RW: Jack joined Fairchild Semiconductor at age 24 and quickly became the head of Linear Marketing. He went on to co-found AMD, run Intersil, and most recently found and head up linear manufacturer, Maxim.
JG: Rob, I, you and I have known each other since 19, I guess '66. I, we were both pretty young men at that time. I think I was, when I joined Fairchild Semiconductor I was 24. I had worked as a design engineer in Los Angeles for a company called Electronic Specialties and Fairchild had recruited me from there. I really wanted to design integrated circuits but they told me I had to be a salesman first. So I spent a year working for Fairchild in the field as a salesman calling on Hughes Aircraft, where I succeeded people like Jerry Sanders, Jim Martin, Don Valentine, and then I was promoted up to come to, to Mountain View to work for Fairchild and I really, I never got to design anymore integrated circuits. I was, got into product marketing. And I'll give you, I'll go on from there in a minute but let me go back to my, the question you asked me, Rob. So I joined Fairchild after a couple of years as designer and I had been at UCLA prior to that. So I graduated from UCLA in 1963 and I had attended UCLA as a scholarship athlete playing baseball and wanted to play professionally and, and did but could not do it and support my wife and my daughter. We were married in high school and we went to a high school called Banning High School down in the L.A. Harbor and attending UCLA was a tremendous culture shock for me coming from, from the docks and, and so I've got two major culture shocks in my life. One was coming from Wilmington, the L.A. Harbor up to UCLA, West Los Angeles, and the next culture shock was coming from there to the Silicon Valley and the electronics industry in, in those early '60's. It was a tremendously vibrant fast-moving business. So my background was probably very good for the business we ended up being in. I had a competitive background from athletics. I had worked in a small start up company in L.A. as an engineer. I'd worked for a year with the most talented, aggressive sales organization the world's ever seen at Fairchild and, and ended up, up in the, the lower management levels of Fairchild in 1965, I believe.
RW: So where, were you, were your folks from a working-class background, or what?
JG: Yeah. My , my father, well, they were basically, well my father was an orphan and left Pennsylvania when he was about fourteen and, Homestead, Pennsylvania when he was about fourteen, and Homestead, Pennsylvania, which was a steel mill town, and he was a professional athlete. He traveled the oil fields from Oklahoma, Texas, Ohio, Montana and then eventually ended up in California where they had discovered oil. But he was like an entertainer. He would do, he would prize fight, he was a prizefighter and a baseball player, and he would, he would provide, they would provide the entertainment on, on the weekends for the, the oil fields. And he was actually good enough that the, the Pittsburgh Pirates signed and he played a year in the major leagues for the Pirates but, so by the time he got to California, he was about 37 years old and his playing days is, and fighting days were pretty much coming to an end and he met my mom who was a, the sister of a, the youngest sister of one of his buddies from the oil fields, Toby Herndon, and he had, he had introduced him to my dad and my dad and my mom were married in about 1938, and my dad got his first real job. He got a job as, digging ditches and, for Mobile Oil in Los Angeles, and so, I was born there in L.A. in 1941. And my mother's family had come to Whittier from the, from the Dust Bowl, actually. They were, they were, as John Steinbeck wrote about, they were part of the, they were Arkies, Oakies and Arkies. Well, they were from Arkansas and they'd come out from the Dust Bowl. So, yeah, they were pretty, pretty grass-roots people.
RW: Great, so, well, anyway, so you went to Fairchild in, what? Mountain View?
JG: Yeah. Originally I worked in L.A, for one year for Fairchild and then I came, they promoted me up to come to Mountain View to become, which is kind of a funny, is a great story, actually, to become the Linear Circuit Manager, Product Manager. And it, and that story needs to be told because it affects, it brings Bob Widlar into the picture. I was in L.A. and I, I was probably, no, not probably, I was the only knowledgeable electrical engineer at Fairchild who was in the applications and the marketing organization who was a legitimate design engineer, in analog who, who understood gain phase relationships and amplifiers and, and, and, and, and basically equipment. And Vic Grinich had some background in that area, but, but, but there were not a lot of others guys. And it turned out that Bob Widlar, I was in L.A, and Bob Widlar had joined Fairchild from Ball Brothers. He was, very background, very similar to me. He was working for an equipment company, Ball Brothers. I think he had gone to the University of Colorado, and they were in Colorado and I had worked at this Electronics Specialties in L.A. and we both left our companies to go to Fairchild and, and Bob somehow got into Fairchild R and D, but he didn't have a, the typical R and D degrees that all these guys had. He, he had a bachelor's degree, out of the University of Colorado and he's, Rob, you know, they had a very pedigreed organization in R and D and, and, and he was very much a radical. And they, maybe even some people say not all together stable, but, but he was a very aggressive and he made a relationship with a fellow by the name of Dave Talbert who was a process engineer working in, in Mountain View in the wafer fab area. And, I don't know what they hired Bob Widlar to do in R and D. I can't imagine even Gordon Moore or Pierre LeMonde hiring him, but somebody hired him and, but it made no difference what they wanted him to do. What he decided he was going to do was design an amplifier. And, and apparently they had tried to design some amplifiers using these digital processes that they had, and they, it was not possible because they breakdown voltages weren't there. They didn't have an epitaxium material that could give them any breakdown voltages. The leakage were, were terrible. They had no PNP transistors. And so Bob got together with Dave Talbert and they both were heavy drinkers, very young, but, and they would, and Bob Widlar talked Dave Talbert into moonlighting and developing a process that he could, he could build an amplifier with. And this was all done while Bob, Dave, Dave Talbert was, was literally working, his day job was running as a process engineer working in a digital line at, at Mountain View. And between Widlar and Dave Talbert, they developed this process that would give them, initially it'd give them I think about 25 volt breakdowns. They eventually took it, they got it up to where it would give them about 35 volt breakdowns. Had a lateral PNP that had a beta of point five. It was just literally terrible. But it was all done without any Fairchild sponsorship whatsoever, or knowledge. And the story's going to go on for a bit but it's really a great story. So unbeknownst to any of the management at Fairchild, Bob Widlar, who is, a bachelor's degree junior engineer at Fairchild R and D has this amplifier that he's developed. And, he, he doesn't tell anybody about it but he does find a way to expose it to a few of the Fairchild salespeople, and the two guys that he exposed it to were Floyd Kvamme, who had, who was calling on IBM at the time, and me, which, because he had determined that we both were technically knew what we were doing and we understood him and he brought, gave us samples. And we started, you know, showing these things to people and, I mean the reaction was phenomenal because it would reduce the board, the board sizes, you know. Every, most of the computing that was done in the defense industry in those days was done fundamentally with analog computing, and so this thing was a huge advantage to reducing size and weight. So there was a lot of customer interest in, and because of this the management of Fairchild found out about it, I mean they heard about, and they, they, What is this thing? What is this, this 702 amp? What is this, you know, what is this product and they found out that this guy, Bob Widlar, had designed it and it was being built at Fairchild and there was enough market interest, very, that Tom Bay and Bob Noyce decided that they would, that we ought to sell this thing. So they go to Bob Widlar, now this is all occurring in about 1965. They go to Bob Widlar and they introduce themselves. They literally didn't know him, introduced themselves to him, tell him, you know, of course he knows who they are and they said, you know, we're going to you know this circuit you designed, we're going to make it a Fairchild product. We're going to announce this thing and, you know, we'll sell it. And, and he said, the hell you are. What do you mean? You're, you're not going to sell this. You guys don't know anything about this product. Nobody in this company knows anything about it. You can't sell this. He says, "I don't want you to sell it. You don't know how to, you know, you don't know anything about it." That conversation went on and the fact is Widlar refused to cooperate. And they, and they walked away shaking their head. Nobody, tell this kid telling these guys, and they were just irate