The Son Also Rises

Raised in Bloomfield Township, Scott McNealy went on to co-found a software powerhouse.
Wayin CEO Scott McNealy went from working in factories to contributing in the creation of Java.

His name is synonymous with the wave of entrepreneurs and startup companies that came into prominence in California’s Silicon Valley in the early 1980s. But because Scott McNealy grew up in Bloomfield Township and was the son of the vice chairman of American Motors Corp., it’s surprising he didn’t end up in the auto industry. After all, this was a kid who seemed to be infatuated with all his father was doing, and from a very early age.

“I was a car guy,” McNealy says emphatically. “I sat on my dad’s footstool, and was fascinated by what he would write and who he would send it to. When he’d work on a Saturday, I’d go in with him to the office and walk around. I just sort of felt at home.”

On the day he turned 16, McNealy got his first set of wheels, one of AMC’s most iconic products. “It was a Gremlin X,” he says with a laugh, before seamlessly reeling off all its features: “It was three on the floor, manual shifter, straight six, 3.2 liters, with racing stripes. It could go from zero to 60. Eventually.”

McNealy spent his high school years at Cranbrook Schools in Bloomfield Hills, where he mostly distinguished himself as an athlete and a leader. “I was assistant captain of the hockey team, captain of the tennis team, and was on the golf team,” he says. “I think I finished 12th in the state in golf my senior year.”

His skill as a golfer enabled him to join his father in countless foursomes at Orchard Lake Country Club with fellow auto luminaries like Lee Iacocca, CEO of Chrysler Corp., and Donald Petersen, CEO of Ford Motor Co. And before entering Harvard University in 1972, he spent the first of what turned out to be several summers working for another car guy, Roger Penske, chairman of Penske Corp.

“Working for Roger had just a huge impact on me in terms of a work ethic, organization, and management style,” McNealy says. “I admired the heck out of Roger. It was so cool because he was into racing, but he was also a businessman. We ultimately ended up on the GE (General Electric) board together, which is kinda funny.”

Surrounded as a young man by mentors from all aspects of the car business, McNealy’s destiny seemed assured. But once he graduated from Harvard, his focus at Stanford Graduate School of Business — after being rejected three times — was on manufacturing. “I don’t know if I even interviewed with Ford or GM,” he says. “I wasn’t real fired up about unions. I’m a very anti-union person.”

While fellow students were grinding away toward careers in finance, McNealy skipped many classes, often playing golf instead. Following graduation, he took a series of obscure jobs in factories that made everything from motorcycle saddlebags to Army tanks. “I wanted to go straight to the factory,” he says. “Everybody else said, ‘No, you’re an MBA, we’re not going to put you in a factory.’ I said that’s exactly where I should go.”

In 1982, McNealy’s life took a dramatic turn when a former Stanford classmate asked him to head up the manufacturing end of a new technology company.

“The four of us were all 27 years old,” McNealy recalls. “I had three years (of) business experience, which was more than the other three founders combined. We started the Stanford University Network.”

SUN quickly grew into Sun Microsystems Inc., and within two years McNealy was the CEO, taking the company public in 1986. Two years later, the corporation recorded $1 billion in sales, and in 1995 it was named one of the 100 best-managed companies in the country. By that time, McNealy had established a freewheeling corporate culture based on his own attitude toward life and work — “Kick butt and have fun” — as he maintained his workaholic, 80-hours-per-week schedule.

The company became as famous for its assertive, even belligerent, marketing tactics as it did for the office high jinx that were the standard, ranging from squirt gun battles he took the position of general to the intricate pranks employees were encouraged to play on McNealy and his fellow executives. On one April Fools’ Day, Sun’s engineers constructed a golf course hole in McNealy’s office, complete with a green and a water hazard.

Meanwhile, the maniacally competitive McNealy took dead aim at Microsoft’s domination of the computer software industry, building Sun’s philosophy around a catchy slogan, “The network is the computer,” and taking an approach that emphasized the importance of an open computing network instead of the personal computer.

“Our whole concept of the computer as a network device,” he explained at the time, “is grounded in a business model that was stolen from every other large utility on the planet: You don’t have a power-generating plant in your home; you’re connected to a power grid.”

In May 1995, Sun revolutionized the entire computer industry with its introduction of Java, a universal software language that could run on any hardware or operating system. Java was an immediate and formidable threat to Microsoft’s proprietary Windows program, which at the time was running 90 percent of the world’s personal computers. For McNealy, the concept of any computer being able to speak and understand a common, universal language was anything but a revelation. Rather, he brashly asserted the approach was “stolen from cavemen who wrote on walls.”

McNealy left Sun in 2006 but he’s anything but inactive, never mind retired (the company was acquired by Oracle Corp. in 2010). He played hockey in several leagues near his home in Portolla Valley, Calif., until he was in his mid-50s, and he still loves golf, although he concedes, “The older I get, the better I was. ”

Although McNealy, 60, has a net worth of around $1 billion, he’s still going full-bore on the work front. He’s CEO of Wayin, a social media startup he founded in 2010. The company ingests whatever people are saying on platforms like Twitter, Facebook, and Instagram about countless products and services around the globe — “We’re getting 5,500 social media posts per second,” McNealy says — and the information is then analyzed, processed, packaged, and sold back to each service or product provider.

As for his days in Detroit, McNealy has fond memories, but he’s skeptical about the prospects for the city’s renaissance.

“I just hope they can pull it off,” he says. “I mean, there’s a great work ethic in southeastern Michigan, but this is just a case where unions and worker pensions have destroyed yet another engine of economic personal responsibility. People are voting for a living out there instead of working for a living.”

McNealy is quick to add he is committed to giving back through, another startup he co-founded in 2004. Delivering free K-12 programs and courses of study through an open-source platform, its goal is to eliminate the vast divide between the haves and have-nots when it comes to getting a high-quality education.

“(America) spends $15 billion a year on K-12 curriculum,” he says. “I want to take that cost to zero with a certified curriculum where no child, parent, or teacher is held back.” db

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