‘Father of Telecom Valley' recalls birth of Optilink, struggles at DSC, launch of Advanced Fibre Communications

Editor's note: This is the fourth installment of select chapters from “Defining Moments,” the autobiography of telecommunications entrepreneur Don Green (see all the excerpts).

Green founded his first company, Digital Telephone Systems, in Marin County in 1969, growing it to $60 million in sales by 1976. In 1987, he co-founded Optilink in Petaluma. In 1992, he co-founded Advanced Fibre Communications in Petaluma, which grew from three employees in 1993 to 800 in 1998.

He later gave $10 million to help create the Donald & Maureen Green Music Center at Sonoma State University.

Eventually Green would become known as “the Father of Telecom Valley” in Sonoma and Marin counties.

In this week's chapter, Green recounts the founding of Optilink, its acquisition in 1990 by DSC, later called Alcatel-Lucent, DSC's vastly different corporate culture and the starting of Advanced Fibre Communications.

Chapter 54: Optilink

We recruited a team of design engineers and raised enough capital to begin development of our new product, the Litespan2000. It was a complex switching system that allowed larger amounts of information to be sent and received more efficiently and with greater flexibility.

It was 1986, and the telephone industry was just beginning to employ similar systems in its infrastructure. My partners and I concluded that in light of this technological evolution, the development and release of our product was well timed.

Unfortunately, when we went looking for the second round of investors, conditions in the financial markets were not as favorable. The VC market had become more conservative, and investors were reluctant to take a chance on us and our new product. This forced us to try to find alternative sources of capital.

We asked engineers from Bell Systems to give us an informal analysis of our product, in the hopes that they might be interested in buying it. They concluded that they liked the product, but couldn't take the risk of deploying a product of such strategic importance from a company with such an immature balance sheet.

We had in-depth discussions with Seimens, Alcatel, and several other large companies, but none was willing to move at the pace we needed, leaving us financially strapped.

I was growing increasingly worried about Optilink's survival. Then one day we were approached by a midsized company called DSC. DSC made an offer to buy Optilink.

I discussed the merits of the offer with my partners and Optilink cofounder Al Negrin. We agreed that the offer, which involved a complex stock swap, was generous. We also liked that all our employees would retain their jobs. In fact, I'd been asked to stay on and continue to manage the day-to-day operations of Optilink for two years.

I argued that the offer was the answer to Optilink's financial problems. Al agreed, and three days later the sale was completed.

That evening as I was driving home, I found myself smiling, humming along with the radio music, and feeling more relaxed than I had in weeks. Then a disturbing question skipped across the placid surface of my mind, causing a ripple of uneasiness.

What if the company culture of DSC and Optilink were vastly different? I realized that I should have done more research. Given our desperation to save the company and DSC's tight time frame, we felt compelled to act in haste. Well, no use worrying about it now, I thought. Tomorrow was my first day on the new job, and I would soon know the truth.

* * *

My first duty was to have lunch with the CEO of DSC, Jim Donald, in his private dining room. I can do that, I thought. Anxious to meet with my new boss, I arrived fifteen minutes early and presented myself to his secretary.

As I approached her desk, she glanced up from her paperwork and with a puzzled look on her face asked, “May I help you?” I smiled and said, “Hi, my name is Don Green. I have a noon meeting with Jim Donald.”

Her face relaxed. “Oh, yes. You need to see Miss Ross, Mr. Donald's secretary. I'm Miss Bonner, Miss Ross's secretary.” She gestured toward the large oak doors directly behind her desk. “Please go in. She's expecting you.”

It was my turn to look puzzled - his secretary had a secretary! - but I said nothing. Smiling once more at Miss Bonner, I went through the double doors.

The office was large and elegantly furnished, with an oversized mahogany desk and subdued, recessed lighting. Along the left wall sat a long leather couch and an antique coffee table decorated with inlaid wood. I had the strangest sensation that I'd just stepped into Boodles, or some other English men's club. I half expected to be offered a brandy and cigar.

Miss Ross quickly dispelled that fantasy when she rose from her desk and said in a no-nonsense voice, “You must be Mr. Green. You're early, and Mr. Donald never sees anyone before the appointed time. Please be seated.”

Then she returned to her work, sifting through a file that lay before her. Pools of light cascaded down from the two banker's lamps that sat on opposite sides of her desk. As I sat and waited, I stole glances at her. In her late-fifties, I estimated. Her white hair was pulled back into a tight bun.

Just as I glanced at my watch and saw that it was noon, Miss Ross said, “It's time now, Mr. Green. You may go in.”

She stood up and motioned for me to follow her. She led me into the next room, which held a pair of chairs and appeared to be a waiting room of sorts. In front of us were three doors. Miss Ross approached the door on the far right, opened it, stood to one side, and said, “This is Mr. Donald's private dining room. Go in, have a seat, and he will join you in a moment.”

I did as I was told. Without another word, she closed the door, leaving me alone. Where to sit? Five large round tables were scattered about, each covered in snowy white linen and set with elegant china, crystal stemware, and gleaming silver.

Suddenly I felt the presence of someone else in the room. I turned and there before me stood Jim Donald. He was about my height, just over six feet tall, but his build was less substantial. His dark, close-set eyes were slightly hooded, his sharp nose somewhat beaky.

As I reached out my hand to shake his, I couldn't decide who he reminded me of more: Jack Nicholson in The Shining, or a large bird of prey. In either case, he appeared to be a man under pressure, with fists slightly clenched and a smile that suggested a grimace.

We shook hands and he said, “Let's get started with lunch, and while we eat I'll fill you in on my company.”

In contrast to the elegant setting, our meal was a homage to Jim Donald's home state of Texas. It featured barbecued brisket, beans, slaw, and a basket of Wonder bread.

