who brought hot glazed doughnuts home to John and sisters after school.

obstetrician-gynecologist that served

was

John's biggest influence

who

his father. Jack,

his

an

delivered 6,500 babies in a practice

numerous prominent Charleston

the family of Senator Jay Rockefeller.

He

residents, including

dabbled in health-care

ventures and Republican politics (once running unsuccessfully for the state Senate). Affable

and

enterprising. Jack

Chambers ran

his

household as John would lead Cisco: with an ethic of achievement, in

an atmosphere devoid of confrontation or open rebellion.

a

home

free of rules,

"I didn't

Jack Chambers said

want them

To

for his son to spend a

summer working

John strove to please

He

enrolled at

Virginia University after

to miss out

on the fun

—and under no circumstance could

they ride motorcycles.

education.

was

with a few exceptions: The kids were not

— allowed to go steady in life,"

It

reinforce this second rule. Jack arranged

his parents,

Duke

in

an emergency room.

who placed a premium on his West

University, then transferred to

two years

to join his high school

prom

date, Elaine Prater, the only person outside his family he ever told

he loved.

It

was

the late 1960s;

Chambers spent most of

time in college playing and organizing intramural sports. his hair

medium

his free

He

kept

length and expressed irritation at the anti-war

CHAMBERS

124 JOHN

Dream

Cisco's

Seller

were building on the nation's campuses, including

protests that

Duke and WVU. His

political

views were conservative and he sup-

ported the war, but not what he believed was the halfhearted

was being to ask

A

like business."

to go,

on

fight

it

to win," he said. "It's a

in

law school

at

WVU

Memphis

a master's degree at

off for seven years.

and once again

who was

They had dated

State.

Chambers was always more

to her, a vestige of his father's

little

service.

a long-distance relationship with Elaine,

working on

on and

you

bad ankle spared him from military

Chambers enrolled

commit

it

fought. "If you're going to fight a war, and you're going

young people

carried

way

hesitant to

"no going steady" dictum,

but by his second year of law school. Chambers began missing her terribly.

He

one day and asked her to return to West

called Elaine

Virginia to live with him. She responded with an ultimatum.

"Let

me

explain

marry you, or "I

I'll

worded

find

it

to you," Elaine said.

somebody

that wrongly,"

come back and

"I'll

else."

Chambers

"Would you marry

said.

me Shortly after he started business school at Indiana University,

Chambers married man. After

a

reception

the

at

to

work

him

Chambers took

a sales job at

in sales, feeling that his

had shown one to get to seize

on

n't selling

little

me

interest

him

IBM. He was

—was

computing

—

in

changing the world.

branch manager,

which Chambers

"He was

excited about computers," said Chambers,

a central tenet of IBM's sales culture:

products as

business process

much

made more

as

it

was

efficient

selling

by

far

more

who came

computers.

exciting than the widgets he

first

—dreams of a

philosophy that allowed Chambers to peddle hope and

which was

the

The company was-

dreams

IBM

reluctant

MBA training suited

law degree and

that

in

Las Vegas.

in

better to marketing or operations. But the

Chris Christie, convinced

as his son's best

Edgewood Country Club

honeymooned

Charleston, John and Elaine In 1976,

Chambers stood

Elaine. Jack

was

It

was

a

possibility,

actually selling.

a

JOHN CHAMBERS

He was

Cisco's

Dream

125

Seller

trained in classic sales techniques and absorbed the

methods of IBM's master salesmen

—

their language (say the per-

name), their attentiveness (always drive toward a deal,

son's

always follow up), their sense of invincibility (who

would you

else

buy from but IBM?). He also embraced IBM's code of appearances: pressed suits, impeccable manners, crisp presentations

universe

removed from the T-shirted entrepreneurs

Silicon Valley.

Chambers worked

IBM

for

1970s'

in

offices

sales

in

— in

Indianapohs, Pittsburgh, and Cincinnati.

He was promoted

steadily but stunted

by IBM's slow-moving

and cautious culture. His immersion in the field told computing marketplace was moving early 1980s,

Chambers was

faster

IBM

than

you don't mess

it

Chambers

IBM was

examples that frustrated Chambers

IBM was

execu-

was

a

way

of

not successful," Chambers said. "You

were rewarded for being status quo."

as

IBM

York

on doing one or

to focus

things really well instead of ten. "That, to me,

expressing that

New

up, you have great potential here," the

executive said. But he urged

two

that the

was. In the

IBM's Armonk,

called to

headquarters to discuss his career prospects with an tive. "If

him

at

It

was one of many such

IBM. His

frustration

grew

getting blindsided by the advent of smaller, cheaper

"personal computers" introduced by upstart firms such as Apple

Computer Corp. Chambers old-line

left

IBM

in

1982

to join

mini-computer power based

Wang

Laboratories, the

in Lowell,

There, Chambers became a protege of founder quiet,

Massachusetts.

An Wang,

the

Chinese-born engineer. They shared a love of tennis and

bridge,

and played

often.

vice presidents usually

at the

far

more time together than

spend with CEOs, especially

decades older. Moreover,

worked

They spent

An Wang's

CEOs who

son, Fredrick

company, eventually becoming

its

Wang,

CEO. But

are

also

he was

not particularly excited about business, and Chambers was seen

by some as a kind of surrogate son to

An Wang.

126 JOHN

CHAMBERS

Cisco's

Dream

An Wang moved Chambers jobs.

Chambers became

the

Seller

through a

first

series of critical sales

non-Asian

Wang

at

to run the

company's Asia-Pacific

sales operation. In several positions of

increasing responsibility

—both

IBM and Wang— Chambers

at

never missed his sales targets.

Chambers schmoozed prodigiously traveled

all

the time.

On

September

6,

v^orry,

my

her with

him

to

statistics

ing in Milwaukee,

on how

bound

about

rarely plane crashes occur.

woman

for Atlanta.

"Don't

flying.

and he comforted

said,

Chambers changed planes

then in Boston. The plane,

Chambers

Upon

stayed on the same

Midwest Express

Chambers watched her plane climb 700

south of the airport, killing since then,

my

all

woods

thirty-one people aboard. "Ever

palms have sweat on takeoff," Chambers

said.

This was not a life-altering trauma. Chambers said.

worse for him a few years death spiral of

its

IBM. Even

like

as

low point of

An Wang

later,

Laboratories was in a

fell. It

set the stage for

what Chambers

his career: the task of laying off

called

return that summer.

Chambers back from Asia

No, Wang

when Chambers knew

to run the U.S.

1988. Chambers asked said,

off,"

Chambers

experience

was

said.

he could

was bad. The

we were

Chambers,

"It

planning a

While no executive enjoys a

a searing one for

if

he was needed the next day.

the situation

every holiday except Christmas

called

5,000 workers.

occurred over a fifteen-month period in 1989 and 1990. like

just

Chambers's career trajectory rose through the

sales operations in the spring of

That's

when Wang

was

It

own. The company was ambushed by PCs,

1980s, Wang's sales the

land-

home,

to head to his

then explode into flames and crash nose-first in the

feet,

The

a clear afternoon.

v^as visibly nervous

afraid also,"

v^^ife's

He

1985, he w^as flying from

Madison, Wisconsin to Milwaukee on

w^oman next

w^ith his customers.

layoffs

seemed

new

layoff, the

Wang

his friends say. "It

absolutely ripped John apart," said Selby Wellman, a former

and Cisco executive. "He told me,

'If I

lay-

ever have to

do

IBM

a layoff at

JOHN CHAMBERS Cisco,

I'll

lay myself off.'" Jack

Cisco

Chambers

it's

thinking about

Dream

said the

was the most difficult experience of his son's Achilles heel,

s

life.

"If

Seller

Wang

127

layoff

John has an

that he's too sensitive," he said. "He's always

who

Maybe

hurting.

is

too

much

so."

Current and former colleagues say Chambers can be overly dedicated to people under him. ple for too long," said

Nick

"He

tends to trust too

many

which can breed,

Francis,

words of one former manager, "a high Bozo factor" meaning that Chambers

is

peo-

in the

at Cisco,

willing to carry a proportion of

low

performers at high levels out of personal loyalty. "John believes a lot of the

get

you "I

time that the team that got you there

to the future,"

make

Don

is

the

team that can

Listwin said.

Chambers

friends for life,"

and

said,

it's

as

much

a

professional philosophy as a personal one. In 1990, shortly after the

March 24th death job.

His father

An Wang, Chambers was

of

said,

doing, please change

"John, it,"

if

despondent

in his

you're not happy with

what you're

Wang

Laboratories

and John

swiftly quit

and spent a month sending out resumes. This yielded no interviews

how

but sparked a revelation. "You realize

the world

friendships

made and kept he

knew from

every station of his career: colleagues from

IBM, school

Chambers contacted people he

Wang and

pals, friends of friends, relationships he'd forged in his

considerable travels. nies,

said.

works" on

He drew

twenty-two through old

his professional

from twenty-three compa-

interest

friends.

He was

steeped in the force of

network, the only kind of network he

knew

—

until

he joined a company that was building them for computers.

PLEASING Cisco's co-founders

shortly after

pany's

Bosack and Lerner

its initial

public offering.

new management team,

led

left

the

company

in

1990,

They clashed with the com-

by a blunt and seasoned high-

128 JOHN

CHAMBERS

tech executive

Dream

Cisco's

Seller

named John Morgridge. Morgridge

Chambers from Cisco executive Terry friend

an old Chambers

Eger,

from Wang. Chambers had been focusing

larger technology companies, but he

learned about

his job search

was drawn

to Cisco in part

because Morgridge told him he planned on stepping

soon and Chambers could be

Chambers was hired

of worldwide operations and became strategic

down

CEO

vice president

four years

the

IBM

philosophy followed closely on a lesson from his

bold,

and hyperambitious. He became

dream of

must be

a super-salesman for

had a

the connected world. "John just

crystal-clear

Reed

vision of the great blue Pacific of data networking," said

Hundt. "He

As

at

just

marched

into

IBM, Chambers's

it,

Chambers

in the 1990s:

Buy

Cisco, bet

Chambers assumed

a

Balboa."

sales pitches included the implicit

message of dominance. Just as firm in the 1970s,

like

IBM was

seen as the computing

in the

noting

how

company

sold Cisco as the Internet

on the

Internet.

manic regimen of speeches,

meetings, and media appearances from Cisco's on-site

"We're

His

later.

days: that successful companies in fast-growing markets fast,

CEO

as

in line to replace him.

1991 as Cisco's senior

in

high-level

TV

studio.

midst of the second Industrial Revolution," he'd

the Internet's rate of acceptance

than phones and

how

daily

on

was

volume of e-mail

say,

six times faster

in the U.S. already

exceeded traditional mail.

For

all his lofty

tive qualities

notions, Chambers's most celebrated execu-

stemmed from

his basic pleasing skills.

He

solicited

employees' viewpoints, kept abreast of their personal predica-

ments job

—whose mom was

sick

and

who was

—and oversaw one of the lowest

contemplating a

attrition rates at a

new

major tech-

nology firm. Cisco was consistently rated one of America's best

companies to work

for.

Several employees recall an event where

kindly best.

He was

Chambers was

at his

hosting a question-and-answer session with a

JOHN CHAMBERS group of kids

in

Dream

Seller

129

connection with the company's "bring your

chil-

dren to work day"

activities in

An

1997.

Cisco's

8-year-old girl got

up

to

ask a question. She held a microphone, stammered for several seconds, and started to cry

was

clear she

had

Chambers honed have a learning

when

she couldn't get her question out.

a developmental handicap of

some kind and

can identify with that," the

in. "I

disability, too."

He

said to the girl, "because

don't do as well."

who eral

The

girl

CEO

said. "I

told her about his dyslexia,

something he had never discussed publicly before.

Chambers

It

I

know when

"Go

slower,"

I'm excited,

I

asked her question, and Chambers,

has spoken often about his disability since then, received sev-

dozen supportive e-mails from

his

employees afterward.

"John doesn't pretend to be a visionary or a business operations genius," said Paul

Bernstein. "I

"What

make my

Sagawa, a networking analyst

he's great at

is

talking

hfe reading people,"

and

I

Sanford

listening to people."

Chambers

And

read an audience, read an individual.

at

told me. "I can

rarely miss."

He applies this skill to Cisco customers, for whom he is known to be obsessively attentive. Each night, he receives voicemail updates on Cisco's "critical" accounts; he devotes 30 hours a

week

to time with customers

and

ties

employee bonuses to cus-

tomer feedback. If

works three

Chambers has for him, he will

the occasion to criticize

do

it

—and

good things about you, then

Listwin said. At a roast for in

privately

Chambers

he'll

someone who

gently. "He'll tell

you

unfold the message,"

at his fiftieth birthday party

2000, Listwin introduced the concept of a "Chambers Secret

Decoder Ring." This was a translation device ingly glowing things

Chambers

said

in

which the seem-

were "decoded" into

his

intended criticism.

Chambers

also

made an

art

form of pleasing Wall

Street.

Cisco beat analysts' expectations by one penny a share for fourteen consecutive quarters.

A

$600 investment

in the

company

at

130 JOHN

CHAMBERS

Cisco

s

Dream

Seller

1991 low would have appreciated to $82,000

its

2000. At

IPO

its

in

money by

at

high in

its

peak, Cisco's shares had risen 100,000 percent from

its

1990. Cisco could essentially print issuing

new

shares.

own Monopoly

its

They would use

this

home-brewed

currency to shop for promising networking firms, twenty-two in

2000

alone.

It's

a great

way

to please customers

ones, in addition to saving billions

By

cultivating a style

Chambers That, as is

believes, a

much

attract

on research and development.

and building a culture based on

company can transcend

as anything else,

new

sums up

pleasing,

a range of obstacles.

his business philosophy.

He

adept at seeing problems and opportunities and acting quickly.

"It's

not that

The no

company's the world's most proactive company,"

this

said Carl Russo.

is

and

"What

it is is

a great reactor."

strategy reflects another central

Chambers code: He has

interest in tying Cisco to a signature innovation, as Microsoft

tied to

Windows

or Apple

is

He

to the Macintosh.

calls

himself

"agnostic" on technology. Cisco will simply build, or buy, the

technology that will most please

By

the end of 2000, Cisco

its

customers.

was

either first or

share of the fifteen network equipment markets

75 percent of

Internet traffic traveled by

The global network was doubling

ucts.

days

all

—and

was

way

company has

better

in.

Roughly

in size every

one hundred Its

revenue

between 1991 and 2000. Just one

ever delivered over fifteen consecutive years of

over 20-percent growth

—IBM

in the

1960s and 1970s.

Cisco also became a model for using the Internet to cut

own

corporate costs

—saving $1

As a

new

books

the

its

billion a year, Cisco declared. It

developed an online reporting system that allowed financial

its

of Cisco prod-

Cisco was enjoying a parallel explosion.

grew by 25 percent or other

it

second in

it

to close

its

in a single day.

company

grew.

Chambers began

constituency: government.

It

loomed

that has stymied other dominant but

to focus

on pleasing

as a potential obstacle

less

pleasing tech firms.

JOHN CHAMBERS

Cisco

s

Dream

131

Seller

notably Microsoft. Cisco's market position and business practices

made

it

vulnerable to regulation:

invite antitrust scrutiny; if

the Securities

by

Its

enormous market shares could

acquisition strategy could be hindered

its

and Exchange Commission

companies must account for

vs^hich

Chambers

first

set

more

stringent rules

their mergers.

bore into politics in 1996, vv^hen he joined

other Silicon Valley executives to defeat a California ballot initiative that

w^ould have

made

easier for shareholders to sue

it

com-

panies. Since then, he has redoubled Cisco's lobbying activities

and courted influence

He

at the highest levels.

members of both

has given large sums to

struck up friendships

—

former House speaker

or "close v^orking relationships"

Newt

D'Amato,

Alphonse

parties.

Gingrich, former

York Senator

Dianne

Senator

California

New

He

—with

Feinstein,

Connecticut Senator Joe Lieberman, and others, notably, George

W. Bush.

Officials

from both the Bush and Gore 2000 presidential

campaigns asked about

Chambers

told friends.

his

He

interest

in

administration jobs,

has also been mentioned as a possible

candidate for governor of California and senator from West Virginia.

Chambers wouldn't

talk to

me about

the prospective job

discussions with Bush or Gore, saying only that

honor" to have been considered and to stay at Cisco through 2004,

all that.

and when

"it's

He

he's

a

tremendous

said he planned

done

at the

com-

pany, he plans to teach.

But given Cisco's struggles for high-level meetings led

he was spending too

in

2001, Chambers's enthusiasm

some company

much

officials to

ask whether

time on politics and diplomacy, and

not enough time tending to his business. The concern was relayed to

Chambers on

a

few occasions, including one

off-site

meeting

with Cisco executives in 2000. There, a research committee rec-

ommended

that

Chambers spend

less

time on the road and more

time in San Jose running the company. Chambers was visibly

uncomfortable with the implicit criticism, especially since

it

came

132 JOHN

CHAMBERS

Dream

management team,

in front of his

Chambers seems

work

Cisco^s

to disregard

for him, according to

Seller

who was

said Listwin,

most

present.

from people who

criticism

one former member of

his executive

team. Chambers will, Listwin said, "graciously ignore criticisms

he didn't think had merit," then do what he wants to do. "I

once

said, 'John,

you don't want to

trying to snuff out rebellion,'" said

He was

like,

Nick

Francis.

'Nick, Nick, don't say that.'

Chambers

always

will

listen to

"He got convulsive.

like denial."

It's

who

Morgridge,

listen to

bad news, you're

is still

person of the Cisco board. But beyond the no-brainer this, there's

a noticeably parental

and Chambers. straightens

them site.

up

When Morgridge Boy

like a

together. Casual

He was also a I

2001,

enters a

room, Chambers always

Morgridge

is

a

who

have seen

Chambers oppo-

big supporter of Al Gore's presidential campaign.

met Morgridge just a

blunt,

politics of

dynamic between Morgridge, 68,

Scout, said Cisco officials

and

chair-

few hours before

Kent Jenkins joined

on the morning of February

for breakfast

us.

I

my

7,

meeting at Chambers's house.

planned to ask Morgridge

if

he had con-

cerns about the volume of Chambers's extracurricular work. But

he beat

me

to the topic, in a

to begin with. Cisco's

CEO

how CEOs in all

When in

I

way

asked him

that aren't right

like the job,

he decided to step

his

down

on

target.

"They become engaged

They spend

a lot of time

on

politics, or

world."

hard to imagine a better invitation to ask Morgridge

in the general sense,"

can get worn out." it's

as

in things

in other things. "I think

Morgridge

said,

He had

raised the issue with

his [Chambers's] decision to

make

it's

if

a

"mainly because

John works very hard, and you're always concerned that your

end,

mind

but they become infatuated with

Chambers had become too engaged concern

was on

can become distracted over time. "CEOs, particularly

the other things," he said.

It's

why

it

1995, he responded with a long diatribe about

our industry, they

in the civic

that indicated

asset

Chambers. "In the

those assessments." At

JOHN CHAMBERS

Cisco's

Dream

133

Seller

which point, Morgridge seemed to conclude that he probably shouldn't talk about this anymore.

Before he

left,

natural in politics,

Morgridge allowed that Chambers would be a that's

if

what he chose

to do.

He

even encour-

aged Chambers to run for something, and said he would support

him

if

he did.

When

I

met Chambers that

night,

was

it

had briefed him on what Morgridge had

clear that Jenkins

said, or at least

what he

had strongly implied. So Chambers was prepared. He assured me that his political dealings were held to a tight schedule

and

tied

directly to his business.

"These are not social things to do," he

said.

"This

is

my

business."

BAD OMENS Cisco's

announcement of

its

was one of

quarter in February 2001 ness events of the year:

Economy

How

T.

most hotly awaited

had the

far

left

of

busi-

so-called Internet

it.^

ever existed at all?

And who would have thought John

the

second

its fiscal

fallen?

Or what was If it

financial results for

that

Chambers, would be looked to as

He had

ever-giddy

its

its

been on the road for weeks

dream

seller,

barometer of woe?

— China,

India, Spain,

Switzerland, Washington for the Bush inauguration. Sixteen- to

20-hour days. Three hours'

On

Two

sleep.

February

hours of voice-mail and e-mail before bed.

Toughest grind of 2,

Maureen Kasper and

jet

Chambers

said.

he was joined in Madrid by two aides, Blaire Christy,

the February 6 announcement.

Chambers's

his career.

who would

They worked

help prepare for

for nine hours

aboard

en route back to San Jose. Chambers then dozed,

134 JOHN

CHAMBERS

Cisco

s

Dream

and awakened to Kasper's stricken

was

lost,

she said.

thing to retrieve

remained calm

just

It

it,

Seller

face. All the

work

they'd done

vanished from her laptop. She tried every-

but couldn't. Chambers took a deep breath.

—have to remain calm—because

"that's

He

how you

teach young leaders," he has often said. They would try to get one of Cisco's IT whizzes to hunt

come

Failing that, they'd just

in

down

the lost data

on Sunday

on Saturday.

to start again.

Turns out, an IT guy rescued the presentation Saturday and

omens kept

averted a massive headache. But bad selves.

On Tuesday,

conference

was

6,

about 30 minutes into Chambers's

announce Cisco's earnings, the phone connection

Network problem. Chambers

lost.

tunity."

call to

February

revealing them-

A joke. He

started again

explained, "a sales oppor-

from the beginning.

Cisco earned $6.75 billion in the

last quarter,

short of the con-

sensus projection of $7.1 billion. Revenue for the coming quarter

could drop as

much

as 5 percent.

Chambers

said.

This would be

Cisco's first decline after eleven consecutive years of growth. Sales

to dot-coms were

from telecom

down

carriers,

nearly 50 percent.

40

percent.

Chambers

The day

after

said.

Orders

he made his

announcement, Cisco's shares dropped $4.69, closing

at $31.06.

"We can be perhaps the most successful company in history," he told me at the end of my visit to his home that night. "We can be the best at giving back. ..." He peeked mid-marvel at Jenkins. He then sprang up and extended me his hand. He said we would keep in touch. "At Cisco, we build relationships, Mark," he said, looking me directly in the eye. He would now take Elaine out for a Mexican dinner. She Still:

deserves

it,

he said, after

all

the patience she'd

previous weeks, and he's thankful for

shown him

Elaine every day, and

keeps getting better between them after so

many

in the it

just

years.

me out, again placing his hand gently on my back. He asked me how I thought the discussion went and how Jenkins was serving me before closing with a summation on self. Chambers

led

—

—

JOHN CHAMBERS

"What you

see

what you

is

at his front door, pointing the

get with

way

Dream

Cisco^s

Seller

135

me," Chambers declared

out of Via Fehz.

HAVE WE MENTIONED THAT HE'S HAPPY? The next afternoon, received a surprise

was back

I

phone

call

at

my

desk in Washington and

from Chambers. He was

calling to

follow up.

"That was one of the most stimulating interviews had, Mark," he

said, his voice

But something wasn't

home, he'd got

sitting right

had talked

to thinking,

with him. After

in the interview as well as he'd

other points he wanted to

few minutes of First,

my

make

have liked

to.

There were

to me, provided he could take a

Chambers

felt

he didn't draw a strong

games and the

"I

that Bill Nottingham's

team beat us

and

remember

he said, talk-

over, there

respect.

.

with his right arm and the ref would never

would always be

to like

game was

was

left,

And Jimmy then hook me

call it."

But Chambers

Buckalew used to dribble around me on the

let it

still

in eighth grade,"

ing extremely fast. "But the second the a tremendously strong friendship

his child-

want our competitors

us" philosophy that he brings to business. "I can

never argued or

didn't

time.

the night before.

basketball

left his

He

enough connection between the good sportsmanship of

hood

I

and he realized

to Elaine

he missed a few things, especially about his childhood.

perform

I've ever

echoing over a speaker phone.

.

.

bother him, and, anyway, he and Buckalew

great friends.

Chambers sounded more upbeat than he had

the night before,

which had been plenty upbeat by anyone's standards. He seemed to sense that he'd

come

off a

little

touch of doubt. So he assured

weary

me on

at the

end and betrayed a

the phone: "I don't ever get

136 JOHN

CHAMBERS

down, Mark," he

Cisco

said. "If

Dream

s

Seller

do, Elaine brings

I

me

up." Or,

if

he gets

too far up, Elaine brings him back to Earth.

But he wanted to reinforce that Cisco's "challenges" had no effect

will

on

None.

his confidence.

come out

"I

have no doubt," he

said.

of this stronger, and the competition will

of this weaker, and

my

confidence on this

is

"We

come out

absolute."

By the end of the conversation, Chambers was

practically

yelling.

MISERABLE But the situation

just

kept getting worse, worse than anyone could

have expected.

On He

April 16,

Chambers made

from the $6.75

billion

Two months earlier, down 5 percent." He hon

would

said that Cisco's sales it

a staggering announcement.

decline as

had generated

much

would be

would write

that

methods and

had so trumpeted

off $2.5 bil-

state-of-the-art forecasting

among more than half of whom now owned stock

efficient operations.

Pleasantville's citizens,

its

"flat to

measure for a

for excess inventory, a deeply embarrassing

company

30 percent

in the previous quarter.

he'd predicted that sales also said that Cisco

as

Rates of attrition rose

options that were well under water.

"Cisco has never been in

this situation before,

tough on John," said Jack Chambers,

more conversations with had

son

his

who

told

—two or three

me

and

that he'd

week

a

it's

been

had

—than he

in years.

On March many

9,

Chambers

as 8,000 employees.

