From Ranch Life to Tech Legend: Longest-Serving CEO in Silicon Valley Tells His Story

In the beginning when I lost my vision, I thought that was going to cause me to have the inability to run a successful company. I became even a better CEO after losing my eyesight than when I had my eyesight. So I became more dependent on other people. And that really helped me become a better leader. And that's important for all CEOs is that, you know, you're not the only person on earth that can run a company. You need other people to do it. No man is an island. Ray Erianovera today is Ray's engineer, inventor, and founder of Micron. He led the company for 37 years, making him Silicon Valley's longest-serving public company CEO, before Micron's 2015 acquisition for nearly $900 million. But his story reveals something far more significant than financial success. Ray invented the wafer stepper, a technology that revolutionized how computer chips are made. When others called it the dumbest idea ever, Ray walked into Texas Instruments and emerged with a $3.2 million order that changed the industry forever. He founded his company on honesty, integrity, and dignity for every individual. Vendors wept, describing how his people treated him. A stranger told him at a company picnic, you saved our marriage. In this conversation, we explore what real leadership looks like, and why Ray would be rather poor than dishonest. This is Ray Erianovera, and I'm your host, Steve Esposito. Ray, welcome to our program. Hi, so good to be with you, Steve. Yes, fantastic to have you here, all the way from Montana. Now, I want to start with the beginning, with your amazing career. So, you've been a CEO for 37 years, and I'm not sure if people realize the extraordinariness of this fact. You're the longest-serving CEO in the Bay Area, which is pretty much the center of the technology in the world. Yet, you grew up on a ranch in Southern California. So, just tell us a little bit about the transition. How did you end up from a farm boy to the longest-serving CEO in the Bay Area? Well, my parents moved to Southern California back in the early 1900s, like 1903. And my father was, sorry, 1911, sorry, when my father was just a child. And his dad, his father, was a rancher. In other words, they moved to Southern California to actually do ranching, raising cattle. And so, I grew up on a cattle ranch, and doing all the necessary chores of a young man working on the ranch, such as cleaning drinkers, cleaning corrals, branding animals, hauling hay, cutting hay, and all the normal things you expect from basically a cowboy kind of life. But it was in California, and not in Montana, as you would. And it was real hot there. I mean, the temperature was in the hundreds in most of the summertime. And I never wanted to go back to the ranch life. I really disliked that kind of life. And I wanted to be more in industry, more in manufacturing. So, I studied industrial engineering at school, at my university, and that's what I graduated in. And so, I didn't want to move back to my home. So, I looked for jobs in San Diego and Los Angeles. And ultimately, I moved to the Bay Area, what they call now Silicon Valley, because my wife was there, my fiancée. And I wanted to start in technology, be a technologist. So, my first job was a ballistics engineer for United Technology on the solid rocket booster that launches the shuttle into space. And my father-in-law, my wife's father, worked at Fairchild. He had just started there. Fairchild started in 1957 with Bob Noyes and Victor Greenwich and the group of seven. There were like seven people that left Shockley and formed Fairchild. And he worked at Fairchild. He worked in the inspection department, you know, doing virtually all kinds of electronic testing and so forth. And he talked me into coming to Fairchild, and I joined Fairchild in 1963 as a young engineer working in manufacturing. I was like a manufacturing engineer. That went on for a while, and until I left in 1967, I left and joined another semiconductor company called Amelco. And ultimately, I ended up working for a company in 1973. I went to work for a company called ElectroMask. And they were building and developing mask-making equipment for doing wafer imaging. Then I developed an idea, a concept called the wafer stepper, and that was in 1974. And got a nice order out of TI from a gentleman called Dr. Bill Allman, who was at TI. And my company that I was working for did not want to do the wafer stepper because they were working on a product called E-Beam for IBM. They called IBM and asked them about what did they think about a wafer stepper, and they thought it was a very dumb idea. We were on the cutting edge of doing wafer stepping, and my company was quite small, and it was very expensive for them to develop this technology. And so back and forth, back and forth, they finally just said, well, we're not going to do this. And it made me upset because I could see the future. So basically, you pretty much invented this technology, and then you even got orders from TI, like $3.2 million, which is a huge amount, especially at that time. Yet your company that you worked for was not interested in this invention, in this product. There were too many moving parts. At the time, it was too complicated, and they just didn't have the engineering or the design ability to solve all the problems associated with it. David Mann was one of the companies that was also asked to see if they could do a wafer stepper. And then it became ASML and a bunch of other companies that started looking at the wafer stepper. But our company was so small, and I was getting frustrated there, that in 1976, before the first one was delivered, the first stepper was delivered from my company, we agreed to disagree. And so I