Larry Ellison co-founded the software giant Oracle Corp. (ORCL) in 1977. Under his leadership, Oracle grew from a start-up with three programmers into the largest supplier of database software and the second-largest supplier of business applications in the world.
Oracle’s rapid growth under Ellison's leadership relied on his impressive track record in identifying and conquering new markets. Oracle also grew by acquiring other software companies, including Sun Microsystems for $7.4 billion in 2010 and NetSuite for $9.3 billion in 2016. Since relinquishing the CEO post in 2014, Ellison has served as chair of the board and chief technology officer.
- Larry Ellison is the founder of Oracle, the software company that created the first commercially viable relational database.
- Under his leadership, Oracle grew into the largest supplier of database software and the second-largest supplier of business applications in the world.
- Despite notable setbacks the company grew steadily until 1992, when its Oracle 7 release swept the market and made Ellison a billionaire.
- Ellison relinquished the CEO post at Oracle in 2014; he currently serves as board chair and chief technology officer.
- Ellison was the 11th richest person in the world, with a net worth of $95.6 billion as of May 4, 2022, according to Bloomberg.
Education and Early Career
Born in New York City in 1944 to an unmarried, teenage mother, Ellison was adopted by his mother’s aunt and uncle, who raised him in Chicago's South Side. After dropping out of the University of Illinois and the University of Chicago without a degree, Ellison spent almost a decade writing computer code for clients including tech companies Ampex and Amdahl, where he worked on the first IBM-compatible mainframe system.
The Idea that Launched Oracle
The idea that launched Oracle came to Ellison while he was reading about relational databases in an IBM research paper that proposed a new way of organizing large volumes of data to make the information easy to access. Although IBM had not yet taken the idea out of the research stage, Ellison immediately saw the enormous commercial potential of relational databases to transform how enterprises operate.
In 1977, Ellison and his former Ampex colleagues, Bob Miner and Ed Oates, used $2,000 of their own money to found Software Development Laboratories, the company that later became Oracle. Over the next two years, Ellison and his team built the first commercial structured query language (SQL) for managing large relational databases.
Key to their early success was winning a $50,000 contract from the U.S. Central Intelligence Agency (CIA) in 1978 to develop a relational database management system (RDBMS), a project code-named Oracle. When Oracle 2, the first commercial relational database, was released in 1979, the CIA was among the earliest customers. In renaming Software Development Laboratories in 1983, Ellison took the Oracle name from this early contract for the CIA.
IPO and Oracle 7
After taking Oracle public in 1986, Ellison navigated the company through major turmoil, including its first quarterly loss in 1990 and revelations about deceptive sales accounting that sank the share price.
The outlook improved in 1992 with the release of popular database software called Oracle 7, which won over the market. Banks, corporations, governments, airlines, automakers, and retailers all depended on Oracle 7. Ellison became the world’s highest-paid executive in 2000 with total compensation of $1.84 billion. Despite the bursting of the dot-com bubble, Oracle's market capitalization nearly tripled to $98 billion in the decade through May 2009.
Another driver of Oracle’s growth under Ellison’s leadership was the series of strategic software acquisitions that allowed the company to enter new markets: Sun Microsystems (information technology); Hyperion Solutions (business intelligence); Retek (retail); Siebel Systems (customer relationship management); and PeopleSoft (human resources, financial, supply chain, enterprise performance, customer relationship management).
Oracle Cloud Infrastructure
By 2020, Ellison had positioned Oracle’s network architecture to handle the explosive growth of cloud-based enterprise tech companies during the early days of the COVID-19 pandemic lockdown. In April 2020, Zoom Video Communications Inc. (ZM), the enterprise video communications leader, chose Oracle Cloud Infrastructure to support the increased demand for its services.
Ellison has a record of outmaneuvering rivals by identifying and cornering new markets they overlooked. In the 1980s, when IBM began to develop SQL software to compete with Oracle, he took advantage of the fact that the SQL products that IBM was developing worked only with IBM servers. Ellison, on the other hand, prioritized the emerging market for relational database systems that would run on any of the new computers targeting business and government users.
The Advent of the Internet
Ellison was also one of the first to anticipate the revolutionary impact that the advent of the internet would have on the business world. Starting in 1997, Ellison began to focus Oracle exclusively on essential business software platforms for the internet. It was a strategy that risked alienating customers not prepared for the shift. Yet it positioned the company to profit from the dot-com boom. By 2000, Oracle was one of the biggest names in Silicon Valley—and Ellison briefly supplanted Bill Gates as the world's richest person.
Why Is Larry Ellison a Business Legend?
After dropping out of two universities in the 1960s, Ellison founded a company in 1977 that would later become Oracle. Under his leadership, Oracle has grown into a mammoth firm that employs over 135,000 people and boasted annual revenues of $40 billion in 2021. In addition to driving the massive growth of his own company since its founding, Ellison has defined how the global business sector uses big data by developing and launching products used by all of the 100 largest public companies in the world and by 430,000 customers in 175 countries.
What Is Larry Ellison’s Net Worth?
As of May 4, 2022, Ellison ranked 11th on the list of the richest people in the world with a net worth of $95.6 billion, according to Bloomberg. In addition to owning more than 40% of Oracle, he owns a stake in Tesla Inc. (TSLA). Ellison is known for extravagant spending, including buying 98% of the Hawaiian island of Lanai, spending $194 million on a yacht, and investing hundreds of millions of dollars in luxury real estate in Malibu, California. He also built a California estate modeled on 16th-century Japanese feudal architecture.
What Are Larry Ellison’s Charitable Causes?
Ellison has donated hundreds of millions of dollars to medical research and education, including $200 million to the University of Southern California for a cancer treatment research center in 2016. He also signed the Giving Pledge in 2010, a campaign launched by Warren Buffett to encourage fellow billionaires to contribute most of their wealth to charitable causes.
The Bottom Line
Larry Ellison is a visionary business leader who built Oracle from a start-up into one of the world's most valuable companies, with 2021 sales of more than $40 billion and a market capitalization of more than $196 billion as of May 5, 2022.
Ellison positioned Oracle for dominance by developing a broad range of integrated software packages: from relationship databases, applications, servers, and storage to the cloud.
When Ellison predicted in the 1990s that the internet would be the future of computing, he led the industry in the development of internet-compatible business applications, which gave Oracle a distinct advantage.