Cisco's sixteen-year history.

It

would eliminate

as

mass job reduction

in

said that Cisco

was

the

first

The company's news

to the action as "involuntary attrition."

Chambers

release referred

90 minutes the night before the announcement.

slept a total of

JOHN CHAMBERS

when

Usually,

a

Dream

Cisco's

company announces

layoffs,

Seller

137

Wall Street

shows instant approval. But given Chambers's repeated pledge never to execute them, the market took his announcement as a sign of trouble rather than a signal of farsighted austerity. Cisco's

shares dropped an additional $2.19, to $20.63.

A month would be

later,

Cisco announced that an additional 500 jobs

cut.

Chambers was never shy about of laying off workers at for

him

Wang.

Even though Cisco under Chambers was never

close to needing to cut jobs,

a

was always an expedient thing

to talk about, an assertion of his humility, his compassion,

his lessons learned.

ees

It

discussing the personal pain

—and a

it

was doubtless

selling point to prospective

ones

a comfort to employ-

—that they worked for

CEO who would never oversee a layoff. He had made the prom-

ise all

the time.

But as the economy shifted,

Chambers hedge

his

rhetorical finesse of a

promise

good

"I'm never going to

Chambers

When position

I

in subtle

fascinating to

ways.

It

that

happen again

News

in

in

was

hear

resembled the

my

life,

never,"

November 2000.

interviewed Chambers three months

later,

as Cisco's

deteriorating, he reiterated his no-layoff vow, but

with wiggle room.

"I'll

again," he said, "because

Four weeks I

was

politician.

let

told Investment

it

later

move heaven and

earth to avoid

you wreck people's

came

them

lives."

the layoffs.

spoke to Chambers again a few days

later.

The

layoff

"speaks to the seriousness" of today's economic situation. Cisco,

he said, had gone from a rate of 70-percent growth in

2000

to a negative

"No one he

is

growth

rate in

November

January and February of 2001.

has ever decelerated at that speed," he says. Even

when

bad news. Chambers takes care to couch

terms

assessing

flattering to his

company.

"It

it

in

goes with the territory," he said, "of

being the most profitable, fastest-growing

company

in history."

CHAMBERS

138 JOHN

In a 20-minute

you wish

good

as

if

he had broken his promise about layoffs. "Yes,

Nearly

I

of

told

me about

them

He ended Then, as

kill

It

I

who would

lose their jobs. said.

you," he said of the e-mails. Then his voice "I haven't failed at

said slowly, haltingly. "But

on

will be a "scar

my

I

many

things

failed at pre-

history."

with an uncharacteristic word: "miserable." receiving a

if

asked him again

live

any of

if

enthusiasm for the people

bad times" twice.

—about 95 percent—were supportive, he

Mark," he

venting layoffs."

in

the e-mails he'd been getting

all

normally smooth cadence. life,

bad

was an acknowledgement, but not an answer.

It

would

it

as

possibly can not to go through that

employees, including some

all

"Mark,

way

not

asked

his

my

it is,

and "Things are never

and never

times,

would do everything

lost its

deal with the world as

to the

good

Chambers

in

"You

said

Seller

Chambers returned often

call,

to be" three times

it

again," he said.

from

Dream

in

I I

s

seem

as they

said

phone

He

relevant bromides. as

Cisco

"New

gift.

Chambers

this

unpleasantness had doused his

Internet

I

Economy," and "changing the

and work and play" and

gotten so excited about

seized an opening:

all

the things that he

for the last six years.

Gosh, no, he

had

said. In

tough times, great companies break away. During every revolution, there are

world,

the dream.

sells

tion: "Isn't

And President

bumps. He

it

he

He

talks to people, listens, travels the

asked

me

his favorite rhetorical ques-

great?" left

Fox

me

with proof that

last night for several

clearly gets it."

it is:

"I

was with [Mexican]

hours," Chambers said.

"He

m.--.

>'.

fe-

CHAPTER FOUR

BILL GATES The Alpha Nerd and His Aker Egos

I

1

.t

was

He

getting unbearable to be Bill Gates.

was, for

founded and

built into a colossus

eral antitrust lawyers.

He had

administrative, political tions

was

that he

The company he had

starters, hating his job.

was

was taking

much

too

—none of

it

to

a beating

worry about

among

fun. Chief

getting to spend

little

from

—

fed-

legal,

his frustra-

time on the technol-

ogy work he loved most.

During one meeting, Gates's voice broke and up.

Over the next

noticed that Gates

several months, his colleagues at Microsoft

was becoming

tracted, quicker tempered.

He seemed

his eyes teared

increasingly overwrought, dis-

They worried about

to be losing weight

and

his

mental health.

sleep.

At a particularly low moment of the

antitrust trial. Gates

even contemplated leaving Microsoft. Not seriously, and never publicly.

But things were bad enough that he mentioned the pos-

sibility to

Steve Ballmer, his closest friend

"Just to

blow

off steam," Gates recalled to

months

later.

"Hey,

if

they really screw the

he said to Ballmer, "really just

split

it

up

and longtime deputy.

me

in his office several

company

that badly,"

in a totally irrational

way. ..."

As he

said this, Ballmer,

who was

stared at his feet.

141

sitting a

few

feet

away,

142 BILL GATES

The Alpha Nerd and His

Alter

Egos

"You know," Gates continued, "would you know." He paused. "At

for us to,

it

even make sense

mentally there was

least

that one point. ..."

He

doesn't complete the thought.

That Gates could even consider such that the World's Richest

Man

needed a

a

measure was a signal rewiring. So early in

life's

2000, Gates, with the blessing and urging of

He

self a present.

ping

down

gave him-

his board,

restored himself to full-time nerd status, step-

as chief executive of Microsoft

of chief software architect.

and assuming the

He would remain

company he had founded 25

years

earlier.

The

as

title

chairman of the

rest

he would leave

to Ballmer.

On

January 13, the day the switch was to be announced.

Gates called a few friends in advance to

tell

them.

"Well, Steve certainly got the short end of that stick," long-

time Microsoft executive Nathan Myhrvold told Gates. "I

know, he

he's willing to

do

Gates said, laughing. "Thank

really did," this for

Steve Ballmer

me."

would do anything

Gates for Ballmer. Although the two roles,

for Bill Gates.

Same with

men were assuming new

and emotional center would

the company's intellectual

remain where

always had: in the complex and symbiotic

it

God

rela-

tionship between Gates and Ballmer, corporate America's most

powerful buddy act

To understand

the

—or bully

act,

depending on one's perspective.

bond between them

Microsoft has become the exemplar of

nance

is

to understand

why

New-Economy domi-

—and America's most embattled company.

It's

also key to understanding Bill Gates.

tycoon of

this era, thus

as he

is

is

the

marquee

seemingly familiar and known. But for as

central as he's been to the global

watched

He

— Gates remains a

economy scantily

—and

for as closely

known

figure.

Over

the years, I've been in several interviews with Gates, both alone

and

in groups,

and

it is

always immediately clear that

his

popular

— BILL GATES

image relays

The Alpha Nerd and His Aher Egos

143

—the cranky-genius-gazillionaire-with-greasy-hair Gates nowhere near the full-measure of the man's

Perhaps more than any other person projects a recurring

come

I've

and palpable sense

peculiarities.

know, Gates

to

not being

of, simply,

like

the rest of us.

On

most

the

superficial level, he looks

and sounds

There's a perpetual adolescent quality to his appearance

mop

round head,

make him look

of light

brown

squeally voice that cracks a

—with

his

and floppy posture that

hair,

like a bespectacled

different.

Muppet. He has

lot, especially

when

and

a high

he's agitated.

He

has a pale, oily face that, in recent years, has taken on a jowliness that

makes him look more adult than he used

mature.

He

is

to,

but

still

not fully

a lousy shaver, with small black patches of stubble

sprouting from his pasty face, especially on his chin.

when he

Gates rocks vigorously

is

sitting, a

trademark habit

that dates to his toddler days and, for whatever reason,

mon

among math,

trait

science,

his thighs

as Gates.

and brings

back up again.

when he

is

When

down

that's so

almost to his kneecaps, then

he's thinking hard,

he rocks

faster;

slower

You almost never see Gates sit still. famous people, and many top executives, have

been-to-finishing-school quality about them. acquire, a deep voice, a courtly presence,

Not

way

relaxed.

Certain

style.

com-

rocking, Gates tucks his elbows into

his chin

When

a

and computer genius types

including Ballmer, though not so often or in a

pronounced

is

Gates.

He

They

a

seem to have, or

and an easy gladhanding

has a limp handshake to match his hunched

posture. I've never heard

him

"respectfully disagree" about any-

thing.

He

know

WHAT you're talking about!?"

will contest things in

quick spasms of disdain.

he snapped to

my

"Do you colleague

Steven Pearlstein at a breakfast interview here at the Washington

Post in 1998 on a

He

visit just

before the antitrust

raised his voice several times that day.

was

"technical

He

enough" to discuss a certain

trial

was

to begin.

asked someone topic.

One

if

he

industry

144 BILL GATES

watcher

calls

him "a

unself-conscious,

anyone that

The Alpha Nerd and His Aker Egos

feral executive," referring to the unpolished,

and unapologetic way he

defies his impulse, reason, or objectives.

Implicit in this assessment

under

maw

people

intellect.

who

have

But as

life.

He

that Gates

I

a lone-wolf type

is

is

in the righteous

spent time with Gates, and talked to

known and watched

relationship with Ballmer his

is

both victim and predator ensconced

siege,

of his

will attack anything or

him,

it

became

clear that his

part of a formative pattern throughout

has always picked out an alter ego, someone to nourish

less-developed sides of himself while matching his I.Q. and zeal.

Gates has been willing to "outsource" large portions of his

and psyche to a chosen especially

federal

partner. Ballmer

is

neatly suited to that role,

now, as Microsoft proceeds as boldly as

court ruling that has declared

intellect

an

it

ever, despite a

monopoly.

illegal

Likewise, Ballmer's increasingly powerful presence as Microsoft's

CEO

allowed Gates to tend to himself, his image, and his company

at a time

when

everything seemed to be crashing

A

down around

him.

NETWORK THEMSELVES

Gates and Ballmer have been friends since they met as Harvard

dorm mates

twenty-six years ago. Like

many high-tech pioneers,

two enjoyed comfortable suburban childhoods

the

that whetted, rather

than dulled, their drive to succeed. They embody the old-money and

new-money prototypes of twentieth-century great-grandson of the

Bank

in

man who founded

1911; Ballmer's

father, a Swiss

affluence: Gates

family in the Detroit suburb of Farmington Hills,

Co. accountant

who began

them

for

life.

who

was

a

settled his

Ford Motor

trumpeting his expectation that his son

would attend Harvard when Both endured early

the

National City

Seattle's

immigrant

is

the

social

boy was

8.

problems that friends say marked

Ballmer was so shy that he would hyperventilate before

BILL GATES

going to

Hebrew

The Alpha Nerd and His Aher Egos

was

school. "I

just so scared,"

my mom would

wouldn't throw up,

145

he told me. "So

have to make

me

I

take short

breaths." Today, his motivational speeches at Microsoft events are

where he runs through

legend, but before he gets to the part ing, cheering

crowds

high-fiv-

he doubles over, sweating and panting, he

till

has to psych himself into the idea that he's up to the performance.

William Henry Gates slang for a three)

was

family. His father,

William

his mother,

Way

(nicknamed "Trey," card-playing

boy prodigy born II,

Mary, was active

United

local

a

III

chapter.

was

a

into a wealthy Seattle

prominent corporate lawyer;

in local charities

Bill,

and was head of the

the middle of three children,

older and younger sisters, Kristiane and Libby. called to his

him over

room,

would shout "I'm thinking" Bill

ant.

was maniacally

"The Gateses

her. Finally, recalled

one

many

They

sent

him

know what

and often

do with Trey,"

to

to a child psychiatrist,

of his youthful hours.

teasing

He was

and roughhousing from

He found many

said the in

ado-

where he spent

his peers.

solace in computers,

brilliant

defi-

small for his age, and endured

which became the object of

full-on obsession shortly after he discovered

Gates,

in

friend, he

Reverend Marvin Evans, the father of Gates's best friend lescence.

mother

in the direction of the intercom.

curious, emotionally raw,

didn't

his

and asked what he was doing

the intercom

would ignore

Bill

When

had

them

a

at age 12. Like

computing leaders started out

as outcasts,

who worked

at Microsoft

said Christine

Comaford,

in the 1980s.

"When

a Gates friend

they find a

tend to swing the other way,"

world that embraces them, they

Comaford

said.

They become

hyperaggressive and driven. "They find their path to success and they'll

do anything not

to turn back."

As Gates and Ballmer grew through a

New-Economy

to

adulthood, they passed

version of an old boys' network. At the

exclusive Lakeside School in Seattle in the late 1960s, Gates

met

not only his best friend, Kent Evans, but also his Microsoft co-

146 BILL GATES

The Alpha Nerd and His Aher Egos

founder, Paul Allen. Gates met Ballmer at Harvard, which they

attended with future Sun Microsystems founder Scott

and Excite@Home

CEO

George

Bell.

and Ballmer became a

In building Microsoft, however. Gates

network unto themselves. They are to caricature: Gates, with five

feet

voice sive

225 pounds, and

—

his vocal cords

shouting-and

Beyond

is

stylistic

tests, is

the petulant nerd. Ballmer, 6

bald, speaks in a rollicking bullhorn

once required surgical repair from exces-

the corporate evangelist.

the caricatures, both

two smartest people

men

are repeatedly called the

Their intelligence

at Microsoft.

described in computing terms, the semantic types.

"Steve

is

a

Pentium

in

Microsoft executive Jon Roberts.

in

an extroverted way.

Bill

is

often

wont of many

techie

said former

a land of 386s," "Bill is also a

have different optimizations. Steve

He

open

opposites, both

smeared glasses and perfect scores on

high school achievement 1,

McNealy

Pentium. But they

the graphic engine, smarter

is

does logic computation thinking

can look at a spreadsheet and immediately hone

tion about marketshare in Spain.

His

level

in

on

better.

a ques-

of penetration

is

extreme."

Gates and Ballmer are both called loyal, impatient, tenacious,

and

insecure,

marked by devotion,

qualities reflected in self-flagellation,

the non-Microsoft world.

and

a corporate culture

a searing suspicion of

Some people wonder whether Ballmer

amplifies Gates's natural ruthlessness

—to the point where

it

has

contributed to the company's antitrust problems. "Steve and

more

likely

to

Bill

are

inflame than temper

Metcalfe, the founder of eral years.

complementary personalities that are

3Com, who has known

"There are three monopolies

and Microsoft

"They have

each other,"

—and only one has an

both

in high tech

said

men

Bob

for sev-

—Cisco,

Intel,

antitrust problem," he said.

failed to internalize that they're the world's

most

BILL GATES

The Alpha Nerd and His Aher Egos

147

valuable company." Gates and Ballmer "are like huge teenage

who

boys

know how

don't

big they've gotten,

and they keep

knocking things over."

Other powerful duos have led high-tech companies, but few, if

any, have been so enduring.

Steve

Wozniak (and

of strain,

if

later.

Apple co-founders Steve Jobs and

CEO John Scully) had periods did AOL co-founders Steve Case

Jobs and

not alienation. So

and Jim Kimsey, Netscape's Jim Clark and Marc Andreessen, and Oracle's Larry Ellison

grew apart If

and Bob Miner. Gates and Paul Allen also

as Microsoft

grew huge.

Gates comes to trust someone enough, a former Microsoft

executive says, he's willing to enter into a "mind-meld" relationship,

an entity that doubles

his capacity for

thought and stokes his

voracious ambition. Early in his

life,

that person

found influence on Gates early adulthood,

As Microsoft rose

to

the

most pro-

in his youth. In his late adolescence

was Paul

it

was Kent Evans,

and

Allen.

dominance. Gates found Steve Ballmer.

'^EXPLORATION" It

men at the same time. when no humor is appar-

can be maddening to converse with both

One ent.

giggles

when

the other talks, even

They speak over each

their

other.

Or

they communicate in clauses,

understanding too rapid for sentences. "Someone will have

to say,

'Can you repeat that for me?

I

didn't quite get

it,'"

Microsoft executive Mich This rang true together in

Mathews said. when I interviewed Gates and Ballmer

December 2000

working on about

for a

Washington Post story

their partnership.

I

found the men

together in Gates's office in Building 8 of Microsoft's

I

was

sitting

campus

in

———

— 148 BILL GATES

had no

office

view and no

special

Holiday Inn room. Gates's desk was

a typical

rounded by framed pictures

—

sur-

wife Melinda, 5 -year-old daughter,

2-year-old son, and Microsoft's a

—

The Alpha Nerd and His Aher Egos

Redmond, Washington. The more space than

—

first

eleven employees. There

was

framed black-and-white photo of Einstein and three framed

Economist magazine covers, which Gates said carry no cance whatsoever except that his

buy

a tough person to

gifts for

sister

and

it

signifi-

got them for him and he's

just

seemed

like a

good place

to put the things.

Seated in a chair in the middle of the room. Gates was rocking

slowly

when I walked

in,

grinning over something, looking notably

unembattled. Ballmer was the one sitting on the couch with his head in his hands.

It

ing of the day

was 9:15

—fourth

A.M.,

if

and the

I

was on

his third

meet-

you include the working game of pickup

basketball he plays every Wednesday.

crimson cheeks when

CEO

walked

He rubbed

in, as if

his

hands over

his

to revive himself.

At one point in an hour-long interview. Gates and Ballmer were discussing

their

aforementioned head-of-state phenomenon.

The conversation went Ballmer: Gates:

If

like this:

you have

Head

a president of a country

of state

Ballmer:

A

meet with

me

head of

state here,

because I'm the

of state's a head of state and

Gates, laughing: Don't think it's

not

like,

Ballmer:

I

some heads of

CEO,

state will just

but you know, the head

don't care

we have

if it's

a lot of,

a small state.

you know

you know

It's

not

like

Putin has been into

town

lately or

something. But you know, the president of Costa Rica's been here, or Chile

Gates: Chile or Poland

—

—— BILL GATES

The Alpha Nerd and His

149

Alter Egos

Ballmer: Poland, you know. Gates: That was

Me: Do you guys Gates: No, no,

month.

last

divide

up countries or something?

get

I

Ballmer: In some ways Gates:

get the head of state of countries

I

Ballmer: Mauritius Gates:

I

was

able to handle

was worried about

I

it,

on

my

though.

While Gates and Ballmer's conversations are

words can be

acidic;

and the fervor of fiercely

right

if

their

fluid,

they disagree, they can't help but bicker,

if

their discourse sets the tone for Microsoft's

"We come from

combative culture.

there's generally a right

"And

own.

you explore

it

where

a philosophy

answer and a wrong answer," Gates

enough, everybody will

said.

just agree there's a

answer and a wrong answer." "Exploration" at Microsoft often occurs at high volume.

"It

can be a knife fight," said Vern Raburn, a former Microsoft executive. "It Bill will

would appear

always

say.

to

many

people that

it's

That's the stupidest thing

(The more accurate and

common

getting personal.

I've ever heard.'"

wording: "That's the stupidest

fucking thing I've ever heard.")

"This

who

is

not a place to come for high stroking," said Ballmer,

can give as well as he

gets,

and which

to coexist with Gates. "Steve has

Bill, it

central to his ability

found a way to work with

without subjugating himself," Raburn subjugate yourself to

is

can get a

said.

little

"The moment you

dangerous. ...

be an alpha male in collaborative situations in ways if

he realizes."

Bill

I

He can know

don't

150 BILL GATES

The Alpha Nerd and His Aker Egos

While he and Ballmer are similar

in elemental

can appreciate that Ballmer has a radically different ality,

and outlook,

Microsoft.

The

all

ways, Gates style,

of which can be useful to

person-

him and

to

abound.

distinctions

Gates loves bridge; Ballmer loves basketball. Gates nibbles at

French

Ballmer eats muffins by ripping the tops off and

fries;

shoving them into his mouth. At a toast during Gates's bachelor party weekend in Las Vegas in late 1993, Ballmer, his best man, teased his friend as

shades of gray.

"someone who

"NOT ME,"

sees

life

as

he boomed.

complex,"

rife

with

"WITH ME,

IT'S

BLACK OR WHITE, ON OR OFR" would be

"It

great to see the world in such a black and white

way," Gates said mockingly.

"It

would be much

simpler."

A

long

discussion about philosophical approaches to the world ensued

among what

the twenty people

who were

present. This apparently

Gates and his pals do at bachelor parties.

Bill

Gates

a nearly mystical figure at Microsoft. Ballmer

is

frontally engaged. Gates breathes Microsoft. Ballmer exhales

On fifth

is

a hot day in June 2000, Microsoft celebrated

its

is

it.

twenty-

birthday at Seattle's Safeco Field, an all-hands bash at which

Ballmer popped out of a giant cake, raced through the crowd to

Kool and the Gang's "Celebration," panting, sweating, gyrating, soaking a black polo

shirt.

He

screamed a favorite story about

then jumped up on a stage and

how

he was once addressing cus-

tomers in Colombia and was playfully throwing baseballs into the

crowd when one of them smacked

man I

lost

a customer in the head.

consciousness and Ballmer rushed to his

side. "I

The

begged,

pleaded," Ballmer screamed, recounting the incident televange-

sweat pouring off his knobby bald head. "Bring that cus-

list-like,

tomer to

life."

The customer

revived. Ballmer gave

him

a

copy of

Microsoft Office. "And from the ashes he rose up again," Ballmer wailed.

"And

happened

in

to this day, this

Colombia

is

in IT."

the

most important thing that ever

BILL GATES

The Alpha Nerd and His Aher Egos

151

Microsoft's employees stood and applauded. Ballmer raised his

arms, looking triumphant,

And

not quite dignified.

if

Gates was safe backstage, happy to outsource such

motivational indignity to his best friend.

whose

Ballmer,

father toiled thirty years at Ford, takes an old

economy view

of corporate

Microsoft dread

telling Ballmer.

said one

who

left in

be emotional."

executive's

had

new

this executive told

seemed

it

very personally,"

Ballmer he would be

stricken. After a discussion

about the

who

job, the discussion turned to Ballmer's father,

This executive's father had died two years before.

just died.

Ballmer closed the door of his cry

takes

leave

January 2000. "You expect these meetings to

When

leaving, Ballmer

"He

who

Executives

loyalty.

and a discussion about

office,

and the two men shared

their fathers,

a

ending with a bearhug.

Gates hates being touched. At a Microsoft event that featured Shaquille O'Neal, Gates became visibly agitated when, to the crowd's delight, the 7-foot basketball star

around the 5-foot-9 Gates and

lifted

wrapped

cial.

said Christine

Comaford.

arms

him up.

"Bill gives off a physical reaction that says, 'Step tle bit,'"

his

When

he used to

back a

fly

lit-

commer-

Gates sat with a blanket covering his head so he could sleep

and also not be recognized. One former Microsoft executive recalls

walking through the Tokyo Airport with Gates

Gates instructed the executive to appear as

if

for a

less likely

At the luggage rack, when the executive turned away

moment

ing they'd

1996.

they were locked in

an intense conversation, so celebrity-gawkers would be to approach.

in

to retrieve his bag, a

met

at a party. "Bill

man walked up

had

to Gates claim-

this really tired,

beleaguered

look on his face," the executive recalled. Gates communicates largely by e-mail. Whenever to him, his responses

often

went on

I've written

were always prompt, always thoughtful, and

for several pages.

He would answer my

specific

questions, yet the e-mails were always completely impersonal.

Not

152 BILL GATES

that I'd expect

never so

them

much

to be

chummy, or even

But there was

familiar.

and

as a greeting at the top, never a "hi,"

my name — all

never any use of typical e-mail

The Alpha Nerd and His Aher Egos

mode with

of which

consistent with Gates's

is

his closest friends. In

Gates simply began with "Sorry

me

took

it

certainly

one note to me,

a few days to write

—

down my thoughts on these questions here they are" and he proceeded. He never signed his e-mails when he was done; he just finished writing and stopped.

was

It

the e-mail equivalent of not

touching.

Ballmer

He

a fat-fingered

—and he often

When call his

and

erratic e-mailer ("graet tnx").

to invade personal space

prefers

offices

is

and pop

head into

his

startles people.

Microsoft executives want face-time with Ballmer, they

executive assistant,

ings are that

Debby

Hill, to find

day so they can walk or

ride the

out where his meet-

campus

shuttle with

him.

Gates

is

more

by saying "Send

me

to have a meeting

Ballmer

is

mail [e-mail] on that" or "Aren't

on

that

tomorrow? We'll

says. "Bill

is

is

more of

talk

on

a challenge

white boxers and

about

it

then."

you

a

guy you want to be loyal

to,"

a

guy to be

is

Ballmer has been called the company's acting

we supposed

—and

the prime minister. Gates

don't touch the king. "Steve

Comaford

with an unscheduled meeting

likely to dispatch

the king

in

awe

id.

of."

In the late 1980s,

from another executive, he stripped to

swam

across Lake

Bill,

an

artificial

his

lake at the

center of Microsoft's campus.

When

called upon, he'll also play

complete wimp," Myhrvold sition deal this guy,

where

because

Bill I'll

said.

bad cop.

just agree.'"

let

me get

Myhrvold adds

doesn't relish playing the tough guy, and

then starts licking your face."

can be a

"There was one very big acqui-

says to me, 'Now, don't

often acts "like a Saint Bernard

"Bill

if

alone with

that Ballmer

he offends someone, he

puppy who knocks you over and

— BILL GATES

He

also

is

prone to

The Alpha Nerd and His Aher Egos

mood

153

"We're golden, we're

swings.

golden," Ballmer will say in an up moment, and "We're fucked,

we're fucked," during the inevitable swoon. Gates wallows in grays,

harps on problems, "tastes every drop of misery," a Microsoft executive said. "If I'm worried "it's

about something

work," Gates

at

said,

there twenty-four hours a day."

