UUNET Concepts

The Power Law: Venture Capital and the Making of the New Future

by Sebastian Mallaby · 1 Feb 2022 · 935pp · 197,338 words

law was inexorable. Even a methodical, anti-Kleiner, prepared-mind partnership could not escape it. The dominance of the power law was illustrated by UUNET, one of several unforeseen grand slams in Accel’s first dozen years in business. Now a forgotten company, subsumed into Verizon’s vast telecom empire

…

by engineers, is a world away from the brand-conscious zippiness of later startup names—think Zoom or Snap or Stripe or Spotify.[24] Yet UUNET is worth recalling because, in addition to illustrating the power law, it illuminates two features of venture investing. First, it showcases the distinct roles

…

diligence or foresight. At the same time, venture capital as a system is a formidable engine of progress—more so than is frequently acknowledged. UUNET began life in 1987 as an obscure Northern Virginia nonprofit. Its mission was to address the central limitation of the internet as it existed then

…

-optic cable, it would be cheaper by far to build out the copper-wire-based internet. Responding to insatiable customer demand, not political edict, UUNET was already grafting routers and servers onto the existing phone networks, turning voice lines into data lines, and now the NSF’s privatization announcement opened

…

to compromise his purity of purpose. On the other hand, however, Adams needed capital; in fact, he needed a ton of it. The more UUNET expanded, the quicker demand grew, because growing usage made the network more attractive to the next wave of potential users. “The project was swallowing cash

…

a kindred spirit.[38] After some further thought, Adams accepted Kapor’s offer.[39] Having secured his skin in the game, Kapor proceeded quickly. UUNET had to grow into those big-boy pants before competitors muscled in on its market. Whatever Adams’s misgivings about investors, this accidental East Coast

…

Over the next handful of years, the internet would leave Gore’s vision in the dust. Unlike in the case of GO, Doerr was unpersuaded. UUNET was not the sort of company that Kleiner Perkins liked to back. It owned no intellectual property, so was defenseless against larger competitors.[40] It

…

. At first, nothing happened. Juggling dozens of investment leads, the Accel team lost interest. At the end of January 1993, Kapor tried to get UUNET back on Accel’s radar by visiting its San Francisco office. To his disappointment, none of the investing partners showed up for the meeting. Accel

…

the partners want? The internet was spreading fast. Now was the time to invest in it. The partners pushed back. People did not need UUNET in order to use email. They could sign up for CompuServe or Prodigy, services that between them allowed three million subscribers to email other account

…

took a nudge from a competitor to change Accel’s attitude. In February 1993, a telecom company called Metropolitan Fiber Systems made a play for UUNET. Adams turned to Kapor for advice. Maybe a corporate investor such as Metropolitan Fiber would be better than a venture capitalist? Kapor fastened on

…

bid. That would get them “heated up,” he assured Adams.[46] Adams met with a Metropolitan Fiber representative at the Ritz-Carlton hotel near the UUNET office. The guy wrote some numbers on a Ritz-Carlton notepad. Then he detached the page theatrically, turned it facedown, and slid it over

…

potential for $100 million.”[48] On top of doubts about the size of the market, there was a question about Adams’s managerial ability. If UUNET was going to grow, it would need experienced operational leaders, and the VCs would have to identify them, woo them, and support their efforts

…

once they came on board. There was a risk that Adams might resist. His ego would have to be managed, and UUNET’s location in Northern Virginia would make this babysitting difficult. As Accel’s senior software investor, Arthur Patterson resolved that he would do the deal

…

almost missing out, the firm was meandering toward the right decision. But the process was not done. The Accel-NEA term sheet proposed to value UUNET at just $6 million—$2 million less than Metropolitan Fiber. Adams was indignant.[51] Again, competitive pressure shifted the investors in Adams’s direction.

