The glossy cover of Conner Peripherals Inc.'s annual report features a photo of the great pyramids of Egypt, 4,000-year-old masterpieces portrayed in warm hues of golds and browns. The firm's immodest goal is inscribed in a corner: "To build a company that will withstand the test of time."
It seems a bit presumptuous, perhaps, for a company just four years old to compare itself to monuments with lives measured in millenniums. But in an industry where history can be made overnight, Conner seems well on its way toward capturing a place in the annals.
The San Jose technology company moved one step closer to that goal with the extraordinary financial results it reported yesterday: Quarterly profits almost tripled to $26.6 million, while sales leaped 85 percent to $303.8 million. If the pace keeps up, Conner will become the first manufacturing firm in U.S. history to hit revenue of $1 billion after just four years of selling its products.
The company to beat is Compaq Computer Corp., the stunningly successful Houston maker of personal computers that, hardly by coincidence, is not only Conner's rival in the record books but also its biggest customer and closest partner. If it weren't for initial funding from Compaq, Conner might not have gotten off the ground with its plan to make small disk drives, measuring 3.5 inches in diameter, that store data inside personal computers. There's nothing particularly flashy about Conner's products -- it was largely in the right place at the right time.
By concentrating on getting its products incorporated into new desktop computers and light-weight portables -- the hottest segment of the personal computer market -- Conner has managed in four years to become the No. 2 company in the $7 billion market for compact hard disk drives. In the unsexy business of disk drive manufacture, Conner has consistently achieved the industry's technical goal -- cramming more data into ever-smaller spaces.
"Why is Conner the fastest growing company in the history of the United States? Very simple. They have a better mouse trap," said Jim Porter, a Mountain View, Calif., consultant to the disk drive industry.
The company attributes its success to exceptionally close contact with its customers, including Compaq, which accounts for nearly a quarter of its sales. "We work closely with customers up front" on future needs, said Finis Conner, chairman and CEO. "It takes tremendous risk out of the equation."
The success also may have a lot to do with the founder himself. Conner, whose first name is pronounced FI-niss, is a consummate salesman who stands out in a valley of modest engineers for his impeccable dress and love of the good life. The 46-year-old entrepreneur is flown from his Pebble Beach home to the office in a private plane and has become a millionaire many times over largely through his stock ownership in Conner. With the shares trading at around $30 -- compared to the initial public offering price of $8 in 1988 -- Conner's on-paper net worth as measured by the company's stock alone stands at roughly $55 million.
Making efforts to transfer that image of wealth and stability to his company, Conner decorated the firm's lobby in white marble, an uncharac- teristically extravagant selection in the penny-pinching high-tech industry. "Conner's approach is ... if you're delivering results, then you shouldn't have any regrets about enjoying life," said Rocky Pimentel, the firm's vice president of finance.
But the company is hardly a haven for partying. With its management ranks filled with veterans of other Silicon Valley start-ups, as well as a president with IBM credentials, Conner is far from the quirky garage shops of Silicon Valley yore.
"It's a very professionally run company," said George Washburn, a manager with Conner customer Grid Systems Corp. "Everybody is pretty buttoned-down there. ... They're a little flashy, but not eccentric, which inspires confidence in somebody like me."
Confidence in companies is something that has never run deep in the hot-and-cold drive industry. Seemingly thriving companies like Shugart Associates and Miniscribe Corp., as well as dozens of smaller firms, have managed to vanish virtually overnight. Conner, too, has its share of challenges, not the least of which is trying to keep meeting its goals while adding roughly 1,000 employees a quarter-many of them in Singapore, where the bulk of the firm's manufacturing is done.
Said Todd Bakar, an analyst with Hambrecht & Quist: "Their biggest challenge is to successfully manage this kind of growth."