Feeds

Lotus 1-2-3 turns 30: Mitch Kapor on the Google before Google

Surviving tech's bubble, but not Microsoft

Choosing a cloud hosting partner with confidence

At last - a credible IPO!

Kapor decided it was time to go public, so LDC floated at $18-a-share in 1983. The IPO was sooner than planned but Kapor reckoned he’d wanted to take advantage of the first tech bubble around him – a string of now mostly forgotten-about personal computers had been going public: Vector, Victor and Eagle.

It was now or never.

“I was looking at this and I thought the quality of the companies going public is decreasing rapidly: most of those companies had no chance and they were foisting themselves on the public. So I said we can go public now, much earlier than we planned, or we will have to wait a couple of years because the window will close. I was not a student of Wall Street but I was a quick study. I thought getting liquidity and having currency to do acquisitions and cash in the bank would be worthwhile,” Kapor said.

It was a dizzying experience. “I woke up every day and I wouldn’t say I was constantly terrified, but I was worried it would all evaporate, [that] I would make one bad decision and it could all fall apart because it had come so quickly,” Kapor says.

It didn’t evaporate, but this was certainly the high point for 1-2-3.

Thirty years on here’s a test. Ask yourself a question: What’s the word you use when talking about your “spreadsheet”? Answer: “Excel”, in the same way you say “Google”’ when referring internet search or “Tipp-Ex” when talking about correcting a mistake on a sheet of paper using a quick-drying white fluid. 1-2-3 still exists as a spreadsheet owned by IBM, which bought LDC for $3.5bn in 1995, but 1-2-3 and the Lotus brand are barely seen outside of blue-blood enterprises and IBM shops.

What happened? A couple of things happened – and one of them was Microsoft.

LDC stumbled twice. First, 1-2-3 lacked a word processor, something that became a staple of personal productivity and left a hole in the suite for somebody else to fill. A word-processing app had been planned but it was dropped because of difficulty in coding and hitting deadlines. Lotus returned to word processors in 1984 chart, spreadsheet and docs package Lotus Symphony for MS-DOS from a then-unknown developer Ray Ozzie, who went on to develop the hated Lotus Notes groupware. While Symphony was still largely based on the spreadsheet, it was never as successful as 1-2-3. “We had the right idea but the wrong architecture,” Kapor says.

“I woke up every day and I wouldn’t say I was constantly terrified, but I was worried it would all evaporate, [that] I would make one bad decision and it could all fall apart because it had come so quickly” - Kapor

Next problem was that LDC had stumbled on its re-writing of 1-2-3 from macro assembler to C (to make it more easily portable). LDC delayed release of the rewrite until 1989 and even then outcome was not one but two products: the rewrite had produced a code base so big it couldn’t run on low-spec machines, so LDC responded by developing version 2.2 on assembler code that targeted PCs lacking extended memory and version 3.0 for “high-end” PCs.

In the meantime, rivals mushroomed. One of these was Microsoft, whose Multiplan spreadsheet was replaced by Excel for the Macintosh in 1985. Excel landed on Windows 2.x in 1987. As Windows grew, so did Excel, and the spreadsheet software was swept into Office in 1990, along with Word – both built under Charles Simonyi - and PowerPoint, which Microsoft had bought.

“It became clear to me by 1984 that Microsoft was likely going to be the big winner in the PC software apps and operating system category, partly because of the dynamics of owning and controlling the operating system: that gave you enormous power and I came to see Bill Gates was fierce competitor,” Kapor says.

“He was smart and ruthless in pursuit of business objectives and I was not as ruthless: I’m super competitive, but... my goals and values are not about crushing the comp and I don’t have the kind of personality to carry out a strategy like that. It presented a dilemma.”

The C re-write and competition from Microsoft happened in the absence of Kapor - he left LDC in 1986 and was replaced as chief executive by former McKinsey consultant Jim Manzi. Running a large and growing public company wasn’t to Kapor’s tastes – he preferred startup mode and entrepreneurism, he tells us.

Calculating the outcome

Kapor now reckons he’d have done things differently, staying longer and building a more sympathetic board and management and cultivating his base inside LDC.

“Had we done it the right way in 1984, things would have been different,” Kapor says. “We get credit for the right idea about what people wanted but we didn’t do it the way we should. So we lose credit on that,” Kapor says.

“With hindsight it seems so clear there are a fundamental set of productivity tools and if you are a company that makes productivity apps then having a strong offering in each is the right strategy. Microsoft gets credit on that - and for executing.”

Kapor says the lessons he learned from those heady LDC days have been applied to "hundreds of other companies". Kapor has since been a founding investor in Real Networks, Second Life's Linden Research and the first commercial ISP - UUNET. He was also a co-founder of web privacy watchdog Electronic Frontier Foundation and a founding chair of the Mozilla Foundation.

Any regrets that despite 1-2-3's role in shaping computing culture, it's Excel that took the money and the market? “It’s now long enough ago that I don’t have regrets,” Kapor tells us. ®

Security for virtualized datacentres

More from The Register

next story
Microsoft to bake Skype into IE, without plugins
Redmond thinks the Object Real-Time Communications API for WebRTC is ready to roll
Mozilla: Spidermonkey ATE Apple's JavaScriptCore, THRASHED Google V8
Moz man claims the win on rivals' own benchmarks
Microsoft promises Windows 10 will mean two-factor auth for all
Sneak peek at security features Redmond's baking into new OS
FTDI yanks chip-bricking driver from Windows Update, vows to fight on
Next driver to battle fake chips with 'non-invasive' methods
DEATH by PowerPoint: Microsoft warns of 0-day attack hidden in slides
Might put out patch in update, might chuck it out sooner
Ubuntu 14.10 tries pulling a Steve Ballmer on cloudy offerings
Oi, Windows, centOS and openSUSE – behave, we're all friends here
Apple's OS X Yosemite slurps UNSAVED docs into iCloud
Docs, email contacts... shhhlooop, up it goes
Was ist das? Eine neue Suse Linux Enterprise? Ausgezeichnet!
Version 12 first major-number Suse release since 2009
prev story

Whitepapers

Choosing cloud Backup services
Demystify how you can address your data protection needs in your small- to medium-sized business and select the best online backup service to meet your needs.
A strategic approach to identity relationship management
ForgeRock commissioned Forrester to evaluate companies’ IAM practices and requirements when it comes to customer-facing scenarios versus employee-facing ones.
Reg Reader Research: SaaS based Email and Office Productivity Tools
Read this Reg reader report which provides advice and guidance for SMBs towards the use of SaaS based email and Office productivity tools.
New hybrid storage solutions
Tackling data challenges through emerging hybrid storage solutions that enable optimum database performance whilst managing costs and increasingly large data stores.
Business security measures using SSL
Examines the major types of threats to information security that businesses face today and the techniques for mitigating those threats.