‘It’s Payback Time’ for O.C.’s Richest Professor
Broadcom Corp. co-founder Henry Samueli, who helped launch the Irvine high-tech company while on leave from teaching and quickly amassed a $4-billion fortune, announced Tuesday that he and his wife are giving a record $20 million to UC Irvine’s engineering school.
Samueli and his wife, Susan, also are handing over $30 million to UCLA’s engineering school, the second-largest single cash gift to the university that granted him a leave from teaching so he could help launch the successful chip maker.
“It’s payback time,” Samueli said. “UCLA has been very understanding about my starting a company. I hope to help promote the next guy who is going to start a Broadcom.”
Samueli’s donation reflects a growing trend among the technology elite who are shedding their stingy reputations and beginning to approach civic duty with the same entrepreneurial spirit that made them billionaires.
For Samueli--whose net worth has exploded from “comfortable” in 1995 to more than $4.3 billion today--such philanthropy also represents smart business. The UCLA and UCI engineering schools are two places where Broadcom competes for top engineering graduates.
Over the last five years, Broadcom has lured 80% of the electrical engineering graduates of UCLA’s integrated circuits group to its Orange County headquarters.
In exchange for the gifts, the highly ranked UCLA School of Engineering and Applied Science and UCI’s School of Engineering will bear Samueli’s name. Both schools will offer Samueli scholarships to undergraduates, Samueli fellowships for graduate students and endowed Samueli chairs to perhaps a dozen of the most promising faculty.
UC Irvine, often overshadowed by such education powerhouses as Stanford and UCLA, is emerging as a little-known hot spot for turning out good engineers. Broadcom and cross-town rival Conexant Systems Inc. of Newport Beach both recruit heavily from there, and Silicon Valley companies are starting to follow suit.
“[The schools] have become an amazing, untapped resource of talent,” said Terry Holdt, chairman and chief executive of Entridia, a small chip maker also in Irvine. “For years, everyone else was running straight to Stanford. But people are starting to understand that there’s a lot of very talented people right here in Southern California.”
Samueli’s interest in helping UCI is shared by Broadcom co-founder Henry T. Nicholas III. Earlier this year, the company’s gregarious chief executive gave $1.28 million to UC Irvine’s Intercollegiate Athletics Department to support the crew program.
Both men also have made a series of donations since they hit the jackpot when Broadcom went public last year, making them among the richest men in the country.
“I won’t let the money be wasted on bureaucracy or media buzz,” said Samueli, 45. “I was once a struggling student and a young faculty member. I know what they go through. I’m here to help them.”
Samueli, the son of Holocaust survivors from Poland, grew up working in the family’s tiny liquor store in East Los Angeles.
His passion for microelectronics started in seventh grade, when a teacher challenged him to build a short-wave radio. Weeks passed, and the young student tinkered with the kit. Finally finished, he brought the box into class and flipped the switch.
“It worked. I was amazed that how, out of thin air, you get sound coming out of a speaker,” said Samueli, who still has the radio stored in his garage. “It was magic. I knew then I wanted to understand how this radio works. That’s my mission in life.”
After graduating from Fairfax High School, he enrolled at UCLA at age 16, earning his bachelor’s, master’s and doctoral degrees in electrical engineering. He received his PhD from UCLA just before he turned 26.
“My parents could not have afforded to send me to a private school,” he said. “I don’t want money to be a reason that any highly intelligent, highly motivated person cannot go to college.”
Samueli kept up his connection to UCLA in his first years out of school. While working as an engineer at TRW Inc., he taught classes at UCLA part-time as a visiting lecturer.
A.R. Frank Wazzan, the engineering school’s dean, was so impressed with Samueli’s enthusiasm and dedication to his students that he made an exception to the school’s rule against hiring its own graduates and offered him a full-time professorship in 1985.
“I sort of babied him,” Wazzan said. “He was very bright and very promising.”
An Exceptional Professor Too
Wazzan made another exception for Samueli, allowing him to go on indefinite leave from UCLA in 1995 to help one of his former UCLA graduate students, Nicholas, launch Broadcom.
Normally, professors are allowed only a maximum of two years on leave. But Wazzan arranged for him to keep his faculty position. “He can stay as long as I say he can stay,” Wazzan said.
Although Samueli said he has no plans to return full-time to UCLA, Wazzan thinks he may change his mind some years down the road when he grows weary of the hectic pace of a high-tech company.
Broadcom makes communication chips, the tiny pieces of silicon that allow computers and other machines to talk to one another. The market for such network devices is exploding: Ten million homes in the United States are expected to share a high-speed network connection for Web browsing, entertainment and other activities by 2003.
Because of these chips, teenagers will someday be able to download digital music into their car stereos, homemakers will be able to use a television remote control to shop for groceries on the Web, and traveling executives will be able to flip on their home security systems through their laptop computers.
