For America's Cup winner Ellison, competition is personal

http://www.mercurynews.com/breaking-news/ci_14401226

For America's Cup winner Ellison, whether it's software or sailing, competition is personal
By Brandon Bailey
bbailey@mercurynews.com
02/14/2010

Billionaire software mogul Larry Ellison won the America's Cup on Sunday by following the same aggressive rules he has perfected in business: Push the envelope on technology. Don't be afraid to spend money. And make the competition personal.

The pugnacious Oracle CEO and the crew of his 114-foot, high-tech trimaran became the first U.S.-sponsored team in 18 years to win the world's oldest sailing trophy, after trouncing the Swiss Team Alinghi in successive races — the first was Friday — making a third event unnecessary in the best-of-three competition off the coast of Spain.

"It's an absolutely awesome feeling. I couldn't be more proud to be a part of this team," Ellison, who was on board for the race, told a TV crew on the scene moments after the BMW Oracle boat, dubbed USA-17, finished the second race 5 minutes and 26 seconds ahead of its rival.

But the quick victory came after a years-long quest, into which Ellison, the world's fourth-richest man, poured hundreds of millions of dollars from a personal fortune estimated at $27 billion. In addition, he waged an extended legal battle against his bitter rival, billionaire Swiss yachtsman Ernesto Bertarelli, to make sure the race was staged on what Ellison considered fair terms.

During those years, Ellison also was spending billions of shareholder dollars to gobble up smaller companies and major competitors, including PeopleSoft, Siebel Systems and, most recently, Sun. Ellison, who cofounded Oracle as an upstart database vendor in 1977, has built the Redwood City business into one of the biggest commercial software companies on Earth — with $23 billion in annual sales and $117 billion in total stock value.

"He is perhaps the most aggressive CEO in the tech industry today," said Jon Fisher, a former Oracle vice president who now teaches business at the University of San Francisco. Fisher added that Oracle, a company that vies with such giants as Microsoft and IBM, is both highly competitive and ruthlessly "engineering-centric," even compared with other tech firms.

The 65-year-old Ellison has long cultivated a swashbuckling reputation — driving fast cars, piloting jet planes and even breaking a few bones while body surfing in Hawaii. In 1998, he won a 700-mile yacht race off the coast of Australia after sailing through a storm that killed six crewmen on other boats.

And he has not been shy about exploiting that image. In recent years, Ellison's keynote speeches at Oracle's Open World — a convention that draws 40,000 programmers, customers and industry executives to San Francisco each year — have been introduced with thundering music and dramatic video of Ellison and the BMW Oracle boat racing on the high seas.

Ellison also is known for publicly deriding his rivals, both in the tech industry and the sailing world. Last fall, he assured a dinner audience in San Jose: "We have the fastest boat, we have the best crew, and if it's a fair race, we'll win."

USA-17 was built with bleeding-edge technical features that helped it skim the ocean at speeds up to 40 knots (46 mph). It has an unusual three-hulled design, made from carbon fiber and topped with a towering 223-foot "wing sail," a rigid structure like an oversized airplane wing that is controlled by nine adjustable flaps.

Winning the America's Cup also took money. Ellison and Bertarelli each spent millions on boat design, construction and wages for a small navy of crew members and onshore support staff. While the exact numbers are undisclosed, Ellison has said he spent $200 million to enter the last America's Cup in 2007, when he failed to reach the finals.

And in keeping with Ellison's approach to competition, he told those attending a Silicon Valley Churchill Club dinner in September that his feud with Bertarelli had become "very personal."

To an interviewer in Spain last week, Ellison, a college dropout raised by adoptive parents, said of Bertarelli, the heir to a Swiss pharmaceutical fortune: "I don't like him."

During their two-year legal battle, Ellison frequently complained that Bertarelli, as the winner of the last America's

Cup, was trying to dictate terms for this year's race that would make it impossible for anyone else to win. But their rivalry dates back to 2003, when Bertarelli's Team Alinghi defeated Ellison in that year's finals.

Ellison later retaliated by hiring away Bertarelli's skipper, Russell Coutts.

Making things personal is how Ellison achieves his goals, according to Mike Wilson, author of a 1997 biography whose title, "The Difference Between God and Larry Ellison," plays off a joke that made the rounds in Silicon Valley. The punch line: "God doesn't think he's Larry Ellison."

Ellison made business personal in Oracle's early days by declaring war on rival database company Ingres, Wilson said. Later in the 1990s, Ellison took on Microsoft's Bill Gates by publicly calling PCs of that era "ridiculous" and arguing that they should be replaced with less expensive devices that would access software over the Internet. The concept is similar to cloud computing, a leading industry trend today, but Ellison was early in talking about the technology.

Wilson said Ellison believes "if he creates an enemy, he can vanquish it."

Now, with the recent $7.4 billion acquisition of Sun Microsystems, Oracle is expanding into the hardware business. Ellison has loudly proclaimed his intention to beat industry leader IBM in the market for high-end corporate computer systems.

"I enjoy competition. I think life is a series of acts of discovery," Ellison told his Churchill Club audience.

But when asked if he would rather win the America's Cup or lure a customer away from SAP, a German software company that has been one of Oracle's major rivals, Ellison said he'd much rather beat the Swiss sailing team.

Explained Ellison: "We beat SAP all the time."

Contact Brandon Bailey at 408-920-5022.