September 1996, Gates made a presentation

In

Francisco's

Moscone Center

to

announce the launch of

version of Internet Explorer. Afterward, he took

and executives to the hotel bar next door to

San

at its

latest

some engineers

celebrate.

But Gates, drinking white Russians, fixated on a Microsoft

e-

mail product and started working himself up about "what a piece of sh

—

"

it

was. His tablemates had nothing to do with the product and

prodded Gates. "Yeah," Gates

said, "that's the

ware we've ever shipped," and he ranted

for

worst piece of

soft-

about twenty minutes.

Ballmer was not pleased with the answers at a 1998 meeting

with seven managers

who worked on

anyone here understand Office?" he

who was

being yelled

at.

Microsoft Office. "Does

yelled, according to

He jumped up from

someone

a conference table in

Building 18, his shirt coming untucked in the back. "Anyone?" told a nearby secretary to "get

someone on

the

He

phone who under-

stands Office."

Ballmer and Gates's relationship riage," even

by the principals.

"We

is

commonly

very beginning in a very deep way," Gates said. their relationship that they treat

others.

They

"and no one But

sit

a hallmark of

each other as roughly as they treat

mom and dad fight,"

usually

Deborah Willingham

Windows

It is

make up

said

yell

Mich Mathews.

quickly. Microsoft executive

recalled a meeting shortly after the release of

95. Excess software

was accumulating

took responsibility, but Gates wouldn't

"Why do we do

"mar-

from the

next to each other in meetings, giggle, and

likes to see

they'll

called a

trusted each other

this?" he said.

let

in stores.

the issue die.

Ballmer

154 BILL GATES

"Look,

man

I

The Alpha Nerd and His Aker Egos

said

I

made

his children call

to hear

me

say

I

that mistake," Ballmer thundered to the

Uncle

made

Bill.

"How many

times do you want

that mistake?"

"Well," Gates said, smiling, "I might want to hear

more

it

a

few

times."

NOTES Whenever answer

I

IN

watch Gates up

settings,

THE MARGINS close, particularly in question-and-

I'm reminded of the sheer volume of things that

the leader of Microsoft needs to be an expert on: technical matters

of great diversity and detail; the nuances of U.S. antitrust law; the

administrative challenges of running a huge and growing com-

pany; the diplomatic stresses of managing numerous corporate partnerships; the financial arcana that Wall Street

And

with.

is

concerned

then there are the matters intrinsic to being Gates, the

scrutiny that goes with being the richest

man

in the world,

and

one of the most controversial.

As

a practical matter, I've always

wondered how Gates

abreast of the things he needs to stay abreast of.

about

his reading diet.

I

stays

asked him

Each morning, he told me, he reads the

Wall Street Journal, usually on paper, and the online version of the

New

nology this

is

York Times.

Web

sites

He

will also visit a

bunch of news and

such as CNET.com, Zdnet,

tech-

MSNBC. None

of

What

is,

unusual for a well-informed technology executive.

however, are the libraries of books, research papers, trade journals, and, basically, everything, that

Gates will read with tremen-

dous speed and apparent comprehension.

He

has seamless recall

of the most obscure articles, software parameters, arcane laws.

By

the age of 9, Gates

from

A

had read the World Book Encyclopedia

to Z, according to Gates, a biography by Stephen

and Paul Andrews.

Manes

BILL GATES

The Alpha Nerd and His

155

Alter Egos

Gates brings thirty books with him on a typical vacation, he tells

me.

He will

and usually

read "more than a book a day" on a pleasure trip

through most of them.

gets

"Think Weeks" a year

in

which he

He

will also set aside

will hole

two

up somewhere and

bore through several dozen books as well as research papers,

memos,

articles,

and anything

numerous "to read" marked-up books Gates says he speed-reader.

Evelyn

is

When

Woods

a "pretty fast reader,"

comments, and

though not a trained

who took an would compete over who could

he was young, he had a friend

and they

faster.

"My

reading

is

very variable," Gates said.

depends on the material that I'm reading.

something

If it's

my view is, you just reread the page to make

about math,

you get everything." He so

will scribble notes,

his

to the author.

course,

read something "It just

up on one of

margins of the books he reads, and will often send

critiques in the his

He

piles.

else that piles

do books about

sure that

books also take him longer;

said science

beloved pastime, bridge, because he takes

his

the time to envision the models in his head. "There's this book.

How

the

Mind Works which ^

said. "I spent

is

a [Steven] Pinker book," Gates

twenty hours reading that book because

many notes in the margin." None of Gates's reading would

I

was

writ-

ing so

by most people. Stonesifer, a

When

I

was

be classified as

in

in

had read on

had

who

office is

of Patty

now head

just received

of

an e-mail

which he summarized and critiqued everything he a just-concluded vacation.

detailed accounts that

went on

These were long and

for several pages, things he often

sends to select friends, especially area of interest that they have in eral

Seattle

former Microsoft executive

Gates's $23.5-billion foundation, she

from Gates

the

light, at least

when his reading relates to an common. He had just read sev-

books, papers, and journals about world health issues, the

focal point of his foundation,

findings to Stonesifer.

and he was thus downloading

his

156 BILL GATES

The Alpha Nerd and His Aker Egos

She would not share the contents of Gates's e-mail, but she did

me

read

on

a sampling of his reading choices:

Antiretroviral Treatment for

members of Harvard

vidual

and

Poor Countries" from

in

indi-

University's faculty; Child Nutrition

the Wealth of Nations by Reynaldo Martorell; Combination

Therapy for Malaria al.,

AIDS

"Consensus Statement

from the

Hype

in Africa:

or

Hopef by

World Health Organization, The

Bulletin of the

HIV

Evidence Base for Interventions to Prevent

and Middle Income Countries

Peter Bloland, et

Infection in

Low

— The World Health Organization's

Commission on Macroeconomics and Health;

Critical Issues in

Global Health edited by C. Everett Koop; The Invisible Enemy:

A

Natural History of Viruses by Dorothy Crawford; and Infections

and

Inequalities:

And

several others.

reminded

Stonesifer in

The Modern Plagues by Paul Farmer.

one area of

interest.

me

that this

was

There were other

just

one Gates vacation,

sets of e-mails that

he sent

to select parties in other topics he cares about, such as software design.

a

And

book

ideas

in e-mail,

and

leagues,

in a given

week, Gates

will also write the equivalent of

dozens of them every day in which he unfurls

criticisms to

an extended kitchen cabinet of

and random people he hears about and who

and who he can Gates

is

get in touch with because he

scheme and explore with, and bash

most

elite

He

a full-contact intellect.

is,

friends, colinterest

after all. Bill Gates.

seeks out partners to

against.

He

handpicks the

ones he can find and occasionally, thrice in his

will find a super-partner

who

and what he can accomplish.

him

life,

he

recasts his notion of what's possible It

started

when he was

12.

NERDS TOGETHER Kent

Hood Evans was

Gates's

boyhood

best friend.

dreamy, dogged, and largely devoid of inhibition.

He

He was carried

— BILL GATES

157

The Alpha Nerd and His Aker Egos

Barron's and Fortune around Lakeside School in his enormous briefcase. Until in business or

he met Kent, Gates had never shown any interest

even making money.

Like Gates, Evans w^as briUiant and precocious; unlike Gates,

he

v^^as

summer

extremely directed. In a resume for a

w^rote: "I

am

once

job, he

looking for a job that involves programming that

He pushed

consider interesting."

and Gates w^ould marvel

Gates to think big and take

at his friend's nerve.

Kent often

I

risks,

tried to

convince him to skip school and join him at a computing center across tow^n, but

more

often than not. Gates

caught. Kent, he recalled,

was

and

fearless,

was

afraid of getting

Gates

after a while.

also learned to be fearless.

Evans loved letters to

style in

and government. He wrote frequent

politics

public officials, typing with a distinctive two-finger

which

right pointer

He

volunteered

week on Hubert Humphrey's

presidential

mashed down loudly on

for several hours a

campaign and once asked Gates ing in

him

key and his

his left pointer controlled the shift

if

in a foreign service career.

the letters.

he would be interested in join-

Maybe, he

an ambassadorship one day. "This

is,

said, like,

it

could result

ninth grade,"

Gates said.

They were both

way

with pants pulled up with a

cleft palate.

distinctive:

Gates was slight and unkempt

too high; Kent was heavyset and born

They were nerds

together,

showing no

dis-

cernible interest in girls, music, or any other teen-boy passions

although Kent was one of the most popular boys in his Lakeside class.

Gates,

who was

unrestrained in railing about peers and

teachers he considered stupid,

annoying person,"

Andrews

in Gates.

that probably sort of

was

not.

He was "an

extremely

one Lakeside classmate told Manes and

"He was

me and

very easy to sort of dislike.

a lot of people took a

bumping him while passing him

school, the guy would've been killed."

little

And

I

think

extra pleasure in

in the hall.

... In public

158 BILL GATES

The Alpha Nerd and His Aker Egos

Gates and Evans would speak for hours on the phone at night,

They recommended

sharing ideas about business and computers.

books to each

other, argued,

and communicated

subject,

Gates would

call this

developed a deep understanding of their in a kind of shorthand.

"high-bandwidth communication."

was one of

In the late 1960s, Lakeside

the

country to have a computer. Housed in a small Hall,

was

it

At Microsoft,

a Teletype

machine about the

first

schools in the

room

in

McAlister

microwave

size of a

oven that became a magnet for math whizzes Gates and Evans,

and upperclassmen Paul Allen and Ric Weiland, who would

become among Microsoft's

first

employees. They formed the

Lakeside Programmers Group, not "club," because "club" con-

noted a hobbyist's pursuit with

all its

attendant

frivolity. It

was

"group" because that sounded more businesslike and

called a their goal

was

to

make money.

The group operated with minimal design, said Fred Wright, the Lakeside

vided that supervision.

supervision. This

was by

math chairman, who pro-

"Our philosophy was,

get a group of smart

people together, give them tools, and get out of the way," Wright said. That,

petition,

he says,

is

the best environment to spur creativity,

and collaboration.

It

com-

can foster dynamic collisons and

ideas between personalities at a defining stage of to see the roots of Microsoft's culture, look

no

life.

"If

you want

further than the

Lakeside Programmers Group," Kent's father said.

The four boys spent Center Corp.

late-night hours at Seattle's

Computer

("C-cubed"), which offered time on a Digital

Equipment Corp. machine per an agreement with Lakeside. C-cubed went out of business

Group

nearly imploded in

in

civil

the knowledge of their partners

1970, the Lakeside Programmers war. Gates and Evans

—arranged to buy a

tapes cheap in a bankruptcy auction. at Lakeside,

When

They hid

and when Allen learned of

this,

—without of

DEC

the tapes in a

room

set

he found and kept

them. Livid, Gates and Evans threatened legal action.

BILL GATES

They were

The Alpha Nerd and His Aher Egos

15.

At one point, the older kids

—Allen and Weiland—told Gates

and Evans that they weren't needed on a particular

when

159

project.

But

Allen and Weiland became overworked, they invited Evans

and Gates back. Gates agreed to return, but on one condition: He needed to be Bill

in

charge of the project.

and Kent were inseparable and overextended. School and

computers ate up most of

their time, the latter

took on consulting jobs, often their junior year,

in

more so

as they

exchange for computing time. In

1971-1972, a Lakeside teacher enhsted them to

automate the school's complex class-scheduling system. They pulled a string of all-nighters, hoping to have the for their senior year.

over the Memorial

on

May 28,

program ready

Evans took a break to go mountain climbing

Day weekend. Ht

slipped and

fell

to his death

1972, in an accident his father attributes to the fatigue

caused by his loaded schedule. "Kent's death

was

a

huge

loss to Bill," Paul Allen recalled.

Gates was scheduled to speak at Kent's funeral, but he was too distraught and sobbed through the service. "Elaving your best

bit,"

makes you

back and think about

life

quite a

Gates recalled in an e-mail. "I was devastated."

When

friend die really

step

Marvin Evans met Melinda Gates

a

husband

the time.

"It's

ber his

still

talked about Kent

all

few years ago, she said her

been nearly thirty years," Gates said, "and

I still

remem-

phone number."

A BASIC MISSION Even

in his grief.

Gates was determined to finish the Lakeside

scheduling project. In choosing a

new

collaborator, he turned to

Paul Allen. Allen was enrolled at Washington State University, but

agreed to help

when he

returned

home

for the

summer. They com-

160 BILL GATES

work

pleted their

The Alpha Nerd and His Aher Egos

and held out the possibiHty of

for Lakeside

doing other projects together. Gates headed east to Harvard

was eager

that he

to be

could challenge him In his

in

among an

1973, where he told friends

elite

who

group of students

intellectually.

sophomore

mutual

year, a

duced Gates to Ballmer.

friend, Jeff Clark, intro-

"Jeff liked Steve because Steve

had

this

very energetic approach to being involved in everything," Gates said with a sniffly laugh. this very energetic

They both

"And he kind

of liked

me

approach to not being involved

because

and science whizzes removed from the more

had

in things."

House, an outpost

lived in Currier

I

full

of

math

centrally located

Harvard dorms along the Charles

River. "In return for living far-

ther away, the male-female ratio

was

you could have a hamburger

better,"

at every meal."

Gates said.

"And

Ballmer said he

availed himself to neither the favorable male-female ratio nor to the hamburgers. Gates said he ate a lot of hamburgers.

Ballmer compensated for his shyness by becoming hyperactive

on campus. He would become the manager of the Harvard

football team, business

publisher of a

campus

manager of the Harvard Crimson, and literary

magazine.

He made

memorizing faces and names from the Harvard

He and

a point of

directory.

Gates became friends, attending a double feature of

Singing in the Rain and

next month. Gates

left

A Clockwork Orange

the door to his

that

November. The

dorm room wide open when

he returned to Seattle for the holidays; because dorm mates hung out in Gates's room, he never locked the door. Ballmer, seeing his friend's wallet sitting in full

view on

Both got perfect scores on in

their

Napoleon, and were both lousy

were both directly his

on

bed.

horrific slobs. Gates his mattress

because

Gary KoUin, who

his dresser,

math SATs, shared an

at hiding their

eschewed it

locked up after him.

bad moods. They

sheets, opting to sleep

was too much trouble

briefly

interest

to

make

shared an apartment with

BILL GATES

The Alpha Nerd and His

161

Alter Egos

Ballmer one summer, said Ballmer did the same. His sheets were the

of

wrong

money

Ballmer

and he thought

size for his mattress,

to

left

would be

it

buy new ones for the summer. Once, KoUin a

a waste

recalled,

watermelon rind out on the kitchen counter

week, a particularly hot week, and

aroma

created the lingering

it

for a

of rotting watermelon in the apartment that summer.

dorm mates

Gates was memorably hygiene-challenged, his

He had

said.

clothes,

and

a distinctive hallitosis

as "the Bill smell."

odor

—mingling perspiration, unwashed

—that former dorm mates

"We'd have

always look to see where

sitting,

possible," recalls Scott Drill, a friend certainly didn't

recall vividly

and

these poker games,

was

Bill

still

then

sit

would

I

away

as far

from Currier House. "He

seem to be showering very much."

Ballmer nudged Gates into doing social things,

not into

if

showering more. Ballmer persuaded him to join Harvard's

male Fox Club. But each had Gates's social

dorm mates went

all

some of

life

his

own

hands together when he'd

sit

$500 or $600.

for Gates.

down,"

"We

say,

'Here

Gates Gravy Train.'" Gates had a locked-in will-

Bill

He was

settle his losses.

up

into the hun-

always good about writing checks to promptly After one particularly bad run, he walked into

room and handed him

instructed Ballmer. "I don't

want

his

checkbook. "Hide

to lose

Neither Gates nor Ballmer required

them debating loudly

was over how they could

best

much

One

"make

this,"

he

anymore."

late into the night,

ing together in unconscious unison.

after they left

used to rub our

"We'd

Drill said.

ingness to keep playing, even after his losses shot

recall

and

most popular being seven-card high-low, with

the bigger wins getting as high as

Ballmer's

circles,

House basement. The poker games

The games often went badly

dreds.

and

interests

all-

revolved mainly around playing poker with

in the Currier

night, the

comes the

as

sleep,

and

friends

both of them rock-

of their disagreements

a difference" in the

world

Harvard. Gates spoke of returning to Seattle to be

162 BILL GATES

The Alpha Nerd and His Aher Egos

closer to his family,

which Ballmer dismissed on the grounds that

he (Gates) needed to go to a bigger city to prove himself. Ballmer

was considering government, which Gates thought was

He

foolish.

talked about going into business.

They studied together economics

dawn

"We're fucked

final.

golden," Ballmer would test;

until

several days in a

in this class.

yell late at night.

.

.

row

for

an

No, we're

.

Gates scored a 99 on the

Ballmer, a 97. Gates's friendship with Ballmer developed in parallel with

Gates and Allen's computer work, which continued as Allen

moved

and took

to Boston

a job at

Honeywell Corp. Whereas

Gates and Ballmer forged their union over classwork, mutual friends,

and

typical collegiate angst. Gates

and Allen bonded

wholly over computers.

was

Allen forced

like

—big ideas

Kent Evans

in Gates.

in that

—and

he spurred

Gates was already sold on the magic of

computing and the challenge of making money from friends recall

him

rein-

predicting

it.

At Lakeside,

—not fantasizing—that he would be a

millionaire by the time he turned 30. But Allen

was

the one

who

convinced Gates that computers would one day, and soon, become accessible to ties

mass markets, not

just businesses

and government

enti-

such as schools. Chips were growing exponentially in speed and

power, and

it

was

just a question of

someone developing

the right

hardware. They needed to position their goals accordingly.

"We became best friends dreaming about what we could do when our best software ideas combined with chip magic," Gates said of he

Allen

was

and Allen the one

logical possibility.

in

who

an e-mail. In Gates's trilogy of

alter-egos,

stoked and directed his sense of techno-

The extroverted Evans and Ballmer thought

businessmen. Allen, too, to a point, but he was foremost a liant technologist,

and also a dreamer. Without

like bril-

Allen's impetus.

Gates would have likely floated along brilliantly but unfocused, another red-eyed nerd in the computing center. Allen got him to

BILL GATES

The Alpha Nerd and His Aker Egos

take a leap of faith that a not-yet-invented tool

sooner than anyone expected to

assume that

He was

was worth

their efforts

was walking through Harvard Square

was rewarded

his leap of faith

stand.

it

would come along

would.

it

In late 1974, Allen

when

—and that

163

at

"The Out of Town" news-

stopped in his sneakers by the January 1975 issue

of Popular Electronics.

The cover bore

boxy

a picture of a

machine with toggle switches called the Altair 8080.

The world's

personal computer.

first

Allen bought the magazine and raced to Currier House.

and Gates wrote a

letter to

MITS,

the Albuquerque-based

He

maker

of the Altair, and offered to write software for the machine in

BASIC, the popular programming language. The people said

go ahead, but warned that the Popular Electronics

won them

a great deal of attention,

and

a lot of people

at

MITS

article

were

had

offer-

ing to write software for their machine. Gates's

and

Allen's lives

were suddenly boiled down to a mis-

sion: to develop software for the Altair in

moved

BASIC. Soon Allen

to Albuquerque; Gates dropped out of Harvard

ior year to follow

him

in

in his jun-

1975. They formed a consultancy called

Micro-Soft. In their rush to write enlisted the help of a Currier

to write

an

intricate

BASIC House

for the Altair, Gates

resident

ing a portion of the software that a greater range of calculations.

bers with

no

named Monte Davidoff

but crucial part of the software. Davidoff, a shy,

middle-class kid from Glendale, Wisconsin,

math package

and Allen

was charged with

would allow

He

writ-

the Altair to perform

developed the "floating point"

for the software that allowed the Altair to read

fixed decimal point. Gates

num-

and Allen were focused on

other things, and were happy to leave this to Davidoff.

Davidoff's experience offers a glimpse at the fine line between

fame and footnote Bill

in

computing

Gates's collaborative style

history.

when he

is

It is

also a

window

dealing with a

into

more timid

"

164 BILL GATES

personality,

was

The Alpha Nerd and His Aher Egos

someone he viewed

an unequal partner. Davidoff

as

a "sweet, unassuming, really quiet guy," recalled

"He was

would walk

the kind of guy Bill Gates

all

became

was

sleeping

room

dynamic," Davidoff

definitely a supervisory If

he

felt

you weren't

say the same thing, louder. ferred not to

living

over."

floor.

in a

They

Davidoff says, but Gates rode him hard. "There

friends,

get very loud.

on the

Kollin.

and Allen

In Albuquerque, Davidoff lived with Gates

two-bedroom apartment,

Gary

work

.

.

.

He

could

says. "Bill

getting something, he

would

liked strong interchanges.

I

pre-

in that way.

Davidoff spent the summers of 1975 and 1977 working for Gates and Allen in Albuquerque. They offered him a permanent job

with Microsoft

hyphen was eliminated

(the

in

1976).

Davidoff, whose father co-owned a small Milwaukee hardware

because he didn't want to drop out of

store, said no, chiefly

Harvard. Gates, with family money

most

a reminder that the risk-takers

— and

in reserve,

to. It's

successful entrepreneurs are inevitably

easier to be a risk-taker

it's

could afford

if

failure

does not

equate to starvation.

"The way

Bill

and

He knew

ing out of college.

thought about money was very

"He would

ent," Davidoff said. collect.'

I

tell all

differ-

of his friends, 'Just call

me

he wasn't going to have to support himself comBill

Gates

is

a rich-to-riches story."

Davidoff graduated from Harvard and went on to a career as a programmer.

Now

45, he lives in Cupertino, California, where

he works as an independent software consultant and pays the

astronomical rents of Silicon Valley.

He

often wonders

"what

if,"

but said he's comfortable with his limited role in Microsoft's precorporate history.

He

has not seen Gates for twenty-four years, except for two

random encounters

at industry events in

San Jose.

"Monte," he recalled Gates saying when he saw him, "we

wondered what ever happened

to you."

i

BILL GATES

The Alpha Nerd and His Aher Egos

165

DIRTY WORK From

the time he dropped out of Harvard, Gates kept track of

They spoke by phone, and Ballmer once

Ballmer.

visited

Albuquerque. After he graduated from Harvard with a degree in applied

math and economics, Ballmer went

Gamble, where he learned Dessert

Makers and,

"Steve

later,

was extremely

man Fve

the smartest

worked with Ballmer describe ness. his

him

When

hand

Think

intense, very personable,

P&G. None

said

Gordon

of Ballmer's

and probably

who

Tucker,

P&G colleagues

he grew tired of selling cake mixes, he wanted to try

of his blue

But he was petrified to

To work up

Mustang and turned

—

full

his

telling himself,

class today,'" said classmate

The sound track

for this

P&G

he rolled

volume. next stop after a brief stay

—Ballmer would perform similar

"He would keep

his

tell

down the Rod Stewart's "Do You

his nerve,

Sexy?" up to the radio's

Hollywood

class.

&

Duncan Hines cake mixes.

At Stanford Business School in

at Procter

to market Coldsnap Freezer

ever met,"

at screenwriting.

Fm

work

as shy, but Ballmer says he continued to battle shy-

boss he was leaving.

windows

at

how

to

rituals

en route to

'Fm gonna kick some

Dan Rudolph, who

ass in

rode with him.

mantra was often Michael Jackson's

"Rock With You." Unlike Harvard and other East Coast business schools, Stanford placed a heavy emphasis on cooperation and teamwork.

Ballmer was well liked at Stanford, but his manic style of engage-

ment and competition played badly with some. So did

the prestigious consulting firms that were offering

advertising

all

him

thus surprised

jobs.

It

Ballmer, after only a year,

software

his habit of

company

some of his Stanford was considering

in Seattle,

friends to learn that

a job with an

where Microsoft had moved

Friends recall Ballmer expressing conflicting desires ditional paths to success

unknown

and something

riskier.

in

1979.

—between

tra-

166 BILL GATES

The Alpha Nerd and His Aker Egos

But Ballmer liked Gates's ambitions, plus "he has always put a great deal of value

on personal

relationships," said Michael

Levinthal, a Stanford classmate. "Here

who

he clearly trusted.

And when

was

this guy. Bill Gates,

Steve trusts

someone

.

.

he'll

.

invest a great deal."

Even self.

As

at 24,

Ballmer had fashioned a business identity for him-

He had grown

a business

comfortable in important but supportive

roles:

manager of the Harvard Crimson^ he supported

efforts of the writers

and

As manager of the

editors.

the

football team,

he worked behind the scenes while others played the game.

He was

comfortable with dirty work. "There are two ways to succeed in business," he told friends.

other

is

"One

to take the big insights

At that point,

in

to have the big insights.

is

and make

The

happen."

it

1980, Gates needed someone

who would

handle the challenge of running a growing business: hiring, personnel, finances. Essentially, Gates sought

someone with

whom he

could join in a business mind-meld to complement the mind-meld

on technology Seattle to

issues he already

had with

spend a weekend with Gates. At dinner with Ballmer

and Gates' parents. Gates shared ers

would soon be everywhere

forefront of the incursion.

phrase:

Allen. Ballmer flew to

—

his

and

From

view that personal computhis software

that dinner

would be

came

at the

a marketing

"A Computer on Every Desktop Running Microsoft

Software."

