“Bear with me,” Mitchell said. “I’ve got to update my notes.” He began to rifle through his pockets, pulling out small pieces of paper. Some were yellow stickies, some were pages ripped from a spiral-bound pocket notebook; there was even the stray napkin or gum wrapper. Mitchell was a prolific note taker, jotting down every interesting idea and reference within earshot. You never knew when he was going to strike out and appropriate the nearest writing implement and fragment of paper. On one particularly frantic occasion, I saw him tear the corner off a page of the New York Times and write in the L-shaped margin.
Making sense of this motley collection of ideas, phone numbers, and reminders was Mitchell’s passion. That’s why he was so committed to Lotus Agenda—he desperately needed the product himself. He powered up the Compaq 286 and waited while the machine went through its lengthy startup process.
Mitchell rolled his eyes, whistled, and tapped his foot in exaggerated impatience. With Agenda finally up and running, he began typing in his accumulated scraps of notes with the efficiency of an executive secretary.
“You know, this is really the pits,” he said. “It doubles the time it takes for me to keep organized. I wish there was some way for me to get all this stuff directly into the computer and skip the paper.”
That sounded like a challenge to me.
“Look, Mitchell, it seems that the real question is how small and light you can make a portable computer.”
“Well, what are the largest components?”
I thought for a second. “The disk drives are one problem. They probably weigh about two pounds each. Next is the power supply, the battery. Another few pounds. The display isn’t really that much, but the two layers of glass are pretty heavy. Next is the keyboard, I guess. It doesn’t weigh a lot, but it’s pretty big.”
“Yeah, and you can’t shrink it much and still be able to type normally,” Mitchell added. “Below a certain size, you’d have to poke at it with a finger rather than really type. That’s why the pocket organizers stink. They’re really just overgrown calculators that you can stick a few names and phone numbers in.” He was referring to gadgets like the Sharp Wizard that let you store a small amount of information in addition to doing arithmetic. These products were purchased on impulse and, inevitably, soon abandoned in a drawer until the batteries leaked.
“Other than the keyboard, though, it ought to be possible to build something pretty cool, sort of flat like a book,” I said. “You could have a flat display with all the electronics on a single board just behind it, and maybe a flat battery, like a sandwich. Instead of disks, you could use SRAM for the data.” SRAM stands for static random access memory. It is like normal computer memory but requires much less power to keep the memory “alive,” and so places only a modest demand on a battery to retain its contents while the computer is turned off.
“The interesting thing is, in principle you wouldn’t need to load and save files. You could just leave the programs running and the files loaded all the time.” Mitchell was getting into it now. In fact, we were both cooking. This was the fun part of the business, imagining possibilities. With technical breakthroughs announced every week—smaller disks that stored more data, faster microprocessors, denser memory chips—anyone could combine these parts and build a new product or create a new market. “But the problem is still the keyboard,” he said.
“Not only that, it’s not always practical to type when you want to take a note.” I waved my hands in the air as though typing on an imaginary keyboard. “You have to set the computer down somewhere to free up your hands.”
Mitchell picked up on my thought. “Even in meetings it’s a problem. Only propeller heads use laptops in meetings, and it’s always distracting.”
We continued exploring this line of discussion for some time until the pilot stuck his head into the cabin, bearing a plastic tray of half sandwiches, some cut-up vegetables, and a container of dip. “Waddaya want to drink?” he asked.
Mitchell and I looked at each other, realizing that we weren’t going to get the usual choice of beef, chicken, or “today’s light fare.” After pulling off the plastic wrap, we picked our way through the soggy assortment of mystery meats, topping off the meal with a delightful medley of miniature candy bars.
After lunch I settled in for a brief nap, tired out by Mitchell’s intensity and the carbohydrates. Besides, I got my best ideas in my sleep.
Mitchell Kapor had wandered into the computer business along with lots of other underemployed but energetic young men at the time. The difference was that he had struck gold, while most others were still panning dirt from barren streams.
In the late sixties, times were tough for college kids with a social conscience—the deaths of Bobby Kennedy and Martin Luther King, the My Lai massacre—which lured Mitchell away from starting down the Wall Street fast track and toward a life of manning protest barricades and experimenting with psychedelics. Like many, he eventually concluded that writing software for personal computers seemed a promising path. He learned the BASIC programming language and ultimately landed a contract to develop a business graphics package for Personal Software Corporation, later known as VisiCorp, which produced the hugely successful Visicalc spreadsheet program.
His product, Visiplot/Visitrend, read data from the files saved in Visicalc and displayed the numbers visually on graphs and charts. While this was a handy thing to do, it was awkward to save a file, exit one program, start up another, and load the file again just to get a look at a graph. So Mitchell conceived of a new and better product that integrated these functions. As required by his contract, he offered the idea first to Personal Software. The company passed.
By the fall of 1981, a special breed of investor was scouring the Silicon Valley like a big league scout, searching for young entrepreneurs with promising ideas. These venture capitalists—usually called VCs—were known to put a million dollars on the table overnight for the right opportunity. It was a modern California gold rush.
