Symantec - History

History

Founded in 1982 by Gary Hendrix with a National Science Foundation grant, Symantec was originally focused on artificial intelligence-related projects, including a database program. Hendrix hired several Stanford University natural language processing researchers as the company's first employees, among them Barry Greenstein (professional poker player and developer of the word processor component within Q&A).

In 1984 it became clear that the advanced natural language and database system that Symantec had developed could not be ported from DEC minicomputers to the PC. This left Symantec without a product, but with expertise in natural language database query systems and technology. As a result, later in 1984 Symantec was acquired by another, smaller software startup company, C&E Software, founded by Denis Coleman and Gordon Eubanks and headed by Eubanks. C&E Software was in the process of developing an integrated file management and word processing program.

The merged company retained the name Symantec, and Eubanks became its chairman, Vern Raburn, the former CEO of the original Symantec, remained as CEO of the combined company. Soon after the merger, Eubanks and Raburn recruited Rod Turner into Symantec as its executive vice president for marketing, sales, product management and international business. Turner had been in interviews and discussions with C&E Software in early 1984 about becoming the president of C&E. These discussions had ended when the two companies merged. The new Symantec combined the file management and word processing functionality that C&E had planned, and added an advanced Natural Language query system (designed by Gary Hendrix and engineered by Dan Gordon) that set new standards for ease of database query and report generation. The natural language system was named "The Intelligent Assistant". Turner chose the name of Q&A for Symantec's flagship product, in large part because the name lent itself to use in a short, easily merchandised logo. Brett Walter designed the user interface of Q&A (Brett Walter, Director of Product Management). Q&A was released in November 1985.

During 1986, Vern Raburn and Gordon Eubanks swapped roles, and Eubanks became CEO and president of Symantec, while Raburn became its chairman. Subsequent to this change, Raburn had little involvement with Symantec, and in a few years time, Eubanks added the Chairmanship to his other roles.

After a slow start for sales of Q&A in the fall of 1985 and spring of 1986, Turner signed up a new advertising agency called Elliot Dickens, embarked on an aggressive new advertising campaign, and came up with the "Six Pack Program" in which all Symantec employees, regardless of role, went on the road, training and selling dealer sales staff nationwide in the USA. Turner named it Six Pack because employees were to work six days a week, see six dealerships per day, train six sales representatives per store and stay with friends free or at Motel 6. Simultaneously, a promotion was run jointly with SofSell (which was Symantec's exclusive wholesale distributor in the United States for the first year that Q&A was on the market). This promotion was very successful in encouraging dealers to try Q&A.

During this time, Symantec was advised by Jim Lally and John Doerr — both were board members of Symantec at that stage — (Kleiner Perkins Caufield & Byers) that if Symantec would cut its expenses and grow revenues enough to achieve cash flow break-even, then KPCB would back the company in raising more venture capital. To accomplish this, the management team worked out a salary reduction schedule where the chairman and the CEO would take zero pay, all vice presidents would take a 50% pay cut, and all other employees' pay was cut by 15%. Two employees were laid off. Eubanks also negotiated a sizable rent reduction on the office space the company had leased in the days of the original Symantec. These expense reductions, combined with strong international sales of Q&A, enabled the company to attain break-even. Because all team members were sharing in the suffering of reduced income, and because of the unifying affects of the Six Pack Program, Symantec's morale during this period was very high — the more so when one considers that the company had a very uncertain future at this time.

The significantly increased traction for Q&A from this re-launch grew Symantec's revenues substantially, along with early success for Q&A in international markets (uniquely a German version was shipped three weeks after the United States version, and it was the first software in the world that supported German Natural Language) following Turner's having placed emphasis on establishing international sales distribution and multiple language versions of Q&A from initial shipment.

In 1985, Rod Turner negotiated the publishing agreement with David Whitney for Symantec's second product, which Turner named NoteIt (an annotation utility for Lotus 1-2-3). It was evident to Turner that NoteIt would confuse the dealer channel if it was launched under the Symantec name, because Symantec had built up interest by that stage in Q&A (but not yet shipped it), and because the low price point for the utility would not be initially attractive to the dealer channel until demand had been built up. Turner felt that the product should be marketed under a unique brand name. Turner and Gordon E. Eubanks, Jr., then chairman of Symantec Corporation, agreed to form a new division of Symantec, and Eubanks delegated the choice of name to Turner. Turner chose the name Turner Hall Publishing, to be a new division of Symantec devoted to publishing third-party software and hardware. The objective of the division was to diversify revenues and accelerate the growth of Symantec. Turner chose the name Turner Hall Publishing, using his last name and that of Dottie Hall (Director of Marketing Communications) in order to convey the sense of a stable, long established, company. Turner Hall Publishing's first offering was Note-It, a notation utility add-in for Lotus 1-2-3, which was developed by David Whitney, and licensed to Symantec. Its second product was the Turner Hall Card, which was a 256k RAM, half slot memory card, initially made to inexpensively increase the available memory for Symantec's then flagship product, Q&A. The Turner Hall division also marketed the card as a standalone product. Turner Hall's third product, also a 1-2-3 add-in was SQZ! a Lotus 1-2-3 spreadsheet compression utility developed by Chris Graham Synex Systems. In the summer of 1986 Eubanks and Turner recruited Tom Byers from Digital Research, to expand the Turner Hall Publishing product family and lead the Turner Hall effort.

