DEC

TL;DR - DEC’s enormous success thanks to ARD’s investment completely altered the trajectory of the venture capital industry.

Helpfulness - 3

Tags - DEC, ARD, Doriot, venture capital, computer, technology startup, IBM, equity

Questions answered:

  • What was DEC?
  • Why did DEC have such a lasting impact on the VC industry?

Summary:

  • Digital Equipment Corporation was founded by Kenneth Olson and Harlan Anderson.
  • DEC aimed to produce smaller, less expensive transistor-based computer machines for business applications.
  • Olson wanted to show that computers were practical, inexpensive and reliable.
  • ARD offered a deal for $70,000 for 70% of the company.
  • DEC reigned as the second largest computer company in the world after IBM and the dominant player in the minicomputer industry.
  • DEC’s success inspired more computer startups, as well as an enormous change in attitudes toward venture capital investing.
  • ARD founder Doriot saw the DEC investment as a tool for massive economic and technological change.

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