…

This time the nudge came from a Silicon Valley partnership named Menlo Ventures, which had heard of UUNET through another serendipitous connection. UUNET’s chief scientist, Mike O’Dell, had previously worked for a Menlo-backed company. A new partner at Menlo, an engineer named

…

higher valuation. Delighted, Adams told Barris that he would do the deal exclusively with NEA; after all, Barris was the investor best positioned to help UUNET. But, in an example of VCs acting to protect their reputations and networks, Barris declined the opportunity to squeeze his rivals out. He had

…

to bankruptcy. In December 1993, he accepted the venture capitalists’ lifeline. As it turned out, the $750,000 shock coincided with a portent of UUNET’s eventual triumph. That December, the front of the New York Times business section featured a story on a revolutionary web browser called Mosaic, “a

…

him enough to give an outside CEO a chance. And Barris had found someone. The question was whether he could persuade this someone to join UUNET. The candidate was another GE Information Services veteran named John Sidgmore, whom Barris remembered for his streak of “entrepreneurial chutzpah.” Back in his GE

…

the cost. “Think of the margins, and what those margins are going to do to the value of your personal equity,” Barris said, seductively. UUNET represented an opportunity for Sidgmore to modernize and cannibalize the entire GE Information Services playbook.[59] YoYo Net, WeWe Net: this was not just any

…

venture rounds, scaling up at breakneck speed and acting on the lessons from GE that Barris had understood from the outset. In January 1995, UUNET secured the contract to build the network infrastructure that supported Windows 95, Microsoft’s first operating system designed around the internet. The next month Sidgmore

…

gave the company a valuation of $900 million, and then, in a wonderful full-circle ending, Metropolitan Fiber made its second appearance, buying control of UUNET at a valuation of $2 billion. Through luck more than brilliance, Accel found itself pocketing fifty-four times its original stake, a profit of $

…

because it held on to its position longer.[60] Venture capitalists as individuals had made plenty of errors. But venture capital as a system helped UUNET to spread the internet to millions. Despite all his misgivings about investors, Rick Adams felt properly rewarded. “I’d like to thank you again

…

,” he wrote to Mitch Kapor after the flotation. “I’ve got $138 million. Pretty surreal,” he added.[61] There was a coda to the UUNET story, and it reinforced the lessons about venture capital. The magical Mosaic web browser, announced by The New York Times in December 1993, had come

…

-power-law companies. Chapter Seven Benchmark, SoftBank, and “Everyone Needs $100 Million” At the start of 1995, somebody mentioned a strange name at a UUNET board meeting. Don Gooding, the telecom analyst at Accel, had been building a company website—the first internet presence established by a venture firm. As

…

astronomical returns to be had from turbo-power-law companies, it was crazy not to gamble on them. What’s more, jackpots like Netscape and UUNET had been noticed by university endowments and pension funds, which responded by pouring extra capital into venture. In 1995, U.S. venture partnerships raised

…

executives had sometimes turned their hands to investing: Mike Markkula had backed and shepherded the fledgling Apple; Mitch Kapor had financed and counseled GO and UUNET.[9] But it took the booming tech market of the middle and late 1990s to turn this “angel investing” into a serious force. Thanks

…

produced a grown-up executive willing to work for the company.[20] Shriram was serving the same role that Mitch Kapor had played in preparing UUNET to pitch investors. In May 1999, the Googlers duly set out to meet the venture capitalists. But, having raised money on such favorable terms

…

no harm in entertaining other suitors. The most insistent was Shervin Pishevar, a new recruit at Menlo Ventures, one of the partnerships that had backed UUNET. Pishevar was not in the same league as Jordan or Gurley. A bulky backslapper with a gift for self-promotion, he had attracted attention

…

multiple cases in which VC coaching made all the difference. Don Valentine rescued Atari and then Cisco from chaos. Peter Barris of NEA saw how UUNET could become the new GE Information Services. John Doerr persuaded the Googlers to work with Eric Schmidt. Ben Horowitz steered Nicira and Okta through

…

in this book show how venture capitalists have succeeded with expensive hardware projects in the past: recall Fairchild Semiconductor, Intel, Tandem, 3Com, Cisco, and UUNET. In the first decades of the industry, VCs financed capital-intensive projects by writing appropriate term sheets. For their patience and ample cash, they demanded

