There’s a story that a technology reporter went along to see Lawrence J Ellison and one of his top executives at Oracle Corp headquarters in Redwood Shores, California, to confront the ebullient other software billionaire with accusations from rivals (and customers) that his company was mainly in the business of selling vaporware. To quote Mike Wilson’s highly entertaining new biography of the great man*, in response, Ellison leaned forward and spoke softly, as of telling a secret. ‘You know, it’s true,’ he said. ‘We don’t actually have any software. This year we sold a billion dollars’ worth of stuff and never delivered anything. It’s a really great business.’ At which point the worried exec turned to the reporter, and, just to be safe, ‘He’s kidding.’ Yet for a long, long time, Oracle’s competitors and customers had a point.
By Gary Flood
Even Bob Miner, one of Oracle’s three founders, and the man ultimately in charge of actually building the database technology that the company made a living from, later admitted that he didn’t think it was until Oracle version 4 – five and a half years after the company’s founding – that Oracle was any use, and there are many who would go even further, and put the date Oracle stopped scribbling over corporate data as 1986, with version 5. Yet somehow, selling crappy products, wildly exaggerating what was available in features and functionality (Larry always had a problem with tenses, snickers one ex-Oracle staffer quoted in Wilson’s book), creating a sales force as aggressive as the Marine division that invaded Iwo Jima, Ellison still made good – big time. For a company that sold ‘vaporware,’ Larry Ellison’s Oracle yet managed to double in size eleven of its first twelve years. If you’d invested $10,000 worth of stock on the day of its 1986 IPO you’d be earning the interest on $790,000 now. But the greatest payback of all came to Ellison himself, whose own investment of $1,200 in sixty per cent of what was then Software Development Laboratories, Inc has been turned into between $6bn and $7bn worth of stock in Oracle today (for Larry has grimly hung on to his shareholding of about 23%), making him one of the top five wealthiest people in the United States.
The extraordinary story of how Ellison and Oracle did it – then very nearly completely blew it when the company overheated and hit the wall in 1990 – is partly the subject of The Difference Between God And Larry Ellison (God Doesn’t Think He’s Larry Ellison). But only partly. The real topic is the fascinating, exasperating Ellison himself, whose creation Oracle very much was (maybe not so much in these more conservative and quality-assured 1990s). Wilson’s theme is that Ellison is like a modern day Charles Foster Kane, the hero of Orson Welles’ stunning 1941 movie Citizen Kane. Like Kane, He is bright, brash, optimistic, and immensely appealing, yet somehow incomplete. Like the main character [of the movie], he wants desperately to be loved, even idolized, but love does not come easily to him or from him. If Wilson is right, one of the main differences is that Ellison took his time getting started, while Kane, according to the movie, was lucky enough to get a nice inheritance to get started. Ellison drifted through high school and college (he has no degree) and so annoyed his first wife at his floundering in the 1970s that she left him. Yet even before he started to really get going – founding what became Oracle in 1977, aged 32 – the hallmarks of the personality that would eventually delight and bewitch everyone from attractive Stanford co-eds to Fortune 500 CEOs to hardened business journalists to Bill Clinton were there.
A friend from his early years in Chicago: When reality was not interesting enough for him, he simply made up delightful and often plausible details as he went along. His stories all had certain things in common: They were funny, they glorified Larry Ellison, and unless you had the right authority to issue subpoenas, they were damned near impossible to disprove. It turned out not to be too hard a step to spin stories not about Larry’s suspiciously impressive doings, to that of his software. From the beginning, Ellison seemed willing to do or say almost anything to get business… When he talked about [relational databases] he was promising businesspeople a sort of technological heaven. But like most evangelists, he did not dwell on the unpleasant fact that people would have to die to get there. Oracle, famously, built on the ideas of relational technology that IBM with System R and Berkeley University with what became Ingres were already working on. What distinguished Oracle was that Ellison picked up this particular ball – relational database management systems – and ran with it like hell. Wilson suggests that, like Kane, or even Ellison’s most admired fellow citizen of the 20th Century, Sir Winston Churchill, Ellison’s conviction was not so much about the benefits of relational database so much as the fact that this was a route to glory. Both [Churchill and Ellison] were masterful manipulators of public opinion who were motivate largely by self-interest… Ellison succeeded not as a technologist but as a marketeer. He did not have any special convictions about technology; Silicon Valley was where he ended up. If he had wound up somewhere else, he might well have succeeded in peddling other kinds of ideas – political ideas, or literary ideas, or whatever… People bought Oracle not so much for what it could do, as for what Larry Ellison said it could do. So if one ingredient in Oracle – the name, incidentally, was ‘borrowed’ from a CIA project Miner and Ellison had been working on when they first met, cheek that the CIA was not terribly impressed with – and its astonishing success was Ellison’s charisma, the second was surely the ferocity of its sales force and internal culture.
In contrast to the gentlemanly philosophies of an IBM or a Hewlett-Packard, the Oracle of the 1980s was not so much like 1941’s Citizen Kane as Oliver Stone’s 1987 Wall St gone mad. The Oracle Way… was simply to win. How that goal was achieved was secondary… It was not enough for [Ellison’s] opponents to lose; he had to humiliate them. Hence the notorious habit Oracle had of claiming features in its products often years before the opposition, which is naughty but at least commonplace in our industry, but just as naturally, this tradition led to the terrible mess Oracle got itself into with regards to basically illegal activity with sales recognition procedures. To achieve the growth Larry demanded, corners were not so much cut as torn to ribbons. But the point is that even if there were excesses – and often shabby behavior, like Ellison’s unpleasant trick of sacking no-longer favored employees just before their stock vested, which isn’t that surprising from a guy who sprung a pre-nuptial contract on his third wife hours before they were to marry – in the end, despite a closer shave than many of us even suspected at the time, Oracle got through 1990, mended its ways, and became the model of corporate sobriety it now is. As that was happening, Ellison was able to hand over running his company to just having the good time he deserved (video on demand! Information Superhighways! Network Computers!). Wilson, though having no problems painting Ellison warts and all, also has to remind us that in the final analysis Larry Ellison did so well – and continues to thrive – not because he ‘cheated,’ but because he had the spirit to go for broke. Yes, IBM gave him the idea. But it did not give him [seven] billion dollars. [Ellison] made himself rich through ceaseless work, brilliant strategy, unrelenting optimism, and ruthless determination… He did it by being himself. This book is an immensely funny, interesting, scandalous look into what being Larry means, and is recommended for fledgling entrepreneurs, high-school graduates, and anyone who feels there’s more to life than working for the phone company, planetwide.
* The Difference Between God And Larry Ellison (God Doesn’t Think He’s Larry Ellison), Mike Wilson, ISBN 0-688-14925-1, William Morrow And Company, 1997, $25.00
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