as, you could remember how they could get. And they had just, they would have killed him but they, it would have been like killing the golden goose. This product was hot. And Widlar's telling them they got no business, you know, with it. They don't know anything about it. They didn't, because he had been rejected many, many times by all, and he was an outcast. So he was, he had a reason to be upset and be arrogant, but he insisted that they weren't, he wasn't going to do it. So they would go back to him another time and they'd tell him, you know, they'd say, "Well listen, you know, what do you, what would make you comfortable with us being able to properly represent the product?" And he said well, you've got to get, you know, you'd have to have an organization that understands these things. You have to have... Well, if we give you a, if we put a product manager in charge of it that, you know, that you, that you're comfortable with, would you be okay then? He said, "Yeah." So they take and bring all of these, I mean they must have had fifteen product managers and, they brought them all in front of Bob Widlar and let him interview them. And these were the, you know, the more senior guys. And they'd come back. Well, what do you think? Which one? None of them. I don't like any of these guys. He said, "Well, what, who would you accept?" He says, "Well, there's this kid down in L.A., you know. He knows amplifiers." Gifford? Who's Gifford? And so I get this call from Bob Graham. And, you know I'm happy as a duck down there doing what I'm doing. I get this call. I have no, I've been there a year. I have no reason to expect to get promoted or anything. I get this call from Bob Graham and he says Jack, who was running all the product marketing, he says come on up. We want to interview, we want you to interview for a job. So I go home and tell my wife and wow. So I fly up there the next day and I don't know, I had been around an airplane about five times in my life. I mean, I think I'd been up to Fairchild once with a customer and I'd gone to, when I'd traveled to play baseball but, so that was a big deal. I mean, I go up there and I, the interview lasts about, I mean, it couldn't have lasted ten minutes. I mean, it was just a routine. It wasn't like, and I'd come back and they call me the next day and they say well, you know, get your house for sale. You're going to be the Linear Circuit Product Manager. And I went, "Wow." So I, you know, I go up there. They bring me, we got to move up there in about two weeks and I walked over and I get this office and, nice office. Big office. Big for me. I had no office. This is the first office I'd ever had in my life. I had this office. I got this desk and this chair and looking around, and I'm not in there five minutes and John Lambrose and John Ready come by. And they're, well I know these guys but not well. And they were very, they were four levels above me in the company. And they're, you know, they're kind of smiling and laughing and, and they, finally Ready says, well, you know, how do you like this office? Oh, this is nice. Well, don't get used to it. You're going to be out of here in ninety days. And they walked out laughing. And I, and what had happened is they had decided we'll just hire, put this, Gifford's the kid, the guy that he wants? We'll put Gifford in there. As soon as we get this product announced we'll just adjust it back, you know. So I'm thinking wow. I'm, this is what's that's all about. So I'm realizing right then I'm good for about ninety days, and, you know, as soon as they get this thing announced. So I just, I was, I made my mind up that they were going to have trouble getting rid of me and I just began building a very competent analog organization at Fairchild which ended up becoming the most competent in the world. I hired guys like Mike Scott. He's at National. I hired Mike Markkula, Gene Carter, you know. We had about eight or nine of us and we at one time had eighty percent of the market and so for a couple of years we did that. And my job continued to be. They didn't fire me. I did well. But a major one of my responsibilities was babysitting Bob Widlar. And he would almost talk to nobody and he would only talk to me on, you know, if I could get him in the right mood. And he was still secretive as hell. And, so, you know, and then Bob hired Jim Giles. And, Dave Fullagar was over at Fairchild R and D. He'd come out of Transitron, and Dave, and then, the story goes on and on but Bob eventually left to found National Semiconductor. He and Dave Talbert were really the founders of National Semiconductor. And then Charlie Sporck joined them later. But Bob left and I remember Widlar telling me, you know, he and Talbert for the first six months literally built an epi reactor. I mean, the two of them. I mean it was like ground, you know, ground zero. You didn't go buy anything and Widlar and Talbert actually built one. And, and then after they started making some linear circuits, Charlie and Pierre and these other guys, you know, came over. But when Bob Widlar left then I pretty much became the, the guy in charge of all of the analog effort at Fairchild. And Dave Talbert, Jim Giles moved over, you know, to replace Bob Widlar and we ran that operation for about another three years, two or three years and then I left and founded Advanced Micro Devices. I told the Bob Widlar story. I know a lot more Bob Widlar stories and...
RW: Yeah, well, Charlie Sporck has been interviewed and he also told, told a few.
JG: Yeah, Charlie really didn't know the stories. He knew them from National Semiconductor but he didn't know them from Fairchild. But he didn't change his, you know, actually this, the stories are pretty much the same stories, just different, they occurred at Fairchild and then they continued to occur at National. But, I remember one night, I mean, you had to drink to be around Bob Widlar. I mean, if you wanted a, I mean and, and I did drink but, I mean, this guy was infamous, I mean. And I remember one night where we were drinking and the next thing I know we're up, we're up at his tree house. He lived in a tree house up in the, by Big Basin. And we're up there and, he didn't live in it but he had this tree house and he's up there shooting a 30-30 off in the middle of the night, three in the morning, you know. And stuff like that. And, another time we're at the Wagon, this is the Wagon Wheel which is where we always went. I walk in there and, and Bob Idler's got one of my guys, Mike Scott, who ended up going to National. Did you know Mike Scott? Okay, Mike went, went to National and ended up doing a great job and then was the CEO of Apple Computer. But when I hired Mike, I hired him out of Beckman Instruments, and he was a, just a very uncouth, inexperienced young man. And we had, you know, bright as hell, aggressive, overweight. He's from Cal Tech, and so we, Mike Markkula and I would, you know, spend a great deal of time trying to teach him, you know, literally how to eat with a knife and fork at times. I mean, that's how crude he was. But, and he was committed to succeed and a nice kid. And one night I, walked up to the Wagon Wheel and here Bob Widlar has him over, you know, at the bar that, it was a rail bar like this, and, Widlar's just harassing him. I mean just incessantly and so, and Widlar liked to fight, and thought he could fight, pretty good. And, and so finally, you know, he just tells Mike Scott, you know, they're going, they're going to fight, they're going to go out in the parking lot and fight. So they go out. About fifteen minutes later Mike Scott comes in. I mean, Widlar, Widlar didn't. But I mean it was, like this kid. Mike Scott just absolutely clocked Widlar. I mean it was like, that was the end of Bob Widlar harassing Mike Scott. I'll, you know, that was good for all of us when that happened. Another question.
RW: Well, eventually I guess the drinking killed him, right?
JG: You know, I think it did. He stopped drinking but I think the damage was probably done, you know, in the first twenty years. I think that's right. He didn't, he wasn't a derelict. He didn't die as a derelict. He wasn't, I mean he was fine. He was coherent. Probably leading the most, he was down in Mexico, living in Mexico, but he was sober and leading a reasonable life for him at that point when he died. He, but he was bigger than life. In fact we have, we're going to put a monument to him in our, out in front of our building, he and Jean Hoerni because of their contribution to the analog business. I mean, it took that personality. It wouldn't have happened. You, the one story I told you about the obstacles he overcame at Fairchild. But, he overcame some huge obstacles in the marketplace. I mean, he was such a great public spokesman that he, and such a great engineer that he, he was like a, like literally a religious symbol to analog, you know, users. And, I mean people would come, you know, across the country just to listen to him talk and he would lecture on circuit design and these things and he would do it half smashed most of the time. But he really popularized the use of analog circuits in microchips and were it not for his personality and his aggressiveness and his ability to convince these people that they, it was okay, it would have, wouldn't have grown like it did. So he not only designed them, he made them acceptable. So you needed, you know, there, there haven't been many personalities like him.
