The world was much different 15 years ago, for it has only been 15 years which most of us had access to the internet. As our lives have changed, it is interesting to look back at before internet was a given in the daily life and the companies which attempted to give us the internet. Back then, the uses of the internet were not seen by the 99.999%, but a few did see something, how they were going to make money off it was an unknown, but a few did see what could be. Jim Clark, the cofounder of Netscape, was one of those people in the .0001% and was the right person in the right position at the right time. He wrote a book about his experiences called Netscape Time by Jim Clark, St. Marin’s Griffin Press, NY, 1999. Mr. Clark was the Chairman of SGI or Silicon Graphics Inc. and was in the process of leaving, although he was a multi-millionaire but not a mega millionaire. He was looking for something else and was alerted to the talents of Marc Andreessen and Mosaic. Most people know the internet was originally a government service with a heavy emphasis on university researchers and defense contractors and run out of the National Center of Supercomputer Applications (NCSA) on the University of Illinois Urban-Champaign campus not far from Chicago. The reason why Silicon Valley is not in Chicago is Stanford University was able to encouraged its people when they had a great idea to set up a company and run with it. Companies that made money gave back to the University and the cycle keeps going. The University of Illinois people felt the company had to go through the University or bureaucracy, which just encourages people to find a better way to commercialize the ideas.

Eventually, Mr. Clark and Mr. Andreessen thought their great idea was to make a killer app or make it easier to use Mosaic which would open up the internet to the average person and thus companies where money was to be made. Each sector would use the internet to do all sort of things, many of which they were already doing with pen and paper. When Mr. Clark set up his company, there were among the thousands of non descriptive companies setting up in the Silicon Valley area. As investors, it is important to remember, with technology after the idea of what is desired, the most important asset is not the computer but people. Mr. Clark was able to set up  the company – he would use his knowledge gain from building SGI in terms of how companies, processes, people and money come together to form products, while Mr. Andreessen and fellow engineers would concentrate on writing the software. This was the ideal division and many companies which are set up, it simply does not exist. The skill set is different, but must complement each other. One raises money, one spends money; one tries to figure out how to generate revenues, one makes it easy for people to use the software; the bridging between the gaps is very hard for most companies.

Linking to dividend paying companies, instead of thousands of companies in non descriptive offices, dividend paying companies already have paying customers which are sustainable. The products are meeting needs and the company continually tries to make the products and services better. That is a different environment than bringing a new market for new uses as the risk is much higher that the market that is being targeted does not generate the revenues needed. When you buy dividend paying companies the risk is lower, and the return more stable which allows for the long term rise in your investments.

There are more questions than answers, till the next time – to raising questions