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Title: Founding of Quantum, Jim Patterson
Author: Jim Patterson
Created: June 11, 2005
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Story:
    Both Harold Medley...and I in September of 1979 were at a crossroads. He was dissatisfied with Shugart Associates and was going to retire or do something different. I was VP of Engineering at System Industries and in a very difficult situation there too… It was a very difficult time to hire engineers, enormous turnover, salaries were going through the roof. Ed Zschau had been away giving a speech and announced at that meeting that we were going to have a sabbatical. He came back and had a staff meeting and said we now have a sabbatical… There were five of us eligible and I was one of them… So I agreed with Ray Noorda that instead of taking three months off, I would work six months at half time and help a friend of mine write a business plan. So I did that.

    In September of 1979, I was working half time, System Industries was going public and Ray [Noorda] wanted to know when I was coming back. That’s when I got a call from Harold [Medley] saying let’s start a company. His original thought was a half-high floppy disk drive that would fit underneath a low profile keyboard.

    I remember my first thought was that all the world needs is another disk drive company. I think there were something like 33 of them at the time. So Harold and I started talking and we soon brought in Dave Brown whom I had known at Memorex and Harold had worked with at Shugart Associates and Joel Harrison and Don Daniels. All of which we had worked together at Memorex…

    We talked about all sorts of things, but in October of 1979 the idea of a 5-1/4” hard disk drive had become prominent and we contacted Norm Dion to see if we could get media from him. He was very interested in it. I remember we met with him on a Monday in October and he said that he wanted to make an investment in the company and we should give him a business plan by the end of the week. So, everybody else was working but me. They were still employed. So the writing of business plan fell in my lap and I worked very hard every night until late in the morning to finish the business plan.

    Thursday night before the presentation on Friday morning, Norm called and said before you come in the morning, I have to tell you I’ve decided to invest in Al Shugart’s company. So I went over and met with him and he… said you do it too… and we’ll give you just as good a support as we give [Al’s company].

    So we came back and we talked about it and we just did not believe that it was a very good position to be in to have a sole supplier of media that was an investor in your competitor. So we decided to focus on the 8” disk. Shugart associates dominated the market… but they had been unable to take it beyond 5 MB. We believed we could go way beyond that and make it compatible with Shugart Associates.

    So by the end of the year [1979], we had really focused in on that idea and Jim McCoy joined the group. Of course, most of them were still working at Shugart Associates at the time. Why was Quantum founded in February 1980? Because they all had bonuses due in February from Shugart and we needed the [bonuses to found the company].

Entered By: Ron Dennison
  September 8, 2005
 

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