RW: A real genius.
JG: Well, more than a genius. I mean, it was just he had courage. He was aggressive. He was, he was insane. He was all of those things. Ego. I mean, just a different person. But he was the right person to be there at that time, I think I was, you know, I played some role in that because my, I was a relatively aggressive person, too, and it took a, a strong person to be around him, you know, and...
RW: As opposed to now.
JG: Oh yeah. Me? No, I don't think that's changed, but I mean Widlar was, I have to work at that. Widlar was natural. He just was, he was the meanest, toughest son of a bitch you've ever seen.
RW: So anyway, you left Fairchild.
JG: Yeah. Let me talk a little bit more about Fairchild, just in one regard, with regard to one other gentleman, Dr. Jean Hoerni. Because I actually ended up working for Jean Hoerni after I left Fairchild and after I had founded Advanced Micro Devices, but Dr. Hoerni was one of the founders of Fairchild. And Charlie Sporck's book gives a great accounting of how he actually ended up at Fairchild, which I didn't know, you know, that he had come, that Bill Shockley had actually, needed a mathematician and called Jean Hoerni cold, literally, and set him up at Rickey's doing, you know, mathematical analysis while the rest of these guys tried to build silicon to make semiconductors. But anyway, Jean was very shy mathematician who learned, got into our business, as did most of the Shockley guys, with no background in semiconductors. You know, they were just a collection of guys that Shockley brought together, including Noyce and, you know, Gordon Moore, you know, and I guess I don't need to tell that story because that's in Sporck's book. But I was fascinated to learn that Gordon Moore came back here simply to get back to, back to San Mateo County so he could, you know, he didn't give a damn what the job was. Well, anyway, Jean Hoerni came into the business as really a mathematician physicist without any semiconductor background, and he ended up not learning enough, you know, physicist and mathematicians can do this, but he in my opinion made the two most significant contributions in our entire industry, including the integrated circuit. I think the more important integrated circuit. The planar process, without that, we wouldn't be here. None of it would have happened and to, it is still, today, unchanged as a process. It's remarkable. I mean, the integrated circuits gone through so many metamorphoses yet the planar process is as simple and as pure as it was when Jean invented it. And it was just one of those beautiful inventions, you know, that rivals the light bulb. I mean it's maybe even maybe more beautiful that the light bulb. I mean, growing of silicon dioxide out of silicon is just simplistically beautiful. He then, you know, without his invention of the gold doping of the transistor, we wouldn't have the computer industry today because as you remember, maybe you don't, but the other transistor prior to gold doping weren't fast enough, you know. They were, they had high saturation voltages and, and he invent, how he did it I have no idea how he, how he even thought about it, but he, he killed, you know, carrier lifetime and did it with gold, and all of a sudden now we have IBM, Univac, CVC making, you know, high speed computers buying millions and millions of these transistors all because of this gold doping process that Jean invented. He, you know, and like, Bob Noyce, although Bob did receive a lot of the notoriety and, is well known. And he's passed away at a young age. Jean Hoerni received almost, you know, very few people know of him. And yet he left, he was one of the early people to leave Fairchild. He founded, I think three companies. I think Amelco, Union Carbide, and of course Intersil. And Micro Power. Four companies plus Fairchild. Five companies he founded. And the thing I just roll my eyes back at now, and even then, I remember Jean Hoerni tried to recruit me to come over and run, actually not as the president, but, but I guess the next in charge to run Intersil at, not too long after he had started it, which would have, it was in about 1969, I think he probably started in '67, and I was trying to start Advanced Micro Devices. And I didn't, he wanted just me and I had a team of people to do analog, and I didn't want to do that. I couldn't do that, and he didn't want my team, so I didn't do it. But I went on and started Advanced Micro Devices with Jerry Sanders. And after a couple of years I left there and Jean Hoerni asked me to come in and, I didn't leave to join him. I'd left to get out of the business. I actually went into farming. And Jean found me and asked me if I would consider helping him with... oh, this is a story, this story starts to affect you, helping him with Intersil, and at the time I had, with you, Rob, and a couple of other guys thought about doing this company called Zatetics, which was going to be a product conditioning company, and I was really emotionally committed to doing that, and I completely believed in it, and I know it would have worked, and we were having, as you remember a great deal as if we were only getting, you know, I couldn't raise enough, I couldn't raise the money. I had a few guys committed. But Jean kept promising me that if I would, if I would help him with Intersil, give him some advice and look at some things, he would consider helping me, he would, he said he would help me raise money for Zatetics, and he was just really stringing me along. He didn't want me to do that. But he wanted me to come in and run his, his analog, his company which was mostly analog that time except for an operation that was where he had developed the, a CMOS process. And they were, and also a bipolar, I think it was, maybe it wasn't EPROM bipolar ROM process, but it was just unbelievable that he had done, again, here he is inventing things. CMOS, he broke the first CMOS micro-controllers. He built the CMOS circuits, CMOS analog watch circuits. You know, he, he did these, these, these ROM's. I mean, this all happened at Intersil. Intersil should have owned the universe, you know. But, at that point anyway, he had all this technology and he had, and stuff worked, and he had this, this original thing was an analog business. Dave Fullagar was over there, and so he wanted me to come in and look, because Art Rock wanted him to get out of the analog business because this other, they wanted to take the company public and Rock, this is your classic, you know, myopic or superficial venture capitalist in that regard. They said no, you know, you know, just forget this other stuff. We want you to, you know, take this digital thing, the, the CMOS microcontroller capability, the prom, the ROM capability, and that, we want that to be the company. This other stuff is distracting. So he asked me if I would look at that and give him my opinion. If I felt it was not worthwhile then he would do what Art Rock said. And I did look at it and I, it, his technology was, was equally impressive in this analog area as it was in the digital area. He had developed thin films that no one else could do. He had, he was doing analog, you know, in CMOS, you know, very low voltage, you know. Literally two-volt stuff. I mean he was developing just this custom circuits for analog, he was doing all of Analog Devices' circuits. Dave Fullagar, and they were giving them to him. And I told Jean. I says, "Jean, listen. I mean you can do what they want and it will be fine but this is, you got a great business here." He says, "Well, would you, would you run that for me?" And I said I would. And so I, I went in. I stopped, I did my farming, you know, two days a work week did that three days a week for Jean Hoerni. And he, the point of my story is that he's very, very under-appreciated. He was always being accused or being judged as what a great technologist but he has no ability to run anything. He can't manage things. And here's a guy that started five companies. Never, you know, made, did it with his own money and never failed, and yet he had this knock on him because he was, he was a very shy person and yet, I, you know, he's one of the best managers I've ever been around. And it's just amazing that, you know, he had this other because he wasn't the typical, you know, outward going, flamboyant person.
RW: Well, I wonder if part of that problem wasn't Don Hoefler, who was obviously you were number one on his enemies list. How did that all, how did that all happen?
