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The World Is Not Enough For Dotcoms

Paran Balakrishnan  |  BSCAL 

Can Sabeer Bhatia turn out another multi-million dollar winner? In the mid-90s Bhatia became a star after founding Hotmail.com and selling it to Microsoft for $400 million. Now, Bhatia, 31, is racing against the clock to turn his newest start-up Arzoo.com into a winner which will earn billions on the stock market.

Rakesh Mathur is also playing the same game. Mathur, who was a co-founder of Junglee.com, is determined to prove that he can do it again. Mathur, now heads the colourfully-named Purple Yogi which aims to find a cyber-device will help Internet users to zero in quickly on topics of their choice.

Why aren't multi-millionaires like Bhatia and Mathur cruising on a yacht or lounging on a beach chair in Goa or Brazil? Instead, they are back at the cutting edge, surrounded by talented youngsters who are all dreaming about multi-million dollar riches. If ever there was proof that money isn't everything, it is watching the stars of Silicon Valley return to the stadium for another dash around the tracks.

Silicon Valley's venture capitalists have learned to watch out for `second-time round' stars who've had one brilliant idea and turned it into riches. Pulling it off the same feat a second time is often tough and unrewarding. The venture capitalists are often wary of big names with gigantic bank balances, who return for a second shot.

Mind you, there are notable successes even amongst the Indian community who've beaten the odds and turned out a second winner. Most prominently, there's Gururaj `Desh' Deshpande who became a sparkling Nasdaq star after listing Sycamore Networks in December 1999. Sycamore is now worth around $18 billion and Deshpande's personal stake is roughly around $3.7 billion. That could make him the richest Indian in the US.

Deshpande's feat is all the more remarkable because he has done it before. In June 1997, he became a multi-millionaire after selling Cascade Communications for an eye-popping $3.7 billion.

Step back in time and there's Vinod Khosla who became president of Sun Microsystems in the mid-80s when the software revolution was still in its infancy.

Khosla, who was barely 30, took a few years off and spent time on pursuits like golf.

Eventually, however, Khosla wasn't able to stay away but he has been smarter than the others. He has become one of Silicon Valley's most respected venture capitalists and his moves are watched by the entire industry.

Being a father figure, guide, mentor and venture capitalist is also the role that Kanwal Rekhi has carved out of himself. Rekhi who was formerly the chief technical officer of Novell, has notable successes to his credit: he was the chief guide for K B Chandrasekhar of Exodus Communications. Exodus went public for $550 million and Rekhi made $10 million on an investment of $200,000.

Is it a desire to be `richer than your neighbour' that drives Internet stars back into cyberspace for second-time round ventures? After all, the Internet is throwing up new celebrities all the time. Forbes listed five South Asian billionaires in August 1999. Since then, Deshpande has gate-crashed into the top league. And Naveen Jain, 39, of InfoSpace has been a billionaire for short spells when the market has risen. (There are 26 first-generation immigrants in the Forbes list and five are Indians. Four are from Hungary and four from Canada).

The constantly rising market is also making the Forbes figures out of date overnight. Sanjiv Sidhu of 12 Technologies was reckoned to be worth around $1.1 billion in August'99. Now, that figure has tripled and Sidhu is worth about $3.5 billion.

Is there a moral in the Silicon Valley Gold Rush or a lesson to be learnt? Probably not. There is more wealth sloshing about in Silicon Valley and places like Redmond, Washington State, than at any time in history. And who can blame hi-tech stars who go back for more.


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First Published: Sat, February 19 2000. 00:00 IST
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