From Humble Beginnings: The Tale of Cisco

From Humble Beginnings: The Tale of Cisco

From Humble Beginnings: The Tale of Cisco

Like all good love stories, the one that birthed the Cisco company depended on communication; specifically, the need for husband and wife duo Leonard Bosack and Sandy Lerner to communicate more efficiently despite being in separate buildings. Wanting to correspond via email, the couple sought a way to connect different networks. This led to the invention of the first multi-protocol router and the birth of Cisco. Two years and many trials later, the company shipped its initial product — the AGS router — for the very first time.

Never ones to shy away from sentimentality, the new owners chose to adopt a name and logo that would simultaneously convey a sense of place and answer the question: “What is Cisco?” Inspired by their passion for San Francisco, the financial and commercial hub of California, they chose an abbreviated city name for the business. Then they took it a step further by crafting a logo that represented the famous Golden Gate Bridge.

In the beginning

A year after selling its first router, Cisco was making approximately $1.5 million in sales. To fund future expansion, the founders partnered with venture capitalist Don Valentine of Sequoia Capital. He invested $2 million to help make the company a success.

Shortly after the company went public in 1990, Lerner was terminated, and Bosack quit in support of his wife. For a staggering $170 million, the couple sold two-thirds of their interest in the company. Until 2014, this portion of the company was worth $90 billion.

Cisco company profile

Cisco creates and sells a variety of products, provides services and delivers integrated solutions to develop and connect networks around the world. It provides solutions for customers through the cloud, video, security, analytics, collaboration, and mobility.

From 1988 to 1995, John Morgridge was the CEO. He was succeeded by John Chambers, who still holds the position. During Chambers’ tenure, Cisco’s market share has grown from $1.2 billion to an impressive $43 billion. Its fourth quarter 2016 revenue was $12.6 billion, according to the company website, with 73,711 employees spanning more than 165 countries and over 475 offices across the world. Cisco is one of the world’s most valuable companies with a market capitalization of more than $450 billion.

Acquisitions

Never hesitant to expand its portfolio through acquisitions, Cisco bought vendor Crescendo Systems in 1993 for $95 million. Since its first acquisition, it has made more than 150 similar deals, including the strategic purchase of NDS Group of Israel in 2012.

Financial allocations

Cisco allocates approximately $5.8 billion — or 13 percent of its revenue — for research and development on an annual basis. By doing so, it has been granted 12,200 patents and files over 700 patent requests each year.

Since 2000, the company has donated networking services and technology to the Democratic and Republican national conventions. It also operated the IP telephony, routing, switching, and firewall for the 2012 Olympic Games in London.

Products and services offered

Versatile in its offerings, Cisco sells products in many categories:  Switching, Next-Generation Network (NGN) Routing, Service Provider Video, Collaboration, Data Center, Wireless, Security, etc. Its collaborative services include voice, mobile, data, and voice applications. These applications are suitable for desktop computers, tablets, mobile phones, desktop virtualization, and more.

Cisco also provides security services and products. These features offer network, identity, and content security solutions intended to help clients reduce data threats. They also enable clients to work in a collaborative, cloud-enabled environment.

Despite strong competition from companies such as Hewlett-Packard, Avaya, Juniper and others, Cisco has remained a dominant force in the networking market. According to Cisco, it’s Catalyst 6500 is the world’s most popular enterprise switch, taking hold in places as diverse as submarines and mountaintops. Likewise, its CR-3 routing system is powerful enough that every motion picture ever filmed could be streamed in fewer than four minutes using the system. It could also download every printed collection of the Library of Congress in little more than one second.

In 2009, the business opted to branch into other areas by becoming more noticeable in the data realm with its Unified Computing System. The system intertwines Cisco-branded x86 servers and Cisco networking technology.

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Matt Goldman

Matt Goldman

Matt Goldman is a Content Marketer/Social Media Strategist for Tenfold. His writing has focused on social selling, marketing, as well as gamification.

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