JG: Well, actually I, I probably, there have been probably a number of people have been number one on his list at different times but you're sure right. I was for a while and, yeah, that was not a good part of my life. It, it happened. I'm, hesitating here because I don't want to cause anybody else a problem but I think it does need to go, go on the record. What had happened was that I was at Intersil and Jean Hoerni was no longer the CEO because they were, they were trying to groom the company. Well at that point it was a public company and they had, they had, the guys like Art Rock had convinced him that he needed a guy that who was more of a CEO type so they brought in Jim Riley who was a CEO at Signetics and Riley promptly, you know, began to ruin the company. And they finally fired Riley and they brought, and they gave another guy who shouldn't have been given the job, Marshall Cox, a job Marshall had no ability to run, to run an integrated circuit company. He had no background and experience. And I was running this division which was the analog division, and I, I forget who was running the digital division, but, but, and Marshall Cox was the CEO, and I was, it was my nature as you know, I was very vocal and very negative about the nepotism that went on there. Not nepotism but the cronyism and the, and the fact that Marshall had, you know, it wasn't a meritorious environment. It was, he had a bunch of, of his, friends in the sales organization. It was, and I have to use the word. It was a corrupt company. I mean there was corruption. I mean in, in, when I, when I finally became the CEO there were, there were kickbacks and people were being bribed. I mean reps were having to pay to keep their lines. And it was a mess. But I didn't know that at the point but I, I was just very, outspoken about a number of issues and I was causing, and that my being out, because we were very successful, this division I was running and so I, you know, I, they did listen to me and, I was never outspoken to the extent that I went above Marshall Cox or to the Board or anything, but I would tell people what I thought if someone asked me, and it was, but at anyway, he became very uncomfortable with, with, with me, and he asked, and he, he told Fred Adler who was the Chairman of the Board that I was a very disruptive influence at Intersil and I was a causing a lot of problems and I really, they needed to fire me. And, and, because I was disruptive, and yet I was running the, the most profitable operation and I was making the money and I, you know, and I was disruptive. And, but I'd been fired once before so I was used to getting fired. I got fired by Jerry Sanders and the Board of at AMD, so, but so one day I get this call from Fred Adler, there at Intersil. And he wanted me to come over to his conference room which was near Marshall Cox's office. And I had met Fred a couple of times so I go over there, and, and I sit down. It's just me and him in this big room. And he said, "Jack, I understand that you're, this, this, this and the other thing, and the bottom line is you're very disruptive to the company. You're causing a lot of problems." And, and he's very, you know, it's clear he's, and then he says, "I going to get up and take, go take a piss and when I come back I want you to tell me why I shouldn't fire you, because I intend to." And I couldn't, and I'm, and I couldn't believe it. I was just, just irate. And, and I just got, and so, he left, he left the room and I just, to the hell with it, I just walked out. I didn't him or this job or any of that stuff so I just walked out. Got, went in the parking lot and he comes, you know, all, altogether, apparently he comes back to the conference room, I'm not there so he comes running out chasing me into the parking lot wanting to talk, wanting me to explain myself, and I told him, you know, you know, fuck you. I'm not, you don't deserve, you know, you don't deserve an explanation. And I just went home. And then I get a call from Roger Smullen, and Roger says, you know, "What happened?" I told him and he says it's ridiculous and so he convinced me to sit down and talk to Adler. I, I explained to Adler what had, what was going on at Intersil and why I was disruptive and then about, and so Adler talked me into not resigning and, you know, gave me, you know, some more stock options and told me he would change things, and in about two months he fired Marshall Cox. Okay. This is actually a Don Hoefler story. You asked me why, you know, why I was on his hit list. Well, so. So indirectly I guess I, I, I, well, I guess I had a direct role in getting Marshall Cox fired but not because I went and got him fired. It was because of this Adler fired him. But at any rate Don, Marshall Cox had this very, very close relation with Don Hoefler, which, you know, and, so Marshall Cox apparently told Don Hoefler that I was the problem. I had done these dishonorable things, and, to him and so Hoefler, that's why Hoefler began to attack me was because Marshall Cox had set him on me, and he attached me viciously for, years.
JG: Yeah. And, well it probably wasn't that long. It seems like that long. But it was...
RW: Well, he accused you of killing his wife.. causing, she died of a stroke.
JG: Yeah, well, he...
RW: And he said it was because of the controversy that he had with you...
RW: I think you sued him, didn't you?
JG: Yeah. Well, I'll tell you that story, yeah. I mean, I think actually, I think I killed him is the bottom line. I mean we could, that was not my, you know, what happened was, so I was promoted to become the CEO of Intersil, you know, when, Jack Welch, and I'll tell you that story. That's a good story, too, about, you know, GE buying Intersil, well what had happened then at Intersil was they finally got their act together and Fred Adler convinced Orie Hoch, who was a legitimate CEO, to come in to be the CEO. Orie was one of the fair, one of the leaders from Litton Industries. He was one of Tex Thorton's guys, physicist in background, came in and he started running Intersil a lot professionally like they ran Litton. And fortunately for me he was a very meritorious based type person. And among all the chaos and the anarchy going on there he sorted out who was making a difference and who wasn't, and then Orie promoted me and I then became his successor as the CEO of Intersil. And that was my first CEO job. And then we were doing very well. We'd, I had built this thing up to a hundred and thirty million dollar company, just very highly profitable. And along comes GE and they want to buy it. And, I'll have to come back to that story because I'll finish the Hoefler story. They did buy, and I'll come back and tell you about that, selling Jack, selling GE, Intersil to GE, selling it to Jack Welch and my relationship with Jack Welch. It needs to be told, too, because Jack's book leaves out a lot. Okay, so we sell it to GE and I become the CEO of Intersil GE. And then Hoefler, at that time he is attacking me, but he continues to attack me. And I just, it's just one lie after another and I told Jack Welch and GE, I says, "I gotta do something about this guy." And they says, "No, no. Don't. Let it go. You, don't, don't deal. Just ignore the press. No problem with us. Just ignore it." And I just keep it going and I ignore it. And so I do nothing because GE doesn't want me to do anything. And then I get fired by GE about a year later for a reason I'll tell you about. But at that point, after that I decided, you know, I've got to do something about Hoefler. I can't, you know, nobody does that to me and, without getting even so I sued him. And I sued him for liable and slander. And this is a, you know, I don't know how much you know about lawsuits but it's very difficult to win a slander lawsuit. You can win liable, but if you can't prove that the guy intentionally lied about you can't get any damages, and it's almost impossible unless the guy says it, tells, you know, he says, "Yeah, I did that on purpose to hurt the guy." It's almost what you have to have happen, Rob, so literally my attorney, a guy by the name of White, under oath got Hoefler so, brought all of this out just like on television and Heffler just blurted out that Yeah, I lied about him because that son of a bitch did this to Marshall Cox! And literally, that's what, he lost the liable and slander suit, which did kill him probably because he had then to pay me some money. But most importantly I wrote for a number of months in his newsletter. I wrote a story undoing all of the lies that he had told under his by, under his byline. I wrote it for him. And he had to publish it. That was part of the settlement agreement. And that, that was the end of the Hoefler story. And during that, and then he died, actually, while that was going on.
RW: Well, today Hoefler's newsletter are online with the Smithsonian...
JG: Oh really.
RW: ...website. That's right. Bob Shriner, who was another one of these, of Hoefler's buddies donated his copies to the Smithsonian, and they're online.
RW: And they're online. You could read all those again...
JG: Read them again, huh? Yeah...
RW: Well, he, Hoefler said it to me that I was indicative of the rag-tag nature of LSI Logic, and he said of Susan that she was the Shady Lady from the Chinese company and inferred that she was having, having an affair with, Wilf Corrigan. So...
JG: Yeah, he...
RW: We, none of us...
JG: And, and none of this stuff was true. I mean, he got away with this stuff. I mean it was just unbelievable. But he accused me of everything from taking forty thousand dollar bribes to, you know, having illicit, doing all kinds of weird things. And not one of them were true. And I, you know, those, that's, and that happens.
RW: Well, let's go back to AMD, because the, the, the common wisdom is that Jerry Sanders was the founder of AMD. So why don't you tell what the, what really happened there?