By spotting this trend early, Broadcom has established itself as a dominant player in the networking arena and has ridden Wall Street’s enthusiasm for such stocks. The company’s stock price has rocketed since it went public at $24 a share in 1998. Since then, the stock has split once. On Tuesday, it closed at $229.88 a share.
Samueli, who has felt besieged by requests for donations, said initially he planned to donate only to his alma mater. But he expanded his plans to include UC Irvine after Broadcom relocated from Westwood to Irvine in 1995.
“It’s in the interests of Broadcom to have a strong engineering department nearby,” he said. “We want to help grow the school into one of the best in the country.”
Ralph J. Cicerone, UCI’s chancellor, called Samueli’s gift “a watershed event” in the campus’ 34-year history. Before Tuesday, the previous record for total giving to UC Irvine belonged to Arnold and Mabel Beckman, who have donated $16.3 million, most of it to the College of Medicine. The Beckman Laser Institute was named after them.
Insurance heiress Edra E. Brophy, who gave $8.6 million in 1988 to the UCI College of Medicine, previously held the record for the largest single gift.
With the Samueli donation, UC Irvine will receive $10 million in stock by the end of the year. The university will then get the remaining $10 million by 2003. The amount of the gift will not be affected by changes in Broadcom’s stock price, officials said.
The school has earmarked $15 million of the donation to endow professorships, fellowships and student scholarships. It also will pay for chairs for six new professorships, including electrical and computer engineering and other high-tech fields in the school of engineering.
The remaining $5 million will go toward capital projects and to enhance research and educational programs.
UCLA plans to use about $20 million to build a new engineering building and laboratories.
Both engineering schools will use the money to fuel their rapid growth. To accommodate California’s burgeoning computer, biomedical and communications fields, the University of California has committed to turning out about 40% more engineers each year.
UCLA, which now has about 3,400 engineering students, plans to add 1,000 more by 2003. UCI, a smaller school with about 1,900 engineering students, will grow 7% every year over the next five years, said its dean, Nicolaos Alexopoulos.
The Samuelis will be consulted and kept apprised of plans for spending the money but will lack the power to block any decisions, said UCI’s Alexopoulos.
“Mr. Samueli is a wonderful philanthropist who’s trying to help us jump-start the school in the right direction,” Alexopoulos said. “He will be of assistance and be very helpful, but he does not have veto power.”
Although the Samuelis’ gifts are generous, they fall short of other California academic donations fellow technologists have bestowed lately. Citing a debt to Stanford University for helping him become fabulously rich in the Silicon Valley, Netscape Communications co-founder Jim Clark last month donated $150 million to propel the university into biomedical engineering.
Gifts such as these are a departure from the practices of the most recent generation of high-tech elite. Although the old guard, people such as David Packard of Hewlett-Packard and Intel founder Gordon Moore, were generous philanthropists, the nouveau riche who have profited so handsomely from the Internet hysteria developed a skinflint reputation.
Giving back to the community was long seen as a distraction, an ego-boost tolerated only by corporate dinosaurs. The aerospace industry did it--and has since faltered. By focusing on business, rationalized these tech players, they were bolstering the nation’s economy by creating jobs.
But over time, these high-tech tycoons are becoming more comfortable with their wealth, realizing their power to change everything--even philanthropy. Microsoft founder Bill Gates has set the pace for these multibillionaires with his September announcement that he was committing $1 billion to scholarships for 20,000 minority student scholarships.
“I think it has to do with the relative immaturity of our wealth,” Samueli said. “Most of us are new wealthy people. We’re not from old money. For me, it’s all been so sudden and so strange.”
So far, Samueli and his wife have donated $3 million to Temple Beth El in Aliso Viejo, $50,000 to Opera Pacific and an undisclosed cash gift to the Orange County Performing Arts Center.
Meanwhile, school officials are grateful to be linked to their longtime colleague, whose Midas touch has turned him into one of America’s richest men. Now that the two schools bear his name, the deans ask, how can he help but make sure they become a fabulous success?
“No matter what he touches, it turns to gold,” said UC Irvine dean Alexopoulos.
Times staff writer Marc Ballon contributed to this report.
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Top UCI Donations
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Donor Amount Date Area of Support (million) Henry and Susan Samueli $20.0 12/21/99 Engineering College Edra E. Brophy 8.6 11/25/88 College of Medicine Donald L. Bren Foundation 5.0 12/10/97 College of Medicine Arnold and Mabel Beckman Foundation 5.0 1/8/90 Beckman Laser Inst. Robert R. Sprague
Family Foundation 5.0 12/18/98 Biomed. Research Bld Anonymous 2.8 7/11/90 Global Peace/Conflict Studies Chao Family 2.4 11/20/95 Cancer Center Beckman Foundation 2.3 2/20/84 Laser Institute David and Lucile Packard Foundation 2.0 5/4/93 Laser Institute Joan Irvine Smith and Athalie R. Clarke Foundation 2.0 11/25/91 College of Medicine
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SOURCE: UC Irvine
