Management Hall of Fame
Most Respected Management Gurus

Arthur Rock
Venture Capital & The Silicon Valley (1926 - Present)

Arthur Rock is the man credited with coining the term "venture capital." Without his work, there probably would have been no information revolution, no silicon valley or even a venture capital industry. He is a venture capitalist of Silicon Valley, California. He was an early investor in major firms including Intel, Apple Computer, Scientific Data Systems and Teledyne.

Key Work

• The first venture capitalist (VC) operating on the West Coast of the United States. 
• Organized the funding that got the computer revolution under way when he helped eight researchers break out from William Shockley's laboratories to found Fairchild Semiconductors. 
• Rounded up financing for some of the biggest companies in Silicon Valley, including Intel and Apple.
• Founds the firm of Davis and Rock which dissolved after a seven-year life. 
• Eugene Kleiner, one of the original "Fair children," later went on to found the VC firm Kleiner Perkins. Many others follow  Arthur Rock VC example
• Forms Arthur Rock & Associates
• Director of Air Touch Communications.

Career Moves:

• He graduated with a Bachelor's degree in business administration from Syracuse University in 1948 and earned an MBA from Harvard Business School in 1951.
• Rock started his career in 1951 as a security analyst in New York City, and then joined the corporate finance department of Hayden, Stone & Company, where he focused on raising money for small high-technology companies.
• After graduating from Harvard, he worked as an investment banker in New York.
• In 1957, when the Traitorous Eight left Shockley Semiconductor Laboratory, Rock was the one who helped them find Sherman Fairchild to start Fairchild Semiconductor.
• In 1961, he moved to California. Along with Tommy Davis, they formed the San Francisco venture capital firm Davis & Rock.
• In 2003, Rock donated $25 million to the Harvard Business School to establish the Arthur Rock Center for Entrepreneurship.

Rock's Law, named for Arthur Rock, says that the cost of a semiconductor chip fabrication plant doubles every four years. As of 2003, the price had already reached about 3 billion US dollars. The semiconductor industry has always been extremely capital-intensive, with very low unit manufacturing costs. Thus, the ultimate limits to growth of the industry will constrain the maximum amount of capital that can be invested in new products

Books and References

• Interview with Rob Walker on November 12, 2002 as part of The Silicon Genesis Project with Stanford University
• Harvard Business School (2003-01-31). Harvard Business School Receives $25 Million from Venture Capitalist Arthur Rock. Press release. Retrieved on 2007-05-07.
• Arthur Rock. HBS Bulletin Online. Retrieved on 2007-05-07.

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