Introduction to Larry Ellison and Oracle

Introduction to Larry Ellison and Oracle

Let me tell you about Larry Ellison, who co-founded the software giant Oracle Corp. (ORCL) in 1977. Under his guidance, Oracle evolved from a startup with just three programmers into the world's largest database software supplier and the second-largest provider of business applications.

Oracle's rapid expansion under Ellison depended on his ability to spot and dominate new markets. The company also grew through acquisitions, such as Sun Microsystems for $7.4 billion in 2009 and NetSuite for $9.3 billion in 2016.

Since stepping down as CEO in 2014, Ellison has continued as chair of the board and chief technology officer.

Key Takeaways

You should know that Larry Ellison founded Oracle, the company that developed the first commercially viable relational database. Under his leadership, it became the top supplier of database software and the second-largest for business applications worldwide.

Despite some setbacks, the company grew steadily until the 1992 release of Oracle 7, which dominated the market and turned Ellison into a billionaire. He stepped down as CEO in 2014 and now serves as board chair and chief technology officer.

According to Bloomberg, as of January 2025, Ellison is the fourth-richest person in the world with a net worth of $182 billion.

Early Life and Education

Ellison was born in New York City in 1944 to an unmarried teenage mother and was adopted by his mother's aunt and uncle, who raised him on Chicago's South Side.

He dropped out of the University of Illinois and the University of Chicago without earning a degree. After that, he spent nearly a decade writing computer code for clients, including tech firms like Ampex and Amdahl, where he contributed to the first IBM-compatible mainframe system.

Notable Accomplishments

The concept that started Oracle came to Ellison from an IBM research paper on relational databases, which proposed a new method for organizing large data volumes to make them easily accessible.

While IBM hadn't commercialized the idea yet, Ellison recognized its huge potential to change enterprise operations.

Founding Oracle

In 1977, Ellison and his former Ampex colleagues, Bob Miner and Ed Oates, invested $2,000 of their own money to establish Software Development Laboratories, which later became Oracle. Over the next two years, they built the first commercial structured query language (SQL) for managing large relational databases.

Their early success came from a $50,000 contract with the U.S. Central Intelligence Agency (CIA) in 1978 to develop a relational database management system (RDBMS), code-named Oracle. When Oracle 2, the first commercial relational database, launched in 1979, the CIA was one of the initial customers. Ellison renamed the company Oracle in 1983, drawing from that CIA project.

IPO and Oracle 7

After going public in 1986, Ellison steered Oracle through significant challenges, including its first quarterly loss in 1990 and issues with deceptive sales accounting that hurt the stock price.

Things turned around in 1992 with the release of Oracle 7, a popular database software that captured the market. Banks, corporations, governments, airlines, automakers, and retailers all relied on it. Even after the dot-com bubble burst in the late 1990s, Oracle's stock more than tripled from 1999 to 2007 and kept rising through the Great Financial Crisis and the COVID-19 pandemic.

Strategic Acquisitions

A key factor in Oracle's growth under Ellison was a series of strategic acquisitions that opened new markets: Sun Microsystems for information technology, Hyperion Solutions for business intelligence, Retek for retail, Siebel Systems for customer relationship management, and PeopleSoft for human resources, financial, supply chain, enterprise performance, and customer relationship management.

Oracle Cloud Infrastructure

By 2020, Ellison had set up Oracle's network architecture to manage the surge in cloud-based enterprise tech during the early COVID-19 lockdowns. In April 2020, Zoom Video Communications Inc. (ZM) selected Oracle Cloud Infrastructure to handle its increased service demands.

Outmaneuvering Rivals

Ellison has a history of outsmarting competitors by targeting markets they ignored. In the 1980s, as IBM developed SQL software limited to its own servers, Ellison focused on relational databases that could run on any new computers for business and government users.

The Advent of the Internet

Ellison was among the first to foresee the Internet's impact on business. From 1997, he shifted Oracle's focus to essential business software for the Internet, a move that risked losing customers but positioned the company for the dot-com boom.

By 2000, Oracle was a major player in Silicon Valley, and Ellison briefly became the world's richest person, surpassing Bill Gates.

Why Is Larry Ellison a Business Legend?

After dropping out of two universities in the 1960s, Ellison founded what became Oracle in 1977. Under his leadership, it grew into a company with a market cap over $435 billion as of January 2025.

Beyond growing his company, Ellison shaped how global businesses use big data by creating products used by all 100 largest public companies and 430,000 customers in 175 countries.

What Is Larry Ellison’s Net Worth?

As of January 15, 2025, Ellison ranks fourth among the world's wealthiest with a net worth of $182 billion, per Bloomberg. He's known for lavish spending, like purchasing 98% of the Hawaiian island of Lanai, a $194 million yacht, and hundreds of millions in Malibu luxury real estate. He also built a California estate inspired by 16th-century Japanese feudal architecture.

What Are Larry Ellison’s Charitable Causes?

Ellison has given hundreds of millions to medical research and education, including $200 million to the University of Southern California for a cancer treatment research center in 2016. He joined the Giving Pledge in 2010, committing to donate most of his wealth to charity, as encouraged by Warren Buffett.

The Bottom Line

Larry Ellison is a visionary who built Oracle from a startup into one of the world's most valuable companies, with fiscal year 2024 revenues of about $53 billion and a market cap over $435 billion as of January 2025.

He ensured Oracle's dominance by developing integrated software from relational databases and applications to servers, storage, and cloud services. In the 1990s, when he predicted the Internet's role in computing, he led the shift to Internet-compatible applications, giving Oracle a clear edge.