The Inspiring Story of Bob Young, a Graduate Who Had No Job When He Founded Red Hat
IBM Buys Red Hat
Bob Young was an unemployed man who was working from the sewing closet of his wife in 1993. He was working at a company that he had just co-founded. That company that started from the closet has now been acquired by IBM for a whopping $34 billion. It stands as IBM’s largest acquisition to date. Red Hat is an open-source software provider and IBM aims to use the company to expand its cloud computing enterprise. Young resigned as the CEO in 1999 after the company became public. In 2005, he left the board of the company’s directors to launch Lulu.Com
Low-Risk Enterprise
At the time Young co-founded Red Hat, he said he didn’t have a job and had no money because he had sold his former business.
Young who graduated from the University of Toronto said he has always been an entrepreneurial businessman. He said he wasn’t the best student around and so his decision to start his own business was not about being smart or being a risk taker. He said it was because of his poor performance in school that he assumed that he had more chances of starting a company rather than going to apply for jobs.
He started his first business after his college graduation in 1976. At first, he was renting out typewriters while his other friends from college had started off careers as lawyers and accountants at big firms. He said his friends weren’t particularly impressed with his career choices at the time.
He later changed to leasing computers in 1984 when he launched Vernon Computer Rentals. After he struggled with finances during the recession in 1989, he sold the rental company.Greyvest Capital was the acquirer of the company and Young got roughly $4 million as the chief executive. The deal he, however, made was that he would work at Greyvest and he would stake his proceeds from his share in Greyvest. However, some months after the acquisition, Greyvest had serious financial issues and its stock declined so much that Young’s stake became worthless. Greyvest subsequently laid him off.
As at 1993, he had no job, a large mortgage, he had 3 kids and his networth was less than what he had when he even finished from college. However, he said all those events were what eventually made him launch Red Hat.
The experience he already had in the computer business made it possible for him to discover agap in the market for software. That in turn helped him develop the product that allow tech business to modify and also customize software in a way that suits their needs.
Unique Offering
Young said in early 90s, the company was the only one that offered open-source software as the big competitors such as Microsoft, Oracle and IBM were not willing to share the source code. He said he was a sales guy and he liked to sell things the customers wouldn’t be able to get from any other place.
It was in 1993 that Young started the business of the sale of software on open-source Unix and Linux OS. He joined forces with March Ewing, a software engineer based in North Carolina. It was Ewing who brought up the company name as Red Hat which referred to a red baseball hat he wore when he was in college. Young then merged his company with that of Ewing which was a distributor open-source Linux software. The business subsequently moved to Durham in North Carolina.
Initial Funding for Red Hat
Young was the chief executive officer of the company and he utilized his background in sales to help with the operations of the company. Ewing was in charge of the software engineering. However, because they had no money, they had to get funding and in a quite creative way and both of them ended up incurring credit card debt.
He said there were so many credit card applications from banks during that period andhe kept getting credit card to pay up the ones from before. He said his debt later reached $50,000 and was spread over different cardstotalling nothing less than 8. He said he considered it to be creative finance and his wifewas the one who made the credit card finance work because her credit rating was good.
He now refers to her as probably the most important contributor to Red Hat’s initial success because without her credit rating he would probably not have been able to get the funding that later got the company profitable.
More in Inspiration
-
`
Camilla Bowles & Prince Charles Ask People to Remember The Elderly This Holiday Season
Every year as the holiday season begins, we rush to the shopping centers and wait in long queues just to grab...
December 27, 2021 -
`
Baby Mama Olivia Munn Welcomes First Child With John Mulaney
You might think that this is wholesome news and there is nothing problematic about it – but guess again! As it...
December 23, 2021 -
`
Being A Feminist – The Dad Version
Feminism – an ideology that works to establish social, personal, economic, and political equality of humankind. In this day and age,...
December 22, 2021 -
`
Starting a Business Can Be Overwhelming–Here’s How You Can Get Over Your Fears & Start Building Your Company
Successfully building a business from the ground up, is not an achievement that all people can claim to have done. It...
December 22, 2021 -
`
Too Busy Working as a Corporate Executive to Manage Your Finances? These Are The Simple Steps You Can Take Today
Corporate executives often find themselves in an interesting predicament. After they’ve managed to put in the work to nab the high-paying...
December 21, 2021 -
`
Leonardo DiCaprio Buys a $9.9 Million Beverly Hills Mansion
Leonardo DiCaprio is no stranger in the world of Hollywood – and if you don’t know him, what have you been...
December 17, 2021 -
`
Kevin Hart Drops $7 Million on The Property Next to His Calabasas Mansion
People often say that kindness is making someone laugh, even if it’s only for a moment. Well, going by that logic,...
December 8, 2021 -
`
Two Decades Worth Of Jennifer Aniston’s Real Estate Grabs – Take A Look!
Jennifer Aniston! Who doesn’t know and love the superstar who breathed life into iconic characters like Rachel Green, Rosie Dickinson, Rose...
December 7, 2021 -
`
Let’s Hear it For The Long-Awaited Film, House of Gucci
Have you watched the House of Gucci yet? The movie has got to be one of the most anticipated ones of 2021 –...
December 1, 2021
You must be logged in to post a comment Login