By the winter of 1986–1987, the Turner Hall Publishing division had achieved success with NoteIt, the Turner Hall Card, and SQZ!. The popularity of these products, while contributing a relatively small portion of revenues to Symantec, conveyed the impression that Symantec was already a diversified company, and indeed, many industry participants were under the impression that Symantec had acquired Turner Hall Publishing. In 1987, Byers recruited Ted Schlein into the Turner Hall Product Group to assist in building the product family and in marketing.

Revenues from Q&A, and from Symantec's early launch into the international marketplace, combined with Turner Hall Publishing, generated the market presence and scale that enabled Symantec to make its first merger/acquisition, in February 1987, that of BreakThrough Software, maker of the TimeLine project management software for DOS. Because this was the first time that Symantec had acquired a business that had revenues, inventory, and customers, Eubanks chose to change nothing at BreakThrough Software for six months, and the actual merger logistics started in the summer of 1987, with Turner being appointed by Eubanks as general manager of the TimeLine business unit, Turner was made responsible for the successful integration of the company into Symantec and ongoing growth of the business, with P&L. There was a heavy emphasis placed on making the minimum disruption by Eubanks and Turner.

Soon after the acquisition of TimeLine/Breakthrough Software, Eubanks reorganized Symantec, structuring the company around product-centric groups, each having its own development, quality assurance, technical support and product marketing functions, and a General Manager with profit and loss responsibility. Sales, finance and operations were centralized functions that were shared. This structure lent itself well to Symantec's further growth through mergers and acquisitions. Eubanks made Turner general manager of the new TimeLine Product Group, and simultaneously of the Q&A Product Group, and made Tom Byers general manager of the Turner Hall Product Group. Turner continued to build and lead the company's international business and marketing for the whole company.

At the TimeLine Product Group, Turner drove strong marketing, promotion and sales programs in order to accelerate momentum. By 1989 this merger was very successful — product group morale was high, TimeLine development continued apace, and the increased sales and marketing efforts applied built the TimeLine into the clear market lead in PC project management software on DOS. Both the Q&A and TimeLine product groups were healthily profitable. The profit stream and merger success set the stage for subsequent merger and acquisition activity by the company, and indeed funded the losses of some of the product groups that were subsequently acquired. In 1989, Eubanks hired John Laing as VP worldwide sales, and Turner transferred the international division to Laing. Eubanks also recruited Bob Dykes to be Exec VP for operations and finance, in preparation for the upcoming IPO. In July 1989 Symantec had its IPO.

In May 1990 Symantec announced its intent to merge with and acquire Peter Norton Computing, a developer of various utilities for DOS. Turner was appointed as product group manager for the Norton business, and made responsible for the merger, with P&L responsibility. Ted Schlein was made product group manager for the Q&A business.

The Peter Norton group merger logistical effort began immediately while the companies sought approval for the merger, and in August 1990, Symantec concluded the purchase — by this time the combination of the companies was already complete. Symantec's consumer antivirus and data management utilities are still marketed under the Norton name. At the time of the merger, Symantec had built upon its Turner Hall Publishing presence in the utility market, by introducing Symantec Antivirus for the Macintosh (SAM), and Symantec Utilities for the Macintosh (SUM). These two products were already market leaders on the MAC, and this success made the Norton merger more strategic. Symantec had already begun development of a DOS based antivirus program one year before the merger with Norton. The management team had decided to enter the antivirus market in part because it was felt that the antivirus market entailed a great deal of ongoing work to stay ahead of new viruses. The team felt that Microsoft would be unlikely to find this effort attractive, which would lengthen the viability of the market for Symantec. Turner decided to use the Norton name for obvious reasons, on what became the Norton Antivirus, which Turner and the Norton team launched in 1991. At the time of the merger, Norton revenues were approximately 20 to 25% of the combined entity. By 1993, while being led by Turner, Norton product group revenues had grown to be approximately 82% of Symantec's total.

At one time Symantec was also known for its development tools, particularly the THINK Pascal, THINK C, Symantec C++, and Visual Cafe packages that were popular on the Macintosh and IBM PC compatible platforms. These product lines resulted from acquisitions made by the company in the late 1980s and early 1990s. These businesses and the Living Videotext acquisition were consistently unprofitable for Symantec, and these losses diverted expenditures away from both the Q&A for Windows and the TimeLine for Windows development efforts during the critical period from 1988 through 1992. Symantec exited this business in the late-1990s as competitors such as Metrowerks, Microsoft, and Borland gained significant market share.