Floppy Days 141 - Paul Terrell Interview - The Byte Shop Part 2
Notes de l’épisode
Episode 141 - Interview with Paul Terrell, The Byte Shop - Part 2
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Hello, and welcome to episode 141 of the Floppy Days Podcast, for July, 2024. I am Randy Kindig, your host, as always, for this historical perspective on obsolete-but-still fun technology.
This month I'm bringing you a follow-on interview episode from last month. As we discussed then, Paul Terrell is a name well-known in the annals of computer history; probably most famously for his kickstart of Apple Computer through the purchase of one of Steve Jobs' and Steve Wozniak's first batches of Apple I computers for his Byte Shop. The Byte Shop was a very early computer store that was one of the few that existed in the world, at the time.
In this interview, we continue to focus primarily on The Byte Shop, how it got started, what it was like, and much more. There will be even more content in future episodes, as Paul and I had a pretty lengthy discussion on just this topic. If you want to know what it was like to run a computer store in those early days, this is the interview for you! Along the way, you'll learn even more about just what the home and hobby computer scene was like in those days.
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Interview with Paul Terrell
(3) Apple-1 Prototype Polaroid Photographs Given to Paul Terrell of the Byte Shop in 1976 - https://www.rrauction.com/auctions/lot-detail/348985606984001-steve-jobs-3-apple-1-prototype-polaroid-photographs-given-to-paul-terrell-of-the-byte-shop-in-1976/?cat=3
Ray Borrill's Data Domain blog - https://www.landsnail.com/thedatadomain/remember.htm
Transcription of Audio-only
Paul Terrell: Now eventually we did get to the point where we needed some legal assistance and we were once again, being in the heart of Silicon Valley, you would network with people. My salespeople knew a guy by the name of Larry Sonsini, who was a a lawyer in Palo Alto, and he happened to be the lawyer that had taken Intel public and Larry was very interested in what Byte Shop was doing because he was representing legally a lot of the electronics companies that were getting into personal computing. So Larry and I developed a friendship where we got together and I was able to convince him, since we were just a startup to be a little bit lenient with his legal fees and provide us with some legal assistance. And of course, Larry expanded his business right along with us. And he's actually the dominant legal firm in Silicon Valley. He's taken most of the companies public out there. He very much focused in the area of public markets and finance and that kind of thing. He grew his company and now he has a huge complex of buildings, a campus and in Palo Alto, which in the old days, it used to be called Wilson, Mosier and Sonsini and I think Mosier dropped out of the program, Rosati came in and so forth, but those were good, contacts to have you know in the marketplace because once again relationships. I met Bob Noyce from Intel who was the founder, one of the founders, of Intel and through Larry's relationship and friendship. Another person that was really dominant in the success that we had at Byte Shop was Regis McKenna. And Regis was one of the people that had come out of the semiconductor business.
Paul Terrell: He was over at National. Had watched their success and as those semiconductor companies were going public and Larry was taking them public they were they were also a source for a lot of technical people, good management, technical people being able to cash out of the success that they had with the startup company they were involved with to where they created a venture capital market in Silicon Valley and San Francisco.
Paul Terrell: And prior to that happening, there was very little funding available and actually the initial seed capital that came in for Apple was from Art Rock and Art Rock was a venture capitalist from New York City. So a lot of early startup money that was available to any kind of business was really New York is the center of finance; nobody's bigger than New York and Chicago does well in the mercantile business, but you know in commodities and so forth, but New York is where the big money was and there was really nothing in San Francisco other than some federal entities that the federal reserve was there and so forth, but and there was standard banking, going on.
Paul Terrell: Wells Fargo was headquartered there and so forth, but these people weren't seed capital people these people weren't providing funding for new business and of course there was a ton of new business going on. As a result of all of these semiconductor outfits and so forth.
Paul Terrell: So we were seeing a lot of new growth and one of the one good example of a venture capital startup was Don Valentine. And he was the first seed money into Apple along with Art Rock because Art's problem was he was located in in San in New York but he needed to have somebody out here that was looking after his money.