…

China’s tech industry. Ismael Farooqui covered the Valley in the later period, delving especially deeply into the story of Y Combinator, the financing of UUNET, and the governance traumas of the unicorns. A succession of wonderful interns and freelancers filled in numerous gaps: James Goebel, Alan Liu, Aaron Pezzullo,

…

. BACK TO NOTE REFERENCE 37 Kapor had founded the Electronic Frontier Foundation, a nonprofit that advocated open access to the web. Its mission complemented UUNET’s founding goal of connecting private users. In interviews with the author, both Kapor and Adams recognized the importance of nonprofit idealism in forging their

…

NOTE REFERENCE 51 Jarve, interview by the author, July 18, 2018. BACK TO NOTE REFERENCE 52 The Series A round was signed October 4, 1993. UUNET raised $1.7 million (counting in Kapor’s $200,000 investment from the previous November) at an $8.3 million post-money valuation. BACK

…

night, a trick that GE had figured out for its time-share services. Barris, author interviews. BACK TO NOTE REFERENCE 59 By holding on to UUNET stock for longer, NEA earned $300 million. Barris, author interviews. BACK TO NOTE REFERENCE 60 Adams, email to Kapor, May 26, 1995. Adams’s

…

wealth rose further as UUNET’s stock appreciated. BACK TO NOTE REFERENCE 61 Jared Sandberg, “The Rumpled Genius Behind Netscape,” Globe and Mail, Aug. 14, 1995. BACK TO NOTE REFERENCE

…

home” moon shots. 1993 Israel creates the Yozma Group, a successful government program to promote venture capital. 1993 Accel, NEA, and Menlo Ventures back UUNET, turning the government-run internet into a mass medium. 1994 Kleiner Perkins backs Netscape, transforming the online experience. 1995 Michael Moritz of Sequoia backs Yahoo

…

mind” approach of, 122, 128, 210, 250–51, 252, 308–9 Skype, 191, 251–52, 285–86 specialist approach of, 129–31, 221 Spotify, 289 UUNET, 135–39, 143–44, 286 Accel India, 324 Accel Telecom, 129–31, 435n, 436n activist investing, 60, 63, 66–69, 80, 81, 84 Adams,

…

–88, 263, 328, 379, 442n Martha Stewart investment, 179, 185 Netscape investment, 146–48, 167, 179, 437n Silicon Compilers and Ungermann-Bass, 107–8, 433n UUNET investment, 135–36 “Don Valentine tartan,” 307 DoorDash, 330 Doriot, Georges, 28–31, 36–37, 98, 419n background of, 28 Digital Equipment investment, 28–

…

Steven N., 436n, 450n Kapor, Mitch, 120–28 Electronic Frontier Foundation, 436n GO Corp. investment, 122–28, 175 Lotus Development investment, 120–21, 135, 264 UUNET investment, 134–39, 141–42, 144, 175, 179, 436n, 437n Katzman, Jim, 427n “keiretsu model,” 107 Kern County Land Company, 44, 48–49 Khosla, Vinod

…

–8, 433n stage-by-stage investing of, 60, 76–77, 80 Sun Microsystems, 107 Tandem Computers, 70–72, 75, 79 Treybig at, 69–72, 86 UUNET, 135–36 Zynga, 289 Komisar, Randy, 269–70 Kopelman, Josh, 386 Kordestani, Omid, 441n, 455n Koum, Jan, 308, 314 Kozel, Ed, 433n Kramlich, Dick,

…

Meeker, Mary, 266–67, 287–88, 289, 298 Meituan, 242–48, 304 Melchor, Jack, 103, 105–6 Menlo Ventures Uber, 354, 355–57, 368 UUNET, 141, 144 Merrill Lynch, 93 Metcalfe, Bob, 99–107, 110, 147, 153 Metcalfe’s law, 147–48, 165, 263, 437n Metropolitan Fiber Systems, 137, 139

…

–97 Neumann, Adam, 342–49, 372–73. See also WeWork New Enterprise Associates (NEA), 92 Netscape investment, 142, 144, 145 3Com investment, 100, 103 UUNET investment, 138–39 News Corp, 159 New Yorker, 25, 64, 179, 371 New York Knicks, 302 New York Times, 25–26, 142, 144, 365, 368

