Early days of Cisco Len Bosack & Sandy Lerner PT 2

Summary

The transcript recounts the journey of Cisco's founders, Sandy Lerner and Len Bosack, who were ousted from the company they helped build. The narrative highlights their lack of employment contracts, challenges with venture capitalists, and ultimate firing from Cisco. They sold their shares early, missing out on the company's immense growth. Today, Sandy runs a foundation and the nail polish brand Urban Decay, while Len pursues his passion for the search for extraterrestrial intelligence. Cisco, which was worth $1 billion at their departure, has since grown to $60 billion.

Takeaways

• 📝 The founders ended up with a four-year vesting agreement, 30% of the company's stock, and no employment contract.
• ⚖️ It's advised to have a lawyer when dealing with such agreements to protect one's interests.
• 🗓 August 28th, 1990, marked a significant day as the founder was fired, illustrating the tension between founders and venture capitalists.
• 🔧 The founder recognized the critical role of venture capitalists in launching Cisco but also their tendency to eventually part ways with founders.
• 🏢 The company's growth led to a shift in dynamics, making it challenging for the founders to continue in their roles.
• 🔮 The chief technical officer and the founder had different visions and skills, which affected their positions within the growing company.
• 💸 The founders sold their shares when Cisco was valued at around $1 billion, missing out on potential gains if they had sold at a later date.
• 🏡 Post-Cisco, Sandy Lerner acquired a manor house in an English village, showing a shift in focus to cultural endeavors.
• 💅 Sandy also established a successful nail polish brand, Urban Decay, indicating a diverse range of post-Cisco activities.
• 🌌 Len Boac is now involved in a technology company and funds the search for extraterrestrial intelligence, reflecting his ongoing interest in technology and the universe.
• 🚀 The story of Len and Sandy's departure and subsequent activities highlights the potential for personal growth and success beyond the original company they founded.

Q & A

What was the vesting agreement and stock ownership like for the founders?

The founders ended up with a four-year vesting agreement and owned 30% of the stock in the company.

Why did the founders not have an employment contract?

The script does not explicitly state why they did not have an employment contract, but it suggests it was a decision they later regretted, as it left them without job security.

What advice does the speaker give to entrepreneurs based on their experience?

The speaker advises entrepreneurs to get their own lawyer to protect their interests, implying that not having proper legal representation can lead to unfavorable outcomes.

What significant event happened on August 28th, 1990?

On August 28th, 1990, the speaker was fired from the company they co-founded, Cisco.

Why do venture capitalists often want to get rid of the founders?

The script suggests that venture capitalists often want to get rid of the founders as part of their formula, possibly to take control and steer the company in a direction they believe is more profitable.

What were the roles of Len and Sandy in Cisco?

Len was the chief technical officer, focusing on the technical aspects, while Sandy was committed to various business aspects and customer treatment.

Why did the seven vice presidents of Cisco Systems confront the speaker?

The seven vice presidents confronted the speaker to give an ultimatum: either the speaker allowed the president to fire Sandy Lerner or they would all quit.

How did Len and Sandy feel about leaving the company?

Len and Sandy felt that it was probably time for them to go, as they did not have company personalities and found it difficult to work in a larger organization.

What was the market value of Cisco when Len and Sandy left, and what is it now?

When Len and Sandy left, Cisco's market value was around $1 billion. At the time of the script, it had grown to $60 billion.

What did Sandy Lerner do with her earnings after leaving Cisco?

Sandy Lerner acquired a manor house in an English village where Jane Austen wrote her novels and also established a successful nail polish brand called Urban Decay.

What is Len Boac currently involved in, and what is his charitable focus?

Len Boac runs a technology company in Seattle, and his charitable donations fund the search for extraterrestrial intelligence, indicating his serious interest in the universe and the question of whether we are alone.