said, I'm going to resign. And that's when you started your own company? In July 1976, I flew back to the Bay Area and told my wife I was not going to work for anybody ever again, because I was so frustrated. And so then I started thinking, well, what am I going to do? What kind of company would I start? And so I had two or three different ideas and companies that I was going to start, but it wasn't until 1978 that I actually settled on starting Micrel. And I actually started developing it in mid-78, and then we actually started the company literally in November of 1978. Then I had to come up with, how am I going to fund it? What kind of funding am I going to have for it? And so that starts a whole different discussion. Well, going back to when you were in sales, so first of all, you went to San Jose State and you got, I guess, the equivalent of an MBA. They had no MBA at the time, but that's pretty much what you got. And then you went into sales, and then you have a bit of a story of convincing, you know, going to TI and selling this wafer stepper. Tell us about that, because it didn't seem like it was as smooth as it may sound. So my boss at ElectroMath chartered me with getting an order from TI. This is before the wafer stepper, this is before that. And so when I went there the first time, they literally threw me out of the building. I mean, told me, you know, they didn't want me to be even there, you know, which surprised me. I couldn't understand that, why they wouldn't even talk to me. So then I went to, my boss said, no, you got to go back another time. I said, they already threw me out of the building. I tore my pants, you know, and I mean, they had two guards that threw me out, you know. So I went back the second time, and so then they sent the two guards again. And I said, I understand this. I said, I'll leave, just don't throw me out again, okay. I can't afford to buy another suit, you know, so, you know, I'll just, I'll leave. So I went, told my boss, that's it, we're done. I'm not going back again. And he says, you're not the character of sales guy you think you are if you give up only after two times. So I said, ah, what am I going to do? So I went back the third time, and I conceived the idea of the wafer stepper while I was on the airplane flying to Dallas. And I'd drawn it up on a piece of paper, and put down some specifications about it. This was just hand, just hand drawing, okay. And it was strictly trying to get me in the door at TI. So I went into the lobby, and I said, I'd like to speak to Dr. Allman. And she said, who may I say is calling? I said, just tell him his brother's here, okay. And so, you know, pretty soon, down the stairs came Dr. Allman. And he went to the secretary and said, or the person in the lobby, and said, where's my brother? And she pointed to me, and I got a big grin on my face. And he was red-faced. He was so angry. He was so ticked off. Well, you're lucky he had a brother. Otherwise, he probably wouldn't have come down. Well, I didn't know if he had one or not. I was just guessing. Okay, 50-50 chance, right? So he came over, and he said, how dare you say you're my brother? You're not my brother. And I said, under God, we're all brothers. And he started laughing, and he grabbed me by the arm and said, okay, come on up. So I went up to his office, and I put that drawing that I had made on his desk. And he said, well, what's this? And I told him, described it to him. He said, you have such a piece of equipment? I said, no, but we're developing it. And he said, oh, you are? Huh. He said, this is amazing. Because they were looking for capability of doing three-quarters of a micron, you know, 0.75 micron. A piece of equipment that I was conceiving and developing could do a half micron. And that totally blew him away, because they were limited to even three-quarters of a micron at that time. It was very difficult to even do that. And I told him, we can get to a half micron. But I hadn't quite developed all the technology yet. So, you know, but I just told him it was a concept. So, you know, so we communicated back and forth for a period of time. And then finally said he wanted to order one. I said, I can't do it with one. You've got to buy more than one. He says, well, how many do I have to buy? And I said, four. And I said, four? And he says, four? And I said, yeah, four. At $800,000 a piece, that's $3.2 million. And he said, you won't take it unless I do four? I said, I can't. I can't go and get them to finish developing this unless I have four pieces of equipment on order. So then after a few weeks, he finally sent the order in. And I said, don't send it to the company. Send it to me at my home address. Because my company had no idea. They didn't even know what I had done. So anyway. That's an amazing story. And I know there's at least some follow-ups to that. But you have shipped, you know, I guess once your company was bigger, you shipped this to Austria, you know, the technology of the wafer stepper. And it kind of ended up on the other side of the Iron Curtain. What happened there? Because there was a defining moment for you to understand communism as well, right? Right. Well, it was, you know, there was a relationship between Austria and Russia that I wasn't aware of. And I did not know that Austria would actually ship it to Russia. It actually went from Germany to Austria because Germany had a relationship with Austria. And then from Austria it went to Russia. And Russia was able to develop it. I didn't find this out until one of my employees at Mike Krell told me, he was from Hungary, and he told me that the whole time frame and everything, how that all happened. And I was blown away that that had happened. And so that's what gave Russia the technology to do the wafer stepper. You