Story goes that when the R&D team lead by Bob Noyce left Fairchild in 1966, it took them 5 days to raise capital to start Intel. The next team leaving in 1967, was the manufacturing team lead by Charlie Sporck. It took them 5 weeks to raise Capital to form National Semiconductor. The third team to leave was Sales and Marketing team lead by Jerry Sanders. It took them 5 months to get capital to start AMD.
All three companies were successful. Intel was engineering driven and excelled in Innovations. It invented DRAM, microprocessors, EPROM and Flash memory chips. National went to become most
efficient manufacturer of chips while AMD was the flashiest marketer.
Intel was forced to have a second source by market for its X86
chips. AMD was anointed. It was much later when AMD acquired NexGen that it had its own microprocessor technology.
For most part Intel went from strength to strength and its stock soared. AMD and National were always “also rans”. So this headline was like a bolt from the blue. Intel strayed from its true path and fell behind in technology. It missed the mobile wave, GPU wave as it lived high on the hog, from fat margins from its microprocessor monopoly.
Intel is trying to get back to its engineering roots. It has an engineer at helm now. IT is shedding its NIH (Not Invented Here syndrome) mindset and using third party technology. It is investing in technology rather than marketing.
Hopefully, Intel, like phoenix will rise again.
Story of Intel is a cautionary tale. You can’t sit on your laurels no matter how large or profitable you are. Ground can shift under you any time. It was the bluest of the blue chips in the valley and had one of the strongest CEO to lead it for a long time. Andy Grove was famous for his quip that only the paranoids survive. For a long time he had a newspaper advice column a la “Dear Abbey”, where he dispensed management advice to all comers. He clearly did not prepare the company for the long haul as it has floundered ever since he left the helm. It had become very insular and developed a strong NIH (not invented here) syndrome. It also lost track of what its core competency was. Was it the chip design or chip manufacturing? It got fat dumb and happy during its monopoly days and missed the whole shift to mobile computing. Its Manufacturing Fabs got lazy as they had assured in-house business and did not have to compete with scrappy players out of Taiwan and China.
Hopefully, Intel will find its Satya Nadella who will steer the ship back from shoals in to deep blue waters.
Poshmark has filed to go public and is probably going to be a public company in near future. A great achiement for any entrepreneur to build a sturdy enough company to withstand the vissitudes of the public markets.
But to many an IPO is an end of a jorney, while in reality it is just a financing event and start of a new phase. Churchillian phraseology is appropriate here: it is not the end of the game, it is not even a beginning of the end but it is merely an end of the beginning.
Many companies stumble after an IPO as many early employees, having gotten rich, suddenly lose motivation to work long hours. They get focused on stock market and stock price. Long suppressed dreams come to surface. Luxury cars and European vacations are to be had. Oh so many distractions, things at office can wait. Newer employees feel left out and jealous of newly rich colleagues.
It is imperative that the entrpreneur does not let an IPO destablize the company. He/she needs to articulate the next goal in very clear and forceful terms. It has to be a goal that is worthy of going for. It can not be financial only goal: going from zero to ten million dollars in wealth is life changing but going from 10 to 50 is not that impactful. Valley is full of stories where the entrepreneurs themselves get destabilized and lose focus and zest. Entrepreneurs also need to take a hard look at their team and see if it needs upgrading; or if it needs supplementing.
It is a rare to have Jeff Bezos, Bill Gates ot Matk Zuckerbergs, who take things in stride and keep growing with out a hitch, at the helm. I have been part of the companies which declined very rapidly after an IPO. Exodus and Cybermedia come to mind. Eagle Computer IPO in 1985 was an extreme case, where CEO after a bit of celebration after the listing went and bought a yatcht and Ferrari. He drove that Ferrari in to Vasona Lake and died. IPO had to pulled back and company went belly-up several months later.
Companies and entrepreneurs are entitled to celebrate for a day or two but need to get back to salt pits quicly.
Indian middle-class ethos are pretty clear. There are constant exhortations: Beta Doctor Bano ( Son become a doctor); Beta engineer Bano (son become an engineer). No parent ever says “Beta entrepreneur Bano”. There is further advice to settle down, find a good job, time to get married, become responsible. Not to forget the advice to have discipline, meaning do what is expected of you. A job with a MNC and a marriage with a family picked girl are seen as smart things to do.
The problem is that these are things that steer you away from listening to your heart and do your own thing; like becoming an entrepreneur. Becoming an entrepreneur goes against every thing that is expected of you.
Further, it is a very lonely and hard journey if you chose to go down that path. You should not expect and will not get any sympathy anybody. People will laugh at you for being foolish. So why do people become entrepreneurs anyway? Because they have to prove something, to themselves. You have to sustain that fire from inside. Nobody from outside should encourage you to put yourself through the hardship. Desire to make money is not enough to sustain it, as it will be a while before you get back to make a market salary.
It is for sure not for everybody.