Connecting the Dot.Coms

Beyond ROLM

While certainly prominent, the ROLM founders were hardly the only Rice graduates active in Silicon Valley during the 1970s and 1980s. At about the time ROLM was being formed, McMurtry left GTE to begin a career in the nascent venture capital industry, a job he has pursued in various capacities for more than three decades.

Ken Oshman

When he left GTE in 1969, McMurtry didn’t think he would stay long in the venture business, figuring it was “too far removed from where the actual work in companies was being done.” As he started the dual track that any VC must follow—raising money and searching for good companies in which to invest—he quickly realized that it was interesting work and that he had an aptitude for it. “I’ve always been intrigued by entrepreneurial people; people who are trying to do interesting things,” he says. “I found that my own talents were suited to being a coach and mentor to some of these people.”

Perhaps one reason McMurtry worked so well with entrepreneurs was that he was one, and he understood the uncertainty and risk all early-stage businesses face. Indeed, from the time McMurtry became a VC in 1969, it took him more than six years to earn his first dollar from any of his investments. “It was painful, I have to tell you,” he recalls.

But those long years of struggle were instructive. Among other things, McMurtry learned the importance of patience and focus in finding and building fledgling start-ups. It’s an attitude different from that of many VCs today, who look for the quick, big payoff. “It was a fabulous education in how to do business,” he says, “and how to keep your expectations more in line with company building than with getting rich.”
He learned well. In his work with Institutional Venture Associates and Technology Venture Investors—two companies he co-founded—McMurtry backed technology giants like Compaq, Intuit, and Microsoft long before they became household names. In all, companies backed by Institutional Venture Investors, which was founded in 1980, employ about 118,000 people and have a total market capitalization of more than $240 billion.

McMurtry, who served on the Rice board from 1987 to 2004, is now semiretired, making only personal investments and spending most of his time on his responsibilities as the chair of the Board of Trustees at Stanford and on other outside interests. His wife, Deedee McMurtry, is involved with artistic institutions in the Bay Area, serving as a member of the Stanford Panel on Outdoor Art, on the Director’s Advisory Council at the Stanford Museum, and as a board member of the American Conservatory Theater. For all his success, Burt McMurtry is more likely to brag about the impact his wife has made on the Bay Area art world than about his savvy investments over the years—that’s right, a venture capitalist who doesn’t claim the foresight of an oracle.

“In recent years, venture capital has become very popular, and you hear VCs tout their ability to create the universe,” he says. “I respect that there are a lot of people more creative than I am, but I think a lot of the hype is overblown. The credit should be going to the entrepreneurs.”

But accolades for McMurtry are inescapable when it comes to the influence he’s had on other Rice graduates who have pursued careers in venture capital. He makes himself available to Rice alums whenever possible and offers the guidance and wisdom unique to someone who has been active in the technology business since the 1950s.

Bruce Dunlevie cites both McMurtry and Oshman as inspiration for the work he has done at Benchmark, a firm that was a big player in the development of e-commerce, assisting companies like Palm and eBay, two of the most recognizable names in their respective industries. “Burt and Ken are two of my most important role models,” he says. “They’re honest, direct, hard-working, very talented guys, and they’ve had an enormous impact on me and what I’m trying to do in my business.”