Compaq: Victim or Instrument?
In corporate history, there are companies that fall on their own. And there are companies that fall because someone needs them to. To understand which category Compaq belongs to, you need to follow three people — and the money.
Act One: The Man Who Built Compaq — And Broke It Twice
Benjamin Rosen started…
Compaq generated $111 million…
Over 18 years, Rosen invested…
Rosen was not simply an investor…
When in 1991 he decided…
Eight years later, history repeated itself.
Act Two: The Strategy Nobody Could Execute
In 1998, Pfeiffer completed…
But Pfeiffer had no clear vision…
Nevertheless, a strategy was announced…
In early 1999, within a matter of weeks…
Act Three: Two Months That Explain Everything
February 1999 — Compaq buys Zip2…
April 1999 — Rosen announces Pfeiffer's resignation…
June 1999 — Rosen sells AltaVista…
Two months between the purchase of Zip2…
Pfeiffer was building an internet empire for Compaq…
Act Four: David Wetherell and CMGI
The man who received the assets…
By 2001, CMGI's portfolio included 65 companies…
Then the bubble burst.
CMGI's shares collapsed…
Wetherell lost his fortune…
Act Five: Carly Fiorina and the Final Blow
While CMGI was sinking…
The deal was Fiorina's personal project…
49% of HP shareholders voted against it…
HP absorbed Compaq for $24.2 billion…
Instead of the promised synergistic effect…
Conclusion
Compaq went through three management coups in twelve years:
1991 — Rosen removes Canion, installs Pfeiffer
1999 — Rosen removes Pfeiffer, sells assets to CMGI
2002 — Fiorina absorbs the company into HP
Each time, behind the beautiful words…
Compaq didn't fall. It was pushed…
Part 1: Zip2 — The Story Nobody Tells
Part 3: Musk — Anointed Genius or Architect of His Own Fate?
Sources note…