JG: Yeah, I think that, and one, and I think Rob, ten years ago that was the common wisdom, but I think with, with my publicity or with my visibility, I should say, and I have explained the AMD situation, you know, a number of times I think among the knowledgeable of people I know through the situation. But what happened quickly was that when the Motorola people joined, came in to run Fairchild, which was Les Hogan and Wilf Corrigan and Leo Dvorkin and these guys, they, Charlie Sporck did a pretty good job of telling the story in his book so I won't repeat that, but they fired Jerry Sanders and, and I, of course prior to the Motorola guys coming in I was trying to start an analog company. I had myself, Jim Giles, Larry Stenger, Frank Botté, and I had a couple of other guys that were from Siliconix and I'd been about six months trying to raise money to, to start the company. In fact I had, a guy by the name of Bruce Waterfall who you may or may not know but he was the staff assistant to Charlie Sporck. He was, he reported directly to Charlie, a young guy about my age. He was from New York, had an MBA and, he and I were friends. He had left to go back at, to work on Wall Street and he had some pretty influential friends so when I decided I was going to start an analog company, and I guess what motivated me was Bob Widlar a year or two earlier going over and, and starting one at National. And I was really at a very high, I mean I was 26 year old and I was a very high level. I mean, I had three hundred people working for me. I was 26 years old and I just didn't want to do that. I wanted to be something smaller. And I wanted to do, and I had been, I had been promoted out of the analog business. I was, and Mike Markkula was running the analog stuff and I just decided I wanted to, I wanted to go back and run an analog operation. So I decided to start this company. And, I called Bruce Waterfall who was back in New York on Wall Street. I says, "Bruce, I want to start, can you help, can you tell me about, can you help me raise some money?" because I didn't know, there were no venture capitalists in those days either, really. There were a couple but, He said, "Well, come on back and, and, you know, write something up. And yeah, I'll take you around and introduce you to all these people that I know." So I go back there for a week and he takes me around. I must have talked to ten, fifteen people, but they were bankers and this and that and, and I came back home and three or four days later I called Bruce and I said, "Bruce, what do you think? How'd it go?" He says, "Well, Jack, it's got two big problems." He said, "One, they don't know what the hell you're talking about. They don't understand this stuff at all. And secondly, they don't know who the hell you are. I mean, you're not, you know, you've never done anything before. You're 26 years old." And so, you know, there just, could just, you get a blank stare. There's not, he says, "You're going to, you know, you really got to, you need to get somebody that, that's, that's got more of a, more experience than you do." Well, a few weeks later the Motorola fired these guys, fired Jerry Sanders. And I'd been now trying to raise money, you know, for almost six months. And I now was convinced it was because my lack of, lack of experience, lack of credential. And so, to me Jerry Sanders well, you know, he was two levels above me and he was certainly more well known than I was. And, so I thought well hell. Jerry, you know, he and I were friends and, I'll get him to come and, I'll get the money. And so I told my wife. I said "Linda, let's go down to Malibu and see Jerry, and see if I can talk him into joining getting involved with us." So we go down there and these guys rented this place on the beach and he's, he's got no money at all. I don't even know how he's paying for it but...but he, you know, he's just completely despondent and, and I'm telling him what I'm all excited and tell him what I want to do and, you know, and that we really want him to get involved and, because he needs a job and he doesn't have a job and, you know. And all, and then he finally, he says no, I've had it. I'm going to get into the record business. What do you mean the record business? I'm going to get into the record brokering business. My wife's uncle or somebody does this at, and he loved Hollywood, you know, and that's what I'm going to do. And so I, so we go to bed that night, we stayed there. And then I tell her, "Oh, I'd give it one more shot in the morning and if he doesn't want to do it we'll just go home." So the next morning I get up and I start in again on him and then I finally get to this light bulb goes on and I'm thinking, you know, I say, "Jerry listen. I know what you want to do. I know you want to go into this Hollywood stuff, but I promise you that we can do this thing. We can go out. We get the twenty million in sales. I mean we can sell this company and now you can take that money and go back and do this." And he looked at me and he says, and he looked at me and he says, "You really think so?" And I said, "Yeah. You give me two years and we can get this done, and then you can go do that." He says, he says, "All right. Okay. Yeah, I get to, But I get to be the president." I said, "Sure, you can be the president." And he says, and he says, "And I want to get, I want to have a digital company. I want a digital part of this." And I says, "Fine." I looked at him and I says, "What do you need?" He says, "Well, you know, John Carrey, you know, and, we'll want to make this, this log, this MSI Logic." You know about MSI Logic, which I hated. But I knew TI was, you know, kicking their ass with their logic form, but I mean, so we did. That's how we started it. And then Jerry and I saw, I tell my guys that, you know, okay, we're going to get this money raised now, so we, Jerry and I get on this plane, you know, big, we figure we're going to make the loop around Boston and New York and where ever. We went back and saw this guy back in New, Boston who, who was the venture capitalist who started Data General, and we talked to him. We couldn't even get an appointment without Rock, but we talked to a bunch of guys. We come back and it was just like, you'd have seen this road show, Rob. And he, if you could imagine Jerry and I together trying to make a presentation. I mean, we were interrupting each other. I mean, it was like, it had to be a the most funniest thing you ever saw. You couldn't, you know, with our egos and both of us trying to sell this thing. So then on top of that, it had no invention. It was just a second source company and so, we come back, and they always wanted to know, well, how do we check on what you guys did? Give us, you know, well, who do you check with? And so we, of course they tell, well, you can, you know, other people this business and Motorola and there's TI, and that was, at least with me they didn't have, you know, I didn't have a bad, I had no reputation at all. It wasn't like they could, now they could go out and they asked these guys about Jerry Sanders and they hated him. They hated Sanders. And so it just killed us, you know. And if it weren't Jim Martin, who Jerry Sanders had fired at Fairchild, just, I, did you remember Jim Martin? Just a wonderful guy and, and Jerry just fired him and, got him fired actually, and Jim had left and got into the fund management business with John B. Loveless at Capital Research, Capital Group, with was one of the largest money managers in the world. And Jim, knowing, you know, because he was a friend of mine, knowing what we'd been trying to do went, you know, he was a low level guy, went to the CEO of that company and convinced him that they ought to help us. And they did. And here's a guy that Jerry Sanders had fired and Jim turned around and if it weren't for him, that's where the money came from. We didn't raise it. Jim Martin got them to give it to us. So, that's how I. That was the AMD story.
RW: But AMD never became that strong in linear.
JG: Well, we, that's not exactly right. When we were, well, when we were small, up, first two or three years while I was there it, eighty, ninety percent of our revenue was in analog. And then I got fired. Jerry fired me, which is another story I think I need to tell, and then he'd de-emphasized it. And he literally got completely out of it. In fact he had, you know, he had, he tore up, he literally expunged me from all of the records there for a while. I mean, I was, I didn't exist. You know, and he had, you know, so it was amazing when he, you know...
RW: What was the source of the problem?