Gates sealed Ballmer's commitment to Microsoft in a ship-toshore phone

call

Virgin Islands.

from

He

his sailboat

(The Doo-Wah) in the British

offered Ballmer a salary of $50,000 and,

important, a significant equity stake in the

10 percent. This raised some

ire

among

company

more

—5 percent to

the tight-knit group of early

many of whom held a natural bias against Ballmer. He was employee number twenty-four.

Microsoft employees, non-techies like

The Gates-Ballmer marriage erupted

honeymoon ended.

In one of Ballmer's

in quarreling before the

first acts at

Microsoft, he

BILL GATES

insisted that the all his

company needed

He

to hire seventeen people. But for

maintained that Microsoft never take on debt and

always have enough

fast

167

aggressive goals, Gates could be very tight v^ith the corpo-

rate dollar.

And

sales.

The Alpha Nerd and His Aher Egos

money

he was not at

enough

all

to operate for a year without any

convinced that Microsoft would grow

to justify Ballmer's hiring.

"You're trying to bankrupt me," Gates accused Ballmer.

The eventual

how

resolution of the argument

decisions have been

and Ballmer,

made

at

would foreshadow

Microsoft over the years. Gates

after expressing their viewpoints at high

volumes,

eventually gnashed their dispute to a natural compromise: Ballmer

could hire

new employees,

rigorous hiring standard

but he must adhere to an exceedingly

—which would include pop quizzes and

brain teasers in interviews that

computing

home

firms. This

would ensure

power." As a

logistical matter,

almost impossible to hire as

wanted

that Microsoft

would be

"super-smart" people with "incredi-

to, in Gates's lexicon,

ble processing

would be widely copied among

many

it

would make

it

people as fast as Ballmer

to.

Gates and Ballmer had another tense row early on. Because of the significant equity in Ballmer's pay package, he bore a huge

and immediate tax that there

was

liability

— $500,000.

a tax effect,"

"We

didn't understand

Gates said, and

it

was unclear

whether Ballmer or the corporation would have to pay. "I'm ting here saying, 'Geez, I'm

24 years old ... oh

my

sit-

god,'"

Ballmer said. Eventually, Gates lent Ballmer the money. Ballmer's sation

compen-

—and Gates's concern about revenue growth—were quickly

mooted

as Microsoft

company

in

became the premier independent software

an industry that was growing even more dramatically

than Gates and Allen had imagined. Ballmer was instrumental in

what would be history:

He

the key business sequence in the company's early

helped Gates and Allen secure the purchase of the

168 BILL GATES

The Alpha Nerd and His Aker Egos

Disk Operating System (DOS) from a small Seattle firm

DOS

1980.

in

allowed applications software to work on personal comput-

ers,

and

uct,

MS-DOS.

it

became the foundation

for Microsoft's flagship prod-

Ballmer then helped negotiate a landmark deal with

Machines to run

Business

International

machines, as well as on millions of

IBM

MS-DOS on

IBM's

clones.

Gates and Allen remained Microsoft's resident icons and visionaries, but as Microsoft prospered in the 1980s, Ballmer

assumed an in-house Ballmer's frequent

and heated discussions, they thrived

cord galvanized a deeper

wear down

lot,

too,

and

"Working with and

Allen.

Gates and

—as

if

dis-

trust.

Gates and Allen fought a to

And through

status to rival theirs.

after a while

it

seemed

for Bill can be a very

intense process," Allen said, chuckling. Early Microsoft employees

remember

that Gates

hardcore technology

employee

and Allen would argue

issues,

One

early

match between the two

part-

but even over small things.

recalls a "friendly" chess

ners degenerating into a Gates tantrum in pieces

loudly, often over

which he scattered the

on the board.

Over time, the co-founders' relationship grew Allen's hours diminished, especially

compared

strained.

to the workaholics

Gates and Ballmer. Gates and Allen stopped speaking on a few occasions. While Allen remained focused

bored by the

mounting

He began discovered a

few days

to feel

lump on

later,

on technology, he was

intricacies of Microsoft's corporate

ill

during a

his neck.

He

trip to

Europe

returned

home

was diagnosed with Hodgkin's

life.

1982.

in late

He

to Seattle and, a

He

disease.

ered, after a grueling series of radiation treatments, but

it

a decision to leave Microsoft, shortly after the release of

recov-

hastened

DOS

2.0.

This was something Allen had been contemplating before he

became

sick.

Gates was a supportive friend to Allen during his con-

valescence, but not about Allen's decision to leave. "I

to stay at Microsoft," Gates said. "It

was

that simple.

wanted him

And he chose,

BILL GATES

faced with his

have

own

decision.

freedom ... to

financial

didn't

"Even though they grew apart,

When

know what him

ever forgive

When Allen and

was deeply wounded by

friend said Gates

affinity for Paul.

I

to

Paul

do with

left,

was

I

And

Allen's

this brother's

Bill left,

I'm not sure

and he

Bill

could

for that." this,

he downplayed his

sensitive to the impression that there ever it

was broken or anything," he

called Allen a "lifelong friend"

"Paul and

people," Gates said.

and

I

we

with

was one.

their partnership will be at

have had our dream come true "Everything

rift

said of their bond.

At one point. Gates looked

sanctified in history. quizzically.

had

Bill

think part of

himself.

asked Gates about

wouldn't say

He

some

mortality and

169

his time free."

One mutual

"I

The Alpha Nerd and His Aher Egos

me, almost like

no two

and talked about

sat

is

almost sort of true."

As the years passed. Gates worked hard to tionship with Allen. In 1986, the

repair his rela-

same year Microsoft's

initial

public offering sent the co-founders' paper fortunes soaring into the hundreds of millions, Gates

and Allen gave Lakeside School

$2.2 milhon to build a science and

math

center.

the auditorium bears this dedication: "In friend

A

plaque outside

memory

of classmate,

and fellow explorer, Kent Hood Evans."

SEMI-EXPERTS With Allen gone. Gates came

to rely even

whose influence quickly expanded

more

into

heavily

every

on Ballmer,

quadrant as

Microsoft became the epitome of high-tech supremacy. In the 1980s, Ballmer helped oversee the

duced the Windows operating system (engineers

team that prorecall

him

stalk-

ing the halls at 2 A.M., clapping his hands and screaming, "Yes, yes, yes").

He

built

and spearheaded one of computing's most

170 BILL GATES

The Alpha Nerd and His Aker Egos

aggressive sales organizations ("Get the business, get the busi-

He was

ness").

Microsoft's most rabid cost watchdog ("That's

who had bought

big-shotty," he sniffed to an executive

phone

in the late 1980s).

When moved

ply

a cell

he wanted to focus on a part of the company, he simhis office there

through an intimidating

—even

if it

was

in

Europe.

He

has bored

level of business detail, clinging to his

"yellow book," a binder in which he keeps reams of financial data

on

all

the company's key businesses.

Gates can be "over-geeky" in his approach to product devel-

opment. This

counterbalanced by Ballmer,

is

who dumbs down

discussions to incorporate the perspective of average users. In a

meeting shortly before the release of

Windows 2000, Ballmer

posed a question to a group of engineers.

"What he said.

exactly

"What can

is I

in here that

customers are going to love?"

get our sales force excited about."

"Instant directory," replied Gates,

who was

and seemingly dazzled by what the engineers were "Is that

"or

is it

just

in the

meeting

saying.

doo-dad actually important to people," Ballmer

said,

Geek sex?"

Gates explained that the technology would allow users to see exactly

who was

logged onto the network at a given time.

And

wasn't that just so totally cool!

"Geek

sex," Ballmer said, smirking,

waving

his

hand

dis-

missively.

In twenty years, Ballmer has held every top at the

Or

company. His

title

throughout:

Bill's

Number

2.

1.5.

As the the

unofficial

management job

federal antitrust trail against Microsoft began in 1998,

demands of

Gates's job,

which he

with, had

grown untenable. The

burden to

his

mental horde, and

his "threshold."

trial it

called

"inhuman"

to begin

added one more monstrous

tipped

him over what he

calls

I

BILL GATES

The Alpha Nerd and His Aher Egos

171

Gates had always prided himself on his ability to compartmentalize issues without letting them bleed into one another.

And

he was suddenly failing that. Microsoft's engineering teams, Gates's intellectual brethren,

him

that he wouldn't have time to read or respond to.

memo

board

to Microsoft's

with his job.

When

named

1997 explaining

his

He wrote

a

unhappiness

president in 1998 and

CEO

in

2000.

asked Gates at what point he chose Ballmer to be his

I

CEO,

"successor" as

word," he

in

to

spurred a series of discussions that would lead to

It

Ballmer being

the

would spend hours writing memos

he seemed confused. "I don't think of that

said. "Steve

company

and

I

had worked

in partnership

for a long, long time." Gates

saw

running

not as any

this

changing of the guard, but rather as a quantitative adjustment of responsibility. "I just

dropped twenty, twenty-five percent of the

burden," Gates said.

He made ect.

This

is

ware that

time to oversee Microsoft's .Net proj-

this shift in

the company's technology initiative to develop soft-

will allow users

Web

and

sites to

share information and

interact as seamlessly as software within a PC.

It is,

as Gates often

says, a "bet-the-company" move, easily the most daunting technical challenge to confront lot

in

more time with

Microsoft in a decade.

engineers,

which

Microsoft

is

is

what

I

"I

am

spending a

love most," he said

an e-mail.

"Our goal

at

to be successful in an incredibly

tumultuous world," said Nathan Mhyrvold. "The building

know

now was

stuff we're

when we started. And we be passe. You try to cover

considered impossible

that in eighteen

months

it

will

that funny cusp."

No one has internalized the precariousness of computing success like Gates

tweaked

and Ballmer. And despite

responsibilities, Microsoft's

in the trickle-down

Steve are

two of

the

their

new

titles

and

psyche would remain steeped

hope and insecurity of

most confident people

its I

leaders. "Bill

know and

and

also the

— 172 BILL GATES

most

The Alpha Nerd and His Aker Egos

one former company executive. In

pessimistic," says

extremes, he said,

it

their

can be confidence to a point of arrogance and

pessimism to a point of self-loathing. "All of these things you

might associate with Microsoft," he

When

says.

they're both in town, Gates

usually for 90 minutes.

It's

and Ballmer meet weekly,

a rare day that they don't speak or

exchange e-mail. Gates tends to e-mail

his

ruminations through-

out the weekend. Ballmer rarely does anything until Sunday night.

They worry

less

each other's

efforts.

about

lines of authority

than about duplicating

Ballmer: Sometimes both of us get dragged into an

which

is

issue,

stupid for us to get dragged into because

Gates: Yuh.

Ballmer:

—

just doesn't

need to take time,

should take

it

time from one or the other but not both.

Gates, laughing: Yuh.

dragged

in.

Then one

It's

if

only one of us gets

of us can be the expert.

Ballmer: That's the thing

home

easier

I

talked to you about

Friday night, and we're both sort of

.

.

on

the

way

.

Gates, laughing: Semi-experts.

Ballmer: Yeah It is

.

.

.

And

not clear why, but Gates keeps laughing.

Ballmer

keeps nodding his head and smiling as he stares at Gates knowingly.

PUBLIC PROPERTY most examined

"Believe me,

I

months

The context of

of being

later.

Bill

live the

life,"

his statement:

Gates

some of

Gates in the early twenty-first century.

is

saying six

the headaches

BILL GATES

"Every e-mail

I've ever sent or received

by multiple [agencies].

you know that

173

has been examined

FTC, then DOJ. So any

First

would have

I

The Alpha Nerd and His Aker Egos

snippet

little

said, 'Let's beat this competitor' or

something, they would have brought out." He's asked for

wealth

is

what

money

defines

him

all

the time.

—and

eral judge say that

the average person,

capitalist

its

focus on money, not spreadsheets.

To

It's

human

nature to

not enough to hear a fed-

Microsoft behaved in a "predacious" and

manner, and then watch Microsoft's stock plummet by $80 in

one day; somehow,

the plight

it's

expressed

is

more

as,

edifying,

illegal

billion

more understandable,

"Did you know that

Gates

Bill

if

lost

roughly $13 billion in stock today?!" It's

difficult for

some type of

rant,

uncommon." He sitting

Gates to go to dinner. "If I'm out at a restau-

interaction can happen," he said. "That's not

is

now

public property.

with Gates and watching a

Myhrvold remembers

woman on TV

speculating

about his psychological well-being. She was pondering the question, "Is Bill

"But

"How

Gates happy?"

I've

never met her," Gates kept saying, incredulously.

could she talk about that?

How

could they

let

her talk

about that? She's never even met me." Gates,

Myhrvold

said,

wasn't so

much angry

as he

was

totally baffled. It

and

I

was June

was

11, 2001, the

sitting

Ballmer. Gates

ipation of the

with Gates

was on

several

day Timothy McVeigh was executed, in his office again, this

magazine covers that week,

Windows XP Operating System

year's end; and, also, a prevailing

—or

that

in antic-

was due out

at

view at the time that the govern-

ment's victory over Microsoft in the antitrust

overturned on appeal

time without

trial

would soon be

at least sharply diminished.

"The Beast

Is

Back" was the headline across Gates's face on that week's Fortune. Gates's office

was

mashed potatoes on

a big mess.

his desk, a

There was a Styrofoam plate of heaping lump covered

in

dark

174 BILL GATES

brown gravy

The Alpha Nerd and His Aker Egos

over from his cafeteria lunch.

left

It

w^as tilted at a

precarious angle amid a pile of yellow legal pads, crumpled

Truman

papers, a Wall Street Journal, a sweater,

and a few carrot nuggets

The desk had

biography, a balled-up

also left over

from lunch.

dorm room during

the feel of a college

finals

week, which mirrored the disheveled and headachey way that

He wore

Gates looked.

"WHG")

a dark green dress shirt

(monogrammed

with large sweat spots under his arms that spread dur-

The

was untucked from

the front of his

slacks, his glasses

were crooked, and he tapped

his black loafers

maniacally on the

floor.

ing our meeting.

Gates was greeted

me

shirt

just off a

in his office

conference

call that

and seemed

matters discussed in the conference

still

ran a half-hour

late.

He

to be very occupied in the

call. It

could have been anything:

the looming Court of Appeals decision; the mega-complexities of XP,

Microsoft's hotly-awaited

had scheduled

later that

new

operating system;

day with

his

or,

the meeting he

Gates Foundation

staff to dis-

cuss prospective projects. Indeed, this or any moment's puzzle could

have been anything on Gates's corner desk, a massively cluttered

monument

to everything he

still

needed to keep straight

—even

after

outsourcing twenty percent to Ballmer.

One on

of

my

goals for this meeting

his reputed ordeal

in meetings,

was

to get Gates to reflect

when he was

during the late 1990s:

demonized by

his

crying

government, attacked by seemingly

everyone in high-tech, and getting pies thrown in his face by strangers in Europe.

I

had heard many of his

speak of Gates's days in the abyss of the

ers

Dark Period"

is

what one executive

called

But Gates wasn't playing now.

how was all

attacked he has been, also defiant.

that the

thrown

how

government and

at him.

late

1990s;

"Bill's

it.

He was

quick to speak of

scrutinized his

He had weathered the

and co-work-

friends

life

was

—yet he

unpleasantness, had taken

his Silicon Valley antagonists

had

BILL GATES

And

here he was,

The Alpha Nerd and His Aher Egos

here, rocking.

still

The government was not trial,

he insisted. This

the trial

would

successful in vilifying

a notion that

is

find laughable. In fact, prosecutors

cating over several questions.

landmark

him

at the

most people who followed

of a videotaped deposition of Gates, brooding

the

175

made heavy

and

use

prickly, obfus-

stands as the enduring image of

It

trial.

government] didn't even

man who got off easy. "They [the choose to call me as a witness," he said,

"which they

have done." They used relatively few of

But Gates

is

talking like a

easily could

the e-mails he

had

resolution

along.

all

that, in the end,

written. Gates

"We had

would be vindicated

A fact

it

few weeks

faith

said he expected a positive

throughout that whole thing

both the laws of encouraging innovation and

Microsoft's particular role in that

now

coming out with new products,

in a very strong

of

—and

in

way."

the federal appeals court ruled

later,

all

did not vindicate Microsoft in a very strong way, or at

all,

depending on interpretation.

The Court of Appeals reversed an

ommended

earlier decision that rec-

that Microsoft be broken up;

and Judge Thomas

Penfield Jackson, author of the earlier anti-Microsoft decision,

was founded against the

made

to have

company

in the

inappropriately biased statements

media and was ordered

off the case.

But the court also upheld the ruling that Microsoft was an

illegal

monopoly, and the case was sent back to a new judge for a sion the

on what

penalties

would be imposed. Based on

government has taken

for this could radically future.

As

I

the hard line

in early settlement talks, the remedies

how

change

Microsoft operates in the

write this, that remedy, and

its

effect

on Microsoft,

uncertain and probably won't be resolved for months,

What was was the

that trial,

if

clear to

me

deci-

as

I

spoke to Gates

if

in June,

is

not years.

however,

he was infected with any resignation or humility over

he was

now

well past

it.

176 BILL GATES

He was

trial'

i

and

as confident as ever, contesting his

"When you

get this 'Hey, what's the latest in the

as certain

place in history.

Microsoft

The Alpha Nerd and His Aker Egos

"you

thing," he said,

definitely feel like, 'Hey,

do

people remember that the software industry was one-fiftieth of the size

it is

today before

we came

in

with our model?'"

This was a different Gates than the one

time,

less

ease,

at

a

besieged.

little

hunched and twitching. He kept

his left

on

side to side, at

In mid-sentence. Gates simply lay

elbow on the couch and held

down on

his

in

isolated

His shoulders were

shifting his position

and back,

leather couch, swaying front

met with

He seemed more

December, when Ballmer was with him. this

I

his black

odd

angles.

his side, planted

hand against

his

cheek as

he continued talking.

A few minutes later,

still

lying

on

his side,

he tucked his knees

few minutes

into his chest, almost in the fetal position. Then, a later,

he stood up and switched to a seat closer to me, collapsing

into the chair, rocking again.

At one point,

I

asked Gates

wealthy and having everyone tion

—we should

as he took in

my

all

One

there

know

it. It

was

a burden in being so

was kind of

be so burdened! Gates gave

questions.

He

smiled, a

"Sure," he said. "But there

A

if

is

little

me

a

silly

ques-

a funny look

mischieveously.

an offsetting benefit."

CONFLUENCE OF FACTORS

of these benefits

is

that he gets to try to save the world.

Gates spoke a great deal about his charitable work, in which he has racheted up his involvement significantly. his

He

has given

away

Microsoft stock in multibillion-dollar chunks. That's been another consequence of Ballmer's expanded role

at Microsoft:

It

has allowed Gates to spend more time with his

foundation, which in January 2000 surpassed the Wellcome Trust

BILL GATES

The Alpha Nerd and His Aker Egos

177

of England as the largest in the world, with total assets approaching

$25

billion.

The

sweeping global

and Melinda Gates Foundation has made

Bill

spread of disease and

to thwart the

efforts

increase the spread of computers. Gates has toured impoverished villages in Africa, vaccinated kids in India,

mobile through Alabama.

And

it's

a

and rode

in a

funny thing. Gates

book-

said.

He

can get a crowd worked up into wild applause about some neat

new

software feature. But he was recently on a panel discussing

world health

issues, talking

about being able to save a miUion

through new research, vaccination programs, and treatment tiative

ini-

—and barely anyone applauded.

"What

if

the foundation were dedicated to saving ten lives a

"You

year?" Gates asks. I

lives

say, 'Hey, that's

worthwhile. Ten people.

could think about that. Ten children are in the

going to save

all ten.'" It's

year. "Well, okay, that's a

"You almost

can't

not

like this

number on

comprehend

when

it's

room and

a million lives a

a piece of paper," Gates said.

it."

He's had a bunch of mini-revelations like that: jointedness of

how

he's

The

basic dis-

how problems are world works. He gets

people think about things,

how

identified, prioritized, attacked,

the

frustrated a lot, said his foundation head Patty Stonesifer. Gates will ask her,

"How are we doing on measles vaccines? How are we

doing in Angola?" she said.

It's

"It's

like

I

can answer with market share,"

not like software, or business, a process with meas-

urable results. This plex,

not

is

complex,

in a

whole new manner of com-

and Gates can only control so much. He reads everything he

can get his hands on about diarrhea, AIDS in Africa, immunization strategies, Alpha-Rice,

and every so

often,

someone from the

Gates Foundation will send over an enormous pile of research papers, articles, and books for

Lanky and

spirited

him

to read.

with reddish

hair, Stonesifer is the

former

head of Microsoft's Interactive Division and has become something of an alter-ego to the philanthropic Gates. So have his wife,

178 BILL GATES

Melinda, and his

The Alpha Nerd and His

father, Bill, all of

Alter Egos

whom

have sunk themselves

together into the dicey scientific, cultural, political, and economic

on

issues involved in fighting disease

discuss,

meet

They

regularly.

a global scale.

dynamic

are a

They

read,

salon, just like

any

other dynamic salon, except that they have $23.5 billion to play

with and a

lot

more where

came from.

that

Friends say that through his charitable work. Gates has

become somewhat ing.

He

radicalized about

life,

the world, problem-solv-

has also become more openly emotional.

He

me

tells

about he and Melinda crying when they watch videos of kids starving

around the world, or when Melinda returned home from

India and told

him about an AIDS

sense, Gates's foundation

work

and emotional mind-meld

at a

On June

hospital she visited there. In a

constitutes a kind of intellectual

new

up of Microsoft, Gates broke up on he had grinned his

Earlier,

employees

in

pany would later

in

Redmond,

prevail

the

stage of his

life.

9, 2000, the day Judge Jackson ordered the break-

telling

a stage.

way through

a speech to his

them he was confident the com-

on appeal. But he was overcome with emotion

day as he gave a speech to a group of Gates

Millennium Scholars, a

select

group of minority students

who

will

attend college as recipients of a grant from the Gates Foundation.

As he addressed the audience, which included family,

And

his eyes reared up, all his

my mom

close friends "I

was

around

just thinking

about

his

my dad

not being there," Gates recalled

what had happened and the

at the

and members of

as he took in the enormity of everything that

front of him, and

mon

many

and he could not speak.

supporting me, and later.

scholars. Gates looked

richest

man

was

in

to him, his voice cracked, in the

world had to sum-

strength he could just to keep talking.

Gates always figured he would focus on giving away his for-

when he hit his 50s or 60s. Before she died of cancer in 1994, Mary Gates always preached the importance of "giving back," tune

BILL GATES

The Alpha Nerd and His Aher Egos

and Gates always figured he would get around to

more

it

179

when he had

time. But at 45, Gates has sped his timetable significantly.

Why?

was

It

and

a confluence of factors, he said: His wife's

father's impetus, his personal fortune soaring to levels

have never foreseen, and the urgency to combating so

he could

many

of the

was

global health menaces. Part of Gates's increased sensitivity stirred

by having

child

so

is

somebody

On

own

his

"The idea of the health of

children.

much more poignant when you that people

another

know," he

common

level, Gates's willingness to

what he

is

an addiction capable

lives

—say $70

billion

to, the

of. It

growth sector to attack, such

worth

in

a

terms of

do something

as

comports to one of

motivations inherent to this book's protagonists: a

desire for, perhaps

exactly

it

said.

ambitious as trying to save millions of the

about

talk

notion of finding out

helps to have a

phenomenal

as software, or a ridiculous net

—to attack with. But

also central to a

it is

personality that seems incapable of niche markets, small gestures,

or limited ambitions.

For as gives

much

away $23.5

as

one can question the motives of anyone

billion,

some have ascribed

in

history,"

said

one Silicon Valley

intended or not, Gates's recent to the battered Bill Gates

from

his rivals

gifts

brand

and government,

Gates's stepped-up

"The most expensive PR

giving to an attempt at image repair. tiative

rival.

ini-

But whether

have served as tidy antidotes

—a

balm

to the demonization

as well as the standard resent-

ments that come with having more money than anyone

Some

who

else.

icons seem born into a natural spotlight; the role suits

the broad shoulders of a

Ted Williams

neatly.

Not

Gates.

He

is

not

much larger-than-life or smaller-than-life as he is, simply, programmed for higher speeds and functionality. Thus, in the whole so

of the wired package. Gates

is

smarter-than-life, faster-than-life,

weirder-than-life. I've never been in a

room with

exudes more nervous energy than Gates.

It's

as

if

a person his

who

mind were

180 BILL GATES

The Alpha Nerd and His Aker Egos

charged to a degree that moves his body.

watch him churn, intimidating,

too,

It's

a fascinating thing to

knowing

you

that anything

say could instantly be dubbed the stupidest fucking thing that

Bill

Gates had ever heard.

But to watch him on stage,

in a hero's setting, tends to rein-

force the impression of Gates's basic discordance with the world he's

changed.

through a

remember watching Gates

I

New

series of public love-ins in

2000. The events were

all

as he

slumped

York

in

his

way

December

tied to a $100-million gift Gates

had

given to the Boys and Girls Clubs of America. The formal presentation of the gift took place at the Boys and Girls Club of

Central Harlem, in a

and

gymnasium packed with

children, media,

dignitaries.

waded through

Before Gates arrived, a clot of elected officials the

crowd and onto

the stage

—Senator Charles Schumer (D-NY),

Senator Joseph Biden (D-Del.), Representative Charles Rangel (D-

NY). None of them got the rock walked

the

politicians gave speeches praising the benefactor. Biden led

room

Andrew

a standing ovation;

in

book Business

phenomenal piece of

As Gates of

Schumer compared Gates

member Naisha

Carnegie; Boys and Girls Club

declared Gates's then-recent to be "a

Gates did as he

accompanied by Hillary Rodham Clinton.

in last,

The

star gasps that

sat

awkward and

fixture to fall legs crossed

on and

to

Boles

@ The Speed of Thought

literature."

surrounded on

stage, he

looked an odd hybrid

serene, smiling while seemingly braced for a light his head.

a gray suit,

and he

hands folded daintily on

his

notably, not rocking

He wore

with his

sat

his lap.