talked very early on about disengaging with China. And now there's, you know, obviously there's a lot of talk about that. A lot of steps are being taken. But you talked about this many, many years ago. Can you give us a bit more on that? Like what prompted you to see it in that way? Because clearly there was a, you know, it's a major step and a very wise step that you took. Well, it was in about that 2005 time frame that China has said that by 2025, which is this year, they were going to source 95% of all integrated circuits in China. They were not going to source it outside of China. And it was right now, it was, you know, kind of backwards. It was like 95% was outside of China and 5% was inside China back in that time frame. So that bothered me that that was going to be their goal. And about that same time frame, we had a whole bunch of FBI show up at our company and they had search warrants. They wanted to go through all of our records and stuff because we had built a chip for Genie, the garage door opener people. It was a receiver that would open and close the garage door. And so they were accusing us, the FBI, of selling those to Iran to make IEDs. IED? IED, that's it. IED, right. Improvised explosive device. That's what it was. And they were killing a lot of our soldiers with these IEDs. And so we had then to open up our books. And so we found out that we weren't sourcing it to Iran. It was China through ZTE, which was a distributor. And China was sourcing our chips, which were sold to, these garage door opener chips were sold to Iran. So they could find no evidence in our files of us selling those to Iran. But that really upset me to find out that they were going from China to Iran. So I became very skeptical of doing business in China. And I didn't allow my company to manufacture or to produce product or chips in China. And that caused me a lot of problems with my board and with some of my sales people. Would you remember any details as far as, like, did China say it would not sell to Iran? Or were there any restrictions or any contracts that they violated? I wasn't able to discuss that because that was now turned over to the FBI. I couldn't talk about it. I can talk about it now because it's history. That's an amazing story. Let's talk about your book, which I read and I was pretty impressed. And there's just so much in your book to talk about. I just want to start with a quote that you have a lot of advice in the book. It's the essential leader. One of your advices is that if you don't like to do something, do it right away. And I kind of had been doing that before. But when I read that, it just helped me a lot in my own work, in my own day-to-day activities. Please tell us a little bit about that. What did you have in mind and how did you go along with this philosophy? Well, part of our culture of our company at my crowd was one of the cultures was do whatever it takes, no excuses. See, an excuse is a reason wrapped in a bag of poop. That's what an excuse is. We didn't want to encourage our people to not take care of a problem because we all make mistakes. A mistake is only a mistake if it's not corrected. At my crowd, I really inculcated the culture of you solve the problem and it won't become a mistake for the company. So that means you have to jump right on it. You take the responsibility for it. You take the accountability for it and you take care of the problem so it's not a problem for the company. That was a difficult culture to inculcate at my crowd, but it did help us improve our quality and reliability of our product. When you put something off, that's called procrastination. And so I wrote a book earlier on back in 2014 called Tough Things First. And the way that book came about was learning to do the tough things, the things you don't like doing, you do them first thing and get them out of the way. Then the rest of the day goes well. So what I do every day, even now, is I think of all the things that I don't want to do and I do them first. Get them out of the way so that the rest of the day goes well. As we know that 20% of what we do, we like doing. 80% we don't like doing. Unfortunately, that's such a large chunk of what we do is 80% of things we don't like doing. That if we don't do them right away, that becomes a burden on ourselves and the company. So I said, let's get the bad things, the things that are hard that we don't want to do, get them out of the way right now. And so then the rest of the day goes well. And I improved the efficiency of our company by 20% by just inculcating the culture of doing whatever it takes, no excuses. Now, there's other elements in your book that are worth talking about. And one of them is, and you kind of proved this, is that you said that you would rather be honest, respected, and trusted than wealthy. And in this day and age, pretty much money is everything. Everyone kind of gives up on so many principles for money. Tell us, how were you able to live your life by those principles to actually not put being wealthy first and put those other principles first? Well, that's an interesting question. As you pointed out, money drives everything. As we know in politics and countries and all over the world, it's really the economy that drives people to do what they do. So what I did is I just focused on, when I interviewed an employee, I would focus on you make yourself wealthy. I'm not here to help you become wealthy. You have to do that. That's your job. What I'm going to do is help you become a better person. And that kind of surprised them. That was a culture that they had not seen before. So I was focusing on helping them become better people. I said, that's my goal. I will help you become a better person. And I said, how much is that worth? And they said, well, you