Paul Terrell: So a lot of these venture capital people, and actually the big financial institutes from New York would team up with these new technical venture capital people. Coming out of the semiconductor companies and Tom Perkins is a good example. Perkins Kleiner. These were semiconductor guys that got involved with venture capital and Tom was one of the guys that I talked to about when Byte Shop got to the point where we needed additional capital to grow. When I ended up selling the Byte operation I was opening eight stores a month and spending a lot of time on airplanes and our growth factor was just limited by how much time I had available to get out there and get contracts signed and so forth.
Paul Terrell: Then, as I pointed out earlier there were new industries that were being created as a result of the personal computer and and venture capital was one of them that really flourished to the point today where, when you hear about these company startups like Facebook and Google and all of the internet companies that have come out of it.
Paul Terrell: A lot of those people were initially funded by all of the people that made their money in personal computing and before we got into Internet and what that was all about. That, and as you pointed out, there's all these other computer stores across the country were coming into existence.
Paul Terrell: The consumer was becoming very aware of computer products. Video games was the big application that really kicked everything off because the electronic companies could make video game machines, which the kids loved. And they can make them very inexpensive versus the cost of putting a computer into a home or an office environment.
Paul Terrell: We started to see the marketplace expand with the advent of the. video games and of course that was coming from the coin operated video games and arcades that were out there accessible to the public and so forth. So there were more opportunities to to be 1-on-1 with technology.
Paul Terrell: Other than going to Paul Terrell's Byte Shops and and participating in the greatest show on earth.
Randy Kindig: A couple questions for you. Did you actually end up with dealerships in other countries besides the U. S. as well?
Paul Terrell: Yeah, the first country that we did business with and was Japan, and I actually opened up the Byte Shop SoGo in Japan what, once again, what would happen is people that were traveling to the San Francisco area maybe to a convention or business got exposed to the computer stores and they didn't have them in their countries.
Paul Terrell: They would take the time to to look around and see what was going on there. And I had a a gentleman from Japan who would come in, and of course our computers weren't very attractive as products for him to sell other than to people that understood English when he went back to his country, but of course, there were a lot of people in Japan professionals that were multilingual and, once again, we were very fortunate in the computer industry that almost the leaders in the business, IBM and the such they were English speaking and so the languages and all of the materials were when they took computers to their country that were from here, they had to do translations and things.
Paul Terrell: So that would have an effect on the amount of growth you could do there, but I was interested in doing a Byte Shop internationally from the legal trademark viewpoint and so we, within the first year, the first when I was involved in selling and expanding the Byte Shop operation I put the Byte Shop SoGo in play and got the trademarks that we needed in Japan.
Paul Terrell: Once again, these things were additional expenses for us. So it wasn't something that I was actively pursuing with Byte Shop. But once again, after Byte Shop, I did a number of other businesses in Silicon Valley and once again, expanded a lot of those businesses internationally, but the stage was set, for the early pioneers, in the personal computer market, and then the same thing was happening in their countries where magazines were getting involved in the business. It was more than just retail stores. You could find magazines and of course the Japanese manufacturers, they were the ones that were making all the televisions and radio and electronic products for consumer electronics.
Paul Terrell: So they were all interested in this category of either video game or personal computer. They had their own local suppliers that they could deal with. And I think they were just looking at our operations over here in terms of, getting a chance to see how it might evolve in their country and what the opportunities would be.
Paul Terrell: one of the things that I was talking about were the individuals, the Tom Perkins the Regis McKenna. And the reason that I keep coming back to Regis McKenna is because Regis being a advertising and public relations person, and his offices were right down the street from from my Byte Shop. His people would spend a lot of time in the Byte Shop in Mountain View and when anybody came to them that they were companies that they were talking to about products and and being the advertising company.
Paul Terrell: For that particular product or company, they would bring them into the Byte Shop and show them our operation and what we were doing and what potential market opportunities might be there. And through that association, I ended up hiring Regis to be the advertising and public relations for Byte Shop and, of course, they were.
Paul Terrell: The advertising and PR for Intel, and Intel, a lot of these companies that were substantial companies with a lot of funding they would do joint advertising programs. And so we were able through our relationships with Regis to be able to create a whole ad program based on an Intel engineer, son, Ricky coming and visiting the Byte Shop.
