"This is all kind of surreal,” Larry Ellison once told me over lunch. The man has a $48 billion fortune, and is the owner of the BNP Paribas Open tennis tournament, an America’s Cup–winning sailing team, the 288-foot superyacht Musashi, an Italian Marchetti jet, a sprawling Japanese-style estate, a large swath of Malibu beachfront property, the Hawaiian island of Lanai, and a Hawaiian airline. “I don’t even believe it now. Not only did I not believe it when I was 14, but when I look around, I say this must be something out of a dream.”
But it’s not: It’s the product of hard work, thinking in a way nobody else dared to, and the audacity to try to change the world. Ellison did just that: He changed everything deeply and forever.
And he did it against the odds.
It is safe to say that nobody expected great things from Lawrence Joseph Ellison. Born in New York City to a 19-year-old unwed mother and a father he doesn’t talk about, Ellison was shunted off to the Chicago home of his aunt, Lillian Ellison, and her second husband, Louis. Ellison remembers Louis as a dour conformist, a complete mismatch for his free-spirited son. Once, in a basketball game, Larry accidentally scored a goal for the wrong team, and his adoptive father never let him live it down. For years, Ellison believed the negativity: He was an average student in the South Shore High class of ’62, and two years into the University of Illinois at Urbana-Champaign, he quit.
In 1966, Ellison was searching for a new life and cruised into Berkeley in an aqua-blue Ford Thunderbird. He found work at an employment agency—his first job was to help people find employment—and got married. Over the next few years, he worked for IBM, hanging tapes and backing up data.
The work didn’t pay much, but that didn’t stop him from being a big spender. “He had Champagne tastes on a beer budget,” says former wife Adda Quinn. Adda got tired of Ellison’s aimlessness and left him. But Ellison’s motivation remained. In the summer of 1977, Ellison went into business as a software contractor. He talked a couple of programmer friends into forming a company called Software Development Laboratories (SDL). Ellison, the apparent leader of the group, bought 60 percent of the business for $1,200, and his partners, Robert Miner and Edward Oates, paid $400 each for their 20 percent stakes.
He invented his own rule book and was determined to make his way. If they needed to run electrical wires from one room to another, he’d grab a hammer and bash a hole in the wall. His motto, according to a colleague: “Find a way or make one.”
Ellison’s big break appeared in the form of an article with the decidedly unsexy title “System R: Relational Approach to Database Management,” published by a group of IBM researchers. The report broadly described a database system that would make it easier for businesses to manage inventory, track orders, and analyze customer behavior. Specifically, the paper was based on Edgar Codd’s concept of Relational Databases, which he developed throughout the ’60s and ’70s. Whereas data used to be grouped together in one record, the Relational Database segregated information in tables by columns and rows, the rows containing information of the same type (hence the word relation). The tables could share information so that searches could yield quick and versatile reporting targeting any category in the tables. Moreover, new types of data could be added without having to reorganize all the other information. On a large site like Amazon, for example, a search will access thousands of tables and produce results almost instantly by culling all the similar information in one particular category.
Ellison predicted that corporations would pay a lot of money for such technology, so he and his partners decided to take IBM’s idea and bring it to market before IBM could. While other small companies had the same ambition, the very idea of attempting to beat IBM with just a handful of programmers bucked the conventional wisdom. The three partners started with the goal of building and delivering the first commercial relational database.
It took them two years to produce the first commercially viable version of their product, which they called Oracle. The CIA and Wright-Patterson Air Force Base were among their first customers. Ellison spent five weeks on the road; he did the installation and taught the training course himself.
Ellison could have puttered along like this, developing a perfectly fine database company. But he and his partners had a big idea: They wanted their database program to run on a variety of machines, from IBM mainframes down to Wang minicomputers. That wasn’t possible at the time; different types of computers could barely talk to each other. But if databases could be linked across multiple computer types, the game would change.
Ellison started selling business owners on this idea, even as his programmers were struggling to find a way to deliver it. When a customer asked Ellison whether Oracle ran on a particular kind of computer, Ellison would say, “Yes, absolutely”—and then call Bob Miner and ask him to start writing the code. As a result, early versions of Oracle didn’t work well and sometimes didn’t work at all. Ellison once joked that his initial approach to customers was, “Here’s our software. Use it. I dare you.”