He

was,

—something he appeared to be working not

to do. In an interview

about

how much

company. were

just

"It's

I

did with Gates a few weeks

later,

he spoke

he loved having Ballmer along with him atop his

a lot less lonely with the

one of us," he

said. "I don't

two of us than

know how

if

guys do

there it

just

BILL GATES

alone." But

convey. sides

it's still

And

as

I

The Alpha Nerd and His Aker Egos

lonely, he reiterated, in

watched him on

seemed apparent. He looked, "It's

Harlem.

ways

stage, the

at this

181

that are hard to

empty space

moment,

to his

lonely.

a great time to be a kid," Gates said in his speech in

He

optimism!"

read haltingly from a script

— "We've

pursued our

—and received a standing ovation when he was done

and the ceremony ended.

As the

politicians

briskly through the

lined to the exit

shook hands with everybody, Gates walked

gym with

a frozen smile

and managed to

get out the

on

his face.

He

bee-

door without touch-

ing a single person in the crowd, even by accident.

CHAPTi:n FIVE

STEVE CASE The Upgrade

A,

.s

he absorbed the pinnacle event of his career, America

Onhne founder and CEO It

Sunday

w^as a

Steve Case seemed not himself.

night,

January

ally left-for-dead online service,

company

the biggest media

was

9,

2000.

AOL,

close to buying

in the w^orld.

connected

Manhattan law

by speakerphone.

lawyers, and

AOL

staffers sat

Negotiators for

AOL

on the deal three nights volleyed: pricing,

"How's

in a

room

in the

firm; a twelfth director

Eighteen

investment

was

bankers,

on the perimeter.

and Time Warner had agreed

earlier,

and

final issues

management teams,

gonna work,

this

Time Warner,

Case and ten members

of the company's board of directors convened thirtieth floor of a

the perenni-

fellas?"

tax,

were

to terms

now

being

and accounting arcana.

director Gen. Colin Powell

asked on the subject of a proposed dual-headquarters arrange-

ment

in

New

chairperson

York and

Virginia.

A

buffet sat untouched. Vice

Ken Novack dozed, wasted from marathon

tions over the

weekend. One lawyer's

negotia-

leg quivered, to the

annoy-

ance of those around him.

Every era has an event or image to embed tory

—a market crash, Woodstock, or Nixon's

its

salute.

point, the so-called Internet age did not have one.

strangeness, virtual wealth, like

IPOs, books with

new

titles like

Zeitgeist in his-

It

But to

this

had plenty of

toys; a procession of Netscape-

Dow

185

36,000 and "the Web-will-

186 STEVE CASE

The Upgrade

make-you-obsolete-or-rich" claims. But no singular "pinch-me"

moment. And ting to the

be

moment. The hovering notion: bender,

left after this

But

this

Henry Luce

many

was

that

in.

would soon hang

its

He would

Warner Brothers

boy,

While so

pure

—were

possibility,

sus-

Case was

trade AOL's speculative allure for the

media domination. He would be

Studios,

hooo

Amazon

Excite,

Time Warner's massive

legitimacy, and,

Time founder

in Steve Case's office.

—Yahoo,

lasting security of real-world

insulated by

Who knew what would

real, as real as the portrait of

blissfully in lucrative states of

ready to cash

fit-

anyway?

Internet standouts

pended

of a tangible focal point seemed

really, this lack

its

all

portfolio of assets

cable lines,

all

of

—

its

its

CNN,

grown-up

the mainstream respect that Case

had always craved. This was so real that

Case

it

was

sat mid-table in the

relaxed. "Steve

had such

surreal.

CEO's

a look of serenity," said board

Frank Caulfield a few weeks

later.

"You'd have no idea

about to consummate the biggest deal

manner

Indeed, his

usual Case. Like cess

and could

many

defied the

and

seat, his face flush

member we were

in history."

mania

in the

room and

the

successful executives, he never trusted suc-

certainly never enjoy

it.

constantly churning with scenarios of

His mind seemed to be

unknown

entrepreneurs,

unformed companies, and uninvented technologies blowing up

his

whole creation tomorrow. Now, though. Case's jaw was not clenched nervously; his baby-round eyes were not opened wide or

narrowed

in suspicion;

and

his general bearing did not

evoke a

scared comic-book character. Case seemed to be in the midst of

some

real-time transformation

—

just as the

media world would be

undergoing, thanks to him.

AOL's board voted unanimously

for

the

merger.

Time-

Warner's board voted shortly afterward. The two groups were

connected by speakerphone, and applause cracked over the

lines

STEVE CASE

when

agreement was dubbed

their

official.

coming of age has mirrored that of suddenly in charge of

all this

was

of satisfaction. His face

Case,

187

whose personal

embattled company, was

his

awesome

The Upgrade

chaos.

He

a flush red, his

indulged a flash

words

breezy.

He

lapsed into dopey smiles.

"At that moment," recalled board member James Barksdale, former head of Netscape, "Steve seemed to be completely above it

all."

Case could relax, but not

Warner had given him "Those guys

Shortly after the associates

—one

official at

will

Warner.

He wore

a look that just beat his

Case admit to

AOL

one day."

for us

deal

is it.

dad

set, at least

two Case

—told me they had confrom Time

recalled past slights

a Cheshire cat grin

one Time Warner

was

executive, the other a high-level

which he

when

official

the deal

was

compared with

at

hand,

who

a kid

at chess for the first time.

too pragmatic to bog

When

I

Time Warner

down

in revenge.

Or

at least

asked him about his recollection of Time-

Warner's past dismissals of that

work

He

slow burn, uttering varia-

another technology company

versations with Case in

Time

that executives at

felt

in a

Time Warner

former

a

decade,

last

respect in a series of dealings.

little

would walk away from meetings tions on,

Over the

forget.

according to industry sources. Case

officials

AOL,

he said, "No, no, no," and added

had treated him with more respect over

the years than executives at other media companies did. In any event,

$112-billion

when

AOL

and Time Warner announced

merger on January

10,

2000, Case and Levin

declared their union a "merger of equals."

holders clear

would own 55 percent of

how

the deal

AOL

buys Time Warner.

the

their

It

was

not.

AOL share-

merged company, and

it

was

would be reported and remembered.

"This had to be particularly sweet for Steve," said one for-

mer

AOL

executive

who

left

the

company

in

1998.

"He

tries to

188 STEVE CASE

come the

The Upgrade

off like he doesn't care

man

is

about these competitive things. But

always keeping score. This was his ultimate victory."

i STATURE In his corporate persona, Steve Case always sought to evoke the

aw-shucks self-assurance of a summering

frat boy.

He had

a

gawky

adolescent posture, a lazy, matter-of-fact cadence to his

speech.

As with so much

at

AOL,

the Case image

crafted to evoke a fun, freewheeling

practiced the

AOL

feel.

carefully

Case was "cool,"

manner of "the "cool" they teach lobby

was

the

in the

MB As zigzagging

in expensive casual clothing.

But up close, there

is

very

little

that's inviting

about Case. In

conversation, his body language turns fidgety. His stony face can be

unnervingly hard to read. Around

Mark

Walsh, a former

AOL

AOL,

he

is

known

as "the Wall."

executive, recalls a trip he took

with Case a few years ago to a county

fair in

Ossining,

New York.

They'd each had a beer or three, and Case became woozy

after a

loop-the-loop ride. His expression never changed as he excused himself, "I just

walked into the woods, and returned two minutes

vomited," Case said in a dim monotone, and then pro-

ceeded to the next

ride.

"Now

Walsh remembered the online shopping service,

that's focus,"

first

Walsh marveled.

time he met Case. Walsh ran an

CUC International,

just struck a deal after a protracted haggle.

and the two men had

When Walsh got up for

the post-deal handshake, he noticed a photo of a college in Case's office. "Is that the University of Virginia?"

"No," Case answered

was

his

later.

briskly.

He

campus

Walsh asked.

did not volunteer that

alma mater, Williams College. "Steve never

tells

it

you any-

thing that you don't need to know."

Almost friends

as

soon as the deal with Time Warner was struck,

and associates noticed a change

in Case.

He was on myr-

STEVE CASE

He was

iad magazine covers.

manner

above-it-all

in the

tive bearing.

He wanted

more

and

stately

When

to

from world leaders and sponta-

full

of

his

AOL

employees. But Case's

board meeting presaged a new execu-

become more of an

dignified, lose the

Case and

189

being dubbed "Citizen Case," and

receiving congratulatory calls

neous applause from rooms

The Upgrade

emissary,

come

off

edgy bearing of the underdog.

Time Warner counterpart, Gerald Levin,

were negotiating the merger's provisions, Case said he had no interest

CEO

being

in

was

of the combined company. This

unusual, since the CEO's job usually offered the most power and control. But

Case didn't want power and control so much as he

craved stature.

He wanted

the

loftier,

more

patriarchal role of

chairman. Let Levin endure the day-to-day rigors while Case surfed above his empire, transmitting huge thoughts, focusing

long-term strategy, getting his

name on

buildings.

preach the good and power of "media integration."

meet with world leaders and

Hawaiian

shirts for

The PR

A

seemed to

initiative

few weeks

announced. Case

after

He would He would and

politicians, trading his khakis

solemn gray

on

suits.

be:

"Make

Steve chairmanlike."

AOL's merger with Time Warner was

visited the offices of

The Washington Post

for a

lunch meeting with a group of reporters, editors, and Post executives.

He had done

ticularly guarded,

of

CEOs who

this every

even by the hypercautious standards, and those

venture into a

table full of tape recorders.

Post,

few years and had always been par-

room

He had

full

of journalists and

coverage of his

young and

struggling,

nerships with

company over

felt

had run unfairly

the years.

When AOL was

Case worked hard to forge content part-

The Washington Post Company

of mainstream, old-media credibility

luncheon had the

feel

at a

longstanding animosity for the

AOL's hometown newspaper, which he

critical

sit

—only

—the

local

to be rebuffed.

of a triumphant return. But this

bly loosened-up version of Case.

epitome

was

The

a visi-

190 STEVE CASE

He wore

a pressed blue dress shirt

haircut appeared

of

The Upgrade

more expensive than

someone who was on

TV

and bright yellow

it

used

to.

He had

tie.

His

the look

a lot.

Case repeated the requisite post-deal "merger of equals" cliches ("This isn't

AOL

about

Warner buying AOL. This

is

buying Time Warner, or Time

about changing the world").

spoke about "building a medium we can

how

He

be proud of," about

all

he wanted the merged entity to be "the most valuable, most

respected

company

world." The kinds of things he'd been

in the

saying daily for four weeks.

But every so often, Case betrayed tic

edge that was never hard to

then the

CEO

of

his signature sarcasm, a caus-

from him. Alan Spoon,

elicit

The Washington Post Company, prefaced

tion with, "Recently, the Washington Post reported," to interrupted,

"Oh, does that make

tone, sounding a

who was

little

it

too hostile for

true?"

He

which Case

spoke with a baiting

to be just a

it

a ques-

chummy

nudge.

AN UNDISPUTED GENERAL It

was around

on Case's

life

this period,

March 2000,

for a profile

While Case might

now

I

use for stories like

unpredictable

areas,

I

began doing research

was writing about him

for the Post.

be the chairman of the largest media con-

glomerate in the world, he never had less

that

this:

The

unsettled

Before the Post luncheon,

I

much

use for the press

Life Story.

There were so many

uncontrolled

topics,

—and

earnestly explained to Case

scenarios.

what

I

was

When I said I planned who have known him, he

doing, even though he'd been fully briefed. to interview about one

hundred people

winced, as anyone would.

He needed

this like

he needed a hernia.

Case agreed to a one-hour sit-down discussion, strenuously stuck to the before,

AOL

official

story

and that had been reported, many times

—

in

stuff

over.

He

which he he'd said

agreed to

STEVE CASE Speak to

me

only on the condition that

I

The Upgrade

191

not quote him on any-

thing without his approval before publication. This "interview"

took place

at a conference table in his office beginning at 3 P.M.

Case ate a banana and handfuls of

self.

Why

life's

imperative was

jar.

He was

his history the least bit relevant to anything?

At precisely 4

now

PR

p.m., the

school

His

the future.

AOL

public relations

babysat the interview, coughed slightly they teach in

beans from a

with any attempt to get him to talk about him-

clearly impatient

was

jelly

—and within

woman, who

—that "time's up"

cough

a few seconds. Case

was

again safe behind his terminal, barely managing goodbye.

much

This was where Case spent his

of his time, ensconced in

Spartan fifth-floor suite at AOL's Dulles, Virginia campus. The

office

was

large,

and landing

with a picture-window view of planes taking off

at Dulles Airport.

bunkered behind

Case passed hours there alone.

his terminal, pondering,

He

and dispatching long

e-mails to his staff.

At the suggestion of AOL's interview with Case by e-mail. priate

way

to

It

people,

eliminated

It

What Case

wasn't sure about, he

would be copied on

all

all

followed up

and appro-

a cool

new media,

titan of

way to control an vagaries of human interaction. could vet with his PR chief, who

the

incoming and outgoing e-mails.

Case was protected. And,

he wrote in

just in case, everything

would be considered

off the record. If

quote from any of them, he would have to approve In

my

also a perfect

is

encounter.

I

would be such

communicate with the senior

they said. But of course, e-mail

his e-mails

PR

one e-mail. Case described himself

this

I

wanted

to

it first.

way:

"I

am

equal

parts capitalist (building a big successful business), an anarchist

(enjoying blowing things up and starting over), and populist (really

hoping to make the benefits of one)." This

was about

this

medium

as expansive as

seemed a decent summation of

available to every-

Case got with me, and

his business self. Indeed,

it

Case was

— 192 STEVE CASE

The Upgrade

the ultimate mainstream revolutionary, an unconventional thinker

from a conventional suburban world w^ho was bent on mass-mar-

mimicked

ket domination. This

AOL: He

his essential

map

for success at

sold his service as a safe-for-Middle-America

way

to

experience an online world that seemed slightly exotic, anarchic.

Case was a diligent

e-mailer.

tions per e-mail and, within a

would e-mail me back.

would

usually ask a few ques-

few hours, even on Sundays, he

was an

It

I

way

efficient

to

communicate,

if

not usually revealing. There were paragraphs that could have been

PR

written by

("The best

He

in its future!").

is

yet to

used a

come

lot of

—most of AOUs history Hes

exclamation points and signed

everything "SC." After a multiple e-mail afternoon. Case ended one missive by saying,

"Now would you just shut up

That was

as close as

I

finish the

damn

piece?"

got to a friendly aside from Case.

my AOL-arranged

Several of

and

interviewees stressed Case's

philanthropic ventures and his meetings with world leaders. At

one point,

asked AOL's then-PR

I

Gary Hart press friends for

Who

me

secretary,

if

to interview.

Kathy Bushkin, a former

chief,

she could help find

How

some old Case

tricky could such a request be?

wouldn't want to round up a few old pals to

AOL

behalf? But

offered

up only

array of current and former big boys,

all

of them.

CEOs

on

his

dignitaries: Colin Powell,

an

—Tribune Corp's Scott Smith

They seemed

none appeared to know him that

testify

to admire Case enough, but

well.

Powell speculated that he

thought Case would make a good general. This

much was

evident: Steve Case

was now an undisputed

general of the Internet age, era, century, whatever, and he

determined to act that way. brands.

No

one

in high-tech

He owned

had

a lot in

Bill

superpower portfolio of

could rival his juggernaut in terms of

power, influence, and reach. Except for There's always

a

was

Bill

Gates.

Gates. Case watched

common. Both grew up

in

him

closely.

They

wealthy families, the sons

STEVE CASE

The Upgrade

193

of Strong mothers and prominent lawyer fathers in the Western

United States

— Case

in

Honolulu, Gates

Both

in Seattle.

their

childhoods were marked by fierce competitions, often at family retreats;

both

dabbled in

later

politics (Case as a college political

science major, Gates as a congressional page); they

marry executives longtime

at their

CEOs who,

went on

to

companies. They are co-founders and

within three days of each other in January

2000, announced they would give up day-to-day responsibilities

become chairmen.

of their companies and

But for as similar as their backgrounds figurative difference in the worlds they

prodigy from the

beginning,"

Microsoft executive

who knows

says

are, there

came from.

Greg Maffei,

AOL

one big

was

a

boy

former

a

both men. "Steve obviously spent

a lot of time in the wilderness trying to fight his

Like

"Bill

is

way

out."

and unlike Microsoft, Case has struggled to win

acceptance in a world quick to overlook him.

He

always measured

himself against larger, powerful personalities and institutions. Early in his

would go on

life,

was

his older brother,

Dan Case

III,

who

to be one of the world's foremost technology invest-

ment bankers. ers,

there

Later,

Case took on a formidable array of naysay-

mentors, and competitors. This struggle has bred in him an

aggressive sense of

how

to find daylight,

burrow

free of

crowded

markets, and forge precedents as he goes. It

explained, to

some

driven to build an empire

—

how someone like Case was and how a boy outcast could become degree,

an icon of faceless communication.

CASE RULES Early in their marriage,

Dan Case and

they could not have children.

his wife, Carol,

The couple,

were told

in their twenties,

had

planned a big family, continuing the legacy of large Case clans

194 STEVE CASE

among

The Upgrade

Hawaii's Anglo establishment. Both were fourth-generation

islanders

—Dan

the great-great-grandson of a lawyer

come from Topeka, Kansas, of a sugar plantation

Dan and newborn

in the late 1890s, Carol the descendant

owner who had emigrated from England.

Carol Case

girl,

filed

papers that led to their adopting a

months

Carin, a few

Carol was pregnant.

who had

Dan Case

III

had learned that

after they

was born

five

months

later,

the

miracle baby. Steve Case followed thirteen

months

later,

on August 21,

1958, the day Hawaii was granted statehood.

Dan worked

who

household;

grew

long hours as a corporate lawyer while his wife,

quit teaching to raise her three diapered children, ran a taut

mealtimes, mandatory quiet periods, and, as they

strict

older, regular chores. Jeff, the fourth child, arrived four years

after Steve.

When Steve was Manoa Valley section

8,

the family

It

—seven Caucasian, one Japanese, one

—and everyone knew everyone was an

picket-fence suburban ethos that Steve

song of tropical

might hear the the nearby

The Case

birds. If the

recital of the

in,

a place steeped in the

would

stay so attuned to in

children began sunny days to the

wind was blowing up

the

hill,

they

Pledge of Allegiance on the lawn of

Punahou School, an

Carol had taught and which

else.

grow up

idyllic setting to

his business career.

to a cul-de-sac in the

of Honolulu. Their street, Ahualani Place,

comprised nine households

Korean

moved

all

exclusive private school

four Case kids

where

would attend from

kindergarten through twelfth grade. There were corgis

named

Tuffy and Tabe in the house, and coin collections, swims in the neighbors' pools,

summers

beach

at a

rental,

and Sundays

at the

Congregationalist Central Union Church, where the boys were ushers.

They partook of

to get their

a classic

homework done

"Gilligan's Island,"

TV diet of the

age, often rushing

so they could catch "Batman,"

"Get Smart," or "Hawaii 5-0."

STEVE CASE

The Upgrade

195

These were the dark ages before chat rooms and instant messaging,

when

ketball

on

kids called one another together by bouncing a bas-

a driveway. After school, the

the cul-de-sac. Steve heard the bouncing

sound would echo across

from

his

bedroom, where

he was often tinkering with a toy rocket or hatching a mail-order business or listening to the Rolling Stones.

room

upstairs that his family called Steve's

hours alone there, typing catalogues.

He

letters

loved nothing

bor kids gathered, along with

on the Alexander

call

much

his "office."

He

time

spent

getting mail.

of the basketball as the neigh-

Dan and Jeff,

family's garage.

Steve's feistier alter ego,

spent so

or ordering stuff from scientific

more than

But Steve would heed the

He

A

at the

hoop mounted

contest seemed to bring out

an out-of-nowhere

tenacity.

Losing came tough to the Case boys, particularly Steve and

Dan,

who waged

a quietly

vehement

almost get bloody," says Steven Bond, ner.

stuff

who

lived

around the cor-

with Steve and Danny." didn't matter

whether the Case boys were competing as

teammates or against each sometimes change the children.

"We

used to

other. If they

were

losing, they

would

rules,

prompting a joke among the other

call

Case Rules,"

it

recalls

another neigh-

Lucy Alexander Black.

The games would rage

just before dinner, serving as pro-

longed study breaks. "Steve displayed a ness

"The games would

"There was always more of the physical, territory-grabbing

It

bor,

rivalry.

that

style of

savvy and steadi-

Doug

always made him a very deceptive player,"

Alexander recalled

in

an e-mail.

He would sometimes

important basket by breaking into

routine, shuffling his feet uncontrollably.

lead with wiggling

celebrate an

Steve Martin's "happy

"We'd follow

feet"

Steve's

and shaking that must have resembled a muted

version of 'Dance Fever,'" Alexander said.

to

When Steve and Dan were teammates, "they know exactly where the other one was going to

always seemed pass or jump,"

196 STEVE CASE

Steven

Bond

said.

"We

When they were

Bond

ticularly fierce,

lose out to his

The Upgrade

Dan would get par"There was no way he was going to

said.

opponents,

younger brother."

figured since

we were

out there playing,

we might

as

well win," said Steve Case.

Dan was

and other neighbors cited in

most competitive Case, the one most

clearly the

invoke Case Rules, said Lucy Alexander Black. But she

likely to

recall that

Case Rules were a family

numerous games. "They would sometimes move

of-bounds

lines in croquet," she says.

trait,

the out-

"Anything to give the Case

boys an edge." Basketball

would end when Mrs. Case rang

her sons retreated to their

home with

Honolulu skyline and the

the also

abound

Pacific

—cribbage, checkers,

the board game. Risk,

the dinner bell

big glass doors

and a view of

Ocean. Inside, games would

chess. Steve

had

a penchant for

where the object was world domination.

The Case games were

often spiced by gentle wagers ("Loser

does the dinner dishes"), but the parents forbade cash never minded doing the dishes so

Carol Case

said.

She and Dan,

long as

it

kids to

work out

He

included

and

fair play.

Sr.

Dan,

much

"They

bets.

as they just hated losing,"

encouraged the competition, as Sr.

disputes in a safe

bought boxing gloves for the

forum with prescribed

always preached, "Humble in victory, gracious

rules.

in defeat."

When there was nothing to compete in, Steve was adept at creating diversions. He liked gadgetry: cameras and weather stations, then radio and cassette recorder gizmos. With Dan, he developed an early fixation

Dixie cups

on

full

selling.

They launched businesses

of limeade

when

they were 7 and 6, and expanding

into door-to-door sales of greeting cards

Steve and

Dan once

money, but

and garden

seeds.

secured exclusive Honolulu rights to

a particular brand of Swiss said they never

together, selling

watch

—and sold zero watches. Dan

embarked on childhood business ventures

for the

sell

gamesmanship of

it.

"Money's

just the

for the

way we

STEVE CASE kept score," he said. Steve would stay up

schemes, sometimes waking

Dan was

Dan with

a basketball

sound of

a car crashing

from the

cul-de-sac.

197

dreaming up

late,

ideas.

A

a classic firstborn: an

and do-gooder. Once,

The Upgrade

student, class president,

game was

on the main road,

interrupted by the

few hundred yards

a

Dan, then 16, charged to the scene and was

directing traffic within seconds.

"Danny was

a perfect role model,

Bond

says. "Steve

was always cooking

very upstanding," Steven things

up and looking for a niche."

met

Steve

by detouring around

his brother's precedent

it.

defined the market early in our family through achievement," says. "Steve

own

was the

path." Steve

rock-and-roll

("Aerosmith

.

guy up.

He had

a B-plus student

music

critic

for

to

work

Dan

to define his

and indulged a love of the

high

school paper

completely overwhelmed the audience and

.

Who

the Guess

band").

.

a

as

third

was

"I

made

look, by comparison, like a high-school dance

He wrote

to record labels

and convinced them that the

paper was one of Hawaii's biggest-circulation papers for young people

—

this

was

Dan and

technically true

—and he received

Steve say their rivalry

were

collisions,

can't

remember what

such as a fight started

when

it,

free

albums.

was manageable, but they were 13 and 12.

only that afterward he

there

Dan

vowed

never to fight his brother again. They were getting too big. "There

bad risk-reward here," he recalled saying

is

a

is

going to get hurt, and

it's

to Steve.

"One

of us

going to hurt our friendship."

So the Case brothers worked to "manage potential areas of conflict,"

Dan

said.

Both loved

tennis,

and

it

became conceivable,

given their closeness in age and the insular world they inhabited, that they

would have

to play each other in tournaments.

negotiated a deal: Steve agreed to relinquish tennis;

They

Dan gave up

basketball. In the mid-1970s,

Dan was contemplating

a

number of

east-

ern colleges, including Williams College, the liberal arts school in

198 STEVE CASE

northwest corner of Massachusetts, that

the

had

father

his

when Steve staked a claim to famconvention and asked Dan to leave Williams for him. Dan

attended. ily

The Upgrade

came

It

as a surprise

obliged and chose Princeton University, where he solidified his

while Steve went on to become a campus mav-

stellar credentials

erick in the Berkshires.

