Jon von Tetzchner, the co-founder of Opera Software fought with investors for several years before quitting as CEO of the company in 2010. Recently, Opera browser was bought by a Chinese consortium. In an interview, Mr. Tetzchner, who founded Vivaldi, said that he is back in the ring again with a powerful new browser named after the company. The Icelandic programmer said that Vivaldi is the world’s first web browser that can control hue lights opening new opportunities for seamless integration between the browser and physical space. For India's growing start-up ecosystem, Mr. Tetzchner's entrepreneurial journey offers several valuable lessons on dealing with investors and building a company from scratch again.
Edited excerpts:
Has the browser war been conquered ?
There is always been competition in the browser space. I started with browsers in 1994, building Opera. The leading browser was Mosaic and you had browsers from companies like IBM, Oracle, Symantec, Apple and Sun Microsystems. Then it changed, there was a period when Netscape took over and IE took over and now there is a little bit more. In the PC space, Chrome is having a significant lead but there are a number of players with significant market share. And on the mobile side, there are few browser vendors. In some ways, you can say that the market is healthy. The only sad part is what is happening with Opera.
Wasn’t Opera supposed to take the web by storm?
When we funded Opera there were two of us. We had $7,000 in starting capital. In the period of our first five years, that is what we lived on. During that time Netscape had a valuation of billions of dollars and disappeared.
At Opera, we had a long-term view. We became number one mobile player and number one in TVs and game consoles. In PCs, we became quite big in certain countries. I am very proud of what we achieved. During my tenure at Opera, the typical revenue growth per year was 40-50 percent for 15 years. We didn’t spend money unwisely, we were always frugal. When I left, the company had $100 million in the bank.
Why did you leave the firm when it was doing so good?
The reason why I left the company was a disagreement on where we wanted to take the company. I wanted to continue the growth, but there were a number of investors that wanted to sell the company. This had been an ongoing fight for us for seven years with some investors. If there had been an offer for the company we would have to deal with that. But during that period there was no firm offer on the table. But they (investors) were unhappy with me, saying things like “We are not looking to be bought and if the bid comes it is for the investors to decide.” They were thinking that it must be some kind of blind luck that we were actually managing this kind of growth every year and that was something that was bound to end at some stage.
What did you learn from this tussle with investors?
When you are building a start-up quite often you need money. In the case of Vivaldi, we have decided not to get external funding. In start-ups sometimes there is so much on the financial side that the means becomes the goal. The biggest problem is when the focus is on the means and not the end. There should be a reason for what you are doing. At any time when you are building a start-up, you know there can be a situation where you have to decide do I sell or continue to grow. We had a big American company probably in 1997-1998, that was offering us more than $10 million. We said no. There were a couple of us who owned the company. I believe that time even my co-founder was diagnosed with cancer which 10 years later sadly led to his death. But we didn’t want to sell. He didn’t want to sell. Because we wanted to build the company.
When does one decide whether to sell?
You have to follow your heart what is right for you but you have to question why you are building that company. If you are only building the company with an intention for sale, I don’t have the right feeling for that concept. I believe in building companies for a long-term for success. Success quite often takes time. There is a concept in the Silicon Valley of 'fail fast' I don't like failing fast, I don't like failing. I think it is better to succeed. Success may take longer, quite often it does. Large companies which have become significant successes, quite often they had difficult periods of time, where they considered selling their technology and everything. At Opera, we had many such close calls when we were thinking selling parts of the company. Luckily we didn’t agree.
Is venture capital important?
The first few years at Opera history were very nice. We had no other investors. We had struggled, we didn’t have a lot of money. Sometimes founder's salaries didn’t get paid but we managed and we enjoyed our time. Then we got venture capitalists in and these were good. We grew the company together and we had the same goals. They did not push us. They gave us advice some of which we listened and some of which we didn’t. When we went public, my feeling had always been that when we go public I have done my job for the investors, I have given them an exit. From now on we continue to build the company and investors that like we would stay and those who don’t like us would leave. But that was my naive thinking. What I gradually found out was that there were a certain group of people that wanted to sell just for more money.
What are the qualities one should look for while choosing an investor?
This is so hard. How do you know? In 1996, we just started Opera, we made an intention agreement with an investor who said they are a long-term investor. It was not a final contract. Next morning I got a call from the investor. They had called another company that they owned and which sold modems. They had asked the firm “do you want to bundle Opera ?” and they said ‘no, we don't need that’. They (investor) told us “forget about this browser thing, you guys know how to make web pages let's make a consulting company that makes web pages.” We told them goodbye. The only thing you can do is if this investor has invested in other companies can you get a frank answer from them?
How is your new bet Vivaldi different from the rest of the browsers?
After having left Opera and after thinking that I would use it forever, Opera decided to go into a different direction. The feeling was that all the browsers were starting to look same. And we felt there is a need for a different design philosophy. Having a tool that is optimised for our preferences makes a lot of sense and that is what we are thinking. It (Vivaldi) should feel like it was designed with you in mind. We believe we should adapt to you and your requirements. We have hundreds of volunteers helping us to translate the browser into different languages and test the browser.
