1. Software products would be compressed just once but decompressed millions of times.
2. It should be possible to create an asymmetric codec that expended tremendous resources on compression but still kept decompression light.
3. Publishers didn't care how much compute compression would require as long as it was still tractable and would save them money. If they had to buy an expensive computer and let it run overnight it would be fine.
I didn't know anything about compression at the time but the premise seemed strong. I took unpaid time off to tackle this problem and in a few months (after a lot of trial-and-error learning) I began to have a workable product.
Borland, Novell, and Microsoft (for the .CAB files) were the first licensees. The compressor was called Quantum and was typically 20-30% better than PkZip. My sales technique was to take a product, recompress it with Quantum, and show the company how much money they could save. (As I recall, I was able to demonstrate reducing Windows for Workgroups by two disks.)