A He was

MEANS TO AN END "He was

not a political agitator or prankster.

from Hawaii who was always trying to

that guy

stuff," says

sell

Larry

who now works at Microsoft. "A Williams professor Mark Taylor.

Sisson, a Williams classmate classic huckster," says

Case

set

up

room

tables in the mail

ran a shuttle service to the airport.

with the manic edge of

to

He went about

a

baskets and

his businesses

man unleashed. As soon

think of a market niche, he tried to conquer

He was no

sell fruit

as he could

it.

longer confined to the small-scale aims of his boy-

hood, business peddled door-to-door or by mail order. As a practical

matter, there wasn't

much

especially sleepy place in the years

else

to do. Williams

was an

Case attended, 1976 to 1980.

There were few memorable events. Bo Derek came to Williams to

A Change

of Seasons, and students were paid $35 to be extras (Derek averaged a "7" in a poll of campus men).

film a scene

One

night,

from

members

inflatable doll off the

of the rugby club got drunk and threw an

Sawyer Library balcony,

inciting a large stu-

dent protest against sexism.

Case was aggressive

was little

the

generally well liked rancor. But this

in business,

but not in personality.

and carried out

his sales offensives

changed when he applied

his

year,

1977. Music was the one

medium

with

ambitions to

campus entertainment committee, which he joined

omore

He

in his soph-

that truly excited

STEVE CASE Case as a young man. this rock-and-roll

He began

The Upgrade

199

trying to bring headline acts to

backwater three hours northwest of Boston.

"Steve said, 'We're changing the paradigm, we're going to get

Springsteen and the Cars to play the Williams hockey rink,'" says

John Svoboda, Case's collaborator on the committee and now a venture capitalist in Chicago. "The student governm^ent body was

always pleading with

me

Williams,

it

guy Case

to rein this

There was concern that

would bankrupt

if

in."

these big acts actually

came

to

the entertainment committee. Case

argued that he could make more money for the college by putting

on

a successful show.

Upon

being vetoed. Case would

He adopted

listen,

shrug, and try again.

booking cheaper bands he believed were

a strategy of

approaching stardom, an early willingness to anticipate Next Big Things.

He

signed the then-unknown

and Meat Loaf ($500).

It

Cheap Trick

wasn't his fault that both

$1,250)

(for

wound up

can-

celing Williams for bigger gigs.

In his senior year. Case organized a Saturday night

The Log,

student club.

that featured

show

at a

two cover bands. The Vans

from the Cars) and The The. The Vans included the best

(derived

three musicians Case could find

—with

himself as front man,

despite a singing ability that the Williams

Record described

as

"limited."

"Case's dazed and dissatisfied look complemented the band's

punk sound," stage to

the review said. After eight songs, the Vans

drunken applause, changed

their clothes,

left

the

and returned

as

The The.

On many

weekends Case would borrow a car and drive an

hour to Smith College girl

was

from

in

Northampton, Massachusetts,

New Jersey, Joanne

Barker,

whom

to see a

he had met when she

a visiting student at Williams. In class, as in high school.

was not

"He was not someone who someone who would leave his mark on the world,"

a great student, earning B's.

stood out as

Case

200 STEVE CASE

said Taylor,

who

The Upgrade

the director of the Center for Technology in the

is

Arts and Humanities at Williams.

Case took Computers 101

his senior year

and was miserable.

me

"This was the punch-card age," Case wrote to

"Waiting an hour to have the cards run to see

worked

much appeal." cared much about

in

an e-mail.

the

if

program

didn't have

Case never

He had

circuitry.

loved Estes

rockets and weather stations as a boy, and then radio and cassette

recorder contraptions and cutting-edge photography equipment.

But he was always

what they could

less interested in

do. "I always

how

things

saw technology

worked than

as a

means

in

to an

end," he wrote. "I have always tried to understand enough about the technology to be able to understand

what might be

possible,

while maintaining a certain distance."

This is

distills

a Case peculiarity

among

high-tech founders.

not, nor did he ever claim to be, an inventor or

whiz. While his titan counterparts

Jobs

—were

saw

a potential marketplace

all

fixated

pose in a box, and

Case was the

it

on

—

circuitry. first.

Bill

programming

Gates, Larry Ellison, Steve

Case gazed into machines and

That became

compensated

He

for

one of

rare, introverted marketer.

his frontier, his pur-

his essential oddities:

He was

a marketing nerd.

Williams did not offer marketing classes, so Case majored in

what he considered first

the closest thing, political science.

presidential vote in 1980, for independent

The most enduring taught.

He

cast his

lessons of Case's college years were self-

spent hours in the library, reading marketing trade

publications, Toffler's

He

John Anderson.

especially

Advertising Age.

The Third Wave,

He

also

a treatise that posited a

read Alvin

world where

machines communicated with one another. Case had already come to view this

getry

world

was growing

as inevitable, not futuristic. His interest in gad-

into a fascination with interactive electronics.

Cable television was in few homes kept hearing about

its

possibilities of

in the late 1970s, but

Case

hundreds of channels and two-

I

STEVE CASE

way communication.

In 1979, he spent the

summer

subscriptions door to door for Oceanic Cable

boss into letting into the

him run

TV

selling cable

on Oahu. He talked

his

a cable wire through the neighbor's yard and

Case house. That summer, Case's father took him to a Rotary

Club speech by a brash cable

TV

had

Pacific

just

The Upgrade 201

completed the Trans

and captivated," Case

executive

named Ted

Yacht Race.

"He seemed Hke

recalled.

was

"I

who

Turner,

enthralled

the classic entrepre-

neur to me, swinging for the fences with seeming fearlessness."

As he prepared

to leave Williams, Case applied to a host of

MBA programs and was turned down by them

all.

He

also sought

marketing jobs at large corporations. But the options in interac-

media were small, even

tive

AOL.com

author Kara Swisher quotes from a cover

wrote to Time

Inc.'s

new

book

Case's plans were not. In her

if

letter

Home Box

cable property.

Case

Office:

"Innovations in telecommunications (especially two-way cable systems) will result in our television sets (big screen, of course!)

becoming an information

line,

newspaper, school, computer,

ref-

erendum machine and catalogue." But he was rejected and didn't get to meet the executive ran

HBO,

a

Time

fast-tracker

named Gerald

ACTUALLY DOING While Dan Case studied

at

arship, Steve set his sights

known

as

Levin.

IT

Oxford University on on

a great training

a job at Procter

ground

Rhodes

a

&

schol-

Gamble

for marketers.

Gamble, too, rejected Case, but he returned

own

who

Co.,

Procter

&

to Cincinnati at his

expense and finagled another interview. This persistence

became

his

— showing up and occupying

—would characterize Case's

could be as annoying as Procter

it

career.

was endearing,

a space until

it

While the tendency it

usually worked.

& Gamble hired Case as an assistant brand manager.

202 STEVE CASE

As

The Upgrade

&

a philosophy, Procter

Gamble espoused exhaustive

market research and focus groups; the company preached and

power of

revered the for

was

the "brand" to

Duncan Hines cake mix,

win customer

loyalty, be

it

Pringle's potato chips, or Crisco.

It

a marketing belief system that informed a generation of

New

Economy executives: Around the time Case was there, Procter & Gamble was also home to future CEOs of General Electric (Jeffrey Immelt), Intuit (Scott Cook), and Microsoft (Steve Ballmer),

among

others.

Case was assigned to a product called Abound, a small towel soaked

in hair conditioner that

could be rubbed directly onto the

You

Bet"). Case launched a point-of-

scalp (slogan: "Towelette, sale

marketing program that involved an optical sensor that

would

activate

a

demonstration video whenever a customer

walked near an Abound

display.

His boss, Charlotte Otto,

the idea as "brilliant," but the contraption

recalls

was deemed too expen-

sive to deploy.

Case lasted almost two years

Abound had no

lasted in test marketing.

interest in being

boxed

& Gamble, longer than

at Procter

He was becoming

certain that he

into a large corporation long-term.

But Pizza Hut, a subsidiary of PepsiCo, was offering him more ence than most people his age were granted pizza tastes.

He viewed

lost in rental cars

more

defensive marketing," said it

on the

nation's

exciting.

He

spent days

around the country, sampling

studying (tasting) the competition. This

and

albeit

this as a transitional job, a place to gain

experience until he found something

and nights

—

influ-

Ken Lerman,

was

pizza,

called "competitive

Case's Pizza

Hut mentor,

consisted of grading the nation's pizza with a scientific tally of

five taste categories

—

crust,

dough, sauce, cheese, and topping.

Case's parents worried. His father,

law firm

who

for forty-nine years, believed that job-hopping

alarm future employers and prospective brother

has been at the same

Dan had

MBA

would

programs. His

returned from England and begun his career at

STEVE CASE Hambrecht Bill

&

Quist, where he

Hambrecht and

a point

ing technology companies.

The Upgrade 203

became a protege of co-founder

man for the bank's work with emergHe sent Steve the marketing plans of

promising high-tech firms, knowing that he was bored at Pizza

Hut and seeking on the

side.

Dan's phone

He

way

a

up

out. Steve set

a marketing consultancy

used Dan's San Francisco address and forwarded

—with the Bay Area's 415 area code—to

Kansas so he would have more Silicon Valley brothers spoke for hours by phone and

his

own

in

The

credibility.

saw each other often dur-

ing these years. Steve Case spent solitary nights in a small condo-

minium on East Harry tools only

Street in Wichita. His interest in

grew amid the

arid

new media

"anywhere" of middle management.

Lerman remembers having Case

to dinner at his house in Wichita

and watching him gawk at a cutting-edge contraption, the

which allowed him Case bought

With

a

to

his first personal

modem, he

ability to

zoom through

computer, a bulky Kaypro.

discovered an escape from the isolation: the

connect with a small universe of computer users through

an early online

actually doing

it

and reading about Case wrote

it,"

in

The Kaypro experience was was suddenly

work

early twenties

was magical because

service, the Source. "It

thinking about

use, the

VCR,

commercials.

possible

it

a

it,

I

was

an e-mail. the clunky

embodiment of what

—and, given how hard the machine was to

that remained to be done.

was

and imagining

after

way

What Case

craved in his

to pursue this mission full time. In 1983,

he found one through his older brother.

THE WHIPPERSNAPPER At a trade show

Von

in

Las Vegas,

Meister, the grandiose

Dan Case

and

erratic

introduced Steve to

Bill

founder of Control Video

Corp. of Vienna. Virginia Control Video was a computer com-

— 204 STEVE CASE

The Upgrade

pany that connected

set-top

phone hnes; Hambrecht

TV

&C Quist

boxes to Atari games through

was one of

backers and

its

Dan

Case was a board member. Von Meister offered Steve Case a job

The notion of working

as a marketing consuhant.

in high-tech

appealed to Case, and he beheved that his marketing instincts and skills

would convey seamlessly

also noted that Pepsi

to

work

at a hot

Soon

after

people.

CEO John

had

Sculley

just left the

He

company

technology start-up, Apple Computer.

investors deposed fifty

to this new, uncharted realm.

Case took the job

Von Meister and

CVC,

at

most of the

fired

company's

the

staff,

As one of Control Video's few marketing

about

specialists.

Case escaped the purge, "definitely on the merits," says Bob Cross, a corporate turnaround specialist ing the mid-1980s. But there to keep

Hambrecht

was another

brought in dur-

"We wanted

factor, too:

6c Quist interested in us," he says, the imph-

cation being that they didn't

Dan and

who was

Steve were

want

known

and Lower Case. While the

to alienate

at

Dan

Case.

Control Video as Upper Case

were awarded

distinctions

playfully,

and

Dan Case

stepped

away from any involvement with Control Video because

of con-

by age, the broader meaning was

clear.

In 1984,

cerns over possible conflict of interest. "People needled Steve about his

own

brother not believing in him," recalls George Middlemas, a

Chicago venture capitaHst and early board member. "That had to light a fire

under Steve," he

says.

ance, that any sibling rivalry with

Case told me, with some annoy-

Dan had ended

Either way, Steve Case, at 25,

was

years

earlier.

essentially leading the

marketing efforts of a company struggling to survive. In

1983 and 1984, the video game market was dying.

Control Video's chain of ated himself boldly.

He

command was

helped implement a

personal computer makers. trying to gain at that point,

He

sparse

new

and Case

insinu-

strategy geared to

spent marathon stretches online,

some understanding of a

in flux,

the emerging world there

community of

fringe hobbyists.

Early

"

STEVE CASE investor

Len Batterson

and someone figure this

to him.

friends

remember asking where he was,

I

said, 'Oh, Steve's upstairs at the

keyboard trying to

whole thing out."

Case was ily

meeting in Vienna.

recalls flying in for a

"Case was nowhere to be found.

The Upgrade 205

and intimacy never came

eas-

too busy, or simply averse, and his body of

girl-

shy, socially clumsy,

He was

and close confidants over the years was

small. Larry Sisson

said he considered Case a "decent friend at Williams, but never

too close," and was surprised in 1985

him It

to be one of five

was

Jersey.

groomsmen

at his

medium-big ceremony

a

Dan Case

matching red People

when Case

called

and asked

marriage to Joanne Barker.

church

at a

Rumson,

in

stood as his brother's best man, and Steve gave

ties as gifts to

each groomsman.

who knew Case

at the time sensed a personality

change, at least at work, where he was spending nearly time.

He seemed

ties

of older

to

exude the busyness of a

And

out big notions.

New

in his rush.

whom

of his

free at last to try

Case collided with the

some of

investors,

man

all

sensibili-

dubbed him "the

Whippersnapper. "Steve

was

a very aggressive

have been the top dog

guy

who

after three days,"

believed he should

Marc

said

Seriff, a

Control Video founder. "If you prove yourself to Steve, he will treat

you

you're 25. a time

It's

when

Especially

an

as

if

intellectual equal.

another thing

if

he's

It's

one thing

if

he's

25 and

25 and you're 55. This was not

25-year-olds interacted with 55-year-olds as peers." the elders already had lost a lot of

money on

the

com-

pany, and several of them wanted Case gone.

Jim Kimsey, a Washington entrepreneur brought in the

in as chief executive,

company who had

knowledge of

this

been

argued that Case was the only one

a bent for marketing, as well as

some

mysterious marketplace. Kimsey's endorsement

saved Case's job, and that

who had

would become

set in

motion a professional co-dependency

the formative relationship in Case's career.

206 STEVE CASE

The Upgrade

CHEESY In the mid-1980s, the notion that connected computers

become an

essential

medium seemed,

at best, optimistic.

would

But Case

held the idea with a fiery certitude.

Usually the engineers, the ones with an intellectual stake in the product, are the truest believers. Case, however, "sold himself as a user,"

not as a technologist, Seriff said.

He came

the flaws and magic of the online experience at the

to see

same

time.

Bringing this experience to the masses was a quest Case took personally.

After years in the wilderness, thrashing about with elaborate ideas,

Case had found

his outlet. In

1985, Control Video rechris-

Quantum Computer Services Inc. It was designed exclusively for the Commodore International Ltd. personal computer, for which Quantum had developed a nighttime service, Qtened

itself

link, that

provided an array of communications tools, games,

news, and soap opera updates.

Case applied driving

every

his

occupy-and-conquer approach to

week

to

Commodore's

Philadelphia to foster the relationship.

headquarters

sales,

near

The next year he moved

to

Cupertino, California, in an effort to win the business of Apple

Computer's Apple

II

machines. Once inside, Case showed up

every day for three months. Finally, Apple officials agreed to

let

Quantum develop their proprietary online service. Quantum survived, but the company was always at the mercy of its partners. Its survival depended on how many makers of personal computers Case and Kimsey could persuade to use

its

fledgling online service. Several people counseled Case to leave the

The online market was showing

company during

this time.

momentum, and

a smattering of rivals

$1

billion

from

Sears,

Business Machines Corp.

—particularly Prodigy, with

Roebuck and Co. and

—seemed

little

far

International

more promising.

— STEVE CASE

The Upgrade 207

But Case did not take a single interview with another company.

was

"I felt this it

the horse

had bet on, and

I

out," he wrote in an e-mail.

By the

I felt

determined to stick

1980s, Case and Kimsey

late

were the public faces of Quantum, a familiar duo

Washington-

in

area business circles. Kimsey, a charismatic backslapper, investors

would calm

and handle tense negotiations; Case, no backslapper, could

project an air of

bemused sarcasm

that people

who

didn't

know him

could find unsettling. But for the most part, Case stayed in the back-

ground and focused on

The commercial online users were

strategic planning

Internet

was

no longer niche

and marketing. few years away, but

a

still

players; the technophiles

were

being joined by a stream of "early adopters." In 1989, Quantum's service

was renamed America Online.

Case was more certain than ever that the online border was finally first

opening for business and that the companies capitalizing

would

prevail.

It

was, he often would

he launched a mass mailing of holds.

The

esoteric

AOL

community of

say, a

land grab

—and

disks to the nation's houseearly

online

users

widely

derided his campaign as old-fashioned commercialism. "Cheesy" is

a

word

was used

that

a lot.

But

selling to

mass markets was

something Case had been studying, and perfecting, since boyhood.

"WHAT'S THAT SAYING, ABOUT THE SON NEEDING TO KILL THE FATHER?" In early

1991, Kimsey entered into merger discussions with

CompuServe,

would not

a rival online service,

stay

if

the deal

nies could not agree

on

was completed.

a price). But there

notably, a near-sale to Microsoft

independence.

He

and Case made

—and

It

it

was not

clear that he (the

were other close

compacalls

Case always argued for

told friends that he worried about "selling out"

before he could leave his

mark on

history.

208 STEVE CASE

The Upgrade

Case, then 33,

was

He began

to Kimsey.

also

growing weary of being subordinate

agitating for the chief executive's job in late-

night phone calls with board members. "Steve always wanted

more, and Jim's role was to moderate," says Doug Peabody, a longtime board member. During his phone conversations with Case, Peabody would say, "Look, you're young, you have plenty of time, don't get too out front of yourself." Kimsey himself kept telling

Case that he wasn't ready.

At that time, according to several accounts. Case would go

around Kimsey and

people at industry gatherings that he was,

tell

And

running the company.

in effect,

he basically was, says John

who worked

Svoboda, Case's old friend from Williams College, William

Blair, a

Chicago investment house that had dealings with

AOL in the early Kimsey

in

1990s. Svoboda recalls a meeting with Case and

which Case was

"clearly frustrated"

"Here was Steve the risk-taker being reined

who wanted him

to

In 1991, the

move

board

by the setup.

in again

by someone

slower."

finally

and Kimsey remained

tive

at

gave Case the

as

chairman.

title

of chief execu-

The company had

130,000 customers by midyear, a fraction of what CompuServe

and Prodigy had. Nonetheless, AOL, with planned an

initial

just

120 employees,

public offering early in 1992.

This was not a time

when

companies

negligibly profitable

were going public; certainly not firms that had uncertain records

and were operating offering:

in

quirky markets.

The company needed cash

to

Still,

Case argued for the

expand

at the

pace he

felt

necessary. The public offering was also a chance to generate publicity,

and Case was anticipating top

But Street

just before the

would

prefer

at the front of the

He

no

IPO, AOL's directors reasoned that Wall

Kimsey 's gray eminence

to Case's boyish face

company. They stripped Case of the

seethed, but quietly,

behalf, to

billing.

avail.

CEO

title.

and several employees protested on

his

— STEVE CASE While Case

fit

no

The Upgrade 209

one's idea of a charismatic leader, he

AOL,

aged to engender a loyal following at

especially

man-

among

young employees and managers. He worked long hours and endured

serial indignities in the

name

of "building the brand."

would attend countless trade shows, stake out established

media companies

and beg them to put

—

like

their content

He

from

officials

Time Warner and Disney on

his online service.

They

would ignore him, but he would keep coming back.

Many AOL believer

—the

employees viewed Case as an online true

leader of their crusade, especially

"businessmen"

like

Kimsey and some members of the board. His

gave him credibility with the

faith

compared with

staff.

But Case continued to

yearn for recognition as a businessman. "In his

own

quiet,

dogged

way, Steve was always crying out for attention from the big boys," said

Gary Arlen, an independent

who

has

known Case

AOL's stock Case,

who had

Internet analyst in

for years.

issue, held

March

been paid largely

pizza business, suddenly

He was

$66

19, 1992, raised

million.

in stock options since he left the

was worth nearly $2

Shortly thereafter, the board returned to utive.

Washington

him

million

the

title

on paper.

of chief exec-

34.

But Kimsey remained as AOL's chairman and he continued to cast a paternal

shadow over Case. He seemed

"mentor" to Case's "protege." Case was insecure about stature to lead

on

his

his

He knew

to relish the role of

Case's sore spots

—that

readiness, about whether he had the

own. Kimsey had

his

own

sensitivities,

about

being perceived as an "empty suit" within the company, someone

who had

lucked into a great situation and had no interest in

understanding the online world as

it

grew more complex.

Kimsey often nudged where Case was began drawing attention

in the national press,

speak about "nurturing" Case. hired

him because of

sensitive.

He

his brother."

also

When AOL

Kimsey would

would point out

that

"we

210 STEVE CASE

Privately,

The Upgrade

Kimsey complained that Case never gave him

company

for keeping the

who remain

echoed by former board members

credit

The complaint

alive in the early days.

is

loyal to Kimsey.

"Steve has spent a lot of time trying to attribute AOL's ascendancy to his efforts," says

George Middlemas, adding that Case's

AOL. "But

butions have been "immeasurable" to

contri-

Steve's not

Superman, although he seems to have a need to convey that."

Bottom I

line,

Kimsey

said. Case's record speaks for itself. "If

who was gonna make me a billion dollars guy who was gonna kiss my and be grateful, I'd take the

could choose a guy

and a first

—

one."

Nursing a scotch

and cheeks on

a

in a pink-tinted glass to

Thursday afternoon

in early

match

pink shirt

his

2000, Kimsey looked

He

every bit the picture of old-boy Washington.

reclined in his

is

spacious office suite overlooking the White House and adorned

with West Point

politicians in the course of

Kimsey while Case

is

is

He namedropped

artifacts.

several big-name

an hour discussion.

every bit the opposite of Case. closed-in; he

is

old

economy

He

is

unrestrained

to Case's new; self-

assured to Case's self-conscious. If

Kimsey was upset over

rare occasions that he

He was

"cordial."

his rift

with Case, he hid

saw Case, Kimsey

said the

it's

On

the

two men were

philosophical.

"What's that saying, about the child needing to in order to

it.

grow up? Maybe

there's

some of

kill

the father

that at work.

Maybe

understandable."

People close to Case defend his loyalty to Kimsey, noting that other executives

would have

early 1990s, they felt

was

left

the

company

mocked Kimsey behind

his increasing

his

disengagement from

in frustration. In the

back for what they

AOL. They

term, "Where's Kimsey," a play on "Where's Waldo." joke, but

problem

coined a It

was

a

Case says that Kimsey's absence had become a serious at

AOL. Kimsey would have

high-level meetings that

STEVE CASE Case didn't

know

The Upgrade 211

about, or say something in the press that would

surprise Case.

In an e-mail, Case wrote that in the late 1980s

1990s, AOL's executive

was

"because

I

company

started

It's

staff pressed

was hard

respective jobs. "This

grateful to

him and Kimsey

for

me

Jim for the

and keeping

it

and

early

to clarify their

to deal with," he wrote,

role he played in getting the

alive during

our

difficult first years.

unfortunate that a decade later our recollections don't mesh."

The tension between Kimsey and Case

crested in November when Kimsey assumed the largely ceremonial title of chairman emeritus. On the way out, Kimsey told USA Today that he

1995,

planned to bring

in

an experienced manager to help run the grow-

He was

ing company.

supervision" at

AOL

determined, he said, that there be "adult

in his absence.

COMBAT ^

Shortly after

Kimsey made

was taken out executives.

for

an

T-shirts

his "adult supervision"

Italian dinner in

printed

remark. Case

Reston by some other

with the legend

"I

AOL

Need Adult

Supervision" were passed around the table, along with "Steve's

Troops" caps. Case was given a general's

The show of stretches of his ing.

loyalty

life.

Then came

the

hat.

came amid one

of the most difficult

His eleven-year marriage to Joanne was end-

news

that Case

had become involved with

AOL Marketing Vice President Jean Villanueva, to whom he now is married. One AOL official remembers Case seeing Villanueva for the first time: She was interviewing for a job at AOL and attending an AOL "beer bust" outside their offices. Case was sitting with

Kimsey and asked him who she was. Case then asked

he could be the one to interview

became Case's

her.

fiercest booster inside

As years went

AOL.

by,

if

Villanueva

212 STEVE CASE

The Upgrade

Case divulged

AOL

with Villanueva to the

his relationship

board. The revelation rocked the company. This was a side of

Case that few inside

AOL,

romantic Case. Suddenly,

anyone,

if it

knew

existed: the emotional,

seemed, the Wall had softened.

Case was hypersensitive to any mention of ing

and

his

marriage end-

with Villanueva in the press. In April

his relationship

1996, Business Week published a flattering cover story on Case

and AOL. But he was furious about the one-sentence mention of

him and Villanueva deep

in the story,

had been reported

relationship

According to Swisher's

several

in

AOL. Com, when

would be included, he became

Week

even though news of the

Case heard that

He

apoplectic.

and threatened to take away

editors

places

already. this

item

called Business

his previously granted

permission for the magazine to use photos from his childhood.

was

like

Week

a nuclear explosion," Business

Lewyn, who had known Case and Villanueva Swisher.

