Making of a Memory Giant: David Sun, CEO Kingston Memory's Start

Started? How Kingston started by luck. 1987, I'll do a very short version. I don't want to take too long, but I can tell you personally later if you want. One hour? But it's pure luck. In '87 I had nothing to do. Me and my partner had nothing to do. We sold our previous company to another company. We started a company in 1985 and '86, the company acquired ours. Then we worked there for two years, from '86 to '87. Then we resigned. So we had nothing to do. Long story short, we took the money and put it in the stock market, and we lost everything in the 1987 black Monday or Black Friday, whatever. We didn't go broke. All the newspapers said we went broke, but we didn't. We just lost 80% of what we earned from that. So we needed to start again. Long story short, then I met you. Okay, let's say you're a friend. You come over to me and say, 'Hey David, you're an engineer. I was at home.' Okay, pure luck. The guy called me and said, 'Hey, why this memory? Yesterday it was $200, today it's $600.' It's really $600. So I said, 'Come over and show me the memory.' At that time, memory was always one chip at a time, put in the socket. So he showed me this module, like this. He showed me this module and said, 'What is this?' I said, 'Oh, this is only 256K. Why is it $600?' I had no idea what it was. I never saw it because before it was always a chip. I never saw a chip on a module. That's the so-called evolution of technology. I looked and said I don't know. So I checked what this is. All I found out is it's a chip on a PCB. It's so simple. Very simple. Instead of chips like this, put eight chips. That's when the revolution stopped because the desktop was very big. They wanted to shrink the motherboard. For 512K memory, they needed 16 of these sockets. So to shrink the motherboard, the way to do it was to go vertical. Instead of putting it this way, they put it that way to save space. So they soldered the chip onto a little module called a SIMM module. All it is is from flat to vertical. So I said, 'That's very easy. Let me do it for you.' So I made it. It was so easy. I just repeated putting chips. I gave it to him. He said, 'How much do you charge me?' I said, 'No, no, no. An engineer just connects. It's simple like this.' I didn't charge him because if I were to charge you, it might be only $100 because it took me only 10 minutes. Yeah, only 10 minutes. I hand soldered it and gave it to him. So he needed a tool. So I built two for him. And that guy was a dealer. He wasn't lying because it was really $200, but because of making it vertical, somehow they charged $600 a unit. So he started selling at $200. All the dealers, their business was only to sell computers. They didn't care about making money on memory. They wanted to make PCs and sell them. A PC at that time was $4,500, so selling a PC made $500. They didn't care about bragging. They said, 'Hey, I got this for $200. Don't buy this $600 one. I have it for $200.' So he asked everybody to call me. So, two pieces at a time. I didn't know them. I said, 'Okay, $225, make $25. I have nothing to do anyway.' So I sold for $225. Then I sold 10. Then the next guy said, 'Let me try $250.' So I sold 10 again. People thought, 'Oh, even $250 is better than $600.' Eventually, I sold at $450, and I sold thousands. I made so much money on that stupid thing. It is so stupid. All I know is I hired my son. My son was in seventh grade. I hired a child. I said, 'I'll pay you 50 cents if you saw them,' and he had 20 pieces. So he sawed them, and then I delivered. At that time, there were no faxes, no cell phones, nothing. I had to be at my home by the phone. If the phone rang and I didn't answer... I didn't have an answering machine. At least my home had no machine. I had to be there, and then I had to deliver. You know why I had to deliver? Because I needed the cash. I didn't have money. So I would sell, get $250, deposit it right away. So I had to deliver personally so I could get cash very fast around our area. I sold 1,000 at $450, cost $200. I made more money than a gigabyte. That's why today, after 23 years, we still do exactly the same thing. Can you believe that? It was pure luck. Pure luck.