Broadcom’s co-founders built a behemoth as a formidable team
The Broadcom tale of the two Henrys is a study in contrasts: one man deliberate and reserved, the other anything but.
Henry T. Nicholas III and Henry Samueli founded the Irvine chip maker in 1991 and went on to become two of Southern California’s best-known and richest entrepreneurs, giants in the tech industry.
When they hit it big, Samueli, the reserved Henry, bought a house in Corona del Mar, toys for his three kids and a Porsche Boxster for one of his employees, but kept his leased Cadillac.
Nicholas, the brash one, sprang for a Harley-Davidson, a red Ferrari, a black Lamborghini and, for longer trips, a Las Vegas charter aviation service with three jets and a helicopter. Home became a 15,000-square-foot mansion on a Laguna Hills estate with waterfalls, two pools, a big wine cellar and to-die-for views.
He made no apologies for his outsized lifestyle.
“I get what I want,” Nicholas told a Times reporter in early 2000, “because I always want to win.”
On Thursday he and Samueli notched a huge win with the announced sale of Broadcom for $37 billion to rival chip maker Avago.
“Today, I’m like giddy,” Nicholas said in a telephone interview. “I want to say this is the culmination of a life’s work, but what we’ve really got now is a new point of departure. It’s really exciting.”
Born in Cincinnati, Nicholas, 55, moved to California in the mid-1960s, when his mother, a schoolteacher and administrator, divorced his father, an attorney. He graduated from Santa Monica High School in 1977 and enrolled at the U.S. Air Force Academy but left when he was deemed too tall at 6 feet 6 to fly fighter jets.
After earning an engineering degree at UCLA in the early 1980s, Nicholas worked at TRW in Redondo Beach, where he met Samueli, his future business partner.
Samueli, 60, the son of Jewish immigrants from Poland, graduated from Fairfax High School at 16 and earned his undergraduate electrical engineering degree from UCLA at 20 and his PhD just before he turned 26.
Early in their friendship, Samueli provided Nicholas’ career opportunities. When Samueli took a huge pay cut to leave TRW and join the electrical engineering faculty at UCLA in 1985, he persuaded Nicholas to become his first PhD student.
In 1988, Samueli picked up a part-time consulting job at PairGain Technologies Inc. and talked Nicholas into joining the firm as the manager of an integrated circuits team.
A few years later, Nicholas left and in 1991 started Broadcom out of his Westside condo. It grew — moving from his house to small offices in Westwood to larger facilities in Irvine.
Nicholas eventually talked Samueli into leaving PairGain and joining him full-time at Broadcom in 1995.
There, the two built a tech microchip juggernaut and became known for their wildly different personalities, and for being a formidable team: Samueli, the chief technical officer, inspired the engineers; Nicholas, the CEO, drove them to win and ran the business side.
In 2003, Nicholas stepped down as Broadcom CEO.
“Nick is a one-of-a-kind entrepreneur who combines engineering insight with business vision and incredible energy and focus,” said Robert Magnuson, a former Times executive who ran Nicholas’ family business after he stepped down from Broadcom.
“He’s got a big brain, a big heart and a big personality,” said Magnuson, who is now chief of communications and external affairs for the California High-Speed Rail Authority.
A few years later, Nicholas made headlines for alleged indulgences in drugs and prostitutes, and for an underground “lair” on his estate. The allegations, first reported by The Times, made their way into a federal indictment in 2008 that alleged he used and distributed controlled substances.
Somewhere in the skies between Orange County and Las Vegas, Nicholas and his entourage generated so much marijuana smoke that it billowed into the cockpit, “requiring the pilot flying the plane to put on an oxygen mask,” according to the indictment.
A second indictment accused Nicholas of manipulating stock options at Broadcom to improperly reward employees.
During the tech boom, Samueli and Nicholas awarded millions of stock options to attract and reward employees. Samueli and Nicholas didn’t receive backdated options themselves, but prosecutors alleged they granted them to others, including some other top executives, to avoid having to report $2.2 billion in compensation costs to shareholders.
Samueli, who owns the Anaheim Ducks hockey team, pleaded guilty in 2008 to a charge of lying to investigators about how the company handled the stock options.
In 2010, a federal judge reversed the guilty plea and threw out the case. The judge subsequently dismissed all charges against Nicholas and another company official.
At Broadcom, Samueli is chairman of the board and chief technical officer, a role he said Thursday he intends to keep after the acquisition is completed. He’s worth an estimated $2.6 billion, according to Forbes, making him No. 276 on the list of the country’s wealthiest people.
After Broadcom’s initial public offering, he and his wife, Susan, created the Samueli Foundation and to date have gifted more than $200 million to support education, health, social services, performing arts and Jewish culture. In 2003 and 2004 the couple were listed among BusinessWeek’s 50 Most Generous Philanthropists in the country.
In 1999, he and Susan Samueli gave a total of $50 million to the UCLA and UC Irvine schools of engineering. In exchange for the gifts, the engineering schools at both universities today bear Samueli’s name.
“I’ve never met anyone more charitable,” said Michael Schulman, the chief executive of the Ducks. “Both he and Susan are absolutely focused on helping the community in so many ways. They’re a great inspiration.”
Nicholas, whose sister was slain more than 30 years ago, has long been a victims’ rights advocate. He also has given millions to education, medicine, the performing arts and other causes.
Reflecting on his company’s legacy in Orange County, Nicholas said it has not only contributed greatly to the economy but made it more cosmopolitan.
“I think Broadcom single-handedly took Orange County and made it the technology mecca it is today,” Nicholas said. “We were unique in that we were very much focused on recruiting. I have relocated hundreds of engineers from the East Coast. We not only hired them, but we made them rich.”
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