can't put a price on it. I said, well, that's the point. You can't put a price on becoming better. I'm willing to pay anything to become better. I don't limit that. I mean, that's the whole purpose of living on earth is to become better. But you can't relate that to money. And so they were very impressed with the fact that, and I actually had this implemented, was I'll help you become better. My managers, my vice presidents, they all focused on helping people become better people. Setting the proper example. Honesty, integrity. Respect for all the individuals. We had the lowest turnover in the entire industry. We had half the turnover what the rest of the industry had. So we could retain people better. We had what we call a boomerang philosophy. Half the people that left the company came back. Because they just couldn't find that culture in the company that they had joined. And so they would come back to micro. And so that was an important measure is getting our employees who leave to come back. Because they want to be better themselves. And if they can't be better at their new company, then they wanted to come back to Arkham. Because they could keep improving themselves while they were at the company. And better people make better products. That's just the fact. Now, you have a reputation for being pretty fit. Can you tell us about it? I think you're doing handstands in your mid-70s. I don't know if you still do them. Or one-hand push-ups. Tell us about it. That doesn't seem the norm for a company CEO to do one-hand push-ups in the mid-70s. Well, I can still do it now that I'm in my 80s. Well, staying fit is important. Because if you lose... I just want to make that clear. You can still do a one-hand push-up right now. That's amazing. Yeah, I can still do that. And I'm in my 80s. So, staying fit is important because it affects your mind. In other words, if you're physically losing it, as they say, your mind is going to go too. So, you really got to stay physically fit if you want your mind to be active. Because if you think about how your mind works, your mind is affected by your body. By how you feel. If you've ever been seriously sick with a cold or a flu or something, you can't think straight. You're tired, you're grumpy. And so, you're just not able to have clear thinking. It's important to be physically fit in order to have your mind work well. Now, I got to ask you about your love for flying airplanes. Before that, you ended up legally blind maybe 30 years ago. And after that, you still led the company as a CEO for another 20 years being legally blind. And on top of that, you were flying airplanes. Or at least with a co-pilot being legally blind. First, let's talk about that. How were you able to manage to continue leading the company as you became legally blind? In London, I think it was, right? We all have handicaps in one form or another. It's when we let the handicap tear us down or affect our ability, that's when we stop being effective. And I thought in the beginning when I lost my vision, I thought that was going to cause me to have the inability to run a successful company. And the boarders wondered it too. They asked me, are you sure that you can now run the company? Because we were just going public. We had not pulled the trigger yet. So, we had time to reverse the IPO. So, I took a few days off and talked to my wife, my family. And I said, what should I do? I was depressed because now I couldn't hardly see anything. And I said, how am I going to do it? And so, I thought of Helen Keller, who was blind, deaf and dumb. She couldn't see, she couldn't hear, she couldn't talk. And I said, look at how successful she was. And she lost everything, her hearing, her sight, her ability to speak. You know, I only lost my sight, you know. Come on, get on to this program. So, I then told my board, I said, oh, I'm going to make it. I'm going to do it, I'm going to make it happen. And you know, I'm a kind of a do it person. I just don't let anything, you know, stop me. You know, as I said earlier, I can do one arm pushups even though I'm in my 80s, okay. Because it's important that I overcome obstacles that I would otherwise let become a problem. You know, we talk about getting older, that things happen to us physically. And so, I didn't want that to be a factor for the company by losing my eyesight that I couldn't be effective as a leader. I became even a better CEO after losing my eyesight than when I had my eyesight. I was more kind, I was more empathetic, I was more willing to let other people help me. Because as a CEO, you like to say, I'm the bravado, you know, I'm going to solve the problem myself, you know, I don't need anybody's help. But I learned to say this, this is a saying that I have. You can only give as much love as you're willing to receive. So, I was able to, after losing my vision, I needed help. I needed somebody to drive me to work, I needed somebody to help me with my memos. This is back before we had, you know, good computer synthesization, you know, for word speaking and being able to create memos by just speaking to them. We were limited in that time frame in 1994. You know, we didn't have, you know, the good internet and the good capability of doing what we can do now. So, I became more dependent on other people. And that really helped me become a better leader when I now became more dependent on other people. And that's important for all CEOs is that, you know, you're not the only, you know, person on earth that can run a company. You know, you need other people to do it. No man is an island. You know, we need other people, we need those around us to help us. And because I had lost my eyesight, my employees became more empathetic. They were saying, we're going to help you, boss. You know, we're