JG: Well, you know, it was, yeah. What happened, so Jerry was just tyrannical and there were only two guys who could control him, myself and John Carey. Jerry would sit in his office and plot things. And, you know, by himself and figure that these, get these schemes and figure this shit out and then he would, we'd have these meetings at night and then he would tell us about what he thinks what we ought to do. Well, half of them, at least half of them were just hair-brained ideas. And it was, you know, up to me and Carey, yeah, I mean me mostly but Carey also, we just, you know, end up getting into these massive arguments, you know, that would last up into the middle of the night. Of course he would be threatening to fire you and do all kinds of, but we would just fight and after a while the other guys, there were eight of us, nine of us. This was going on and one day they came to me. They all came to me except Ed Turney, and they said, "Jack, we can't live with this guy. This guy's crazy." And, and I was of course the guy who recruited him, right? This guy, he didn't say he was crazy but he, we just can't, we don't want him as the President. He, we just don't like this environment. And I said you know, listen. This guy will die before this thing fails in wind. I don't have any choices. I mean, this is, I can't. They weren't coming to me for me to run it. They were coming for me to help find, to get another guy. And I said, and they kept after me. Well, you've got to find somebody else. And I said, "Well, let me think." So I thought about it and I thought well, there are a couple of guys that I would, that I thought could be effective. No sense in bringing some guy that can't do a good job. That way, and I knew Sanders could a, you know, a good job. And I, if you could tolerate him. I mean, the guy could, and I felt I could control him and I felt me and Carey could control him. And we could. It was agonizing, though. I mean the, God, the mental stress. That was just one of the worst two years of my life. But anyway, I decided that, well, I'll give a shot. I'll call Don Balentine. I'll call Tom Bay, and see if they have an interest in coming in and replacing Jerry Sanders because, I called Tom Bay, and of course he was drinking a lot in those days and he didn't want to do anything but drink. And I called Don Valentine. I love to get this phone, this conversation. So, so he, I, I'm like normal. I'm going on telling Don about this, how we're doing and of course he knows, he's just been fired by Charlie Sporck at National and he's now working for Jim Martin's company, Capital Group. And, I have great regard for Don. Don hired me actually, you know, in the field at Fairchild, and I am pretty much a protégé of Don Valentine. And, I'm going on about how we're doing, and how great the company is and, of course I'm saying but we've got, these guy's got a problem with Jerry. They don't want Jerry Sanders to be the President. And I says, "Don, you could come in and you could, you know, you could really make this thing what it needs to be and this would be a great deal." I'm going on and on. And, and after I finish, you know Don, I don't know how well you know Don Valentine but there's just a side, you know, he doesn't say a lot. He just sits there. And this is on a phone so I couldn't see his expression. But he doesn't say one word in this whole conversation. And then after about ten, fifteen minutes I stop and I says, "Well, well, what do you think?" And silence on the phone for it seems... And he says, "You fucking gotta be crazy. I got no interest in that." Click. That was the end of that. So I go back to my guys and I say, "Hey listen. Jerry can do this." I says, "He can do this. After we get through these critical period we'll, if you're still unhappy we can do something then. But we gotta go with Jerry. He's got to be the guy to run this thing. And I mean, lead us through it." And so I calmed them down. And I, I calmed them down. And then about a month later, we're in a Saturday working and Jerry comes down to my office and he's got some idea and he starts, we get into an argument about it, and he says something very attacking which he always does. He's always, tries to threaten people with things. And I just got mad. And I, you know, physically, I mean, Jerry Sanders is, I mean, I could handle Jerry Sanders like (snap of fingers). He's nothing. He's a nothing physically. I'm not worried about, but no, some guys, he isn't. So I just got really upset and I just grabbed, I just threw him in the chair, literally. And I was, I says, "Listen, you son of a bitch. I want to tell you something right now." I says, you know, "A month ago everybody in this company came to me to get rid of you. And if you don't change your ways you're going to be out of here." And I says, he sat there and talked to me for about two hours. We talked about how he was going to change, you know. He says, oh he just got white in the face. It was just, you know, "I gotta change." And, and I thought hey, you know, this is good. This is, you know, we'll, this is going to, well, it's over. And I, not two weeks later, he immediately then goes to the Board, tells the Board I'm a problem. He's just petrified. He thinks that I'm, you know, that I'm interested in his job, which I have no interest in. I'm helping him. He goes to the Board. Sets them against me and then he goes to every one of the guys and says that if you support Jack Gifford, then I'm going to fire you, too. That's, that's the story. Fired me.
RW: So, GE bought out Intersil.
JG: Yes. We were doing quite well. We were about a hundred and thirty million dollar company, an analog company at that point, and I was running the, I reported to Bob, to Charlie, Orie Hoch and, but I was like the General Manager of it, and pretty much the prime mover of the company and, I had gotten us into an DMOS business, which a guy I hired, a guy by the name of Larry Regela. There were two guys doing it in the world. There was Larry Regela and there was, oh jeez, I'm embarrassed, the guy who runs Cypress...
RW: T. J. Rogers.
JG: T. J. Rogers. And they had come out of Stanford and, they both had this vertical MOS interest, and we were, I think T. J. Rogers was at AMI and, and Larry Regela was over at HP and I had hired Larry and we started making these DMOS process, and I got to shorten the story up, but it allows you to build a high voltage MOS device. And we had done some products and written some things with it, and it wasn't altogether that exciting a technology once we got into it, and the economic value of it was not clear yet. And, anyway, GE was the, is the largest consumer of motors in the world. And of course they had, and there was this energy crisis going on, and they had decided that they, if the electronically controlled the speed of motors they could get this huge efficiency in motors and therefore, their, all of their washing machines and their refrigerators, that they would have this, this huge power savings and they would then gain more, improve their monopoly or oligopoly in that business. So, as big companies do, particularly GE, their board or their management hears of what can be done with electronics, you know, in terms of speed, motor speed control and improving efficiencies and then the key element, of course, are these higher voltage integrated circuits, these DMOS circuits and who makes them? And our name comes up on the radar. And all of a sudden now we are a target, right? Not for any, this had no economic value at all hardly to Intersil. We weren't making any money on it. It was just a little niche thing and now all of a sudden they come flying down on us and they want to buy our company and they pay what they offer us. They offer the board five times the market, the sales for the company. Which in those days was a huge price, you know. And of course they're not talking to me at this point. They're talking to our Board, and the Board really wants to sell the company, Fred Adler and the others and so they realize that, I need to go along with this. And so they come to me and our Board comes to me and says, we want to, GE wants to buy the company. I says, "Well, you know, I don't really want to be part of that." I says, "I don't want to work for GE. I don't want to be part of a big company." I says, and I, in fact Maxim is a predecessor or a successor to Intersil. I says, and I told them then. I says, "You know, I can make this a billion dollar company if, you know, we can be, you know. They didn't care. They wanted to sell it. And I says, "Well, I don't want to sell it." You know, I'd taken it up from four mil, four million a year up to a hundred and thirty million and I knew what to do next. And I didn't want to work for GE, and nobody at Intersil wanted to work for GE that were important. So I said, "No, I don't want to do that anyway." So they go back and they tell GE that, you know, "Well, we'd love to do it but this one guy who's key doesn't want to do it." And this goes on for a little while and then finally, it, Jack Welch, you know. They tell this to Jack, who's not the CEO of GE yet, he's about three months away from being the CEO. And he suggests, or somebody suggests, "Well, let's have Jack go out and have dinner with Jack Gifford and we'll, you know, let him convince him or let him." So I, they arrange for him to come out and take me to dinner. So he comes out. Nice guy. I like the guy. And we go up to drive, limousine they drive up to the, we drive up to the city and have dinner. Both of us get about half drunk. Maybe all drunk, probably. We're, you know, we get along great and finally, I tell him all of the reasons why it won't work, because we're entrepreneurial and, that will go away and we've got stock options and you got to where you are because you built this plastic