May 16, 2008 — Good Afternoon.
I am honored to be here. The picture before me is fascinating. Bright young talented individuals who will lead the world into the future. Looking out at you I see that the process of evolution is working. You are far more knowledgeable and far more capable than many of us when we graduated years ago. In fact, just between us, I am glad that I entered college when I did because I am not sure that I could have been able to keep up with you today.
I know by now you have been lectured enough and have received a lot of sagely advice. The last thing that you want is another lecture. Instead I am going to tell you a story about how to eat for free and live without paying rent if you want to start a company.
I decided to share with you some of my personal life experiences in
the role of money.
Fariborz Maseeh addresses Viterbi School graduate students on May 16, 2008, in an afternoon ceremony at the Galen Center.
Hopefully some of these experiences will either be helpful to you or at least amuse you.
I grew up in Tehran, Iran. I came to the US when I was barely 18 not knowing a single soul. I did not speak English and some people think that I still don’t. I went to a bunch of schools and collected a few degrees and credentials.
Oddly enough much of my academic training was not very helpful in the life challenges that I was about to face. I started a micro-technology company called IntelliSense, grew it for nine years and then sold in 2000. This story relates to the time that I was building IntelliSense.
I went to college for a long time. When I received my bachelor's degree I started looking for a job. At the time not many jobs were available, at least they were not available to me. Reluctantly, I decided to go back to school and get another degree.
When I received my masters degree, I did not have much more luck. So back to school again. When I finally received a doctoral degree I had a lot more luck. I was offered to stay on at MIT as a Research Associate until I found a faculty opening. I was also offered a few jobs at well known corporations.
Despite all these wonderful options, I decided to accept an offer at an unknown startup in Silicon Valley at a lesser starting salary. Friends, advisors and my family tried to dissuade me describing what I wanted to do as a “career suicide”. The day after my commencement, I took an early morning flight from Boston to San Francisco and reported to work at noon.
After a year of employment at the startup I decided the company I chose to start my career in was not going anywhere. I resigned. I sold all my belongings for a few thousand dollars and went back to Boston where I knew a few more people. I had enough money to rent a small office, and connect a phone line. I then started contacting everyone telling them that I am in business. Not having enough money to rent an apartment, I had to stay with a friend. I started by developing new micro-scale technology for others and received a few small contracts.
During the initial life of my business despite watching every penny, I ran a bit short of money. How short? I remember the day vividly even today. I had $1.50 in my checking account and $2.50 in my savings. On top of that I had more than $100,000 of credit card debt and student loans, all requiring monthly payments.
With no money and no credit, I had no money to eat. I remember I used to go to a local bar which offered free food for their drinking customers during Happy Hours and ate there for free. This went on for a while. I stopped going when one day the bartender brought me a free drink! I thought about giving up many times. Then there came the end of the month. I had no more money to pay for my office rent. That day I said to myself “you did your best—not much more you can do”.
So I decided to call everyone and tell them that I am no longer in business. I placed my first call to a government agency that I had sent a proposal to. I knew my chances with them giving me a contract were especially remote. I told the lady on the phone that I am going to close my business because I can no longer afford it and I was calling to inform them that I was not going to keep my address. She asked me to wait so that she could pull my file. She put me on hold for a long time. Since I was paying for that long distance call I thought about hanging up. Finally she came and said a few words that changed my life. She said “I would not do that if I were you”.
Those words to me at the time were the voice of an angel telling me hold on just a bit more. There may be a glimmer of hope. I decided to hold on a bit more. Within 2 weeks of that phone call I received my first contract. Within another week I received another major contract. That was the first of many inflection points in my business life.
Speaking recently at another engagement.
During the first phase of the development of my business IntelliSense, we faced another beast called the Competition. We had a well-funded, well-connected competitor with three times our staff. We could not win a single contract whenever we were competing for the same research funds. Every one of our proposals were being rejected and almost every one of theirs were being funded.