…

50, 449n Facebook investment, 255–56 founding of Accel, 128–29 Google investment, 174 specialist approach of, 129–31, 435n, 436n telecom investments, 129–31 UUNET investment, 138, 139, 141 PayPal, 211 eBay acquisition of, 206–8, 248, 292 Stripe and, 317, 319, 320 viral marketing, 443n X.com and Musk

…

Francisco (UCSF), 73, 75 University of Chicago, 49 University of Illinois, 20, 144–45, 200, 237 University of Virginia, 216 Urban Decay, 117 Usenet, 436n UUNET, 132–44, 148, 175, 179, 286, 436n V Vacuum Foods, 25 Valentine, Donald, 60–66, 79–80, 97 Apple investment, 83–87, 90–91,

A Mathematician Plays the Stock Market

by John Allen Paulos · 1 Jan 2003 · 295pp · 66,824 words

Gilder had been long and fervently singing its praises, and was aware that among its holdings were MCI, the huge long-distance telephone company, and UUNet, the “backbone” of the Internet. I spend a lot of time on the net (home is where you hang your @) so I found Gilder’s

…

and Fundamental Analysis I was especially smitten with WorldCom’s critical Internet division, UUNet. The Internet wasn’t going away, and so, I thought, neither was UUNet or WorldCom. During this time of enchantment my sensible wife would say “UUNet, UUNet” and roll her pretty eyes to mock my rhapsodizing about WorldCom’s global

…

more general anti-Pollyannish meaning as well. “Maybe the bill is so exorbitant because the plumber ran into something he didn’t expect.” “Yeah, sure. UUNet, UUNet.” “Smitten,” “rhapsodizing,” and “Pollyanna” are not words that come naturally to mind when discussing value investing, a major approach to the market that uses the

…

in networks and connectivity is not unrelated to my initial interest in WorldCom, which owned not only MCI, but, as I’ve mentioned twice already, UUNet, “the backbone of the Internet.” Obsessions fade slowly. Economic Disparities and Media Disproportions WorldCom may have been based in Mississippi, but Bernie Ebbers, who affected

…

at my suggestion, that I could be a persuasive wordsmith when I believed in something, and WorldCom, I believed, was well positioned but dreadfully undervalued. UUNet, the “backbone” of much of the Internet, was, I fatuously informed the CEO of the company, a gem in and of itself. I knew, even

…

in technical traders vs. value traders treasury bills trend analysis. see also technical analysis Tversky, Amos ultimatum games undervalued stocks, lists of unemployment United Nations UUNet division, WorldCom (WCOM) value investing. see also fundamental analysis accounting practices and better returns than with growth investing contrarian basis of contrasted with growth investing

…

sell-off infatuation with margin calls on moving averages and purchase of Digex as example of “losing through winning,” recommended as strong buy in 1990s UUNet division Yahoo! Zipf’s Law Copyright © 2003 by John Allen Paulos Paperback edition first published in 2004 by Basic Books All rights reserved. No part

The Best of 2600: A Hacker Odyssey

by Emmanuel Goldstein · 28 Jul 2008 · 889pp · 433,897 words

): They’re told to do “cold potato” routing, meaning that Exodus is expected to deliver traffic bound for UUNet at the nearest UUNet peering point to the IP for which the traffic is bound. Meanwhile, UUNet does “hot potato” routing, shifting Exodus traffic to their network as quickly as possible! Meanwhile, while all

…

multiple providers, and PSI is a market leader in this regard—they’ll peer with anyone operating a backbone, free of charge. Others, such as UUNet, are demanding that smaller providers purchase circuits from them at regular customer rates until they meet certain criteria (which seems to change frequently). And finally

…

network. This is where your dial tone comes from. Switch: The heart of a CO, switches calls within or between COs. ISP: Internet Service Provider (uunet, concentric, netcom, etc.) VOIP: Voice Over IP (Internet) 94192c13.qxd 6/3/08 3:34 PM 13 A Page 491 Hackers and the Law part