division entrepreneurial but you can't, you know what I'm talking about. And we just, the minute, you know, the GE thing starts to effect Intersil, I for sure, you know, am not going to be interested but, but nobody else is either. And he, and he says, "You know, Jack, I understand." And he said, "Listen. If you don't want to, if you don't want to sell it to us, I'll call the dogs off because I understand." He said, "But I tell you what. I promise you that if you sell it to us I will set you up as an independent subsidiary of GE. You can have your, all of your stock options. You guys will work just like you are now and nothing will change." I said, "You can't do that." He says, "Yeah, I can." He says, "We've only got one other independent subsidiary. It's Utah International. But I'll set you up just like that." Utah International is a four billion-dollar company. We're a hundred million-dollar company. So we get out. We get into, we get into a wrestling match. We do all kinds of stuff screwing around. We finally go home, get home. The next morning he says, "Do you want to do this?" And I says, "Hey, let's go home. We'll wake up in the morning. If you still feel the same way, call me. We'll talk about it." About ten o'clock I get this call from him at work. He said, "Well, what do you think?" I said, "Do you want to do it?" I said, "Well, what do you think?" He said, "I can do this." Are you sure you can do this? Yeah, I can do it. So okay, well fine. If you can do it I can't object to it if you can keep everything like it is. Stock options and, it's done. We do the deal, you know. We put it together. Maxim's set up, or Intersil's set up, only as an independent subsidiary of GE. Our own stock, everything. And then, from then it, you know, a year later, a year and a half later, he fires me. And, because, essentially because, and he and I became good friends and are good friends today, but what happened was he drug me around everywhere he went, and he was using us a model for how he wanted the rest of GE to be. You know, entrepreneurial and this and that and he put me in situations where it was clear that I was his fair-haired boy. And, in fact we were at, they'd had these cocktail parties on the weekends in Boca Raton, Florida, and there'd be two hundred of these general managers and I'm sit, I'm there, I'm running a hundred million dollar operation, some of these guys are running, you know, four billion dollar operation. But there's about two hundred of them. And, you know, he would walk across the room and, you know, and one time we were, I was sitting there talking to some guys, didn't know anybody. He took me over and introduced me to Reginald Jones, and Mr. Jones told me that, just as Jack got appointed to CEO. And he says, "You know, Jack, I'm so glad to meet you. Jack's told me so much about you." He says, "Why don't you sit down and talk. I want to talk to you a little bit." And he actually told me. Reggie Jones actually told me. He says, "A lot of people criticize my appointment of Jack to this position." But he says, "Let me tell you." He says, "They wanted a financial guy in this job but I think times have changed, you know. And we needed somebody different than me. And what Jack says is you're a lot like him. Your background's the same." And he says, "I put him in that job because we need to be a different company going forward. We need to be product market focused and not financially focused." And so he literally, he would do things like this and set me up in front of these guys, and so I mean I became a real target for all these guys. I'm sitting there with no credential. Relative to some of, other guys have been there thirty, forty years, whatever, running big divisions. I'm sitting there with stock options. I'm sitting there, you know, his buddy and, you know, and this kept go, this kept going on. Well, finally after about six months of this, he starts to hear from his other general managers. Hey, this isn't fair. I mean, I've worked for GE all my life. I don't have stock. What's going, I mean, how could he do this? And he had a mutiny on his hands. He had a truly, a mutiny that we caused. And so Jack started talking to me, you know, and every once in a while he'd say, you know, "God, you know, boy the stock options are causing me a problem, you know." Then it got, "Do you really need those? Can't we do something else?" I was, "Jack, that was the deal," I says, and "I don't need them. I mean, but Intersil needs them. I can't, that was, by the way, that was your idea." He says, "I know. I know." So anyway, then we're back at one of these parties again; about a year later. Different, you know, same environment. I'm standing around talking to ten or fifteen of these guys and Jack comes across the room and he's got ten or fifteen guys following him. I get there late. So he's already had a couple of drinks, and he comes swaggering into my group and, you know, how the hell are you know. We start talking. No sooner does the greetings stop and he says, "God damn it. Why the fuck do you guys have to have those stock options? There, you know, jeez." And he goes on and on and on in front of fifteen, fifteen. In front of twenty, twenty-five guys, you know. And just, I mean we'd talked about this, five different times, you know. And all of a sudden he's now, you know, coming like it's my fault, like I'm the problem, right? And he's, say he's had a couple of drinks. And finally he starts, "Well, what do you think?" And I said, and I was going to react and I just, I says, I was so mad and I just said, "Fuck you." And I just turned around and walked out. And man my, I, I heard, and then, I mean that, that went rippled throughout the company. I mean, you told that to Jack? Yeah, but, you know, yeah, I did. So about a week and a half later I get a call from him to come back to Fairfield, and he says, "Well, I gotta talk to you." What are you gonna do? He says, "Well, I gotta fire you." I says, "Well, why don't you just fire me?" He says, "Well, why didn't you tell me this?" Cause you need, that's just why, maybe I shouldn't have done it but you, you caused it. He says, "I know, but I gotta fire you." So he fired me. And so, anyway. That was how I ended up getting out of Intersil, GE. And then, they were very, they were great as far, a great company. I mean, the part of his book that I thought was, you know, he should have done this. And, he didn't need to tell those stories, but what he should have done, when he bought GE, or Intersil, he spent a billion and a half dollars acquiring companies like Mac, like Intersil, because like Reginald Jones told me, Jack was going to go out and steal some entrepreneurial product development activity. He bought about nine great companies that were different sizes like, a company called Structural Dynamics in the Midwest, the top CAD company, Mentor Graphics out here. A couple of, I can't remember all of them.
JG: Calma. Two years later they were all destroyed. He pissed away a billion and a half dollars. But Jack was a smart guy. He figured out that ain't going to work. And he stopped. And he was able to create this fantastic image in the subsequent years that they were an entrepreneurial company. That they were a product development company. He changed the image single handedly from that of a banking company to a products company, and he improved, he doubled their price to earnings ratio. And he's a great, and he's a great leader. I mean, just a great leader.
RW: But there has been no external company that's come in to Silicon Valley...
RW: ...and been successful. But many have tried.
JG: Not to my knowledge. No. They tried. And it's for the reason I described, you know. I had no, when I made the deal with Jack, I had these examples in front of me. Your company, I mean, Gould had tried, you know, they'd acquired AMI. There had been some acquisitions and they fail, all failed. So I knew what was going to happen. And the structure we set up would have worked but they...it was going to destroy GE.
RW: Right. That is of course the problem they have.
RW: And, and it is probably true that it would.
JG: Yeah. It would have. Yeah. And he did the right thing. I mean, he needed, he had to change the deal he made. He had to change it. And, he would have, well, he was going to change it regardless. He had to change it. But once he, when they got rid of me then they changed it. That was, that was the first thing they did.
RW: And, and eventually, got rid of it.
JG: Yeah, and what happened is that's what caused Maxim. So when he changed it, you know, those guys came to me and said, you know, Jack, you gotta do something, you know. Our careers, he's destroyed our career, you know. And I was forced to do Maxim. I was, I mean, I caused the problem, so...
RW: So what was the idea behind Maxim?
JG: Well, it was the same idea I had at, it was the build an employee owned, the best analog company in the world that's owned by employees. The employees at Maxim owned, have owned, owned or will own seventy-eight of the company and it do just analog, you know. Don't get, because all my life I'd been, you know, step brother to the digital thing, and so we were going to make, and I, you know, I'd what have I had? I've had since, at thirty years of, I was the best in the world. I am the best in the world at this. So, it was clearly the thing I, but I was not motivated to do it. Frankly, what motivated me was this responsibility to these other guys, you know. And that's why we did it, frankly.
RW: And so, how, how are you doing today?
JG: We're the best analog company in the world. We're a billion three in revenue. We make seventy percent gross margin. We're considered the best, maybe the best semiconductor company in the world; as far from the financial community.
RW: And you're actually profitable.
