Sramana: What did you do after Mozart Systems?
Bill Daniel: From there I went on to start two other companies in the Bay Area before I made my way out here to Texas. I have now been here almost 14 years. Mozart Systems was actually sold years after I left when it had around $10 million in revenue. It was a lifestyle business as opposed to a high-growth business. The person I started it with had done quite well at Oracle, so he did not have the same motivations that I did. That caused us to part ways eventually. The company was sold to SAIC, which is a defense contractor.
I went on and co-founded Datis Corporation, which was a medical information company that assembled large databases of patient data. Some of it was based on UB82 and UB12 for uniform billing. There is an entire set of Medicare regulations that define how to do billing. We also had a lot of detailed information about acute care, hospital visits, surgical visits and some outpatient procedures. We started in California and then marched across the country. We signed up hospitals, surgical centers, as well as large physician practices to contribute their data into these regional databases.
We turned that data into information products. We put that into local access products on Windows applications. The driver behind the business was collecting enough data to describe delivery of healthcare in a region in order to draw interesting conclusions about efficacy of procedures and cost differences of the procedures. It was a giant comparative database. We sold that company to a public company called HCI, which became part of Thompsons, which is a private Canadian company.
The third startup was a company called Wallop. It was a web development platform for people in the late 1990s to build web applications. Complicated websites had a good deal of code in addition to HTML and images. We built an integrated development environment that developers could use to stitch things together in a true application sense. You would have a browser that made a request to a page and behind the scenes everything needed was assembled in real time and displayed to the browser. There were not many tools out there to do that.
We were acquired pretty early on by IBM. Today that product is WebSphere Studio, which is part of the WebSphere platform. We grew that company to around $10 million in revenue before we sold it.
Sramana: Did you self-finance your businesses?
Bill Daniel: The first business we financed ourselves. My partner had made a lot during his time at Oracle, and I had the sweat equity. The second company was bootstrapped until we raised money from Sutter Hill ventures. We raised only $1.5 million. The business was breakeven and profitable very quickly. That was back in 1994, when raising venture capital was not like it is today. There were not nearly as many firms and firm sizes were relatively small. It was a difficult task to get money.
When the web hit with all those massive success stories there was a lot more venture capital available. For Wallop we raised money from Sequoia as well as Kleiner Perkins. That was a much different process. There was a lot of frothiness in the market. We started Wallop in 19997, and we sold it in the summer of 1998 to IBM. That is what was going on back then.