…

, 375 overview of, 372–373 POSTNET, 373 UTF-8 format, and China’s firewalls, 804 UUCP (Unix to Unix Copy Programs) network, 149–152, 154 UUNet, 305 V V4 boxes, electronic message centers, 769 vacation, hacking on, 722–725 valet switch, programming car remotes, 774 Value Transfer Stations, 610–612 Varney

Confessions of a Wall Street Analyst: A True Story of Inside Information and Corruption in the Stock Market

by Daniel Reingold and Jennifer Reingold · 1 Jan 2006 · 506pp · 146,607 words

President, Investor Relations WorldCom (originally LDDS) Bernie Ebbers, Chairman and CEO Charles Cannada, CFO Scott Sullivan, Treasurer, then CFO John Sidgmore, Vice Chairman, founder of UUNet Blair Bingham, investor relations manager OTHER TELECOM EXECUTIVES Jim Crowe, CEO of MFS, later CEO of Level 3 Communications Bill Esrey, CEO and Chairman of

…

of the world’s Internet traffic. Just prior to WorldCom’s offer, MFS had quietly acquired a small, relatively unknown company called UUNet (pronounced “you you net”) for $2 billion. UUNet was the country’s largest “Internet service provider” and was growing like wildfire. I was mystified. Although telecommunications and the Internet

…

that anything could grow at the rate that some were predicting. And the predictions were shocking. In 1997, Michael O’Dell, the chief scientist at UUNET, the Internet services provider that WorldCom had bought a year earlier, was the first of many to proclaim that overall Internet traffic was doubling every

…

$400 million yourself. Maybe the board should have thought about that before they loaned him the money. John Sidgmore, the former CEO of MFS subsidiary UUNet, who had joined WorldCom’s board after it snapped up his company, became the acting CEO. Jack, meanwhile, had replaced the younger and blonder Henry

…

deal and Tully, Dan 2 stock rating Tyco Underperform rating underpriced stocks Unger, Laura US West financial problems of Global Crossing bid for Qwest merger UUNet valuation value investors Vander Ploeg, Mark venture capitalists Verizon video services Vodafone Voice-Stream Vortex Conference Wachovia Securities Waddell & Reed Wallace, Sean Wall Street bonus

Alpha Girls: The Women Upstarts Who Took on Silicon Valley's Male Culture and Made the Deals of a Lifetime

by Julian Guthrie · 15 Nov 2019

a company called Internet Access, to bring corporations online. But the two couldn’t raise any VC money, and their company had been merged into UUNet, a similar commercial Internet access provider. As Magdalena and Lynch walked into the conference room at Menlo Ventures, she was struck by something unusual and

…

projecting what one former boss called her “delicious eff you attitude.” She shook hands, hugged one of the partners, John Jarve, who had invested in UUNet, and pulled her PowerBook Duo and docking station from her briefcase. Magdalena and Dan had sixty minutes to present, followed by time for questions. Where

…

chased after fresh-faced, wide-eyed dot-com entrepreneurs. Companies such as At Home and Real Networks had impressive IPOs, as did Verisign, Exodus, CyberCash, UUNet, and Inktomi. Companies like Priceline, eToys, Pets.com, GoTo.com, and Webvan experienced dazzling growth—as measured by eyeballs, page use, and unique customers. Sonja

…

,” she said. She had turned down VC funding for CyberCash, opting instead to forge partnerships with existing companies, including Intel and Cisco. (Her stock in UUNet had also paid off when MFS Communications acquired the company for more than $2 billion.) Krausz, who like Magdalena had a degree in electrical engineering

…

led them to the fourth floor, where pitch meetings were held. Accel had had its share of hits, including RealNetworks, Macromedia, Portal Software, Polycom, and UUNet. Returns in 1999 were more than one hundred times investments. But Accel didn’t have a superstar start-up in its portfolio—Apple, Netscape, Yahoo

Someone comes to town, someone leaves town

by Cory Doctorow · 1 Jul 2005 · 390pp · 113,737 words

Front?" "TorIx -- the main network interchange for the whole city! We stick an antenna out a window there and downlink it into the cage where UUNet and PSINet meet -- voila, instant 11-megabit city-wide freenet!" "Where do you get the money for that?" "Who said anything about money? How much