But his dogged sales strategy did have one upside: It scared off most of the other companies who were pushing relational databases. Ellison had conducted business in Japan and was influenced by that country’s very rational, aggressive business mentality. He believed Oracle’s technology would come around eventually—and it did. Within a few years, the company was consistently shipping software that did what he said it would do. Oracle doubled in size in 11 of its first 12 years. From there, Ellison expanded his reach into applications, consulting, and a host of other tech businesses. Today, Oracle has more than 420,000 customers, including 100 of the Fortune 100. With revenues of $38 billion in 2015, it employs 130,000 people and operates in more than 145 countries. Oracle built its success as a leader in database software and has continued to develop its whole technology stack, from servers and storage to database and middleware, through applications and into the cloud. Interestingly, Ellison invented the cloud before there was a name for it. In 1998, he founded NetSuite with Evan Goldberg and directed Oracle to rewrite its software programs to run in the cloud. Today, the number of Oracle clients using the cloud has grown to more than 60 million. “It’s gone from an idea to a multibillion-dollar business in the blink of an eye, and growing very rapidly,” Ellison told Forbes. Now the cloud is at the core of Oracle’s business model.
The driving force behind all of this, Ellison packs a big personality. Used to testing his limits, and aspiring to think outside of them, he is relentlessly competitive, noncomforming, and provocative, and he has no qualms about publicly trashing his enemies.
On the flip side, Ellison is capable of showing loyalty. As Steve Jobs was famously pushed out of Apple Computer in the 1980s, longtime friend Larry Ellison even offered to buy Apple and put him back in charge. Larry said, “I will buy Apple, you will get 25 percent of it right away for being CEO, and we can restore it to its past glory.” But Steve Jobs decided he wasn’t into hostile takeovers.
He is also very good at having fun. As a result of his success, he has been able to fully indulge the “Champagne tastes” that his first wife complained about. No longer constrained by a “beer budget,” he lives large and spends lavishly on trophy possessions. He can fly fighter jets and once sailed a race through a hurricane, an experience he never wants to repeat. His passions extend to architecture, science, and Japanese philosophy—and let’s not forget women. Currently divorced from his fourth wife, Ellison has the reputation of being a ladies’ man. Outdoors, he is as tenacious in sports as he is in business, and after losing the America’s Cup two times, he pressed on and has now won it twice. He couldn’t stop when he was losing and then couldn’t stop when he was winning. The second win was in 2013, in San Francisco Bay. Leading up to the race, Ellison took it upon himself to “modernize” the sport and set about building 72-foot, multimillion-dollar catamarans that can reach 50 mph, replacing the sluggish monohulls used previously. People criticized the new boats because of their expense and also saw them as potentially dangerous. The winners get to choose the location for the next race, and Ellison picked Bermuda. The event will take place in 2017.
Marc Benioff, the former Oracle employee who started Salesforce, refers to Ellison as a mentor despite their ongoing love-hate rivalry. In Benioff’s book Behind the Cloud, a small section called “The Larry Ellison Playbook” lists seven lessons: Always have a vision; be passionate; act confident, even when you’re not; think of it as you want it, not as it is; don’t let others sway you from your point of view; see things in the present, even if they are in the future; and, finally, don’t give others your power, ever.
The “Playbook” outlines a rigorous mind-set, and no doubt a practice, that has manifested manifold for Ellison and all the people who have benefited from his achievements. His oft-quoted statement “I’m addicted to winning. The more you win, the more you want to win,” and the aspect of his personality that refuses to accept failure, seems as if it arrived coded in his DNA. It certainly wasn’t ingrained in him by his father.
Ellison’s fierce intensity is constant. When he looks to the future, he sees opportunities for the next generation of radical thinkers. In talks, he speaks of technology solving the shortcomings of public schools, of creating marketplaces that bring wealth and commerce to diverse communities, and of health care that will produce miracles.
He has said that he feels envious of the young, ripening minds beginning their adventures at the precipice of all these discoveries.
“I don’t know of any place or any time where there aren’t great possibilities,” Ellison once said, and he continues to prove it.