Entrepreneur’s Journal: Startup advice from Oracle’s Larry Ellison

15 12 2007

Entrepreneur’s Journal: Startup advice from Oracle’s Larry Ellison

Posted by: in Small Business

Filed under: International Business Machines (IBM), Oracle Corp (ORCL), Entrepreneurs, salesforce.com inc (CRM), Small business

It was a tough time in 1977. There was inflation, unemployment and political turmoil because of Watergate.

But such things didn’t mean much for a group of programmers — Bob Miner, Ed Oates, and Larry Ellison. They started a database software company called Structured Development Laboratories. Of course, the company would eventually be renamed Oracle Corp. (NASDAQ: ORCL) and grow into a multi-billion dollar powerhouse.

Well, this week at the popular Oracle OpenWorld conference, Larry devoted his keynote to the early days of the company (the picture on the upper right is the original 900-square foot office location).

What lessons were entrepreneurs able to carry away from his speak? Several solid concepts:

Study your market and competition: Larry spent much time reading journals and talking to experts. What were the hot technologies? Who were the key companies?

For example, Larry read an interesting article in the IBM Journal of Research and Development, which talked about relational databases. He thought it could be a killer technology. Besides, wouldn’t the support of IBM (NYSE: IBM) make it legit?

“Smoke and mirrors” can be a good thing: As a small company, it’s not simple selling complex technology to large organizations. So in those early days, Oracle needed to find clever ways to make it seem larger than it really was.Think about that the company called its first product version 2.0. Hey, who would purchase version 1.0?

Hire super-smart people: Larry believes that his most important job was finding top-notch people. Interestingly enough, he would rather having empty desks if he couldn’t find the right people.

Little wonder that former Oracle employees have created such companies as PeopleSoft, Quest Software (NASDAQ: QSFT), Siebel Systems and Salesforce.com (NYSE:CRM).

Be the eternal optimist: Larry never had any doubts. He was convinced of the market opportunity.

After all, when he started the company, he almost had to foreclose on his home. But how could something like this be a problem for a true entrepreneur?

Tom Taulli is the author of various books, including The Complete M&A Handbook and The Edgar On the web Guide to Decoding Financial Statements.