TitleFounder & Owner
CompanyArthur Rock & Company

Amid the iconoclastic and frenetic glamour of Silicon Valley, Arthur Rock’s low-key eastern pragmatism might have seemed strangely out of place. But Rock, a Rochester, NY native who graduated from Syracuse with a degree in political science and finance and later earned an MBA at HBS, is as responsible for that region’s entrepreneurial triumph as anybody. Indeed, without Rock’s visionary wisdom and soft-spoken, calm counsel, the Silicon Valley might never have become the technology-based gold mine of ideas and startups that it is today. Beyond Rock’s superb financial acumen, his impact lay in a simple but profound desire: he wanted to help talented people build great companies.

“Anyone who comes into the office and says `I have this business plan and you’re going to make a lot of money if you invest with me’ doesn’t stand another two or three minutes with me because that’s not what it’s all about,” Rock said. “It’s about building companies. Success for me is helping to build great companies. That’s how I get my kicks.”

For the past half-century, Rock has certainly gotten his kicks. He has been an active champion of entrepreneurism in American business and his $25 million donation to HBS in 2003 lead to the creation of the Arthur Rock Center for Entrepreneurism. He and his wife Toni Rembe also founded the Rock Center for Corporate Governance at Stanford University. His deft touch has left an imprint on hundreds of successful startups over his long career. Legend is an overused accolade, but in Rock’s case, it is entirely fitting.

A 1984 Time magazine cover story was titled “Arthur Rock: The Best Long-Ball Hitter Around.” Writer (and later successful Silicon Valley venture capitalist) Michael Moritz wrote he profile of Rock, a lifelong baseball fan, and said “Since the late 1950s, Rock has been carefully scrutinizing pitches of another kind—start-up bids by young technology companies— and when he goes for one of these, he rarely misses.”

Among the iconic companies Rock helped launch were Fairchild Semiconductor, Intel, Scientific Data Systems, Teledyne and Apple Computer. Rock has had a remarkably intuitive sense of the people with whom he invested and his steady hand and ever-curious intellect provided invaluable mentorship and advice to a legion of technology giants. What has become standard industry practice was Rock’s philosophy from the beginning. He invested in the people more than the product and he spent an inordinate amount of time with the founders of prospective investments in order to gage whether or not they had the right stuff to succeed.

A Rock profile in Investor’s Business Daily by Reinhardt Krause in 2009 was titled “A Gem Among Venture Capitalists” and focused on Rock’s search for intellectual honesty in the people with whom he invested. “Rock’s money smarts and guiding hand turned feisty Silicon Valley startups into some of the nation’s biggest technology companies,” Krause wrote.

Having graduated from HBS in 1951, Rock’s journey into venture capital began with an early stint in investment banking at Hayden, Stone in New York City. His natural affinity for finance led him to encounters with a number of small companies around New York and Boston and he found that he liked the people who ran these companies and enjoyed the experience of raising money to help these businesses grow.

In a serendipitous encounter in 1957, Rock was approached by a group of seven scientists who were working at Shockley Laboratories in Palo Alto. The group had been working under the Nobel Prize winner William Shockley, the co-inventor of the transistor, but Shockley’s quirky anagement style was a turn-off and these scientists were looking for help landing other jobs. They wanted to find a place that would hire them as a group so they could continue their work developing silicon semiconductors. Rock helped them compile a list of 35 prospective employers and he personally visited nearly every one. But none wanted to support this group effort. Instead, Rock suggested they form their own company.

Rock approached Sherman Fairchild, who had started a company called Fairchild Camera and Instrument. He persuaded Fairchild to hire the group, which had added Robert Noyce and was thus dubbed “The Traitorous Eight” and allow them to create a new company called Fairchild Semiconductor. Fairchild advanced the group $1.5 million to get started and Hayden Stone ended up with a 20 percent piece of the new company.

The rest, as they say, is history. For Rock, the experience of helping to create an exciting new technology company was transformative. The nascent venture capital industry was rising to prominence and Arthur Rock found himself at the forefront of this new wave of business creation. For many, Rock is considered the father of modern venture capital.

In the early 1960s, Rock began to chafe at the conservative attitudes toward new ventures that he encountered in the east. It was “old establishment and old money,” he said. “People have been doing things one way for a long time and it’s very hard to change.” California, on the other hand, felt like the Old West and there was a palpable sense of adventure and innovative spirit which appealed to Rock.

“I found that the brighter, more imaginative, adventuresome people were out here rather than in the east,” he said, explaining his move to San Francisco. In 1961, he and his new partner Tommy Davis founded Davis & Rock, and went to work building what became Silicon Valley.

When Bob Noyce and Gordon Moore became disenchanted working at Fairchild Semiconductor in 1967, they turned to Rock for advice. He could see their frustration with Fairchild, which was being run by an autocratic group at the company’s headquarters on Long Island. Rock counseled Noyce and Moore to leave and start their own company. He believed that this world-class duo producing revolutionary technology was a sure thing.

“I liked opportunities that seemed to have no limit,” Rock said. He secured the financing, doled out shares in the new venture, and Intel was born. This iconic firm heralded a coming technology revolution. The golden age of the microprocessor was underway and the world was being changed forever. With this technology, the era of the personal computer commenced, bringing with it a surge magical new hardware, software and services that lead directly to the current world of the Internet, powerful mobile devices and a hyper-connected globe where all knowledge is at our fingertips.

“I was never 100 percent sure that a company would make it, except for Intel,” Rock recalled. “Of that, I was absolutely sure.”

One of Rock’s sternest tests came in the late 1970s with his introduction to Apple. It was hardly an intuitive coupling for Rock but he knew Mike Markkula who had been Intel’s marketing vice president and Markulla persuaded him to take a look at Apple. Rock was thoroughly unimpressed with Steve Jobs and Steve Wozniak, the scruffy, long-haired founders. “They turned me off as people,” Rock recalled. But fortunately, he was sufficiently persuaded by Markulla’s enthusiasm to make an investment.

In 1985, with Apple struggling and a young Steve Jobs engaged in a power struggle with new CEO John Sculley, the board sided with Sculley and Jobs departed in a fury. Rock was on pple’s board and thus in the middle of the calamity. The board did not believe Jobs had the experience and focus to right the ship and made its fateful decision.

Rock brought in the wisdom of his Silicon Valley experiences. “There are three key stages in a company’s life,” he said. “There’s the first stage where the entrepreneur does things himself. He goes into the lab and develops things. He makes sales calls. He sets the tone for marketing. Then there’s the second stage where, if the company grows, he does things through other people. He has a vice president of sales, a vice president of marketing, a vice president of engineering. But he keeps on top of everything. If the company grows to a third stage, the entrepreneur no longer has any direct control over things. A lot of people can’t handle that stage and that is of course what happened at Apple.”

By 1993, the board decided it was time for Sculley to go as well and Rock left the Apple board shortly thereafter. He continued to invest in startups and cement his legend in Silicon Valley.

As the head of his own venture firm Arthur Rock & Co., Rock has remained among the most revered of the country’s venture capitalists. He is an active philanthropist and considers himself the good listener he has been throughout his career. “Success breeds success,” he said. “The people here in Silicon Valley saw what could be done and they thought they could do it better, and they did.”