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[ The Top 25 Success Stories ] The American Dream Our survey results found that well over half the Top 25 executives and entrepreneurs are in Silicon Valley -- for the past 20 years a fertile ground for all sorts of success stories, including those below. Still, though people of Asian descent make up 25 to 30 percent of workers at high-tech startups, they remain underrepresented in the executive ranks. Of 100 firms that received traditional venture capital funding, only 7 percent were headed by Asians or Asian Americans, according to a study this year by the San Jose Mercury News. At the same time, small businesses owned by Asian Americans are flourishing in California. According to new Census data, some 38.4 percent of all small businesses in the state -- bringing in $37.7 billion in annual receipts -- are owned by Asian Americans. And on the horizon are venture-capital networks dominated by Asians and Asian Americans. Last year, these networks, mostly Taiwan-based, pumped more than $400 million into start-ups.
Hsieh, who attended San Rafael’s Branson High, went on to Harvard, where he ran a pizza shop in one of the dorms. After graduating with a degree in computer science in 1995, he and his roommate, Sanjay Madan, joined Oracle Corp. as programmers. He and Madan started doing Web design on the side for businesses and malls. “We were meeting with clients on our lunch breaks and creating their Web sites at night,” recalled Hsieh, who soon detected a common problem among all his clients -- a lack of a low-cost way to bring visitors in. “It didn’t matter how good our site was if we couldn’t promote them,” Hsieh said. “Back then, the only way is to contact Netscape or Yahoo or some huge site and they wouldn’t even talk to us unless we would spend a minimum of $5,000 on advertising.” The solution to that dilemma was to create a free on-line advertising network -- LinkExchange, which was founded in 1996 in Hsieh and Madan’s living room. The idea, Hsieh explains, was to provide “banner advertising for the masses, a cooperative system that is free to join.” Getting LinkExchange off the ground required Hsieh to redraw his own career path -- he had planned to get five or six years’ experience under his belt before starting his own company. But, as he puts it, “Oracle was boring, and we didn’t feel we made a difference.” Hsieh says his parents weren’t pleased to hear he was quitting his job there after less than a year with the company. “My parents always wanted me when I graduated from Harvard to go get a Ph.D. They were initially disappointed when I told them I was quitting my job. My parents are pretty risk-averse,” said Hsieh, who in his untucked flannel shirt and sneakers still very much looks like a college student. Yet in less than a year, LinkExchange managed to raise venture funds from Sequoia Capital. “There was overwhelming enthusiasm; there was a need,” Hsieh said. While other Web sites traded links, LinkExchange’s breakthrough was its revenue model, under which the company arranges a 2-for-1 link swap. That gives LinkExchange surplus inventory across the company’s network of member sites, which it then sells to outside advertisers. In 1996, LinkExchange, having grown to a staff of 10, moved out of Hsieh’s living room and into a real office in San Francisco’s South of Market area. Hsieh’s own risk paid off in 1998, when Microsoft acquired his company for about $250 million. Now, LinkExchange is responsible for providing a variety of services to small businesses.
“Silicon Valley is such a racially mixed environment that I don’t feel a difference,” Chang said. “People respect me for what I’ve done, not because of my skin color or my gender.” The only thing that matters, she says, is that “you have to have what you say you have and it has to work.” Chang grew up in Taiwan and attended ChiaoTung University, where she pursued a double major in computer science and engineering. “It’s practical, and it produces results,” said Chang of her choice of majors. After getting her Ph.D. in database management systems from Purdue University in 1979, Chang worked as an engineer at Sun Microsystems and research scientist at AT&T Bell Laboratories. In 1986, Chang co-founded Teknekron Software Systems, now TIBCO Software. While at TIBCO, she pioneered the development of the digital trader workstation, now a Wall Street standard. It was during this first entrepreneurial venture that Chang says she hit a low point. She was managing a project for Goldman Sachs to build a prototype trader workstation, and, as she recalls, Bob Rubin, then a partner at Goldman, was impressed by the demo she put together. But then she got a call from Goldman canceling the entire project because one of the partners had a friend who advised that PCs were going to be the future. Despite her response that PCs were not capable of handling mission-critical applications and that specialized trader stations were necessary, “they said, ‘Thanks very much. That’s it,’ recounts Chang. “I have never been so depressed in my life.” Yet what seemed to be a disaster turned out to be a golden opportunity for Chang, who shopped her technology to Fidelity Securities. Not knowing the rules was in this case an advantage, Chang said. “When Fidelity’s trading floor went live within six months, people congratulated me and said that it was a miracle,” she recalls. “I hadn’t known that it always takes a lot longer than that.” The technology was a hit. Because Goldman Sachs had released the intellectual property rights to the prototype when it canceled its contract, Teknekron was able to mass market Chang’s prototype. Within three years, nearly all of the major securities firms were using her workstations. “That was very satisfying. It was the first time that I saw that I produced real world impact,” said Chang. (Goldman ended up buying Chang’s workstations years later.) “Whenever there is a problem, there is an opportunity,” Chang said. “My greatest low became my greatest high. Had Goldman not canceled, we would have made a couple of million, I would have continued working with Goldman, we would not have sold the prototype outside and history would have been very different.” In 1994, Chang co-founded Vitria, a privately held developer of Java-based application integration software. Its roster of clients includes Deutsche Bank, Federal Express, SBC Communications and KPMG. The venture-backed company, which specializes in business software that allows information to more easily transcend different computer platforms, raised $9.5 million in 1997 and just brought in another $3 million in venture capital. Chang stands out among Silicon Valley CEOs not only for her race and gender, but also for having successfully negotiated the transition from the technical side to the managerial one. “I interviewed this Chinese engineer who was applying for a job and he said that he was very impressed by me because of my minority background.” she recalled. “ ‘Which minority background?’ I asked, ‘as a woman or as an Asian?’ He replied, ‘Your minority background as an engineer when most CEOs come from sales and marketing.’ ” Chang gives some advice to those techies who want to cross over to management. First, change your attitude towards technology. “You have to love the impact of technology, instead of loving to create technology. People in tech get caught up in doing interesting technology. You need to focus on the end result.” Those with science backgrounds also need to get away from their lab and mix with the people, she said. “They need to do a reality check, listen to the customer.” Successful CEOs need to configure, adapt and build to satisfy the customer’s needs, she said. “They need to develop customer intimacy and relationships. The market and the customer always has the answer.”
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