What We Didn’t Know When We Did the “Big Pitch”

[20 Years Ago, Part 11. Other options: prior post or start at the beginning.]

This post is kind of a footnote to the story of “The Big Pitch to TJ and the Exec Team“. It’s the revelation of two key pieces of information that Ciemo and I did not know at the time, but that were very helpful in setting the stage for our pitch.

The first piece of information was something that I would learn minutes after the pitch, and it was something that everyone in the room (but us) knew.

The second was something I wouldn’t learn until years later, and it was information known to only one person in the room.  (And that person was the company’s President and COO, Tom “TJ” Jermoluk.)

The First Piece of Information

Victorious in our Big Pitch, Ciemo and I exited the Board Room and returned to the waiting area, not because we had anything to wait for, but just to take a few minutes to let it all soak in. We had landed $2.5 million, but to keep our end of the bargain, we would have to create and launch a whole new product line in less than 76 days. And we’d have to do it in a period of time that would include Thanksgiving, Christmas, and New Year’s!

As we stood in the waiting area, various execs came up and offered their congratulations, encouragement, and compliments on the presentation. Tom Furlong, our division’s GM, came up with a big smile on his face. “Nice job,” he said. “By the way, you have no idea how good your timing was.”

“Thanks,” I replied. “What do you mean?”

“The call with the country managers could not have set you up better,” he said. “The main topic of conversation was the Web. Multiple countries reported issues of losing account control, with Sun servers starting to penetrate some of our most strategic SGI-only accounts, driven by a desire for an Internet server. The big question everyone was asking TJ was ‘What are we going to do about this Web thing?'”

The Second Piece of Information

It wasn’t until almost three years later, in a lengthy and depressing BusinessWeek cover story entitled “The Sad Saga of Silicon Graphics,” that I would learn the other key piece of information we didn’t know. As it turns out, TJ was more than a little bit familiar with what we were pitching him; in fact, just a few months earlier, Jim Clark had been wooing him to take on the CEO role at Netscape!

Tom Jermoluk, President and COO

And that means he would have had quite a bit of knowledge about the Web’s rapid growth, its potential as a server market, and the degree to which the company at the center of the action was leveraging SGI boxes for development and serving.

Here’s what Rob Hof wrote (in August 1997) of the incident and the reaction of our then-CEO, Ed McCracken:

The Internet’s singular potential should have been more obvious to Jermoluk than to anyone. In late summer, 1994, Clark had offered him the CEO spot at Netscape. But McCracken didn’t want to lose Jermoluk, least of all to Clark. So to keep him, SGI offered the young president a new compensation package valued at $10 million-plus over four years. He stayed1.

In Silicon Valley, more than any other place, it is often said that “timing is everything”. And certainly it is now clear that our timing could not have been better for that historic pitch.

Speaking of timing; did I mention that we now had 76 or fewer days until launch?

To be continued


1But he would not stay the full four years. In fact, he would resign in less than 18 months to become the Chairman, CEO, and President of @Home.

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4 thoughts on “What We Didn’t Know When We Did the “Big Pitch”

  1. AH says:

    Thanks for a great footnote to an already great story.

    I’m hoping to get your perspective on why SGI was unable to drive as much revenue traction during the .com boom, as Sun did. IRIX had an unrivalled, top-end filesystem at the time, there was a web server line, investment in VRML and similar initiatives in play. Heck, Marc Andreessen even wrote Mozilla on an Indigo! Yet, SGI didn’t become a “web” company.

    There’s a bit of a connection here with NeXT in that despite the fact that the first webserver was implemented on a NeXT cube, that company didn’t seem able to capitalize on this rapidly growing application category or create messaging around being the optimal platform for web authoring and delivery.

    Sun’s eventual fate ended up being sad – though considerably less so than SGI’s – but at least during the .com boom, they made much hay selling web gear. Why didn’t SGI?

    • therealmccrea says:

      AH,

      Thanks for the positive feedback. It is my hope to answer your questions as my #20YearsAgo series takes us through the end of ’94 and the big events of ’95.

      Stay tuned!

      John

  2. Ben Hamilton says:

    I’ve really enjoyed these stories. Please don’t forget to link this entry to the most recent one (the “To be continued” link should be https://therealmccrea.com/2014/12/26/webmagic-the-untold-and-rather-improbable-story-behind-the-first-wysiwyg-html-editor/ ).

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