Steve Case Interview (page: 3 / 8) Co-Founder, America Online	Print Interview

During the period that you were working towards this, what kind of support did you get from your family? Were they encouraging in your entrepreneurial choices or were they concerned about them?

Steve Case: I would say a mix. They were beginning to think I maybe had picked the wrong horse. They're a little more traditional. They understood Proctor & Gamble, a great consumer marketing company. They certainly knew PepsiCo. When I moved to this entrepreneurial world, a company they had never heard of, creating products they couldn't really understand, they thought it was a little bit screwy. After many years of not being very successful, there were moments when I think they thought, "Maybe it's time for Steve to pack it in and do something else. It took over a decade before we began to hit our stride.

What did they think you should do, go to law school?

Steve Case: Not necessarily go to law school. Maybe go to some other company, but I wouldn't say there was a lot of pressure to do that.

Get the Flash Player to see this video. I think a lot of people, friends included, were saying, "I know you're a believer in this and all, but you know, sometimes no matter how hard you believe it just doesn't happen. Maybe you should kind of give up the ghost and try something else." But I just believed, and so I kept doing it. I just viewed each of these setbacks as a challenge, and that we wanted to stay in the game. In fact, I think because there were some of these challenges I just redoubled my own commitments. "We're going to make this happen." We were going to stick with it, and the team that we built at AOL shared the passion about this new medium and that we really were pioneers in building something. And what was fun about it is nobody knew what to do and you kind of had to make it up as you go, and that means you're going to make mistakes, and you've got to keep picking yourself up off the floor and keep going.

[ Key to Success ] Perseverance

So it wasn't just me.

Get the Flash Player to see this video. I think the support of the other team at AOL and everybody's really shared passion and belief about this and -- saying that some day everybody was going to be on line. Some day we were going to be living in a more interactive world. Some day people would feel like they're part of an electronic community. I think just that vision of that, that some day that was going to happen, I think, propelled us. There was many who had questioned whether we would even be around when that happened, but I think most people believed, even the cynics, that probably some day that would happen. And we said, "Well, rather than just sit by and wait, or fold our tent and go do something else, let's keep at it. Maybe we can be the ones who can figure this out," and eventually we were.

[ Key to Success ] Perseverance

Did you study business in college? Did you draw on those studies to get you through these crises and setbacks?

Get the Flash Player to see this video. Steve Case: Williams College is a classic liberal arts school, so there is nothing really business-oriented about it. There's no business classes. There's no marketing classes. It's really a more traditional kind of thing. So my degree was in political science, which I think was -- the closest I could come to marketing is politics. You know, for better or worse, a lot about marketing and positioning candidates and so forth, but I was sort of interested in it anyway. So, I wouldn't say that any specific course really was instrumental. I do think that a general liberal arts education is very important, particularly in an uncertain changing world. I think what a liberal arts perspective gives you, is you know a little bit about a lot of things, and look at the world as sort of a mosaic and kind of see how the pieces come together. I think that gives you a perspective that I found to be very valuable. And so in one sense, there's nothing specific that I learned that was applicable. In another sense everything I learned was a useful foundation. Because I do think -- not just in building AOL -- but just the world in which we live is a very confusing, rapidly changing world where technology has accelerated.

[ Key to Success ] Preparation

The pace of innovation has accelerated the speed of how companies react. Consumers have adopted it in significant ways. It has lowered some of the barriers in terms of traditional impact of television and newspapers, because now there are other ways to get information. That electronic world has also accelerated globalization and blurring of the borders between countries, creating more of a global perspective.

More recently, unfortunately, some of the challenges are related to terrorism and the fact that it's not the conventional kind of war. They're not the conventional ways to deal with things. All of these things are kind of disruptive new out-of-the box ways to think about your life and think about the world.

Get the Flash Player to see this video. I think the more you have a generalist perspective, I think sometimes the more you can kind of see through the forest and the trees. And when it gets a little bit cloudy, you know, have some sense of, "Well, maybe this might happen or maybe that might happen." So I really am a big believer in liberal arts education. I think it's better -- particularly in these kind of uncertain times -- to know a little bit about a lot of things as opposed to being expert in one thing.

I guess having a sense of history helps you to see that it doesn't always go in a straight line.

Steve Case: Right. I think one of the things that was useful to me was not really college, but just reading books and studying how major consumer innovations took place. If you look back at the history of the telephone a century earlier, it took decades before it was common. Initially people said, "Why would I ever need a phone? If I want to talk to somebody I'll just go next door and talk to them." You couldn't imagine that people would have phones. So eventually, after many years, maybe there was a phone in the bar in town. If you had to make a call to somebody, you'd go to that one phone and enter a party line, a shared line, and so forth. Eventually, it got to the point where people did say, "You know, you do need a phone in your home!" By the time I was growing up everybody had a phone in their home. Today they have multiple phones in their homes and cell phones and computer access with instant messaging.

It has really been a dramatic acceleration of the different ways to communicate. But if you look back in history, those core innovations don't happen overnight. It takes a while. Similar with cars. It took a while, in part, because people thought, "Why do I need a car? I'll just get on my horse." It was only when more people had cars that people said, "Oh, it is useful." Because more people had cars, you started building roads which made the cars more useful. It's sort of this chicken and egg thing. You just have to break through and it takes a while.

That gave me some perspective and patience that enabled me to persevere in pursuing this particular vision, because I knew it takes a while for things to develop. One of the biggest challenges we had in the first decade was not that many people had personal computers. There weren't that many people to sell to, and it was hard to identify them. You had this market, and Computer . You couldn't really market generally, because the number of people with computers was so small.

Get the Flash Player to see this video. Most of the people who had PCs did not have modems and could not use those PCs as communicating devices. They really were using them for spreadsheets or word processing or storing recipes or playing games or what have you. Very few people in the 1980s used them the way we now think of them today, as communicating devices, because they didn't have modems. A modem was viewed as a peripheral device. You went to the peripheral section of the computer store to buy a modem. So, it's essentially being defined by the industry as an optional, nonessential, peripheral part of the computing experience. So, we actually spent many years trying to get a modem built into a home PC, and finally we were able to convince IBM, I think it was 1989, to do that. They were the first PC company to build a modem into the PC. Once IBM did that, others felt, "Well, if IBM is doing that, we have to do it," which is what we thought would happen. And suddenly, in about a three or four-year period, every home PC had a built in modem. That single act of finally convincing IBM -- and it took years -- to build a modem into the PC was probably the single biggest factor that then drove the growth of AOL and the Internet. It was not really the inventions as much as the World Wide Web, and other things that came later, because if you didn't have a modem built in your PC, you had no possibility of getting connected. And so, it was an example of how you have to kind of put the basic building blocks. Like you had to put roads in place to make cars useful, you had to put a modem in place in a PC in order to create a mass market for consumer services.

Looking back in history and seeing how these things played out gave you some hint at what perhaps might be necessary to really have a breakout strategy for interactive services.

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