going to help you do this. So, the team spirit became very strong because they saw what happened to me and they really wanted to help. And that really helped me gain a lot of strength within the company, even though I had lost my vision. Can you share with us some of your biggest accomplishments, or better said, some of your most satisfying things that you have gone through in life? What was it most satisfying for you? It was first finding my beautiful wife. We've been married 64 years. So, that was the biggest accomplishment, was finding a good partner. And then to have my children. I think being a good father was an accomplishment for me. Being able to start a company with no money, basically. You know, I didn't use any venture capital. It was all my own funding and bank funding that did it. That was a big accomplishment. Going public as a bootstrap company. I think I was the very first bootstrap company to go public. In some connectors, anyway. And so, that was a big accomplishment. Being able to run a company without having my full eyesight, being legally blind, I thought was a big accomplishment. I've written six books, which I think is a big accomplishment. Ran a very successful company. We were one of the best-known companies in the industry at that time. I hate to lose more than I want to win. I don't like to lose. Even though I lost my eyesight, I didn't want that to be a loss factor for me. So, being positive, having a passion, not letting obstacles get in my way, I think that was an accomplishment, too. Can you tell us some of the stories, share with us some of the stories that meant a lot, something that your employees would talk about, or some amazing stories that you experienced in the company? So, we had a company picnic, and I was going around visiting with some of the employees, and this man came up, he was not an employee of the company, he came up to me and said, may I talk to you for a few minutes? And we greeted each other by name and so forth. I said, sure, come over here under these oak trees. It was kind of hot that day. It was in August. And I said, how can I help you? And he says, I want to know just what kind of spirit or culture you have in your company. Because when my wife joined your company, we were going through a divorce. And we were dissolving our marriage. But after she started working for your company, within a few months, she didn't want to go through a divorce. She wanted to go through therapy, marriage therapy. And he says, her starting working for your company saved our marriage. And I want to know how could that happen? What did you do to turn her around? And then I talked to him about the culture of the company. And that made sense to him. And so, he had tears in his eyes. He was just, he wanted to give me a hug. He said, thank you for saving our marriage. That's pretty amazing. And how important would you say faith or any kind of belief in anything divine plays in the way that you approach things? In the way that you see life or you see running a company? That's a good question. So, I do believe in a divine being, in a God, okay? And so, I said, what would God have me do? How would God have me run the company? What kind of culture would God have me do? And I often would pray for guidance. I would say, what should I do in this circumstance? I went through eight downturns at my crell in my 37 years. And every time I went through a downturn, we had difficulty. We had to make some decisions regarding cutting back capital expenditures and cutting back wages and things like that, which I didn't want to do. But I had to do that. But I wanted guidance. And I asked for guidance. And so, I wanted to have a company that God could walk into the door anytime and be pleased, be proud of our company. So, I did not allow any vulgarity, any condescending language. You couldn't yell at people. You couldn't use swear words. Because if you did and you didn't change, you'd be terminated. So, at the company, we had no swearing, no vulgarity. We had no problem with abuse of employees, sexual or any other abuse. It was just non-existent at our company. That, to me, I thought would be the kind of company God would want me to run. Having those kind of standards, those kind of morals. Not cheating people, not being dishonest in the way we dealt with people or with the customers. Our customers admired us because they felt we were honest. And that made them feel really good and had high integrity. And so, that's what we were known for. We were known for our honesty and our integrity. Great. Thank you so much for your time. In conclusion, what would you like people to get out of your book, out of your latest book, The Essential Leader? What is your hope with this book? Well, my hope is that we can reverse the trend of companies that are startups failing. We would like to cut that in half. So that we improve the quality of the leaders of the company so that they can run their company for 37 or 40 years like I did. And so, this book really, you don't have to run a company. This book can apply to an individual, to a team, to an athletic team. It can apply to a husband and wife situation. It's not limited just to being a CEO of a company. We're all leaders in some fashion. And so, this book, The Essential Leader, is talking about how to be an effective leader. And I did that for 37 years. Great. Thank you so much for your time. We really appreciate it and we look forward to have you back on our program. I'm anxious to come back. I know you have more questions for me. Yes. Thank you for watching another episode of Bay Area Innovators. If you enjoyed this episode and you know someone who should be on our show, please send us an email at sfbay.epoctimes.com. We would love to hear from you. Thank you and see you next week.