JG: We're very profitable. We have a forty to one PE ratio. We were making, we'll make a dollar twenty-five this year. We're going to grow this year. We've never had a, we have returned, Rob, to our shareholders forty-nine percent per year growth for the last fourteen years. No other company in the history of the world's done that. Year after year. Forty-nine percent per year. If you'd have bought the company stock in 19, 1989, then you would have gotten forty-nine percent increase per year. Per year. So we're, we're a legend.
RW: That's great.
JG: High margins.
RW: Now, are you affected by the, this run away costs in wafer fabs...
RW: ...that the digital people are seeing?
JG: No. No.
RW: A billion? Two billion dollars?
JG: No. We use secondhand wafer, our state of the art analog technology is point four microns. That's state of the art. So we're always able to use, buy used equipment. So we're able to, we're able to produce for a hundred million dollars in equipment about one point three billion in revenue. We're selling engineering. We're not selling, silica is just a medium to put the wafers on. We're selling ideas in the form of silicon. I need to tell you the Gordon Moore stories, because this is more about these other characters than Jack Gifford. I mean, one thing I know, I know a lot of these characters very well and, Gordon...you know, first I'll tell you the MOS story because this is... So when I was at Fairchild in the early '60's we used bipolar. That was our technology. That was Gordon's background. That was, their, R and D's background was all in bipolar devices. And they did hire the best research guys they could find. And they hired guys like Don Ferrina, Frank Waniless. I can't remember some of the others. Ed Snow. There were a bunch of guys who knew about surface devices, field effect devices. Or field effect, the field effect. And they'd, they literally, without really a lot of sponsorship from the general management, not as radical as Bob Widlar's situation because Fairchild R and D would let these guys work on whatever they wanted to work on, right? But they, Ferrina and these guys developed the first, the first MOS devices in the world. And they would talk to Gordon Moore about them. And Moore said no, no, we're not going to sell them. They don't make any sense. They're not stable. They're not reliable. They're going, you can't control the surface... And he continued to kill these projects. He killed these ideas. Never let anything happen. Finally, I, the details are vague, are general because I don't have the specific details, but the result was he fired three or four of these top scientists. Ran them out of Fairchild and they went out and started GME and couple of big companies. And I think Ferrina was one of them, but he literally told them they needed to leave. So that's how the MOS business started because Fairchild rejected it, and these guys started. And then I became involved with Les Vadasz and some other guys because we were trying to catch up to Fairchild. It was so funny because all the major customers in the world were pleading with us to build MOS devices because they were afraid to deal with these start-ups. And we tried to. Les and I tried to do custom circuits, this is like 1967 I think, for Hughes and we couldn't compete with the technologies these guys had. We just lost so much because he'd gotten rid of everybody. So it's ironic that Gordon, who now has built one of the finest companies in the world that's an MOS company was the cause, was so antiMOS and actually ran these guys out of the industry which started MOS.
RW: The parts were unstable.
JG: Well, of course. Yeah, but, I mean they got fixed. I mean, they learned how to make them, right? They learned how to, you know, how to control the oxides, how to make cleaner oxides. It was, you'd have to ask Gordon what was his thinking at the time, but they were, well in fact when they started Intel, clearly MOS was a non-persona. That was not in their charter at all. They were a bipolar company.
RW: The first product was bipolar.
JG: Forever it was bipolar. They only went to MOS when they couldn't find a viable product rep for bipolar. That was a default strategy, you know. They had missed their plan about four times, you know, before, and then they stumbled onto Ed, Dick Hoff. Dick Hoff, the micro...
RW: Ted Hoff.
JG: Ted Hoff. You know, but before that it was the 1103 MOS memory that saved their life. And the irony of it, not anywhere in the Intel plan ever did they talk about number one: micro-controllers, number two: MOS. But, only Gordon Moore and Bob Noyce could have been allowed to fail that many times as a start-up. You know, they'd missed their plan three or four times. But only, because of their credential and their own money they were able to keep it alive. Any other start-up would have been out of, out of money in debt, you know, so those are stories that aren't, aren't commonly understood. Their planning ability sucked, you know, terrible. It was a terrible plan. Terrible vision, and terrible vision. But, you know, that they had, they got it done. They did get it done.
RW: Well, but the, vision was really more than the technology. They became the "Unfairchild" in that, no reserve parking except for visitors. Informal dress...
RW: ...that sort of thing.
JG: ...but that was a vogue thing. I mean, you could, fine. I, I'm not sure what that's all worth. The point is that from the fundamentals of why they exist and, you know, they didn't, well, they're not a case study for a well-planned company. They aren't. And today they still aren't. I mean they got themselves to be a eight hundred-pound gorilla with one product in one market. That's not well good planning. So, need a contrarian, a contrarian view about Intel and you just got it.
RW: Well, the argument is, and I was at Intel at the time, that the reason that the 8088. The 8088 was selected by IBM over the 68000 and over the Z8000 was that is was less powerful...
JG: Uh huh.
RW: ...and therefore, it wouldn't destroy the IBM price performance curve, because the 68000 would have put it into the mini-computer area.
JG: Uh-huh. Interesting. Yeah. Yeah. That's the, you can find those stories all over the place.
RW: Well, you had something more on Gordon Moore though.
JG: Oh, well, Gordon's a good friend. And in fact Gordon told me this story about, when I had breakfast about five years ago and he, very complementary about how great Maxim's done and what a nice company it is. And I was embarrassed. I says, "Gordon, look at Intel." He says, "Jack, you don't realize what a precarious situation Intel is. How would you like to wake up every morning and you've got one product and one customer." He said you've got how many products? I said I have three thousand. You got three thousand products. How many customers you got? I got about twenty thousand. Twenty thousand? I mean, I would much rather be in your business than in mine. But that's not the story. The story, I took Gordon fishing over in Hawaii. I took him a couple times. But we went, and I had, I got this little eighteen foot Boston Whaler and so me and the fellow I was just on the phone with, Jay Paulson, and Gordon are out there and we're catching, it's a little tuna. And, so get these spinning reels, and they, he. I forget how it happened but I look over and, and Gordon's got this huge, Gordon's a really good fisherman. I mean he's been around the water all of his life. And he's got this huge rat's nest in his reel. It's just this, these spinning wheels...it just exploded. So it's just line everywhere. And if you're a fisherman you spend about four minutes. Four minutes. You spend about fifty seconds trying to get it undone and then you realize, screw it, and you just cut the line out. And, and I'm fishing and I'm watching Gordon and a minute goes by and three minutes goes by, and ten minutes goes by, and he's just fascinated with this knot. And so Jay goes over and says, "Hey, why don't I just cut this." He says, "No, no, no. I think I got it." And he, he was just, I mean that's the intellect that he is. He was just, all of a sudden as much of a fanatic he is in fishing, he was more intrigued by getting this knot undone. So I was, he's a wonderful guy. He really is.
RW: He really is. And he's giving all his money,
RW: ...essentially to charity...
JG: Yeah. Absolutely.
RW: ...to foundations.
JG: Yeah. Yeah. And he's, there's not a bone of ego in him, and he's just the nicest guy, and then he's so good. He's, his dad was the deputy sheriff up here in the San Mateo County and he's just as happy running around in those hills as he is anything else. Nice, yeah.
RW: A real Californian.
JG: Yeah. I think that's pretty much the,
RW: All right. Well...
JG: End of my stories.
RW: Thanks, thanks, Jack. This has been an exciting time and it's good to see that you're still excited and...
RW: ...and still moving.
JG: Well, it's good to see you again after so many years. Yeah, we have played a part in one of the most exciting times in history, frankly.
RW: Changed the world.
JG: Yeah. Yeah. And I think we'll, this could help very have our ancestors know what the hell went on.
RW: All right. Thanks.