Going it alone, and getting $270 million
You've heard the Silicon Valley quip that few entrepreneurs build more than one hit. Well, Philippe Kahn is one of those exceptions making the rule.
You probably saw reports about Verisign buying Santa Cruz's LightSurf for $270 million on Monday. The news referred to LightSurf as "closely held."
Turns out, there's nobody behind it besides the CEO, Philippe Kahn. "LightSurf never raised any money," he told us. "I financed it personally, however in the first year we started generating cash. Thatās how I like to run businesses."
Apparently, that also goes for the other two companies he built, Starfish and Borland. "Never venture capital, built on retained earnings," he says. "I am very proud of that. It shows that it can absolutely be done. Note that I am a limited partner in a couple of VC firms, but never take it for myself!" He's an investor Technology Crossover Ventures and Velocity Cap.
It's great to be able to self-finance and generate cash early on in the life of a company. However, the real question is how much he spent to become profitable and grow the business. Where did the working capital come from? Didn't he really act as his own VC?
Mike on January 14, 2005 9:54 AMComment link