…

do you think UUNet and PSI charge each other to exchange traffic with one another? Who benefits when UUNet and PSI cross-connect? Is UUNet the beneficiary of PSI's traffic, or vice versa? Internet access only costs money at the

Tubes: A Journey to the Center of the Internet

by Andrew Blum · 28 May 2012 · 314pp · 83,631 words

the existing phone lines, with specialized equipment installed on either end. By the early 1990s, the trickle became a wave, as companies like MCI, PSI, UUNet, MFS, and Sprint attracted increasing investment dollars—and used them to dig their own trenches and fill them with the new technology of fiber optics

…

its building (especially when Sprint didn’t have a business setup to properly charge them for it). And for the Internet providers themselves—companies like UUNET, PSI, or Netcom—it was expensive to be there, because of the cost of leasing local data lines back to their own office or network

…

Factory in Herndon, Virginia. At the table were Bob Collet, who ran Sprint’s network; Marty Schoffstall, cofounder of PSI; and Rick Adams, founder of UUNET (who would later make hundreds of millions of dollars taking it public). Each of these networks operated independently, but they knew full well they were

…

London, 50, 52 University of Karlsruhe, 137 University of Minnesota, 110 University of Pennsylvania, 52 University of Utah, 43 Up in the Air (Kirn), 38 UUNet, 56, 59, 60 Verizon, 19, 79, 86, 98, 102, 110, 121, 151, 152, 165, 166, 196 Vienna, Virginia: peering and, 128 Vietnam, 201 Virginia data

Peer-to-Peer

by Andy Oram · 26 Feb 2001 · 673pp · 164,804 words

.S. Geological Society, was run by Rick Adams. By 1987, the load on seismo had become so great that Rick formed a separate company, called UUnet (http://www.uu.net), to provide connectivity services for a monthly fee. As the UUCPnet was replaced by the newly commercialized Internet

…

, UUnet added TCP/IP services and became the first commercial Internet service provider. ISPs create a layer of hierarchy and centralization even though the IP routing

…

revolution make UUCP (Unix-to-Unix-copy protocol), Usenet UUCPnet, Mixing centralization and decentralization: Usenet, email, and IP routing UUIDs of messages (Gnutella), Message broadcasting UUnet, Mixing centralization and decentralization: Usenet, email, and IP routing V verifying bandwidth allocation, Other considerations from the case study coins, Anonymous macropayment digital cash schemes

UNIX® Network Programming, Volume 1: The Sockets Networking API, 3rd Edition

by W. Richard Stevens, Bill Fenner, Andrew M. Rudoff · 8 Jun 2013

then, the art of computer networking has changed dramatically. All it takes is a look at the return address for comments from the original text (‘‘uunet!hsi!netbook’’) to make this clear. (How many readers will even recognize this as an address in the UUCP dialup network that was commonplace in

…

a name that has only an MX record. freebsd % hostent nosuchname.invalid gethostbyname error for host: nosuchname.invalid: Unknown host freebsd % hostent uunet.uu.net gethostbyname error for host: uunet.uu.net: No address associated with name 11.4 gethostbyaddr Function The function gethostbyaddr takes a binary IPv4 address and tries to

Internet for the People: The Fight for Our Digital Future

by Ben Tarnoff · 13 Jun 2022 · 234pp · 67,589 words

Shah, “Fool Us Once Shame on You,” 125. 17, The goal was to promote … The five corporations that became the backbone providers in 1995 were UUNET, ANS, SprintLink, BBN, and MCI, with a combined market share of 90 percent; see Shah and Kesan, “The Privatization of the Internet’s Backbone Network

…

network because it reaches the whole US through peering, though it must purchase transit overseas.) The five backbone providers in 1995 were UUNET, ANS, SprintLink, BBN, and MCI. In 1996 UUNET was acquired by WorldCom, which was bought by Verizon in 2006; SprintLink continues to operate as a Tier 1 network owned