Paul Terrell: And then we could show off, we could talk about the Intel processor being the what's inside the computer and you see a lot of that co-op advertising is what they call it today and Intel pays a lot of the computer companies that buy their products and put them into the machine.
Paul Terrell: They provide a lot of money for these companies. And so if you see Intel inside, that's what that's all about. If the company puts an Intel sticker on their product, they're getting free money, from the supplier, from Intel. And so we were able to leverage a lot of the expense that we would have had with these relationships and probably the most important relationship that Regis ever did for Byte Shop was he introduced me to Jack Wilson, who was the Bureau Chief for Business Week Magazine out of San Francisco and Jack would travel to the Silicon Valley visiting the computer manufacturers like Tandem Corporation, Apple; he would spend a lot of time over there and by the way, Regis I recommended to Regis early on that he get behind Apple once we started carrying the Apple products in the Byte Shop and got Steve Jobs and him together and once again there was a lot of co-op going on between the individuals as we networked out there.
Paul Terrell: But Jack Wilson was writing an article for Business Week about the technology and the microprocessors and what was going on in Silicon Valley, and they had a technology section of business week, where people that were reading that magazine would go there and see what was going on new in the business. And so when Jack came down to see the Byte Shop he was also looking at the Homebrew Computer Club. He was looking at what was going on with Tandon Corporation, with Commodore, with Apple and so forth.
Paul Terrell: And Jack was really amazed at the depth of what was happening with technology and the companies that were getting involved and the extent of the products that these products, these microprocessors, we're going to be in everything in your house. They were going to be in your refrigerators.
Paul Terrell: They were going to be in your microwaves. They were going to be in your entertainment products and so forth. So he put together a a story about Silicon Valley and he interviewed me and our interview took about three hours when he came to the store, I took him over to Johnny Luigi and Johnny Frankie and Luigi's pizza parlor, which was two doors down from me, we spent lunchtime there and three hours talking about all of the things that were going on.
Paul Terrell: And. And when in July of 76 is when the article came out in BusinessWeek and Jack called me up and said, Paul, he said, I really have to apologize. He said, we spent all that time talking about what you were doing and the computer club and the hobbyists and the computer stores.
Paul Terrell: And all, but he said, when I sent the content of my article back to New York, he said, they cut out all of the personal computer stuff because it was just too lengthy. He said, I had 12 pages of an article and the technology section in business week is only about one or two pages, and they just wouldn't allow for it.
Paul Terrell: So he said, unfortunately, your stuff isn't going to be in that magazine and I apologize for it. And so anyway, when the magazine came out, I obviously bought a copy of it read about all of these companies. That I was mentioning before being highlighted in there. And and then I got a call from Jack that following week, and he said, hey, he said, good news.
Paul Terrell: He said New York has decided to go ahead and run the personal aspect of it. And so I'm going to have your stuff printed. And it'll be in the July 7th edition of business week, you might want to check it out. And when I got that magazine and it hit the street and the news racks, there was in the technology section, you opened it up and there was a picture of me standing behind the cash register in the Byte Shop and underneath the picture, it said Terrell plans franchising in California. That was the title of it. And then it went into all of the things that we were doing with the stores and the obvious, the computer enthusiasts that were out there and, what basically happened is Businessweek had whet the appetites of people with this huge article the previous week about microprocessors and what the future was going to hold, and then all of a sudden, the following week, they come up with a picture of me, and here's how you can make a buck at it.
Paul Terrell: "Terrell Plans Franchising". Let me tell you, all of a sudden, the mailman was coming to the Byte Shop in Mountain View, and he was literally dumping mailbags full of letters on the floor in my store and he said, you're the only Byte Shop in Mountain View. There's no address 1063 West El Camino here. So I'm assuming that this is all your mail.
Paul Terrell:When I opened the letters was people like the chairman of the board of Telex Corporation wanted a three state territory. They were down in Texas. They wanted Texas, Oklahoma.
Randy Kindig: Were these people wanting dealerships?
Paul Terrell: Yeah, basically they were asking how do they become involved with Byte Shop and what the return on investment was for a Byte Shop store and quite honestly I'd never had any business like that and consequently I went to one of our dire