Lessons from the Rise and Fall of VisiCalc

18 Jul 2019

Lessons from the Rise and Fall of VisiCalc

Re: Dan Bricklin (MBA 1979)

Topics: Technology-Software History-Business History

Dan Bricklin (right) with his MIT classmate and VisiCalc collaborator Bob Frankston (photo by Richard Chase)

It was 1979 when Dan Bricklin (MBA 1979) and Bob Frankston made history by launching VisiCalc, the world’s first independent software company and the first spreadsheet program for personal computers. The program came with a $100 price tag, but people were so eager for it that they also bought an Apple II, to the tune of $2,000, in order to run it, according to a recent story in the Wall Street Journal. Steve Jobs said that VisiCalc “propelled the Apple II to the success it achieved more than any other single event.” It also was the force behind the later success of Microsoft in business computing. But VisiCalc’s success would be notoriously short lived.

Forty years later, VisiCalc is long gone—but the tech industry has embraced lessons learned by its experience that continue to shape strategy and decision-making of engineers and executives alike. Among those lessons:

First, new empires take shape at the dawn of a new platform. In the case of VisiCalc, accountants shifted from centuries-old practice of handwritten ledgers to a digital spreadsheet on a personal computer.

Which leads to the second lesson, which is that “a killer app doesn’t guarantee enduring success.” When Mitch Kapor left the company and built Lotus 1-2-3 for the IBM PC, VisiCalc became perhaps the first casualty of what Clayton Christensen would call a disruptive innovation. Lotus bested VisiCalc by offering the same major features plus a handful of others, such as variable column widths and the ability to create charts and graphs. Plus it had speed.

These days it’s much harder for upstarts to challenge the dominance of the tech giants, who tend to get further out in front of potential disruption. Take, for example, the way Microsoft embraced the shift to cloud-based software, or how Google had the vision to invest heavily in and acquire Android.

“Certainly there are still examples of new companies rising, but it’s hard today to imagine the handful of giants that loom so tall over the tech world allowing themselves to go the way of VisiCalc or Lotus. And the more wealth they accrue to buy into new technologies, spreading their bets evenly around the whole roulette wheel, the more invulnerable they appear,” writes Christopher Mims.

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Dan Bricklin

MBA 1979

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