July 6, 2005 – Restaurant at the End of an Era

July 6, 2005 – Restaurant at the End of an Era

I first started going to the Lion & Compass restaurant in 1982 shortly after it opened to rave reviews, including one in the New York Times, which was posted proudly at the entrance to the restaurant. I was working as an editor for a technical magazine and based in the newly named high tech corridor, Silicon Valley—the name coined by himself, president of the agency I previously served: Regis McKenna Advertising and Public Relations. Silicon Valley is physically located in the lush once-agricultural region of the Santa Clara Valley on the Southwestern side of San Francisco Bay. The restaurant is on the corner of Weddell Drive and Fair Oaks, right off 101 on the east side of the freeway in Sunnyvale. As I recall, the site the restaurant was built upon was once home to a drive-in theatre. Back then, I was a frequent guest being entertained at the restaurant by marketing types who wanted me to write nice things about their company and products. Today, my wife IM and I remain regulars—it’s IM’s favorite eatery.

The restaurant has become a symbol or sorts for Silicon Valley, for the generation that frequented its tables and enjoyed the wonderful faire its chefs have prepared over time. Humans have a fascination for great meals. It’s a hunger that is evident from the beginning of recorded history. In his book Courtesans & Fishcakes, James Davidson describes the people of the ancient city of Sybaris in the instep of Italy’s boot as having made food of such importance that they allowed the inventor of a new dish a year’s exclusive use of the recipe. Davidson also describes the noble Sybarite Smindyrides in 572 BCE journeying to Greece to woo the daughter of Cleisthenes ruler of Sicyon. In his entourage were 1000 fishermen, cooks and fowlers to ensure he achieved the culinary standard he enjoyed in Sybaris while on the road. In the heady days of early 1980, the Lion & Compass became the restaurant that raised the standard of dining in Silicon Valley, to what one could expect in San Francisco—a place where Smindrides would have felt right at home without his entourage.

The Lion & Compass began its life at the same time the personal computer became something more than a hobby for most everyone purchasing one. By 1982, the PC had gone portable with the advent of the Osborne and Kaypro machines—they were known back then as luggables since they resembled something slightly larger than a hard side Samsonite briefcase. These PCs were running the CP/M operating system and offering the buyers bundled software that included WordStar—“the” word processing software of the time, and SuperCalc, the most popular spreadsheet program of that era. Both companies where shipping 10,000 units a month with an average selling price of $1600 each—a yearly income of $150 million, not bad for a new company back then. At the same time, the IBM PC debuted in 1981 and it was immediately followed by a collection of clone PCs, the first of which was Compaq Computer out of Houston. With the advent of IBM and its clone, the unit volume of computers began to rise at an accelerating rate. And there was a food chain of chip suppliers and board vendors feeding these PC manufacturers with goods and services, the vast majority being start up companies based in Silicon Valley.

Walking into the Lion & Compass in the early 1980s the visitor would see tables peopled by venture capitalist wooing potential clients: the din of voices striving to be heard as the movers and shakers of the valley came together to do business. And the continuous table hopping as friends would see each other being seated and get up to shake hands ask a quick question, make a date for drinks later, or get a commitment for a formal meeting—have your assistant call my assistant… Back then money was less a concern than having the right people take you public. It was the equivalent to getting the right date for the debutante’s ball.

The wait staffs at the Lion & Compass and every other Silicon Valley eatery were run off their feet trying to keep up with the demanding high-strung clientele—the not infrequent snorts of coke in the restroom recharged energy levels sufficiently to keep up with the pace. The highly refined Erythroxylum coca leaf was the substance of choice in the supercharged world that seemed to have an inexhaustible source of fast money. One Silicon Valley company was purported to deliver the substance in interoffice envelopes. The Aymara and Quechua (modern Inca) Indians chew the Erythroxylum coca leaf to acquire the stimulant that enables working for long stretches at a time. In this country, it was being used for the same purpose only ingesting it in a more concentrated, faster acting form.

The Valley went through a series of ups and downs: 1985, 1989, 1996, and most recently 2001. I know them all. I was touched by each recession, though far less than some of my colleagues, some of who are still reeling. And not only were the downturns devastating for some, the successes were equally disastrous. The president and CEO of a PC clone company takes his company successfully through an IPO and is worth millions on paper. The day his stock ticker starts to trade on NASDAQ, he takes a local Ferrari dealer salesman to lunch at a restaurant in Los Gatos, where alcohol flows and cocaine blows. The two jump in the Ferrari for a ride after lunch, the CEO at the wheel, Somewhere northbound along the curving two lanes of University Avenue, the CEO, driving faster than his substance-impaired judgment could control runs the car off the road and into a ditch at high speed. The CEO is dead at the scene; the passenger severely injured. He had once been the VP of sales at the publishing company I worked for. He had quit a year earlier to take the helm of the PC company. He had reached the epitome of Silicon Valley success and was gone.

The Lion & Compass is now over twenty years old. The young executives whose voices filled the walls of the restaurants four separate dining areas, have all grown old and have lost the frenetic energy of youth and no amount of artificial stimulant is likely to bring it back. Every CEO of a major Silicon Valley semiconductor company who managed to steer the enterprise through four recessions have all now finally retired. Most have become venture capitalist financing the next great venture. At Lunchtime, the restaurant still has a good crowd but the frantic deal making that resembled panic buying in an irrationally exuberant market has subsided.

The aging population is but one of the factors. The other is that the deal making has gone elsewhere, Taiwan, India, Korea, and increasingly to China. There is a Lion & Compass in each of those places where the same frantic energy has been unleashed. But Silicon Valley has a way of redefining itself in the wake of downturns. The PC market gave way to the telecommunications market, which gave way to the Internet market. Ultimately, something new will come along and start the cycle all over again. And, the Lion & Compass will be there to feed the ravenous hunger of the next generation of high-energy executive out to make his or her fortune.