Philadelphia Reflections

The musings of a physician who has served the community for over six decades

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Michael Dell, the Millionaire Teen-ager.

The Franklin Institute gives out an annual award for business innovations, and a few years ago it was given to Michael Dell. The banquet is very splendid and well-attended by people willing to pay high prices. So, it happened that the founder of Dell Computers was wandering around the dinner table where I was seated. Being a gregarious sort of guy, he introduced himself and told his story.

As he relates it, his mother gave him a new IBM portable computer for his 19th birthday. So, he took it upstairs to his bedroom along with a screwdriver, and took it all apart.

What he discovered annoyed his mother, but intrigued the birthday guests. Every single part of the computer was composed of articles obtained from other manufacturers. So he got in touch with these parts makers, and asked for their prices. His discovery was that he could assemble a duplicate computer for half the price his mother had paid. One thing led to another, and he was soon producing Dell computers for much less than IBM was selling them. Naturally, there is a market for such a product, particularly if they were sold without middle-men, mail-order. And in the course of a short time, he became a billionaire, IBM got out of the business, and it was all his. As is so common with stories like this, he eventually went bust, and was soon engaged in new adventures. But he took his screwdriver to other tables, and we never did hear about those later exploits.

 

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