This overheated climate created a feeding frenzy around personal computers and software. Mitchell approached Ben Rosen, a former Wall Street analyst, and L. J. Sevin, a colorful Texan, with his idea. This unlikely pair had formed a partnership to grab a piece of the action, which they did with a vengeance. Rosen had used some of Mitchell’s software, and liked it. They cut him a check and went on to their next deal. Mitchell named his new company Lotus Development Corporation because of its countercultural, oxymoronic tone, like the name Apple Computer.
Lotus was in a race with several more established competitors, and he knew it. Most industry people thought Lotus was crazy to try to unseat Visicalc, which dominated the market at that time. But Mitchell intuitively understood something that only the Japanese taught in school: in a fast-growing market, what matters is your share of new machines, not existing ones, because new machines quickly come to dominate the market. When IBM announced that it would be bringing out its own version of the personal computer, to be called the IBM PC, Mitchell directed his programmers to tailor their program to this machine.
In 1982 a crop of new and improved spreadsheet products were slated to debut at COMDEX, the computer dealers’ exposition held every November in Las Vegas. The Lotus team scrambled to ready their product, which they named 1–2–3. Mitchell decided that to beat the competition, Lotus had to come out of the starting gate with a bang, so he committed the unheard-of sum of $1 million to marketing and promotion. Mitchell knew it would all be over by Christmas, one way or the other—they would ride the IBM PC into orbit or be marooned in the Las Vegas sand.
As the last dusty moving vans carted away the exhibit booths from the Las Vegas Convention Center, it was clear that Lotus 1–2–3 was a major winner. Lotus’s heavy promotion had created a larger-than-life impression, and more important, one that dwarfed its competitors.
Rosen and Sevin knew they had hit the jackpot, and soon trotted the fatted calf off to Wall Street for sale in an initial public offering. With
the IPO, Lotus became the darling of investors and an instant emblem of the success of the American capitalist system. Mitchell Kapor, still a compassionate and philosophical proponent of the counterculture, found himself invited to meet the governor of Massachusetts and was profiled in the New York Times. It was as though the megaphones had abruptly gone silent and someone had politely explained to him that it was all some terrible mistake—would he please come across the police line and tell the nice officials what he thought they ought to do. To top things off, he was now rich.
Half an hour later, I woke up with the strange feeling that I had just forgotten something important. I turned to Mitchell, who was still clicking away on his Compaq 286, and stared at him.
“You OK?” he asked.
I was quiet for a moment, trying to get my bearings. Suddenly I knew what was bothering me. “Mitchell, suppose you used a pen instead of a keyboard.”
“What do you mean?”
“Suppose that instead of typing in text, you write with some sort of stylus directly on the screen. If it was possible to sense where the tip of the pen was, electronic ink could appear on the screen right under it, and it would look like you were drawing a line, or writing. The trick is to turn the handwriting into regular text or numbers. I’m sure there are algorithms that do this.”
“What about the function keys?” Mitchell was referring to the non-alphabetic keys on a keyboard that allow you to issue commands like paging up or down, saving or loading a file, deleting a word, and so on.
“I don’t know. I guess you could figure out some way to do that stuff with the pen too—like tapping on icons or menus. The point is to eliminate the keyboard.”
“A device like that would be more like a notebook or pad of paper than a laptop,” Mitchell observed. “In fact, the thing would be so different, you’d need a whole new approach to software.”
We both sat in stunned silence as this insight sunk in. People had certainly thought about pens and computers before. We had both seen electronic tablets attached to desktop machines, which were mainly used by drafters and artists. But these tablets had always been just another type of input device, an accessory to the keyboard and the mouse. This idea was different. We had put it all together, combining simple, familiar elements into something radically new. We recognized that an electronic pen, without a keyboard, could create a completely different device.
Almost like clockwork, every ten years since the beginning of the computer revolution, a new class of computers had unexpectedly emerged.
In the 1960s, the popular image of a computer was a room full of mysterious, monolithic boxes the size of refrigerators, with spinning tapes and banks of flashing lights. These remote, intimidating mainframes were housed in special rooms with raised floors, filtered air, and glass walls which looked like an intensive care unit for electronics. With the advent of the minicomputer in the 1970s, the popular conception of a computer began to shift. These were smaller boxes that could be hidden in a closet or storeroom and connected to terminals sitting on the desks of engineers, bank tellers, and travel agents. In the 1980s, the personal computer took its place as the dominant form of computing. Now a computer was an individual productivity tool, consisting of a video screen sitting atop a rectangular box with a slot for floppy disks.
This historical progression was not just about the physical look of the machines. With each wave of devices came whole communities of customers, operating systems, applications software, and companies. Subsequent generations didn’t supplant the previous ones; they empowered different people by solving different problems. Like some profound new form of energy, the underlying constant—computing power—had no shape or substance. Each type of computer simply delivered this power in a different way.
