A firm that lurched through crises with no panic

THEY knew they were taking a risk, putting not just themselves but their families on the line. But Rod Canion, Bill Murto, and Jim Harris felt they had done all the legwork. They knew computers and knew there was a big market for Winchester (hard) disks for IBM PCs, which at that time had only limited memory on floppy disks. They had presented their business plan to Ben Rosen and L. J. Sevin, who had financed other high-tech stars like Lotus Development. The venture capitalists were giving them encouraging signs.

So one day in December 1981, they quit their jobs at Texas Instruments. A week later, Mr. Rosen called. He would not fund the Winchester project.

``It was a disappointment,'' says Compaq president Canion in characteristic understatement. ``But then we said, `OK, let's throw out that old idea and start with a clean sheet of paper.' ''

What came off that clean sheet was a portable computer that's compatible with IBM which hurtled them onto the Fortune 500 faster than any other company had ever managed to do.

Compaq, whose headquarters is hidden within 55 acres of woods northwest of Houston, was never your typical start-up. It had a start-up's crises, but not a start-up's vision.

That got it through crises without panic. Like the time officials were showing a prototype to Sears Business System Center, an important dealer. They were meeting on the morning of June 7, 1982. They had never gotten their machine to run. They worked until 2 a.m. on the 7th, and finally it burped into action.

With a model stuck together ``with chewing gum and wire,'' they trundled it down to Houston, where it was a big hit.

``There really wasn't a sense of panic,'' Canion recalls. ``We knew we had a good six, seven hours.''

More than bytes or bits, it's this dispassionate, ``grown up'' perspective that has set Compaq apart from the hundreds of computer start-ups that have failed since the boom began in the 1970s. That kind of vision can be developed, often through wrenching experiences, as at Apple Computer.

But Compaq was fortunate; it had it from Day 1.

``The original concept,'' says chief financial officer John Gribi, ``was that we were a large company in its formative stages.''

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