Lycos was started...
Lycos was started in 1995 when CMGI’s investment
group, @Ventures, bought a search engine developed
by Michael Mauldin at Carnegie Mellon University
and Bob Davis signed on as CEO. The company
grew rapidly over the next several years as Internet
usage exploded.
By the peak of the Internet Bubble, it was the
fourth most popular site on the Web. In 2000, Lycos
was acquired for $5.4 billion by Terra Networks,
a subsidiary of the Spanish telephone company,
Telefonica.
Davis is currently a managing general partner at venture capital firm
Highland Capital.
Livingston: Lycos’s original technology came out of CMU. How was the company
started?
Davis: The technology was invented back in 1994 by a brilliant computer scientist
at Carnegie Mellon University named Michael Mauldin, whose nickname
was Fuzzy. It was a research project, the result of a federal research grant. So it
was Fuzzy by himself in a closeted office at the research lab at CMU.
He knew he had something, but wasn’t really sure what to do with it and
didn’t want to be a businessperson in a commercial entity. So he worked with
CMU’s Tech Transfer Office to try to sell the technology. They came across Dan
Nova of CMGI, which at the time was a small, early-stage, $35 million venture
capital fund, and grew into one of the most successful Internet investment
firms of its era. CMGI’s venture firm was founded by Dave Wetherell, who
understood the magnitude of what this medium would become while most others
were still learning how to spell Internet. Making a long story short, he acquired
80 percent of the company, and 20 percent of it continued to be owned by a
combination of Fuzzy and Carnegie Mellon—10 percent apiece.
Livingston: How did you get involved in the founding of Lycos?
Davis: I was VP of sales for an old-line technology company that sold memory
for big IBM mainframes, which wasn’t a very exciting job, and I was unhappy.
One day my friend Dan Nova called me just to check in socially. He told me
about how he was trying to put a deal together with Carnegie Mellon for a technology
and that, if he got it done, he wouldn’t have a CEO. At that point he was
in the early stages of thinking about the deal. I said, “What about me?” He
laughed. I said, “I’m serious.”
So we talked more about it and I worked with him as he went through the
process of wrapping up the deal with Carnegie Mellon. I then joined as the CEO
of a company that didn’t exist yet because Carnegie Mellon still had the technology
and hadn’t closed the deal with CMGI. So for about a week in June of
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