"The

since Steve

said he

was

and

intensity

many

Mark

years, told

were remarkable to everyone,

usually so calm."

is

People

vitriol

for

reporter

"It

who worked

close to Steve Case during that period

able to remain focused

were mounting

AOL. The

at

on

his job

— and serious

rapid acquisition of

new

issues

users led to

a nasty run of technical problems that culminated in late 1996, at

which point

AOL

was becoming known

Case took the criticism

AOL, by

relentlessly

behaving unethically

AOL

executive

strong belief in

Around

in stride, but

it

often

marketing a service

—and

as

it

accounting, eliminating

this infuriated Case, said

AOL its

came with

could not

who worked there in that his own moral correctness,"

this time,

"America on Hold." a hint that

deliver,

was

one former

period. "Steve has a the executive said.

decided to tweak

its

method of

long-held and controversial practice of

spreading direct marketing costs over a two-year period. Instead, the

company would

an immediate

hit

start reporting the costs all at once, causing

on the company's earnings

—and enraging many

STEVE CASE on Wall

In a prolonged grilling

Street.

investors at

New

House

York's Essex

The Upgrade 213

by stock analysts and

hotel,

Case fielded every

question and never raised his voice. The only time he showed ible strain,

according to one eyewitness, was

dubbed AOL's

when one

vis-

questioner

practices "immoral."

and 1996,

In 1994, 1995,

AOL

recorded

massive disk

its

giveaway as "subscriber acquisition costs," which allowed

it

to

spread the cost over the long term while appearing profitable in the short.

(On May

SEC

15, 2000, the

AOL

ruled that

should

have booked these costs as an "ordinary business expense," and the

company agreed

charges;

AOL

to

pay a $3.5-million

fine

neither admitted nor denied wrongdoing.)

There was more front-office turmoil.

announced that Fed Ex executive

company

to settle the

as president.

He

Bill

lasted four

Case

1996,

In

Razzouk would

join the

months, a choice doomed to

and

clashes between Razzouk's conservative operational style

AOL's more wide-open ing,"

to

Case began a meeting with

someone

The Razzouk

management team, according

affair seized

in fact

on Case's self-consciousness over

mature enough to lead a large and grow-

"He seemed nervous

had surrounded himself with would executive ers

would

who

morn-

ashen and his voice pitched.

in the meeting, his face

ing organization.

his

this

room. Case looked uncharacteristically shaken

in the

whether he was

Razzouk resigned

culture. "Bill

has since

left

that

all

the other adults he

lose faith in him," said

one

the company. Case worried that oth-

leave, too.

In fact. Case has a strong record of retaining deputies, several of

whom have had their pick of chief executive jobs— and this

was only

partly due to the wealth

AOL

created for

its

While Case was never big on the basic managerial "thank you's" and "sorry's,"

his steely

seductive over time. Examples of this

known

top ranks.

fuzzies like

determination could prove

became numerous and

within the fledgling sector of online business.

well-

214 STEVE CASE

The Upgrade

In July 1994,

Mark Walsh was

preparing to take a job at a

Rockville, Maryland-based online service called GEnie. But Case

tracked him

down

6 A.M. L.A. time.

to a hotel

"What the

room

in

Los Angeles and called him

[expletive] are

you doing?"

is

at

how Case

greeted his friend, Walsh remembered. By the time Walsh realized

who that off

it

was, Case had promised that he would wipe out GEnie and

Walsh would be working

by three months,"

recalls

AOL within

at

Walsh,

who

six

months. "He was

stayed at

AOL until

1997.

Case was hardly born persuasive. His voice was naturally low, in a

way that made

umes. Case's

go away.

gift,

And

world he was convinced,

What

it

seem

like

he was straining to reach higher vol-

was

as always,

that, essentially,

selling: It

call

was

him nuts

—

his willingness to

was

here,

it

it

his

message about the online

wasn't going away, and

was going

said,

was how

the carrier," said

member

infectious his intoxication with

things online could be over time. "We've is

—he was

to transform the planet.

people underestimate about Case, board

Frank Caulfield

Steve

show up and not

all

caught the virus, and

Ken Novack.

Case could be hostile toward nonbelievers and dismissive of rivals.

As he

felt

more comfortable

in his position, said several

longtime associates, his leadership style evolved: from endearing desperation to something that could be viewed as disdainful assurance. Scott Kurnit, Chief Executive of

bered meeting Case for the

Bermuda. Kurnit, then a

first

self-

About.Com, remem-

time in 1993 at a convention in

rising cable executive at

Viacom, men-

tioned to Case that he had taken a job at the online service Prodigy, one of AOL's chief competitors.

"Why the hell are you going to Prodigy?" Case said, Kurnit recalled. "Why the hell didn't you call me?" Case kept shaking his head, and was not smiling. Kurnit tried to lighten the conversation,

not successfully. Finally, Kurnit agreed to come to Virginia to

meet Case. They met, and had a good discussion, but Kurnit decided that he could not renege on the job at Prodigy.

STEVE CASE

The Upgrade 215

After the meeting, as Kurnit boarded a shuttle to

Case followed him (he was going to the seat next to him. this,"

In the

anyway) and took

pulled out a contract mid-flight. "Sign

two men kept

in touch.

mid 1990s, Case joined

a paintball outing.

a

group of

Arnold, a longtime

AOL

employee

employees

the woods, crawl

line of fire," recalls

who was

at

at the event.

Amy

At one

and started bleeding below the

point. Case took a hit in the face

He

AOL

"He would charge through

stomach, run directly into the

his

eye.

York,

he said. Kurnit would not and Case didn't react well, Kurnit

said, but the

on

He

New York

New

kept playing.

"He was focused on didn't care

how

he got

getting the flag,"

Arnold

said,

"and he

it."

:-)

Bill

Razzouk's job was eventually taken by Bob Pittman, the for-

mer head of MTV. Pittman tastes,

is

a social

charmer with Hollywood

an image that can obscure a fervidly hands-on management

He demanded numeric analysis of ness (How many people were reading exactly how long?). style.

Under Pittman's

certain

leadership, placards appeared

walls to remind everyone of player,"

every aspect of the busi-

"AOL

"self-management and

Valued

Work

initiative")

pop-up ads for

on headquarter's

Behaviors" ("team

and

Leadership Qualities" ("vision," "care for people").

"AOL

Valued

Company

mis-

sion statements blanketed AOL's offices in various forms (posters,

wood

carvings).

pressures,"

Terms

like

"core values,"

"performance-based

and "micro- budgets" became common.

With Pittman

in charge.

Case could move away from man-

aging the day-to-day operations, a task that never suited him.

tended to lose focus on micro-management matters.

He had

He

little

216 STEVE CASE

skill

for,

The Upgrade

or interest

Gary Arlen

in,

schmoozing

basic corporate

situations.

recalled being invited to a private briefing with Case a

few years ago. Arlen brought a business partner and year-old son, Benjamin, an

AOL

and

perfunctory handshake

then 17-

Arlen recalled that after a

user.

a

his

sarcastic

remark about Arlen

"bringing an entourage," Case didn't acknowledge his son at Case's brilliance

lies in his strategic

all.

thinking, his ability to

discern future market trends and churn endless scenarios through

What were customers ready for? What would his competition do? What if so and so teamed up with so and so? Case's instincts were informed by that rarest of New Economy comhis

mind.

modities It

—experience.

was

also the product of his wiring. "Steve thinks business

strategy like there's an eight-dimensional chess his head," said

Marc Andreessen,

and Netscape Communications

the co-founder of

who

Inc.,

"Very few people can think that way.

It's

briefly

Steve's

In the mid-1990s, the biggest threat to

had released

the Internet. Netscape

game going on Loudcloud

worked

at

in

Inc.

AOL.

form of genius."

AOL's

viability

was

trademark browser, which

its

allowed personal computer users to "surf" the entire global net-

work. As mainstream users stormed online, the days of proprietary services like

want

to play in a

AOL

little

seemed numbered.

online sandbox

when

Why

would anyone

the Internet offered a

whole playground? Case dismissed the notion that the Internet would as "Valley talk."

It

reflected a long-held

kill

AOL

and mutual ambivalence

between Case and the epicenter of the high-tech industry. Silicon Valley's hardcore techies their

elite

creation,

mocked

the

AOL

"Internet

as a pedestrian version of

on training wheels." Case

believed that the Valley's thinking tended toward dazzhng tech-

nology, often at the user's expense.

Certain high-tech companies and ideas

Linux operating system

— foster

a

—Apple,

eBay, the

ramped-up fanaticism by

STEVE CASE employees and users. Their inventors

Omidyar But for

The Upgrade 217

— Steve Jobs (Apple), Pierre —are often worshipped.

(eBay), Linus Torvolds (Linux)

all

the fervor Case held

America Online, despite

its

movement. And that was

and preached

for the

"medium,"

success, has never incited a religious

fine

with Steve Case. Customers didn't

have to chant "You've Got Mail" as a mantra,

just so

long as

they were comfortable enough to sign up for the service and pay for

it.

When

Case looked

saw an uncharted

at the Internet, he

wilderness too unruly for the mass markets he'd been studying

& Gamble. What they would want, he believed, was

since Procter

a friendly intermediary. In 1995, ice.

The

AOL

began integrating a

transition set off a rush of

chases of

CompuServe

in

end, nearly 50 percent of

Web

browser into

its

serv-

growth that included the pur-

1998 and Netscape

home computer

in

1999. By century's

users in the United States

AOL—yet the term "online service" in Dulles. AOL now viewed itself as a

were getting online through

had become

all

but taboo

full-blown "media company." Case coined the voracious corporate

mantra

—AOL

Anywhere. He was

Global, preferably.

Each month,

And as

striving

for

total

ubiquity.

fast.

the

company

grew,

AOL

would achieve

another milestone, often in relation to some powerhouse that had

AOL earlier. Case would always take note and keep score. 1997, longtime AOL executive Ted Leonsis tried to nego-

scoffed at

In tiate a

co-branding agreement with Walt Disney Co.

never co-brand with a said,

little

company

like

"We would

you," a Disney

official

according to a source familiar with the discussions. Leonsis

went back and reported the conversation the source said, shortly after

to Case. In late 1998,

AOL's stock market value exceeded

Disney's, Leonsis sent Case an instant message pointing out the

benchmark. Case replied with an emoticon:

:-).

218 STEVE CASE

The Upgrade

STEVE Case was

now getting

especially

when he was with one

picked out in crowds.

had between them. There were and tightened

Star era events.

—which

Once

threats of harm,

—one of the

AOL sources said,

Case became accustomed to

rituals of the

tech-CEO-as-Rock-

he would usually honor, especially at public

New

in

always pained him,

It

of the five children he and Jean

security measures.

autograph requests

2.0

Orleans, he

with a married couple

was asked

photo

to pose for a

who had met on AOL, and

he obliged.

His friends and associates remarked that Case seemed noticeably less embattled in the months leading up to the Time-Warner deal.

It

more

was

as

if

he could sense that his peak was close.

reflective, as if

he were taking inventory of his career. In

September 1999, he gave a

on

brief but sweet testimonial to

his sixtieth-birthday video.

Lerman,

his

He seemed

He came

across a

Web

Kimsey

site for

Ken

former boss at Pizza Hut, and called Lerman to offer

to write something about

Lerman on

the

timental whuda-thunkit e-mails with old

Case brought thropic projects

site.

He exchanged

AOL

sen-

friends.

wealth and energy to bear on philan-

his

— and AOL brought

its full

PR

energy to bear on

promoting them. Case had proven himself as an entrepreneur, the thinking went.

Now

he himself deserved to be "branded" on a

higher plane.

This

is

a

common

transformation

ogy CEOs. Once they reach a certain

among

big-ticket technol-

level of titanhood, they strive

for statesmanhood. Bill Gates did, so did Intel's

Cisco's

John Chambers, and

others.

They were no longer

hugely successful Capitalists, they were

with world leaders

in

Andy Grove,

now

Industrialists,

photos posted on corporate

Web

just

posing

sites.

This reinvention was particularly central to Case's character,

and

in the evolution of

others to see him.

how

he envisioned himself

He remained

—or

wanted

loath to be seen as the

little

STEVE CASE brother, friends said.

a big brother. Case

port to the

CEOs

would

"Steve

see

He wanted

would make

main man. Or

at least

unsolicited phones calls of sup-

of young Internet companies as they struggled.

some event happen

CEO

ten," said Jeff Bezos, the call

to be the

The Upgrade 219

and say something

of

to us, or

some

article writ-

Amazon.com. "And he would

like 'Hey, let

me

tell

you

a story about our

life

despite himself, a

darkest days.'"

Case was also learning to enjoy public fact

many

attributed to the influence of Jean Case. "She has

helped unlock a part of Steve's personality that you never used to see," said

one friend

who

when Gerald Levin

1999,

known Case for several years. and Case were among a delegation has

U.S. business leaders to visit China, Levin recalls seeing Case

Jean

in a "personal

moment"

was so

A

at

He was

her,

surprised by this. Levin said, because

few months

later.

Case approached Levin on

insisted that established

to invade cyberspace

his ultimate

AOL came to dom-

remained a legion of doubters

media

interests

and rout AOL. And

would

at a time

figure out

Around

that time,

Case. "They

said

all

a panel of

secure.

vice

chairman of

CEOs

that included

John Sidgmore, the

Worldcom, remembers watching

how

when anything

seemed possible. Case had an acute sense that nothing was

if

it

odds with what he perceived as Case's reserve.

inate access to the Internet, there

as

and

shrouding her in his jacket to

land grab: the purchase of Time Warner. After

who

of

outside the palace of Beijing. Steve

kept wrapping his arms around

keep her warm.

In

kept saying, 'I'm very confident in our strategy,'

knew exactly what they were doing," Sidgmore, who has known Case for several years. Case said they were certain they

sarcastically that he

wished he could be that sure of everything.

"To the degree that everything keeps me up, I'm always worried about everything," Case

said,

according to Sidgmore.

This was especially true in light of AOL's inflated stock value,

which Case knew

as well as

anyone

else to

be precarious. Joining

220 STEVE CASE

Time Warner would,

forces with

AOUs

share price, insulating

The

to come.

deal

AOL's empire olution.

dancy

The Upgrade

It

would

from the dot-com

it

under

in effect, place a floor

also bring classic

as the online migration

fallout that

was

American brands to

exploded into a cultural rev-

represented a formal marker for the company's ascen-

— and

for Steve Case,

would

it

also represent a bridge

between the establishment world he came from and the world he helped create. Negotiations between Case and Levin ran hot and cold

through the end of 1999. The biggest point of contention was the

"exchange ratio" between

AOL

much each company's market

and Time Warner shares

—how

valuations had been skewed, for

worse (Time Warner's) by the peaking

better (AOL's shares) or

dot-com mania. Their negotiations culminated on Thursday, January 6

at a dinner at Case's

home

in

McLean,

Virginia.

were impasses, but Novack urged Case and Levin to keep

They

did,

working

their

way through

As the chocolate mousse

a bottle of

By

Powell.

from the

was nearly

set.

They discussed

York, where the

AOL

He

living

deal.

the time Jean dropped Case at Dulles Airport

the deal

talking.

1990 Bordeaux.

dishes were being cleared

room, the two men had the broad outlines of a

There

shared a corporate

on Saturday,

jet

leasing a helicopter for future

with Colin

hops to

New

and Time Warner conglomerate would be

based. It's

attire,

a media cliche that

it

company If

if

an executive

signifies the post-adolescent

—

in other

he wears a

suit,

supervision." So

is

dressed in casual

energy of a

words, a good thing, at

New Economy

least in the late 1990s.

he works for a company with too

it

was exhaustively documented

much

"adult

that Levin, the

then 60-year-old head of old media Time Warner, wore an open collar at the

announcement while Case wore the

suit

and

tie. It

symbol that the new kids had formally usurped the old boys

was

a

and

all that.

STEVE CASE

The Upgrade 221

But most striking to those involved was Case's show^ of emotion as he

hugged and high-fived

to intellectuaUze history as

seemed

it's

his v^ay across the stage. "I tend

happening," Levin said, "but Steve

touched by the significance of what he had done."

truly

Case would preside over an empire that included the Bugs

Bunny cartoons of his boyhood Saturday mornings, he

listens to today,

one early cable visionary

him

for a job (Levin).

REM CDs

inspired

him

as

and another whose company

a college student (Ted Turner), rejected

who

the

New

media and

old,

maverick and

mainstream, would coexist as a singular corporate powerhouse, a big

and uncertain hunk of

Case

turf that

rules.

CHARACTER ISSUES At the end of

my

research

on Steve Case,

more unvarnished version of

the

Sunday The Washington Post story

nothing until

it

finally

encountered a

man. He made himself available

for a last-minute fact-checking interview

pubHshed. This was

I

I

on the Friday before

the

was writing on him would be

classic Case: to

be inaccessible and reveal

became apparent what the other person knew.

This way, he could see

how much

information he owned, what

kind of control he had. Then he would respond, aggressively. I

reviewed

all

the objective facts in the story with Case over

the phone. In the interest of giving Case advance notice,

passages that might have bothered him on Sunday.

whole,

I

read him

was, on the

thought, a profile that gave him his due. But he quibbled

on small

And

things, increasingly as the

bigger things.

He

That he somehow

felt

phone

call

raised his voice.

went on.

He

objected avidly to

much credit for AOL's success. vindicated when AOL bought Time

the notion that he had grabbed too

Warner.

It

I

— 222 STEVE CASE

The Upgrade

That he had undermined

And any

was ever an

hint that he

appointment to him.

He

his bosses.

upstart seemed a bitter dis-

"Humble

repeated his father's bromide

in

victory, gracious in defeat" three times.

But by the end of the discussion, Case had returned to an

unemotional monotone. that this

We

at w^orst,

v^^as,

hung up.

When

I

He seemed

come

some peace

to

an annoyance.

went

to lunch.

returned, there

I

to have

was

a long voice-mail awaiting

from Case. The more he thought about

it,

the

more upset he was him

about the "character issues" that people were raising about the story. "I've takes,

and

I

mistakes, and

am committed

His tone was

you need

made

at

bers Frank Caulfield

Later,

and a

talk

flat,

more people," he

cell

mis-

spoken to

said to me. I'd

He

least,

mem-

and Ken Novack, two older mentor

types,

told him.

spoken to already

I'd

in

suggested board

I

at length.

Case called again. "Kathy Bushkin said

should

I

call

about some philanthropic work we're doing," he said

grandmother to thank her

phone number and

in

whose mother was making him

obligatory tone, like a kid

call his

make

once resigned and pleading. "At the very

to talk to

whom

will continue to

to doing things the right way," he said.

about one hundred already,

both of

I

me

his hotel

for a lousy present.

He

room

called

in Atlanta.

I

left his

him

back and we talked more. There were no ground rules for these discussions. They were

on the

record. But

it

was too

close to publication for

me

to intro-

duce too much new Case material into the newspaper story except

for

his

responses

corrections to objective facts.

to If I

specific

characterizations,

could do the story again,

I

would

have figured out a way to use more. This was as revealing a conversations as

I

could have hoped for with Case.

It

or

set of

offered a

neat glimpse of his sensitivities, his control-freakishness, his edges

when he

feels

cornered.

— STEVE CASE

When kill

I

The Upgrade 223

read him Kimsey's remark about the son needing to

the father, Case did a decidedly unCase-like thing

but audibly.

Slightly,

Kimsey

said that? Surely

I

Kimsey

unfazable Case.

Still,

Kimsey had been

Was

did. ("It's a line I've used

I

sure

I

suggested that

was amazed

I

it

Kimsey always knew how

that

I

call

many

to faze the

vehemence of Case's

at the

given

especially

how

irrelevant

largely

and AOL's, day-to-day existence

to his,

Whether

eral years.

me

Kimsey,

to

said.

said.)

People had told

reactions

He

misquoted him.

Kimsey again to double-check. times,"

Case

"That's bizarre,"

—he gasped.

was

a father-son

for sev-

dynamic or not, when

Case talked about Kimsey, he didn't sound so much angry as he did hurt, disapproved of. It

was

also fascinating to hear Case's reaction to the material

about him and ably,

his brother

Dan. Steve was rankled, understand-

by the suggestion that he could never have made

given what Steve had achieved,

Likewise, he

was offended by

in busi-

would upset anyone,

ness without his fraternal connections. This especially

it

and on

his

own.

had some psychic

the notion that he

need to surpass his brother. But when

I

read Steve the parts about

change the rules of

their

how

childhood basketball games

he became more indignant than about anything voice again, nearly to a

he and

yell.

"That wasn't

Dan would

—Case Rules

else.

He

raised his

me and Dan,"

he said.

He was the one who changed the rules. Not me." They had a joke in their own house about Dan changing the rules, he said. Dan was the really competitive one. "I was more 'go "That was

just

Dan.

with the flow.'" Clearly, Steve said,

boyhood neighbors had

told me.

I

had misunderstood what

Or maybe

they were generalizing

about the Case brothers. But they must have to just

really

Dan, because Steve would never cheat.

in victory,

humble

in defeat" again.

reconfirm. Yes, they assured me,

it

I

called

his

He

been referring

said "Gracious

back the neighbors to

was both Cases.

224 STEVE CASE

When

The Upgrade

Dan about

talked to

I

was

laughed. Yes, he said, he Steve growling up.

He

couldn't recall exactly w^hat happened in the

"Who

my

to like

reporting,

him

I

spoke to

a great deal.

And

take himself too seriously. ing with a nosy reporter I

cares?" Long-

stuff, sheesh.

During

came

he

more competitive than

definitely

basketball games. Mostly, his reaction v^as,

ago kid

that Friday,

later

this

He

—

Dan Case

several times

and

v^as thoughtful, open, didn't

this vv^as

unusual for a

CEO

deal-

—he was empathetic.

had an odd personal experience with the Case family

as

I

On my way to visit them in Hawaii, I had to my wife, Meri, had complications with her preg-

reported this profile. turn back because

nancy. Everything turned out to be fine, but

and

had

I

to cancel

all

of

my

Hawaii. Later that week,

I

it

was

a scary

48 hours,

scheduled meetings with the Cases in

Dan

spoke to

twice,

and he always

how things were with my wife. His parents did, too, did Bushkin, who was my main point of contact at AOL. My sit-down with Steve was that week, too. He acknowl-

inquired about as

edged nothing. Not reporter

much

is

his style. That's

hardly a litmus

in character:

Dan

OK. Kindness

test. Still, it

was

every Sunday. Steve e-mailed

with

sister

demon

strange. But also very

the pleaser; Steve too focused for niceties.

Into his adulthood, Dan, ever dutiful,

in regularly

to a

home when

busy, so they don't

is

said. "I hate to

make him

feel like

called his parents

he could.

Carin and brother

radically. Steve

still

want

Dan checked

Jeff; Steve,

more spo-

to bother him, Carin

we're part of the whirlwind."

own best friend. "Steve is my best friend," Dan Case said repeatedly in the course of several conversations. He kept saying, convincingly, that he is thrilled by Steve's success. He joked that the notion of him Steve, she says, has always been his

overshadowing Steve help

is

wonder how Dan,

as the

Lower Case of

"not a problem anymore." Yet, the golden son,

the

New

felt

Economy.

about

I

couldn't

his adult status

STEVE CASE

now and

"Every

younger brother strange thing. didn't expect

When

Dan

me.

Jeff told

He it

then

The Upgrade 225

has to shake his head," their

"I think

he understands

this

is

a

Maybe

he

and Dan attended a White House reception

in

reahzes this

Steve's time to shine.

is

to last this long."

Steve

1999, people kept coming over and asking Steve to meet some dignitary or cabinet official.

was

Sidgmore

asked him person?"

if

was nonstop,

Dan would

there that night.

Finally,

It

recalls,

smile

says

patiently.

someone tapped Dan on the shoulder and

he could get Steve's attention.

Dan

John Sidgmore, who

and stand by

"He was

said to his brother.

But he seemed, for a

split

"What am

I,

your

PR

kidding," Sidgmore says.

second, exasperated.

CONVERGENCE AOL-Time Warner merger was

Early in 2001, shortly after the ratified, It

circles,

Dan Case was

was devastating news,

especially in high-tech

of

children, one of

Hambrecht

&

and banking

He was 43 years old and them an infant. He stepped down as

where Dan was quite well

had four

CEO

diagnosed with brain cancer.

liked.

Quist in

May—he

stayed on part-time

while receiving radiation treatment. His prognosis was not good.

Through much of 2001, Francisco to

spoke

little

visit

Dan and

about Dan's

Steve

made

regular trips to San

his family. Predictably, friends said he

illness.

He

concentrated on his corporate

ambassadorial and philanthropic duties, which he had, by

all

accounts, eased into comfortably.

He

attended a White House meeting on tax policy and a con-

gressional retreat at the Greenbriar resort.

Council of Americas.

He

leaders to reduce tariffs

German Deputy

He

addressed the

gave a speech urging Latin American

on high-tech products. He met with the

Minister.

He

ate

breakfast with the King of

226 STEVE CASE

He

Jordan.

The Upgrade

joined George

W. Bush

HBO film 61

screening of the

'''.

He

for a private

White House

pledged $7 million to Punahou

School, since rechristened Case Middle School.