Until that moment on Mitchell’s jet, it had been difficult to imagine what the next generation of computers might be like. There was an obvious trend toward faster, smaller machines, but it was hard to see how the basic character of the computer would change. Entrepreneurs had made so much money from the personal computer industry that many believed the computer revolution had achieved a kind of final, perfect form. It seemed that the personal computer was right for all people—they just didn’t know it yet. It was only a matter of time before everyone, from the CEO to the youngest schoolchild, would use one.
Mitchell and I had stumbled upon a plain truth: personal computers are deskbound, like typewriters, and are unsuitable for people who spend their time away from a desk or work face to face with others. There are segments of the population that fit this profile—salespeople, inspectors, consultants, and delivery people, to name a few. They certainly have access to computers back in their offices, but this isn’t where they really do their business. Moreover, the problem isn’t just taking a computer with you, it’s how you use it in the course of your work. In meetings with colleagues and clients, mobile professionals use pen and paper—notebooks, folders, and calendars—because these don’t interfere with the interpersonal communication so critical to their jobs. Still others—the clipboard crowd—need to write while they are standing up or walking around.
Mitchell and I both instantly understood that the key to the next wave of computing was to create a device that worked like a notebook instead of a typewriter. The impact of this insight, so obvious and yet so novel, overwhelmed us. We shared a sense of seeing something utterly new and important, like the adventurers who had first encountered the Rocky Mountains, now five miles beneath our feet.
This unique emotion—the modern scientific version of religious epiphany—is startling in its raw power and purity. I had experienced it previously only once or twice in my life, always at an unexpected moment after months of struggling with an impossible problem. It is reserved for those rare occasions when you, and you alone, know something that no one else knows. The poet Edna St. Vincent Millay wrote that “Euclid alone has looked on beauty bare.” And now Mitchell and I knew exactly what she meant.
We were momentarily unable to speak. I saw Mitchell’s eyes become glazed and teary.
As we started our descent into San Francisco, we regained our composure and began fleshing out the details of the concept. The tone had abruptly shifted from an intellectual exploration to something very personal. We knew we had to pursue this. “You do realize what this means.” Mitchell’s voice tightened as he spoke. “A whole new operating system, a whole new model of how the user will work with the system.”
“Hell yes,” I said. “There’s a lot of far-out research to be done. The first thing is to answer some basic questions, like what resolution is required to display writing legibly on a computer screen, and whether it’s possible to write directly onto the surface of a flat display.”
“Then, of course, it all hinges on how good the handwriting-recognition software is.” We both said something like this simultaneously, and laughed as though we had bumped shoulders trying to walk through a door at the same time.
“Hey, look,” Mitchell said, “I’m having lunch with this great guy at Apple, Steve Sakoman, who’s sick of the place and wants to leave. He’s in charge of hardware engineering for the Macintosh, but he wants to do something more exciting with portable computers and he isn’t getting any management support. I’ll talk to him about this and see if he thinks it’s feasible.”
“Since this most likely involves a new operating system, maybe Gates would be interested.” I was referring to Bill Gates, the techie founder and chairman of Microsoft, at that time the second-largest PC software company after Lotus. Mitchell stared at me with a dark intensity.
“You don’t understand. The PC business is war.” He spoke as if announcing this to a crowd. “Either you fight or you’re a casualty. You have to look the enemy in the eye and never, ever blink.”
I wasn’t sure why Sakoman at Apple was an ally and Gates at Microsoft was an enemy. But clearly that’s what Mitchell meant.
As the plane taxied to the private aviation terminal at San Francisco
Airport, Mitchell and I packed up our gear, ready for a quick getaway. His rental car was prepped and waiting next to the plane as we rolled to a stop. A man in a Hertz shirt snapped to attention, ready to collect Mitchell’s signature and hand him the keys. For the big brass, the rental companies don’t mess around.
The gangway sprung open with such force it rocked the plane. “I’ll call you tonight,” Mitchell said, and took off south to Cupertino like a guided missile. As I hiked to the parking lot to pick up my car, I could tell I wasn’t going to get much sleep that night. Or, for that matter, for the next few years.
Within a couple of weeks we had become thoroughly enchanted with the idea of a pen computer. Over the previous few years Mitchell had grown bored at Lotus, where he was increasingly called upon to play a ceremonial role, presiding at product announcements and board meetings. As he shed his operating responsibilities, in part to work on Agenda, he joked that he was becoming a rabbi—reduced to reciting blessings on special occasions. The Agenda project had rekindled in him the unique feeling of working with a small, close-knit team of engineers, reminding him of the early Lotus days. But Agenda was just a taste, and he wanted more. Perhaps the idea of a pen computer was a way to get it—if he could build the right kind of spirit.
After several preparatory one-on-one meetings, he called together his hand-picked team of collaborators for the new project. In addition to Mitchell and myself, it included Peter Miller, a brilliant and erudite software project manager from Lotus, and Steve Sakoman, the restrained and thoughtful hardware engineer whom he had visited at Apple Computer in Cupertino. We met in a suite at the Kendall Square Marriott in Cambridge. Outside, the last piles of salty winter slush were fading in the fresh spring air.
Startup: A Silicon Valley Adventure Page 2