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Gateway--A Trip Down Memory Lane

Posted by: Stephen Wildstrom on August 27, 2007

The impending sale of Gateway to Acer and the potential disappearance of the Gateway brand brings back memories of the early days of the PC business.

Back in the mid-80s, BusinessWeek was looking for new PCs to replace our first generation not-quite-clones from Texas Instruments. We evaluated units from a number of clone makers, including PCs Ltd. (which would become Dell) and Gateway. We liked Gateway 2000, as it was then called, the best, so a colleague and I traveled to Sioux City, Iowa, to meet with he company. Although Gateway associated itself from the beginning with cows from Iowa, the state is really pig country and Gateway’s original offices were located above the very fragrant pig exchange in the Sioux City stockyards.

We toured the “factory,” basically a workroom next to the offices, and did a deal for several hundred PCs for BusinessWeek and other McGraw-Hill publications over lunch at the Holiday Inn. It was Gateway’s first sale to a Fortune 500 corporation and some years later, Gateway founder Ted Waitt Jr. told me that they took our purchase order to the bank to borrow the working capital they needed to fulfill the order. Had we known that at the time, we probably would have looked elsewhere.

Reader Comments


August 27, 2007 9:22 AM

Great blog post. Short but sweet. Keep 'em coming!

Nathan B

August 27, 2007 12:30 PM

My college (where I was employed as a techie) purchased Gateway 2Ks as well. This was back in 1995 so the 2K label was very trendy. The lab was in the process of to replacing aging bulky IBMs (which had a tendency to overheat, smoke and smell liked burnt popcorn).

They were great computers but we always got a kick out of the cow-hide patterned boxes - whenever a lab would be updated it would look like the comp. dept. had been overrun by the herd.

Joe Harkns

August 28, 2007 3:29 AM

That's an interesting comment that, had you known how Gateway financed production of a large order, you would have looked elsewhere.

It's a fairly common practice and a good way to grow a business. I'll bet that all the suppliers of the day - and even many today - use one version or another of ad hoc financing, be it asset loans, factoring of receivables, etc. So why, on the basis of that alone, would you have not bought?

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Bloomberg Businessweek writers Peter Burrows, Cliff Edwards, Olga Kharif, Aaron Ricadela, and Douglas MacMillan, dig behind the headlines to analyze what’s really happening throughout the world of technology. Tech Beat covers everything from tech bellwethers like Apple, Google, and Intel and emerging new leaders such as Facebook to new technologies, trends, and controversies.



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