He was no

longer an insurgent, he

was

He was

a leader.

a

missionary not for the Internet, but for the notion of "convergence," a single, seamless theater in which

phones, televisions,

cell

computers, personal digital assistants, and whatever

work

together. Internet access

else

and content would be delivered

over Time Warner Cable wires and wireless devices. The

would launch Warner

artists

new

a

would be

be available on

would

company Time

online service where music from accessible

on

AOL—just as movies would

demand from AOL's network

what AOL-Time Warner

called

its

of

Web of

destiny

sites.

This

is

"interlocking

dreams." Several sources at

so hard as he did

He was

prove.

AOL

say that Case

when he and

his

not working nearly

is

unknown

firm had so

much

to

involved in issues related to getting regulatory

approval of the merger, but since remained largely invisible inside the company, except behind podiums.

One

friend said that post-

merger. Case had been as disengaged as Kimsey years at

was

in his later

AOL.

Because he was chairman of the world's biggest media company. Case's speeches were closely watched. His most awaited

appearance occurred on

May

3,

2001.

He

addressed Hambrecht 6c

Quist's annual conference, an influential gathering of bankers

technology leaders at San Francisco's Westin It

Steve

became

a building curiosity

St.

among

would say anything poignant about

brother Dan. Several the event. This

members

was akin

and

Francis Hotel.

attendees whether

the event's host, his

of the Case family had

come

in for

ceremony of Dan

to the valedictory

Case's career. Steve, his hair noticeably grayer since the

stepped to the podium to a standing ovation.

Time Warner

It

deal,

could have gotten

STEVE CASE

The Upgrade 227

sentimental right there. Steve held up his hands. "Times a-tickin, clock's a-wastin,'" he said.

Steve thanked his brother for inviting him. ries

about

to Spain

their

when

and drinking

boyhood business

He

told a

few

sto-

ventures, about a trip they took

they were in their early 20s, staying in dingy hotels a lot of beer. Recently, Steve said, he visited the

Spanish president at the presidential palace president issued

them

a full

pardon

for

—and

any laws they might have

broken. There was some laughter from the crowd.

There was a pause.

Maybe

it

would

the Spanish

Dan

smiled.

get sentimental now. But then

Steve Case launched into his prepared remarks, about conver-

gence or something, and he was on to the next thing.

:^iiiiiSilffii:y.fi.&

"

0,ne of the problems with writing a is

that a terrifying qualifier

book about technology

looms over the whole process:

''Everything can change.

And

it

probably

times over.

will, several

already has changed, weeks ago, in

some

invention or late-night cubicle brainstorm: that

makes

everything

secret deal,

The

basement

flash of inspiration

Cisco's routers unnecessary; the court ruling that slices

Microsoft in

Amazon

Or maybe

half;

the hand-held shopping gadget that banishes

to yesterday; the surfing, biking, boating, or flying calamity

that kills Larry Ellison.

Yikes. In the

same way that engineers

live in fear

of their

inventions getting "obsoleted" (one of those Silicon Valley words),

nothing begs for irrelevance more than a plodding,

media" outlet

like a

book.

When

peak. People would speak of the

and permanent sibility that

it

fact of

modern

working on

for "selling out"

Time's

life,

"New Economy"

this proj-

its

as a

its

normal

with no allowance for the pos-

could, in fact, get old. Wall Street

Warner's tradition and

tech's

started

"old

February 2000, the Internet stock bubble was nearing

ect, in

AOL

I

static,

was punishing

sexy, Internet-only allure for

stability. Jeff

Bezos had

just

Time-

been named

Man of the Year. John Chambers was being called highbest CEO and Cisco was primed to become Wall Street's

most valuable company. Larry

Ellison

231

was saying

that Oracle's

232 EPILOGUE

was

vital-to-the-Internet software

in the process of "obsoleting"

Microsoft's PC-oriented software. Microsoft seemed battered,

vulnerable and adrift, confronted with a host of emboldened com-

and the exodus of key exec-

petitors, a bitter loss in federal court utives. Gates,

who had

just reliquished his

CEO's

seemed to

job,

be easing into a state of semi-retirement.

That was 18 months ago. Today, Microsoft unveiling of the

XP

much

a

powerhouse

operating system,

its

whose creation was supervised

years,

Man

in the

AOL

for control of your

World. The company

content offerings.

Time-Warner a

down

as

is

media

life

And few would

sellout today. Far

as the single best strategic

decision that protected

AOL

that's befallen Oracle, Cisco,

considerable luster since In other words,

most awaited product

in

closely by the still-Richest

locked in a Cold

—from desktop, to call Steve Case's

from

its

it,

move

War

with

set-top, to

move

to

buy

the acquisition could go

of this commercial era, a

from the bubble-bursting damage

Amazon

began

I

is

as ever with

—

of

all

whom

have

lost

this project.

from February 2000 to September 2001,

everything has changed.

Or has

it?

Nasdaq has

Yes, the

landed, the U.S.

economy

has, too,

and

the imperative of world domination has been replaced by the virtue

of at-home execution. (To say nothing of a nation suddenly preoc-

cupied with fighting a war.) But Gates, Case, Chambers, Bezos and Ellison

still all

preside over the franchise firms in a cultural

economic world that they have changed forever changed them

forever. Their stock prices

none of these companies sectors with

is

is

profits

that has

might

dip, but

close to losing their strangleholds

which they've become synonomous.

competitors have struggled

This

and

—and

not to say the

much worse than

New

Many

and

on the

of their

they have.

Imperialists don't

all

face

major

challenges and big questions. Gates' professional future remains

EPILOGUE 233 clouded by the still-uncertain resolution of the government's antitrust case. Ellison

is

dangerously alone at the top of Oracle, hav-

ing lost another generation of top executives (Executive Vice

President

company

Gary Bloom quit

—which

relies

few months

a

after

on companies paying

sophisticated software tools

—

is

Ray Lane large

did).

sums

His

for

its

vulnerable to the kinds of captial

spending slowdowns that have occurred in 2001; the same slump that's

hampered Cisco and which continues

Chambers so

uncharacteristically

lead in an extended

The

downturn? Those answers are unfolding,

biggest questions surround

only have closed. But

its

e-commerce

rival

much unknown. Amazon

its

has lost

too.

Amazon: on one hand, not

stumbled, most of them have

on the other hand, Amazon's

long enough to profit from

ters. Its

beleaguered.

make John Can Chambers to

ability to stay solvent

singular position remains very

money

for 17 consecutive quar-

cash reserves at the end of the second quarter of 2001

were $161 milHon, down from $251 million

in the first quarter.

Bezos became a relatively scarce figure in the summer of 2001, lowering his once sky-high profile in the media, even in the

Amazon

hallways, according to a

Will

Amazon "make

it?"

company

My guess

is

iwork of Bezos' brainiacs, then perhaps target for a large

media or

retail

source.

yes,

it's

from some

virtual iteration of

not by the hand-

as a logical acquisition

firm such as Bertelsmann or

(which made a $100 million investment, in Either way,

if

likely that in five years,

Amazon

people will

Amazon

still

— and, Bezos

AOL

in July).

be buying

will

still

be

laughing, somewhere, his place in the mythology of this weird

time assured. Again, that's just a guess, rendered with the standing caveat.

Everything can change.

What makes apart?

I

these

men

different?

have been asked variations on

What

qualities set

this repeatedly since

I

them began

234 EPILOGUE

this enterprise.

The connective

tissue questions. Surely,

I

have formed

some theory on why Gates, Case, EUison, Bezos and Chambers could succeed so stunningly while others could not, right? But while

it

was not

for lack of agonizing

always equivocal. Let's

on

they are

see:

very, lucky. Their identities, public

my part, my answers were

all

and

driven, smart

private, are tied

the fates of their enterprises, fates have teetered

and

very,

wholly to

on the

fine line

between hope and hubris that these men have straddled throughout their

lives.

They owned enough

self-confidence to believe they deserved to

be "anywhere," to put a computer on every desktop, to get big to

"empower"

the Internet generation.

or programmed, to

open spaces

in

jump

where they could forge

Somehow, they were wired,

as boldly as they did into

commercial

history. Digital space, a

industries

and

fast,

one of the great sprawling outlet

also identities.

Where Gates could go from lonely prodigy to the world's prodigy. Where Ellison could go from unbridled youth to unbriWhere John Chambers could re-focus his old corporate ladder to a new corporate fron-

dled multi-billionaire.

ambitions from the tier.

in

Where

Steve Case could

and make

his

own

rules.

hang around, endure, not be reined

Where

Jeff

Bezos could do something

memorable.

Where The

they could

all

New Imperialists

be in charge. are linked in history, united in a club of

wealth, power, influence and celebrity few of us will ever join,

alone identify with. But rather than impose too stories

and

selves,

I

wanted to

let their gifts

much

and

let

order on their

frailties to

stand as

discreetly as possible, as individual lives, five stories for these times.

We

can leave the

rest to history,

and the future to them.

America Online-Time Warner merger, 185-188, 190,

220-221, 225

About.Com, 214 Alberg, Tom, 87, 90

share exchange ratio, 220

Albright, Tim, 94

Ampex, 36

Alexander, Doug, 195

Anderson, Lorena, 122

Ali,

Andreessen, Marc, 147, 216

Muhammad, 26

Allen, Lizzie, 65,

Andrews, Paul, 154, 157

80

Annan, Kofi, 118

Allen, Paul, 13, 38, 146-147,

AOL.Com

158-159, 162-164, 167-169

Amazon, 4-5,

7,

Ardai, Charles, 64

216

Arlen, Benjamin,

collaborative filtering software,

Arlen, Gary, 209,

92 diversity issues at, of, 89,

216

Arnold, Amy, 215

debt offering, 60

Lehman

20, 90-91, 108,

125, 130, 147, 204, 206, 216

8-9, 186, 233

challenges to, 90-91, 94-96, 101

growth

212

(Swisher),

Apple Computer,

Allgor, Dr. Russell, 101

Atari games,

67

204

Aznar, Jose Maria, 118

93

analyst's report, 94,

97-98 as lifestyle brand,

B

99

100

profitability issue, 95,

Back, Karen Rutzky, 30-34

public offering, 92-93 staffing standards,

startup of,

Ballmer, Steve, 3, 50,

64-68

87-88

America Online, 4-5,

at 8,

Harvard, 160-162, 165

50, 91, 99, at Microsoft,

108, 147, 185,233

new

202

growth of company, 169-170

166-167

relationship with Gates,

imperialism

of,

9

Bankers Trust, 82-83

Pittman's leadership of, 215

Barksdale, James, 187

208-209 207-208

public offermg, startup of,

Barnes and Noble, 89-93

237

141-153

238 INDEX

Bosack, Leonard, 114, 127

205

Batterson, Len, Bell,

George, 146

Bostrom, Sue, 112-114

Bell,

Ray, 107, 111

Boys and Girls Clubs of America, 180

Benioff,

Marc, 15-16, 40-41

Bricks-and-mortar superstores, 92

Bertelsmann, 233

Buckalwe, Jim, 123, 135

Bezos, Christina, 69, 78-79

Burgess, John, 18

Bezos, Jackie Gise, 69, 71-75,

Bush, George, 117

Bush, George W., 109, 131, 226

79-80, 87, 92, 101

219 achievement of, 64-65 biological father of, 79-80

Bezos,Jeff, 5, 57,

childhood

of,

Bushkin, Kathy, 192, 222

C

69

on competition, 71, 76 corporate admission standards,

California Pizza Kitchen, 29

64-68 development of business plan,

Case, Carol, 193-194, 196

81-82

early career of,

early education of,

72-74

Everyman persona, 58-59 high school years, 74-75 personal philosophy at Princeton,

as

models

Carnegie, Andrew, 7

Case, Carin, 194, 224

58-59, 85-86

role

Cable TV, 200-201

of,

58-63

Case, Dan,

Case, Jean Villanueva, 211-212,

218-220 Case,

69-71

Time Person of the

Year, 4,

Jeff,

194-195,224

Case, Joanne Barker, 199, 205, 211 Case, Steve, 4-5, 91, 108, 147,

60-61, 93

185-186

value system of, 68 Bezos,

193-198, 201-205,

Case, Dan, Sn, 193-194, 196

78-79

for,

III,

223-226

MacKenzie

Tuttle, 61, 85, 87,

101 Bezos, Mark, 69, 78-79 Bezos, Miguel, 69-70, 73-75, 79-80,

at

AOL, 208-215 216

childhood and youth

of,

at

Bezos, Preston, 101

services,

206-208 217-218

Biden, Joseph, 180

Internet challenges,

Biggers, Kelsey, 82, 91

personal characteristics

Black, Lucy Alexander, 195-196 Blair,

Tony, 4, 110

Blasgen, Michael,

37-39

Bloom, Gary, 233 Boles, Naisha,

180

Bond, Steven, 195-197 BookStacks Unlimited, 86

192-195

Control Video, 203-205

growth of online

87, 101

i

business strategy of,

of,

221-225 at Procter

& Gamble, 201-202

public

and statesmanship

life

218-219 relationship with Kimsey,

208-211 at Williams,

198-201

of,

INDEX 239 41

Caterpillar,

Colony, George, 89

222

Caulfield, Frank, 186, 214,

Comaford, Christine, 145, 151-152

Commodore

Cerent, 115

Chambers, Elaine

Prater, 119,

123-124, 134-136

Compter

International Ltd.,

CompuServe, 207-208, 217

Chambers, Jack, 123-124, 136

Control Video Corp., 203-206

Chambers, John

Cook,

T.,

4-5, 107, 218

assimilation strategy of, 115

childhood and youth

108,

of,

122-123, 135

Scott,

Craft, Melanie, 19,

cue

124-125

202

Covey, Joy, 65

Cross, Bob,

dyslexia of, 122, 129 early career of,

206

Literacy Bookshops, 86

23

204

International, 188

Curry,

Bill,

97,

99-100

government relationships, 131 leadership style of, 111-113,

119-120, 129

D

on network revolution, 118-119 political

ambitions

sales genius of,

of,

131-133

108-109 128

strategic philosophy of, at

Wang

Labs, 125-127

Dalzell, Rick,

92-93

D'Amato, Alphonse, 131 Davidoff, Monte, 163-164

Davos World Economic Summit, 119

Chambers, June, 123

D.E. Shaw, 62, 64, 68, 83-85

Chandrasekaran, Rajiv, 18

Defense Department, 18

Christie, Chris,

124

Dell Computers, 7

Christy, Blaire,

133

Dell, Michael, 7

Cisco Systems, 4-5, 8-9, 107, 131,

146 acquisition strategy of,

boom-to-bust

114-115

107-108,

cycle,

134, 136

campus

of,

origin of,

Drebin, Julie, 68

of,

111

130

E

114

216

Clark, Jeff, 160

eBay, 91,

Clark, Jim, 147

Eger, Terry,

Clinton,

Bill,

161

Duquense Capital management, 98

136-138

competitive culture of,

217

Doerr, John, 98

Drill, Scott,

111-112

challenges of,

growth

Disk Operating System (DOS), 168 Disney, 91, 209,

110, 117

Clinton, Hillary

Rodham, 180

128

Ellison, Larry, 4-5, 13, 108, 111,

CNET, 83

charitable giving of,

CNN,

Chicago childhood

186

147

business approach, 15

24

of, 15,

Codd, Ted, 37

competitive strategy of, 40

Coleman, Dennis, 28-29, 32-33

cosmetic nose surgery, 34

25-26

240 INDEX

development of Oracle product,

39

Fisher, Larry,

programming work 36-37

early

fear of death, 24, first

First-phase automation, 83

marriage

of,

of,

Fitel,

120

81-83

math package, 163

Floating point

49

Forbes, 52, 113

33-36

high school experience

Ford, Henry, 7

of,

27-28

Francis, Nick, 110-111, 127,

132

interpersonal relationships of,

46-47 heritage,

27

and caprice

of,

and Jewish lateness

18-19,

41-42

G Galli, Joe,

learns of adoption,

29

media attention

14

of,

Gates (Manes and Andrews), 154,

157

physical attributes of, 17-18

Gates,

as Playboy's best-dressed, 31

relationships with employees,

42

29

software development consultancy of,

37-38

Woodside home complex

antitrust trial,

141-142, 170, 175

boyhood friendship with Evans, 156-158 charitable

work

of,

176-180 of,

145-146

foreign dignitaries and, 3-4,

of,

20-25, 49

148-149 founding of Microsoft, 163-164

Ellison, Lillian, 26, 30,

32

25-27, 29, 35-36,

48 Entrepreneurs, 7

Evans, Kent, 145, 147, 156-159,

169 Evans, Marvin, 159 Evans, Rev. Martin, 145 Excite,

13, 35, 38, 42, 52, 91,

childhood and youth

Sydney-to-Hobart race, 49-50

Ellison, Louis, 15,

Bill, 5,

108, 111, 117, 120, 147, 192

romantic relationships, 30-31 social hfe of,

94

186

at

Harvard, 160-162

Lake Washington home, 20 Lakeside Programmers Group,

158 personal characteristics

of,

143-144, 151-152, 161 public scrutiny as icon, 173-174,

179 reading and intellectual curiosity of,

154-156

relationship with Balmer,

149-150, 153, 167-168,

F

170-171 Fairchild

Camera and Instrument

Corp., 33

Gates Foundation, 176-177 Gates, Kristiane, 145

Feigin, Stuart, 18

Gates, Libby, 145

Feinstein, Dianne, 131

Gates, Mary, 145, 178

Fetko, Linda, 91

Gates, Melinda, 147, 159, 178

INDEX 241 Gates, William,

145

II,

Internet, 48,

85-86

General Electric, 108

online retailing, 86, 88

GEnie, 214

as second Industrial Revolution,

Getner, Errol, 25,

128

29-30, 46

switching equipment, 114

Gingrich, Newt, 131 Gise,

Lawrence Preston, 70, 76, 101

Intuit,

91

Glass, Jennifer, 21

Gore, Al, 132

Greenspan, Alan, 4 Grove, Andy,

7,

120, 218

Jackson, Judge

Gupta, Unang, 41-42, 48

Gutterman, Sheila Maydet, 27

Thomas

Penfield,

175, 178 Jenkins, Kent, 117, 121,

132-134

Jiang Zemin, 4, 18, 110 Jobs, Steve, 7, 20, 35, 48-49, 108,

120, 147,

H

Johnson, Paul,

Hambrecht & Quist, 203-204, 225-226 Hambrecht,

Bill,

Jorgensen, Ted, 79 Judy, Judy,

73-74

Juno Online

203

217

110

Services,

64

Hart, Gary, 192 Heel, Geoffrey, 81

Henley,

Jeff,

44, 48

K

Hewlett Packard, 33, 88 Hill,

Debby, 152

Karzes,

Tom,

62, 81

Hirsch, Harvey, 82

Kasper, Maureen, 133-134

Hodson, Keith, 18-19 Home Box Office, 201

Kennedy, Gary, 26, 41-42 Kimsey, Jim, 147, 205-211, 218, 223

Honeywell Corp., 162

How

the

Mind Works

Kleiner Perkins Caulfield and Byers,

(Pmker), 155

51,89

Humphrey, Hubert, 157

Knecht, G. Bruce, 50

Hundt, Reed, 108, 128

KoUin, Gary, 160-161, 164 Kurnit, Scott,

IBM, 37-39, 90-91, 108, 126, 128, 168,206 sales culture of, 124-125 Imbler, Steve,

43

Lakeside Programmers Group, 158 Lane, Ray, 14, 44, 48, 50-52, 233 Leblang, Jonathan, 66, 75

Immelt, Jeffrey, 202

Lehman

Insider trading, 98

Leonsis, Ted,

Intel, 7,

114, 116, 120, 146

214-215

Brothers

Inc., 94,

97

217

Lerman, Ken, 202-203, 218

242 INDEX

127

Lerner, Sandy, 114,

Levin, Gerald, 187, 189, 201,

219-221

Montana,

Joe, 17

Morgridge, John, 128, 132-133

Murray, Mark, 3-4, 149

Levinthal, Michael, 166

Lewyn, Mark, 212

Myhrvold, Nathan, 142, 152, 171, 173

Lieberman, Joe, 131

99

Lifestyle brands,

Linn, David, 27, 38, 46

N

Linn, Doris Ellison, 26-27, 30, 33,

Netscape, 89, 91, 147, 187, 216-217

45-46 Linn, Jimmy, 27, 32-33, 46

Linux operating system, 216 Listwin,

New New

Economy,

Nottingham, Inc.,

109, 116, 138,

5,

231

Don, 110-111, 127, 129,

132 Loudcloud

corporate imperialism, 5

Bill,

135

Novack, Ken, 185, 214, 220, 222

216

Luce, Henry, 186

Luongo, John, 43

Gates, Ed, 38-39

M

Omex, 38 Omidyar,

Pierre,

217

McDaniel, Carolyn, 76

O'Neal, Shaquille, 151

McDonald's, 9

Openwave Systems

McNealy,

Scott,

146

Maffei, Greg, 193

Oracle Corp., 4-5,

Manes, Stephen, 154, 157 Massimino, Andy, 74

company campus, 42 Ellison-Lane conflict, 50-52

Microsoft, 3, 5, 38-39, 50, 66, 91,

financial troubles of,

99, 108, 114, 116, 130-131,

initial

146

sales culture,

corporate loyalty, 151

163

Otto, Charlotte, 202

167

of,

9

Middlemas, George, 204, 210

P

Miner, Bob, 37-39, 147

Minor, Halsey, 83

Parks, Dr. Maury, 34

Modern

Peabody, Doug, 208

imperialism and imperialists,

5, 7-8,

234

I

48

40-41

Overstreet, Jenny, 17, 25, 42,

hiring practices of,

imperialism

43

public offering of, 39

Internet challenge,

antitrust trial, 141

new

49

as e-business suite,

Metcalfe, Bob, 146

of,

13-14, 19, 91,

8,

108, 114, 147

Matthews, Mich, 147

founding

Ill

Inc.,

Operation Pedro Pan, 69

Pearlstein, Steven,

143

44

INDEX 243 Salomon Smith Barney, 94

People, 8

155

Pinker, Steven,

Schroeder, Gerhard, 118

Pittman, Bob, 50, 215

Schumer, Charles, 180

Popular Electronics, 163

Scully,

John, 147, 204

Powell, Gen. Colin, 185, 192, 220

Sears,

Roebuck and Co., 206

Procter

& Gamble, 201-202, 217

Prodigy, 91, 206, 208,

214

Second-phase automation, 83 Securities

The Proving Ground (Knecht), 50

and Exchange Commission

(SEC), 98, 100, 131 Seriff,

Marc, 205-206

Shaw, David, 83, 85-86 Sidgmore, John, 115-116, 219, 225

Q

Silicon Valley, in 1960s,

Q-link,

206

Sill,

Quantum Computer

Services Inc.,

206-207

Igor,

33

42

Sisson, Larry, 198,

205

Smartpipes, 111

Quinn, Adda, 33-36, 45

Smith, Scott, 192

Spellman, Florence, 45-46

Spoon, Alan, 190

R

Sports Illustrated, 8

Raburn, Vern, 149

Ramos,

SQL

("Sequel") programming lan-

guage, 39 Fidel,

18

Rangel, Charles, 180

Stanford Business School, 165 Stanford University, 33, 114

Ray, Julie, 73

Razzouk,

Bill,

213, 215

Relational database, 37 Riggio, Len, 90, 92

Stonebreaker, Michael, 40 Stonesifer, Patty, 155,

Sun Microsystem, 91, 146 Sundheim, Duf, 110, 120

Riggio, Steve, 90, 92 Risher, David,

65-67

Roberts, Jon, 146

177

Suria, Ravi, 94,

97-98

Svoboda, John, 199,208 Swisher, Kara,

212

Robertson Stephens, 110 Rockefeller,

John D., 7

Rosenfield, Rick, 29, 46 Roskefeller, Jay,

123

Router device, 114 Russo, Carl, 115, 121, 130

Tavve

Inc.,

Taylor,

Ill

Mark, 198,200

The Third Wave

S Saffo, Paul, 93,

(Toffler),

200

3Com, 146 Time, 4, 8,60-61,93,201 96

Sagawa, Paul, 129 Salesforce.com, 15-16

Time-Warner, 185, 209, 219-220 -America Online merger,

185-188, 190, 220-221, 225

244 INDEX

Tjomsland,

Irv,

Toffler, Alvin,

38

200

Torvolds, Linus,

Toys

R

217

Us, 94-95

Wang, An, 125-127 Wang, Frederick, 125

Wang

Laboratories, 125-128, 137

Warner Brothers,

8,

186

Tucker, Gordon, 165

Washington Post Company, 189-190

Turner, Ted, 201, 221

Weiland, Ric, 158-159 Weiss, Chuck, 26, 32-33

Wellman,

U

Selby,

126

Werner, Ursula, 76-78

Wilingham, Deborah, 153 University of California at Berkeley,

33

Wilson, Gretchen, 68

WordsWorth, 86

WorldCom, 115-116,219 Wozniak,

Steve,

147

Wright, Fred, 158 Vajpayee, Atal Bihari, 118

Von

Meister,

Bill,

203-204

Y Yahoo, 186

Wal-Mart Stores, 92 Walsh, Mark, 188,214

CBA

2

nfl2 DDTDD 31b7

^^t^

OBa

15

2002

GATES

about his boyhood best friend,

talks

whose death

in

—

haunted him

a fluke accident at age 15 has

and perhaps driven him

—

ever

since.

ELLISON

reflects

on hii^father's recurring

scorn that he just wasn't good enough to ever succeed.

BEZOS

talks

about never knowing his natural

father.

CHAMBERS reveals how a childhood learning disabililty

CASE

hampered

his early schooling.

addresses the tensions

relationship with his

AOL

\h