Founder of ASK Computer Systems Inc.
"I think luck is seizing opportunities. There are opportunities all around. There are millions of good ideas, but it's those people who seize the ideas and seize the opportunities that appear lucky."-Sandra Kurtzig
In today's male-dominated software industry, women founders and CEOs are practically nonexistent. But while software titans like Microsoft's Bill Gates, Netscape's Marc Andreessen and Oracle's Larry Ellison have become the poster boys for Silicon Valley success, the first multimillion-dollar software entrepreneur was a woman. Starting with just $2,000, Sandra Kurtzig built a software empire that at its peak boasted $450 million in annual sales. And it all started as a part-time job.
Like many Silicon Valley companies, ASK Computer Systems Inc.'s beginnings were humble. In 1972, Sandra Kurtzig quit her job selling computer timeshares for General Electric so she could devote more time to starting a family. An admitted workaholic, Kurtzig knew she couldn't give up working altogether, so in hopes of making a little extra money and "to keep her mind occupied," she launched what she thought would be a small, part-time contract software-programming business in her snug second bedroom. "I never intended it to be outside the bedroom, let alone the world," she admits in an Industry Week article.
Her first client asked her to create a program that could track inventory and provide manufacturing information in a timely way. Realizing that other manufacturers might find such a program useful, she recruited several bright computer and engineering graduates and directed them to write standardized applications aimed at solving the problems of local manufacturers. "I knew what manufacturers wanted because of my technical background,"
Kurtzig told Forbes magazine, "and I could translate those needs into easy-to-use software."
Initially, Kurtzig was unable to convince Silicon Valley venture capitalists to invest in her start-up, so she was forced to launch ASK on retained earnings alone. To gain access to the minicomputers her company needed, she convinced executives at a nearby Hewlett-Packard plant to let her and her programmers use one of the company's series 3,000 minicomputers at night. "They let us in at 6 p.m., and we came with sleeping bags and stayed until 6 a.m." It wasn't long before Kurtzig's part-time job was taking up 20 hours a day. By 1978, ASK had its first salable products-a package of programs called Manman (short for manufacturing management), which improved inventory control and production management.
Kurtzig then struck a deal with Hewlett-Packard to sell its minicomputers pre-loaded with her programs. This breakthrough turnkey system meant ASK could market a complete product to computer-wary managers several years before computers would become common tools of the industry.
Without money for a sales force, marketing, advertisements or brochures, ASK built its customer base by selling systems to big corporate clients like Hewlett-Packard and Hughes Electronics "on our personality, our ideas, our energy, our hard work and our commitment to their success," Kurtzig explains. The strategy worked. Kurtzig's association with HP enhanced ASK's credibility with prospective customers and afforded the company access to promising industrial markets. The system was an instant hit, and ASK sales soared from $2.8 million in 1979 to $39 million in 1983, making it the 11th-fastest-growing company in the country between 1978 and 1982.
Meanwhile, Kurtzig took the company public in 1981. Between 1981 and 1983, following a small equity offering and a 2-for-1 split, earnings per share doubled, which meant a windfall for Kurtzig that made her worth $65 million.
But even with her tremendous success, Kurtzig was growing tired of the fast-track life. "When you are the CEO, you live it seven days a week, 24 hours a day," she explains. "And you can't ever go on vacation and not think about the meetings you're missing-or should be attending-or without feeling guilty about what you're not doing." Wanting to devote more time to her children and realizing that she couldn't do that and keep up her whirlwind pace at ASK, Kurtzig resigned from most of her duties in 1985, keeping only her title of chairman.
Feeling that other parts of her life "needed fulfilling," Kurtzig spent the next four years dabbling in other pursuits, including a brief association with ABC's "Good Morning America," building a home in Hawaii, writing her autobiography, and, of course, spending time with her sons.
For a while, ASK continued to prosper despite the departure of its founder. Over the next four years, profits grew by $1.5 million, hitting $13.5 million by the end of fiscal year 1989. But there were storm clouds forming on the horizon. Sales seemed to be flattening out after reaching $79 million. More ominous, ASK's product line was flat. The company was still living off a software package whose last overhaul coincided with Kurtzig's decision to relinquish day-to-day control. In the fall of 1989, when it became clear ASK was facing the first of what would likely be several quarters of flat sales, ASK's board of directors persuaded Kurtzig to rejoin as CEO in hopes that she could turn the company around. It was an offer she couldn't refuse. "When push comes to shove," she says of her return, "well.ASK is my baby, and ASK is what I know."
Kurtzig's first step after returning to ASK was to bring entrepreneurial-minded people onto the board. To increase employee participation, she asked research and development employees to rate the performance of the division's managers. The top-rated managers were rewarded with greater responsibility. Those who received low ratings were given their pink slips. She also put an end to the practice of senior managers giving themselves hefty raises and bonuses.
Most important, she repositioned the firm as a database provider and re-engineered the company's software to run on a variety of different computers. By 1992, ASK was back on top, boasting sales of $450 million, making it the largest public company ever founded and run by a woman.
Comfortable that her company was back on track, Kurtzig once again retired, letting professional management take over the company she'd nurtured back to health. Two years later, ASK was purchased by Charles Wang's firm, Computer Associates.
Today, Sandra Kurtzig is chairman of the board of E-Benefits, an insurance and human resources service provider she founded with her son Andrew in 1996. Though no longer considered a "major player" herself, Kurtzig was instrumental in laying the groundwork of the modern business-to-business software industry. Her innovative approach of creating easy-to-use software for complex manufacturing tasks has been a model for virtually every successful software company in the industry today.
In her autobiography, CEO Building a $400 Million Company from the Ground Up, Sandra Kurtzig offers the following advice to would-be entrepreneurs:
- Believe in yourself. If you don't believe in yourself, no one else is going to believe in you. You're not going to be able to communicate well if you don't believe in your idea.
- Surround yourself with good people. Have a good team and don't be afraid to share the glory and the responsibility and the authority. It takes a lot of hard work, and as the company gets bigger, it doesn't take any less. The work is just different.
- Be willing to make mistakes. You just have to make fewer mistakes than your competition.
- Don't get wrapped up in your success. When we went public, all of a sudden we were the fair-haired children of the peninsula and we were the overnight success. But it took six or seven years of hard work and 20-hour days to become the overnight success.
- You're still the same person you were when you started. You still stand in line at the post office, you still put your pants on one leg at a time, and just because all of a sudden everybody thinks you're great, don't let it go to your head. If you do, when your business has problems, you won't be able to cope with it.
One of the reasons for Sandra Kurtzig's tremendous success was her refusal to accept the status quo. When she first started ASK, it was a generally held belief that in order to compete in a male-dominated industry, a woman had to think like a man. But Kurtzig felt differently. Rather than following the classic rigid, hierarchical "male" approach to management, she adopted a policy of being honest with her employees, sharing information rather than withholding it, and keeping her office door almost always open.
"I have a style of walking around and stroking people," Kurtzig explains in a 1990 Time magazine article. "Whenever possible, I try to compliment them in front of their peers and go up and hug them. A woman can show the warmth that a man often can't." Thanks to Kurtzig and other female managers, a woman's emotional range and empathy, which were once looked upon as distinct disadvantages, are now viewed by many as potential resources. "The best way to negotiate," Kurtzig insists, "is to understand what the other side wants. With men, it's often all or nothing. They can end up where it's the last time either side will do business with the other."