As we ate, he did his best to present a glowing history of DSC, highlighting successes and minimizing any failures. For over an hour he went on about how DSC had flourished under his masterful management. He ended his tribute by saying, “And that is why DSC's revenue growth is so strong, and why we are a major supplier for the telephone industry.”

Jim asked me no questions and did nothing to include me in the conversation. I left thinking that my new boss had the biggest ego, I'd ever encountered. Dealing with him on any level would be a challenge.

The following day, when I stopped by Jim's office to drop off some paperwork, my impressions were confirmed. As I entered his secretary's office, the frosty Miss Ross, narrowed her eyes and said, “I see you are wearing a blue shirt. Mr. Donald doesn't like blue shirts.”

Stunned, I handed her my paperwork and started to leave. Then, impulsively, I turned back and said, “Then I hope he doesn't buy any.”

By the end of the day, seemingly every DSC employee had heard about the exchange.

Jim was not pleased, I was told. That's lesson number one, I thought: Jim Donald has no sense of humor.

* * *

The following week I was to attend my first management meeting. I figured it would give me a chance to gain a better understanding of Jim Donald's management style. The first ?item on the agenda was an announcement outlining company objectives. It included a large-scale purchasing plan that Jim Donald and his staff had prepared for the following year.

I couldn't believe what I was hearing. If the company implemented the purchasing plan, the obvious result would be a surge of inventory. And these objectives had been created without input from the line management team. Clearly, Jim Donald favored a top-down process.

Unable to contain myself, I stood and said, “I haven't had enough time to look at the impact, but if we come up short on the revenues side it will put great pressure on our cash reserves.”

An uncomfortable silence enveloped us. I scanned the room and saw lowered eyes. No one was looking at me except Jim Donald.

The crimson flush in his face and the tightly clenched fists suggested rage, and I braced for the explosion. He said nothing. The silence stretched on, broken only by the ticking of the wall clock.

Finally he spoke through clenched teeth, his manner suggesting someone struggling to keep control of himself. “I expect you . . . ” He paused, pointing his finger at me like a gun. “. . . to perform your duties as you're told and not concern yourself with any other portion of the business plan!”

Before I could respond, he said, “Let's move on to the next item on the agenda.”

I took my seat, thinking: Lesson number two: Never disagree with Jim Donald unless prepared to pay the price.

I had to keep that lesson uppermost in my mind because one of my mandatory duties as a consultant was to attend those meetings every week. I found them supremely annoying-no exchange of ideas, just listening to other managers reporting to Jim-and they took a big bite out of my workweek.

Since the DSC corporate office was in Texas, a four-hour flight from my home in California, I'd spend Mondays flying to Texas, attend the meeting, and then fly home on Tuesdays. That meant I didn't even step foot in the Optilink office until Wednesday morning.

Flying home after the third meeting, I found myself gnashing my teeth. “Well, there goes another meeting in which none of the information disseminated had any relevance to Optilink.

That evening as I drifted off to sleep, I told myself, “Just be patient.”

* * *

As I hung up the phone a week later, I had to remind myself of the virtues of patience. I'd just spoken with Miss Ross, Jim Donald's secretary, and my mind was still whirling as I replayed the conversation in my head.

She had informed me that “Mr. Donald will be visiting your facility next Wednesday. He will need two limousines, which must be driven on the tarmac to meet the company plane. One of the limousines will be for Mr. Donald's exclusive use - he prefers to ride alone - and the second will be for his entourage. The temperature of the car must be set to 68 degrees. His hotel room must have a king-size bed and - “Why are you telling me these things?” I interrupted. “You should be talking to my secretary. I'll transfer you.”

Lesson number three: Jim Donald is inflexible.

* * *

My employment contract with DSC was for two years. During that time, I could be fired only for cause and I was restricted from working for any other tech company. I avoided dealing with Jim Donald as much as possible, looking forward to the date when I would be free.

One afternoon, eighteen months into my contract, two security guards and a man in a black suit entered my office at Optilink. I looked up from an engineering blueprint and said, “Yes, what can I do for you?”

The man in the black suit was vice president of human resources. He did the talking but refused to meet my eyes. While looking at the floor, he said, “I'm sorry, Don, but I'm here to relieve you of your DSC duties. I have been sent to inform you that Mr. Donald no longer requires your services. We are here to escort you off the premises. You will be allowed to return after five pm, to retrieve your personal items from this office.”

I reached for my jacket that hung over the back of my chair and followed the men out. Numb at first, I soon felt a mix of anger and relief. I was angered by the lack of integrity, the absence of professionalism, the personal insult-but also relieved to be away from this madman.

I opened the front door, stepped outside, took a deep breath, felt the sun shining on my face, and smiled. Just as I was about to get in my car, I saw John Webley and Jim Hoeck, two old friends and employees of mine. They were now contract engineers for DSC.

John saw me, waved me over, and said, “We just heard about your termination. I'm sorry, Don.”

I smiled. “News certainly does travel fast. Well, don't feel bad. I don't. I'm not going to miss Jim Donald, his ego, or the endless flights to Texas.”

Jim asked, “What are you going to do now?”

“I'm sure I'll find plenty to do. Something always seems to appear to keep me occupied.”

John smiled. “As a matter of fact, we've been working on something we think you might find interesting.”

“I'm intrigued already.”

We arranged to meet a few days later. Driving home, I thought, “This has been quite an eventful day.”

* * *

Before long John, Jim, and I had formed a fruitful partnership. We called our new company Advanced Fibre Communications (AFC) and our new product the UMC1000. It was a switching system; in tech-speak, a “digital loop carrier.” Using newer technology, it was an improved version of the D960. We seemed to have a winner.