Something Ventured Page #8

to-to get funding.

Uh, we just weren't successful.

We were not the first people

to see it,

as armies of people

have told me-

That they saw it before we did,

and they turned it down.

They took the position that this

wasn't a tenable business model.

I-I don't think, in their position,

I would have disagreed with that.

But I wasn't in their position,

and I did disagree with it.

These things are not so clear.

Different people

see them differently.

The person who got us involved

with Cisco said,

"You are probably the only person

in North America...

who would be willing to deal

with these people."

The people at Cisco-

If you were designing

hard-to-get-along-with people,

they got the model right down.

Difficult to do business with...

on any basis.

Totally intolerant of

a mistake made by anybody.

But very instrumental

in starting that company.

I think that we were difficult

to work with.

We were all very independent.

We were used to having our own way.

You know, certainly there's the

mind-set that has to go along...

with years and years and years

of people saying that, you know,

"You can't do what

you say you're going to do,"

"You can't make money'

even if you could do it,"

um, and that "You're

the wrong person to do it."

We bought a third of the company

for $2.8 million.

And we had an agreement

that basically said,

"You get a third of the company'

and we get a third of the company'

and we will find the people

to run this company."

None of us had ever

built a company.

We understood that there was an

enormous need for-for more structure,

and to bring in people that

we had no way to reach.

Sandy and Len agreed to

step down into new roles.

And Don Valentine

recruited John Morgridge,

a veteran of several high-tech

start-ups, to run Cisco.

Morgridge's first task was to address

what he and Don Valentine saw...

as a troubled corporate culture.

The quarter that I arrived,

we hired a shrink.

He eliminated fighting

in the open hallways.

Physical fighting, I mean.

I actually had the, uh...

vice president of engineering deck

the sales vice president in my office!

We really did have

a trench mentality.

This is not a good big-company mentality.

Quelle surprise!

But, on the other hand,

I think that there was no one

there in that original group...

who didn't ardently

love that company.

As Cisco grew,

a culture clash developed...

between the original employees

and the new hires.

And ultimately, this clash

centered on Sandy Lerner.

She was definitely

a strong personality,

and she definitely was the reason

the company existed.

Sandy was an incredible piece

in the puzzle...

of getting things done right

for the customer.

Silicon Valley has not always been the place

where the customer's thought of first.

They may, in some places,

be thought of second or third.

But Sandy was ensuring that the

customer was thought of first.

Unfortunately, at the expense of

some of the other major managers.

I had very much alienated

the other people in the company,

because, you know, other than Len,

they hadn't been there very long,

and, you know, I saw them,

rightly or wrongly,

as the people I was trying

to protect the customers from.

By her own admission,

she would detonate.

Usually in my office.

At Cisco, you know,

being the only woman and a technical woman,

I think I was just very,

very frightening.

And there just

wasn't a box for me.

And I think that I didn't make it...

particularly easy

for them to ignore me.

And I didn't make it particularly

easy for them to find a suitable box.

Um, in that, you know,

the boxes that existed for women at the time

didn't seem to fit what I thought I-I was doing.

Finally one day,

my assistant said

the conference room is filled...

with eight Cisco employees

demanding to see you.

All of the vice presidents of the

company were in the conference room.

They walked up Sand Hill Road

and said, "Either she goes, or we go."

"Terminate her,

or we're quitting.

All of us."

And he called me and said, uh,

"Do you want me to handle this?"

And I said, "No, I'll handle it."

And Sandy was retired.

First of all, I mean, let's

just get it out. I was fired.

John called me into his office.

He said, "You know,

you're now worth so much money,

it really doesn't make any sense

for you to work this hard.

You know,

I think it's just a good idea...

if you just, you know,

retire at this point."

I said, "But, John,

I have a lot to do here.

I-You know, I think I have a,

you know, a place in-in the company,

and I-I-I don't really

want to retire right now."

I was... 35 years old.

Um, and he said, "Well,

I think today's your last day."

I walked to Len's office' where Len

informed me that I must surely be mistaken.

And I sat in Len's office while

Len went up and talked to John.

And, uh, came back and

walked out the door with me.

And we never walked back in.

You know, this idea that 45 % of

founders will be gone in 18 months?

In retrospect,

that was clearly the mind-set.

Len and I clearly did not understand that

that was the game that we were playing.

You know, the first rule of any

game is to know that you're in one.

It's an unpleasant thing to do,

to fire anybody.

But it's clearly the facts of life.

I think each of them went

away with 170 million.

I don't know how people

think of what comes next...

after the first 170 million,

but, uh, I don't think they've

ever forgiven either of us.

I was once asked, did I start Cisco

to make a whole bunch of money?

And I said, "No.

If I measured myself that way'

I probably couldn't look at myself

in the mirror in the morning."

Um, I don't. I think I've been a pretty

good tool-user, and money is a tool.

You know, technology

keeps evolving,

and ever since Leonardo da Vinci,

it's been evolving,

and it will continue to evolve

through good times and bad times.

It will evolve.

Venture capital

is here to stay though.

Well, I get my greatest satisfaction out

of thinking back on the companies...

that I helped start

and helped grow.

It's... nice to sit in the glow

of your adulation,

but... without the entrepreneurs,

you're nothing!

You have to have these

real people with the ideas...

and their willingness

to commit their life.

I don't think,

and I would not say...

that Silicon Valley is the result

of good venture capitalists.

Not at all.

Entrepreneurship

is the main show.

Venture capital is an aid,

and sometimes people got lost-

"We must have venture capital."

No use having venture capital

unless you have entrepreneurs.

If it hadn't been for

the Treybigs and Swansons,

where would Kleiner and I

have been?

Without venture capital, the future

wouldn't happen nearly as quickly.

New companies are much better

at exploiting new technology.

They can extend

and exploit a new idea.

We would all have a lower

standard of living, worldwide.

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