Ellison shares some Oracle moments

Including some interesting pieces of trivia

If a billionaire entrepreneur has to narrate his "rags to riches" story, when better to do it than before a gargantuan audience, and on a big anniversary.

Both those elements were present on Sunday when an unusually ebullient Oracle CEO Larry Ellison reminisced about the early days of Oracle, laughing heartily at some of his own jokes and anecdotes.

Ellison reminded the audience -- numbering in the thousands -- that it was a double anniversary: 30 years since Oracle was founded and the 10th death anniversary (to the day) of Bob Miner who cofounded the company with Ellison in 1977.

Ellison's keynote was redeemed from being another "good ol' days of yore" spiel by some interesting pieces of trivia he shared with the audience. For instance he recalled how:

  • He was so cash strapped during Oracle's early days that Don Lucas - an Oracle board member since 1981 -- took over his house mortgage to save him from a bank foreclosure;
  • Before he joined Oracle as its first chief financial officer, John Kemp used to deliver Pizza to the early Oracle team (that's how they met and hired him), while Safra Catz now Oracle's co-president was working as a waitress;
  • Oracle got its name from a failed project done for the Central Intelligence Agency (CIA) by the Ampax, the company Ellison used to work for. The project was code-named Oracle, said Ellison, and because it had failed, the name was available.
The Oracle CEO talked about the events that led him and Miner to start Oracle in the 1970s. At the time, he said, he and Miner were working for Ampex, a Silicon Valley company that was building advanced tape drives, and was contracted by the Central Intelligence Agency (CIA) "to create this huge terabit mass storage system on tape drives."

Ellison said soon after he was recruited by a competing firm, called Precision -- that used laser technology to store data -- as vice-president of software.

"Precision needed more software than we could write internally for its laser storage initiative, so we had to contract out some of it." He said he persuaded an initially reluctant Miner to quit Ampax and bid on the Precision contract, while he wrote the specs for the databases software that Miner bid on. "The spec was written and we bid US$300,000 dollars," Ellison recalled. "We won easily because the next lowest bid was US$2 million."

He said after winning the bid, Miner and he started the company (then called Software Development Laboratories) that eventually became Oracle.

"We hired Bruce Scott (who later went on to found PointBase and become its CEO) and capitalized the company. I put in US$1,200, we had US$2,000 in the bank, and were sitting pretty -- working out of a modest office at Silicon Valley that Precision had rented to us."

Ellison noted that while the money soon kept pouring in from several consulting jobs he and the other team members determined that they didn't want to be a consulting firm.

"We looked at the mainframe marketplace and saw that the biggest independent software firms were database companies. We determined to do the same thing, but for minicomputers."

He recalled that IBM research labs at the time had come out with System R -- one of the first relational databases (but it was a research project and wasn't commercially released).

"So we thought: 'to heck with this old stuff; let's build the first commercial relational database using the IBM research documents as our specification'."

He said he decided to try and sell the product even before it was built.

"The only people I knew were the guys I worked with at CIA. So I went to the one customer I knew. [The CIA] liked it and I made my first sale of US$48,000."

From then on, he said, business kept coming in -- including contracts from other government agencies.

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