Yesterday I sat down with a senior exec at EMC. What was on his mind?
He's seeing accounts with billion dollar IT budgets and EMC only scratching the surface. He's seeing countries where EMC doesn't have the #1 market share. He's seeing customer after customer and survey after survey which continues to name what EMC does at the top of the spending priority list ... initiatives such as Information Security, Information Virtualization (to save money), and good-old Information Storage(because digital stores of information grow every time we touch a keyboard, make a call, use a credit card, post something to You Tube, etc.)
Contrast that recap with the headlines we're seeing every day in the industry.
Image: Gumbo, by Travisatwork on Flickr. No offense to Gumbo fans. This image says to me "cooked." Gumbo, be it a reach, was the best word I could come up with to contrast Gusto.
No business comes easily today -- read our SEC filings to get a feel for what can happen on any given quarter let alone in a climate like this -- but business is there.
Following are a couple editorials I noticed coming in on my daily news feed today. One declares EMC again as the market share leader in storage software -- with a 24.7% share. The other says we're the market leader for external controller based disk storage revenue with 26% share.
What does that say to me?
We lead the market and yet about three quarters of both the software side and the hardware side of the storage business are not yet EMC customers.
"Storage remains one of the few bright spots in a struggling economy. Research firm IDC this week reported that the worldwide storage software market had revenues of $3.1 billion in the third quarter, an increase of 11.6 percent from the same quarter a year ago. It was the 20th consecutive quarter of year-over-year growth, the firm said. IDC said EMC Corp. was the overall market leader with a 24.7 percent share of third quarter revenue."
"Researcher Gartner reported Dec. 9 that worldwide external controller-based disk storage revenue totaled $4.3 billion in the third quarter of 2008 -- a full 10 percent increase over the same period in 2007. EMC maintained the No. 1 spot overall, finishing the quarter at 26.1 percent market share, IBM was second with 13 percent of the market, followed by Hewlett-Packard with 11.3 percent."
I've mentioned a few times here the "E" in EMC, Dick Egan.
He's made a huge impression on my life. Working for him was the best motivational experience of my professional career. There were no limits to what could be accomplished. In fact, he used to say that roadblocks were thrills in disguise.
Over the years, journalists and MBA students have often queried me on how EMC got started or heard that EMC got its start in the furniture business. The latter is interesting, because I know full well that Dick never had any intent to launch or build a furniture business. He did, however, have ...
THE ULTIMATE ENTREPRENEURIAL INTENT to get a business going and make a ton of money.
On Thanksgiving morning I received an email from an EMCer working on her MBA asking for the "start of EMC" story and mentioning the furniture business. I suddenly recalled an interview with Dick in our employee publication, EMC.NOW, on how we got started. Who better to tell the story than Dick, himself? The interview was done in 1999 to coincide with the 20th anniversary of our founding. Monya Keane, Editor in Chief, conducted the interview and has since produced the goods, as follows:
DICK EGAN: But anyway...okay, so the first one is frugality on the office furniture. I think you’ve all heard this story. We started the company, Roger and I. And there was sort of a third guy. We used to meet in my basement in Wellesley and we all had jobs. All of us knew each other but we all worked in three different companies. And the fellow, the C, he decided last minute, not to come.
Why did we want to start a company? We were, I think, in some cases, in our early forties or approaching forties and we felt that we could do it because we had worked with a lot of people that had started companies. And we felt that we were as capable as they were.
But we didn’t have an invention or a product idea or a market concept. That is, a market that needed a product or service. But we wanted to start our own company. Somewhere in my history I had helped a friend start a manufacturer's representative organization. At the time, Roger was a manufacturer's representative, and we saw this as the quickest and lowest-cost way to get into business.
Starting a manufacturer's representative organization really requires little or no capital equipment. It does however; require office space, phones, a desk, a file cabinet. So we started the company and went out to solicit a principal: Principal is the generic term that one applies to the manufacturer or provider of the product or service as opposed to "customers," who just then sell them.
One of my friends, a guy I knew from California, had an office-furniture company, and he had developed furniture which he wanted to sell to computer users because it made a good workstation. He made us an offer we couldn’t refuse, but we didn’t want to do it.
We started the company: Roger and I were the owners, but we actually started with a third fellow who wasn’t an owner. He was an engineer who worked for me at Intel back East. So among the three of us I think there were five electrical engineering degrees.
And here was my friend wanting us to sell furniture! I remember telling, I think it was Howard Wasson, I said Howard, “We’re all double E’s; we don’t want to do this!” He said, “Hey, take the furniture; see what you can do with it. And by the way, it’s fifty-five percent gross margin for you!” I said, “Howard, maybe we’ll do it, maybe we won’t.” He said, “Hey, you’ve got to furnish your office; I’ll give you all samples.” And that’s how we furnished our office.
And we made a shitload of money.
I don't think they sold computer desks for more than 6 months. I do know that Dick used that free metal computer desk during his entire career at EMC, even while moving up the list of FORBES 400 Richest Americans list.
----------------- Talk Back -------------------
Thoughts on this entrepreneurial story?
I thought this story is nifty on a few notes -- but perhaps most of all on Dick's ability not to be snotty on how he brought in money to launch his real dream.
I can't say the same for myself. I've only had one resume in my life. I used it to get my first PR job, which happened to be at EMC in 1991. I was 25 at the time. On this resume I edited some work experience out. I was embarrassed and felt this work experience did not reflect on who I truly was. The edit? I was an "Office Manager" for an "Office Products" start up company. (I started this company with my uncle during the day while I finished my degree at night.) Office products are terribly unsexy, don't you think?
How funny is it that even today, EMC's government issued SIC code indicating what industry we participate in is, "Office Products!" I still don't consider EMC -- or myself -- in the office products industry but I can say it has fulfilled a pretty good item on the checklist of life -- EMC has made a sh#tload of money. And along the way it has done some mighty fine good in the world, too.