By giving dealers considerable leeway in pricing Compaq's offerings, either a significant markup for more profits or discount for more sales, dealers had a major incentive to advertise Compaq. Under Canion's direction, Compaq sold computers only through dealers to avoid potential competition that a direct sales channel would foster, which helped foster loyalty among resellers. Due to its partnership with Intel, Compaq was able to maintain a technological lead in the market place as it was the first one to come out with computers containing the next generation of each Intel processor. In contrast to Dell and Gateway 2000, Compaq hired veteran engineers with an average of 15 years experience, which lent credibility to Compaq's reputation of reliability among customers. Unlike many startups, Compaq differentiated its offerings from the many other IBM PC clones by not focusing mainly on price, but instead concentrating on new features, such as portability and better graphics displays as well as performance-and all at prices comparable to those of IBM's PCs. Overall, the founders managed to raise $25 million from venture capitalists, as this gave stability to the new company as well as providing assurances to the dealers or middlemen. Rosen and Sevin Rosen Funds, who helped the fledgling company secure $1.5 million to produce their initial computer. Their first venture capital came from Benjamin M. The first Compaq PC was sketched out on a placemat by Ted Papajohn while dining with the founders in a pie shop, (named House of Pies in Houston). The name was chosen from many suggested by Ogilvy & Mather, it being the name least rejected. The name "COMPAQ" was said to be derived from "Compatibility and Quality" but this explanation was an afterthought. Each invested $1,000 to form the company, which was founded with the temporary name Gateway Technology. The three of them had left due to lack of faith and loss of confidence in TI's management, and initially considered but ultimately decided against starting a chain of Mexican restaurants. Ĭompaq was founded in February 1982 by Rod Canion, Jim Harris, and Bill Murto, three senior managers from semiconductor manufacturer Texas Instruments. Prior to its merger, the company was headquartered in northwest unincorporated Harris County, Texas, which now continues as HP's largest United States facility. Ben Rosen provided the venture capital financing for the fledgling company and served as chairman of the board for 17 years from 1983 until September 28, 2000, when he retired and was succeeded by Michael Capellas, who served as the last chairman and CEO until its merger with HP. Murto (SVP of sales) departed Compaq in 1987, while Canion (president and CEO) and Harris (SVP of engineering) left under a shakeup in 1991, which saw Eckhard Pfeiffer appointed president and CEO. The company was formed by Rod Canion, Jim Harris, and Bill Murto, all of whom were former Texas Instruments senior managers. Since 2013, the brand is currently licensed to third parties for use on electronics in Brazil and India. The Compaq brand remained in use by HP for lower-end systems until 2013 when it was discontinued. Struggling to keep up in the price wars against Dell, as well as with a risky acquisition of DEC, Compaq was acquired for US$25 billion by HP in 2002. It rose to become the largest supplier of PC systems during the 1990s before being overtaken by Dell in 2001. Compaq produced some of the first IBM PC compatible computers, being the second company after Columbia Data Products to legally reverse engineer the IBM Personal Computer. Desktops, notebooks, servers, telecom equipment, softwareĬompaq Computer Corporation (sometimes abbreviated to CQ prior to a 2007 rebranding) was an American information technology company founded in 1982 that developed, sold, and supported computers and related products and services.
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