Comment by adventureful | Hacker News Reader

Comment by adventureful | Hacker News Reader

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I remember CommerceOne being worth $20 billion, and having a gazillion dollar burn rate (they lost $3.7 billion over 10 years from 1994 to 2004). There was a famous story at the time that the CEO wouldn't take Bill Gates' call because CommerceOne was the future and Microsoft was the past.

Internet Capital Group was another similarly insane story, once worth $60 billion.

VA Linux IPO'd at a valuation of $7 billion if I recall, and had a roughly 700% pop on its IPO price.

Nortel and Lucent were worth $200 some odd billion, around the time Cisco punched up to $600 billion. And those are in 12 year old dollar terms; Cisco's valuation would be $900+ billion in today's dollar.

Infoseek was once worth $27 billion.

There was a great story in The Industry Standard or Wired about CritalPath, a messaging startup that planned to solve the holy grail of messaging. It intro'd with their team laughing about how a few pennies spent on a postcard had secured hundreds of thousands in new business, and that their biggest problem was dying of indigestion from growing too fast. Chuckles all around apparently. The company was worth $4 or $5 billion at the peak, and ended up bleeding out.

Masayoshi Son claimed that Softbank would end up owning something like 1/3 of the entire Internet eventually. He said he was building a thousand year empire. Softbank of course owned something like 25% of Yahoo when it was worth $100 billion, Softbank supposedly owned 15% or some odd chunk of all Web traffic, and Masayoshi was worth $70+ billion, just behind Gates.

Broadcast.com was purchased for $5.7 billion at a time when it had a mere $22 million in sales or so (and matching losses).

Yahoo paid $3.6 billion for Geocities. In that quarter, Geocities lost $8.4 million on sales of $7.5 million.

Viant, Scient, Razorfish, MarchFirst - billion dollar web development shops and consultants.

There are so many stories to choose from. Pud chronicled it well with Fucked Company.

>> CEO wouldn't take Bill Gates' call because CommerceOne was the future and Microsoft was the past.

Were you referring to CommerceOne CEO?

Out of curiosity, how was AAPL doing those days? Was Jobs taken seriously by Silicon Valley during those days?

Jobs had just returned to AAPL and was cleaning up the mess left by Sculley and Amelio

And no he wasn't taken seriously at all, he was still remembered as the guy who created the abysmal AppleIII, botched the Mac and then got fired from his own company.

In fact no VCs invested in his second company NeXT, only himself, Ross Perot and Canon did. That company had to leave hardware altogether and was bought by AAPL because they desperately needed a new OS, so ObjectiveC and NeXTSTEP became the founding blocks of OSX and later iOS.

Back then Jobs only recent success had been Pixar's Toy Story.

I disagree. There's a difference between valuing NeXT as a business and valuing Steve Jobs as a visionary or creative genius. Investors didn't believe in the business prospects of NeXT, but Jobs was still very highly regarded by the valley.

NeXT wasn't a terrible business and it had many of the same ideas that AAPL uses today, like top-of-the-line industrial design.

Do you even realize there were 5 years between Jobs arrival at AAPL and the iPod right? 3+ years if we count the time it took the iPod to become a true sensation. Add to that 11 years since he had been kicked out from AAPL.

You seem to believe that Jobs was always in the limelight, when the truth is there was a time nobody believed in him, and thus nobody would invest in his new company not so much because of the business model but because he was in charge.

NeXT actually sold for almost $500 million, hardly a complete failure, and yet when he was back at AAPL nobody believed it would make a difference.

He was booed on stage while announcing the deal with Microsoft, how is that being "highly regarded"?

Also consider that when Sculley fired Jobs AAPL stock went up dramatically, not down.

He was booed possibly more out of fanboy-ism than anything else. Remember, at the time, the "Mac Community" was tiny, tightly knit, and viewed Microsoft and Bill Gates as Satan personified. Hell, there was even a mailing list called the Evangelist.

NeXT was a terrible business, it never turned a profit, and bled money endlessly. The products were often good, but they were extremely expensive and were never quite matched properly to a market. NeXT was such a terrible business, Jobs was nearly at a point of having to shut it down when Apple purchased it because it couldn't stand on its own as a hardware company any longer.

The reason VC never touched NeXT was the hyper valuation Jobs placed on it from day one. Before it had any products or any sales, he slapped a $100+ million valuation on it, which was a lot of money back in 1986, and a huge valuation for any VC to touch without any sales or product.

It would have been trivially easy for Jobs to get VC money at a sane valuation.

And yes, I realize there were five years between the iPod and Jobs arrival. So what? The point was the iPod is what revived Apple and set it on a huge upswing (which is also why the stock didn't move until 2003 as the iPod sales rolled in). The work that was done on the iMac got Apple back to stable ground as a business, the iPod sent it on a skyrocketing trajectory.

The valley absolutely believed in Jobs. He was a big reason the NeXT products were often good, and the valley saw that. The fact that the valley believed in him is why he was able to sell NeXT to Apple for so much money in the first place, and why he was able to take the helm at Apple again in the second place.

Do you realize how absurd and contradictory you are being right now? NeXT was an actual company and didn't get any funding while complete hacks like the one in the article got millions and didn't even have a product.

A NeXT was used by TimBL to create the Web! Carmack used one to code DOOM, do you even understand how prestigious this is?

And don't talk about NeXT as if Jobs was just an employee, it was HIS company, he started it practically alone with money off his own pocket.

100 millions=insane? AAPL was a 4 billion company, and NeXT was full of former AAPL employees, how is 100 million insane?

Right now you have startups with no strategy getting more funding and higher valuations than NeXT because the founder is from Facebook or Google.

Again, when Jobs was fired he had already lost all momentum, where have you seen a public company whose shares go up after firing a founder? That's how bad Jobs' image in the Valley was.

Jobs was absolutely taken seriously by Silicon Valley at that time. There was a period, from when he left Apple, through the NeXT days, that Silicon Valley seemed to understand that he had begun to grow up / mature as a leader. When he first left Apple he was a creative pariah, and many of his peers thought he was a dangerous leader; by the time he joined Apple again, that view had faded almost completely. There were big questions over what could actually be done to turn Apple around, few saw the iPod coming, but most people seemed to understand that Jobs could bring a spark back to Apple that had been missing for a long long time.

I don't think Wall Street believed in Apple much, or that Jobs could turn it around - Wall Street didn't see what he did of course. You can see that in the stock valuation that Apple received during the bubble days, it didn't pop even a fraction as much as other stocks like Sun or Oracle (Sun was worth $150+ billion or so, and Apple around $30 billion; granted Sun was riding a direct wave benefit with their hardware that had sent their revenue parabolic).

I beg to differ.

At that time Apple was selling the iMac, remember this was years before the original iPod.

The running joke amongst VCs that were funding companies like Google, VMWare, and Salesforce.com was that Apple was "selling colored plastic"

My recollection of Apple leading up to and immediately following the introduction of the iMac and OS X, was that everyone in the press was beating the drum of impending doom. I recall a coworker telling me that her financial adviser had recommended she buy Apple, and I thought she was nuts. Not that I had a shred of wisdom at the time, but I'm pretty sure a good portion of the public would have sided with me (hence the extremely low share prices).

>> Nortel and Lucent were worth $200 some odd billion, around the time Cisco punched up to $600 billion.

This is really good to know. Nortel has a pretty significant presence here in Dallas, TX and I remember hearing stories that they were handing out brand new Porsches to new hires that signed on with them in the 90s. I never understood how much money it would take to see that kind of excess, but now I know.

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