The initial research money was vital for our development. Remember we were developing a new field and all of its infrastructure. The breakthrough for me came one day when I read in a management book “never compete with a small competitor. If you win it is not a big glory, and if you lose, you lost to something small”.
I decided to ignore our competitor and instead move forward as fast as we could. On the other hand our competitor, which probably did not read what I read, was watching our every move. While we looked ahead and engaged with our customers and tried to please them, our competition spent their time watching us and spent their funds reacting to what we were doing. Our attention shift from competitor to customer resulted in commercially superior products which became, at the time, the standard for the industry.
Salary and Compensation:
During late 90s our business was booming. We were doubling and tripling our size every year and had lots of profitability with no loans or external investments. In this era we faced a different type of a problem – the competition for talent. Dot com companies were popping up left and right, all backed by significant venture investments. Our business needed highly talented engineers and scientists but we had a difficult time meeting the salary expectations that Internet companies were setting at the time.
Master's degree candidates, along with their families and friends, sitting in the bleachers, watched Maseeh on the big screen.
We were faced with the dilemma that “if we paid the new hires what Internet companies were offering and wanted to invest aggressively in equipment and manufacturing, we could not remain profitable, and if we didn’t, we could not grow as rapidly. A young graduate, on the other hand, was faced with the choice of whether he or she takes a job with an Internet startup where they offered a plush office environment with cappuccino makers, ping pong tables, a juice bar, an occasional massage; or take a job with us where we offered complementary water cooler and tea bags with the benefit of less compensation.
The choice to a young star, without a lot of experience, was clear at the time. Unfortunately when the Internet bubble burst, many had wished they had made a different choice. While I am not advocating that anyone gets paid below his or her fair value, I advise any of you to refuse taking a job if you know you are overpaid. Paying more than fair value is a sign of incompetence. Incompetent companies will waste your most valuable asset: your time and your life!
Money brings happiness:
When we sold the company, we made 16 individuals instant millionaires and many others wealthy. I had always preached that money to business is like oxygen to life. The meaning of our life is not oxygen but without that we cannot live. The happiest memory of mine was when I left my former colleagues with a smile on their face. Remembering those faces is one of my most profound and pleasant memories.
To be successful, I have learned that you need to be intelligent. All of you are very intelligent. You need to work very hard. But you already have done that. The most important lesson of my story is to have dreams and then have perseverance for your dreams. Some of you, I promise, will face seemingly insurmountable challenges in the future. You will ask “why are the circumstances stacked against me? “ If you break through that cloud by your perseverance, you will find brighter skies.
Speaking of skies, I like to leave you with one last message that I believe is more important than anything I have said so far.
A few months ago I was sitting with Senator John Glenn, the former astronaut. As you know, he has been in and out of the earth a few times. We talked about space, travel to the moon, and possible travel to Mars. While these conversations were fascinating, it is what he said about our planet earth that had the most impact on me.
He said: “I am sure you have been on a jet before.”
“Of course,” I said, “many times.”
“That usually flies thirty or forty thousand feet above the Earth,” he said.
”Yes, I know. Been there many times.”
“Did you know”, he said, “at about forty thousand feet, the mass of the atmosphere drops by eighty percent? This means that most of the atmosphere that we live and breathe in, lies within this forty thousand foot layer above the surface of earth!”
If you consider the size of the planet, this is a very, very thin layer! To put this into perspective, if you scale the earth diameter to a person’s height, the depth of this layer is only 1.5 millimeters, about the same as the thickness of skin for a person of average height.
All of our lives, living, breathing, and polluting take place within this thin film which moves around our planet. Being so thin, no wonder it is so fragile.
If we don’t take good care of it, all talks about our dreams and our future will be irrelevant. As engineering graduates, you are equipped with the skills to not only change the world, but also the way we all live. Put those skills to honorable use and create for us a sustainable future.
Your destiny will be different. You will face your own challenges and circumstances. Take risks for your dreams, persevere, ignore competition, and if you are overpaid, quit! Enjoy the journey and take good care of our planet.
Remember, never give up hope, never surrender!