Kaypro: Thirty Years of Innovative Experience

(This press release item was given out at COMDEX '83.)

KAYPRO: THIRTY YEARS OF INNOVATIVE EXPERIENCE By Daniel Burstein

Unlike some computer companies that were literally "born yesterday," the Kaypro Corporation is one of the few entrants into the personal computer field that can claim more than three decades of manufacturing experience in electronics. What's more, ever since Andrew F. Kay founded Non-Linear Systems (which officially changed its name to Kaypro Corporation in 1983) the company's history has been one of consistent breakthroughs in price, miniaturization, integration of components and product quality.

Andrew Kay, an MIT graduate, founded Non-Linear Systems in Solana Beach, a northern suberb of San Diego, in 1953. In short order, the company became known throughout the electronics and aerospace industries for developing the first digital voltmeter and the smallest commercial oscilloscope. Later, other sophisticated electronic test equipment was added to the product line.

In the 1960s, the company developed a reputation as a pioneer in innovative management. Layers of middle management were pruned away, worker participation was maximized and the company exuded an atmosphere of creativity and invention at all levels of the work force. Social theorist Vance Packard wrote that it was "one of the most revolutionary companies in America," while psychologist Abraham Maslow visited at the factory for a summer and later wrote a book about his impressions. Maslow concluded that what was happening at Non-Linear "showed the way to the future."

In the economic recessions of the 1970s, Non-Linear had to curtail some of its managerial experiments, but the company continued to follow founder Andrew Kay's belief that the goal of an enterprise is not only to make a good product for a profit, but also to make certain its employees feel good about their work and can take on as much responsibility as their aptitude permits.

In the late 1970s, Kay began to see the coming revolution in personal computers. Using Non-Linear's long experience in many areas of electronic technology, R & D efforts were begun to do what many thought was impossible: bundle all the software and hardware the average computer user would need into one package, design it for portability around an office or from home to office and produce it at an affordable price.

As work on the computer that would later become known as the Kaypro II got underway, Andrew Kay, who had always worked with wife Mary in the company, brought in more and more family members to help out with the transition into the computer business. Sons David and Allan Kay became company vice presidents, while even Andrew Kay's father Frank Kopischiansky, today 87 years old, started coming to the factory to help out.

In June, 1982, the first Kaypros IIs were shipped to an enthusiastic welcome from the trade press, dealers and consumers. In the highly competitive personal computer field, Kaypro managed to sell almost 42,000 units in its first year of production despite one of the lowest allocations for advertising and promoting in the industry.

Best-selling computer author Peter A. Mcwilliams wrote, "Non-Linear Systems has packaged their personal computer with the ruggedness of a piece of electronic testing equipment ... The Kaypro II gives the impression that it could take on Conan the Barbarian and rise victorious. It's built like a brick pagoda. Maybe it's the metal case (almost all other personal computers are plastic), maybe it's the no-nonsense design, maybe it's knowing that it's made by a company with thirty year's worth of experience in packaging delicate electronic instruments for portable use. Whatever it is, it's the only personal computer--at any price, portable or no--that I would describe as rugged ... The Kaypro II ... is all the personal computer many people may ever need ... The software included ... is certainly the most impressive array of free-with-purchase software included with any machine at any price."

Elsewhere, the response was similarly enthusiastic. Within months of its birth, the Kaypro II had become a classic. It was joined in 1983 by the Kaypro 4, which sported double sided, double density disk drives for more storage, and then by the Kaypro 10, another major pathbreaker for the industry: the first-ever affordable hard disk computer for mass storage (featuring a built-in 10 megabyte hard disk), built for portability as well.

Reviewing the Kaypro 10 recently, Infoworld magazine wrote, "The Kaypro 10 is a welcome addition in today's hardware carnival--it gives consumers who want a hard-disk system the chance to buy a quality product at a good price."

In August, 1983, an initial public offering of stock in the Kaypro Corporation was made, and the offer was fully subscribed. "Kaypro Corp., a portable computer maker whose sales have skyrocketed this year, went public to a warm reception," the Wall Street Journal reported the day after the offering. The Journal went on to quote Edward Currie, a computer industry expert as saying, "Of all the portable-computer makers around, Kaypro stands a good chance of making it. They are commanding a very, very important part of the market."

The continued manufacturing and financial success of the company was reflected in reports for the fiscal year ended August 31, 1983. Kaypro's year-end books showed $12.9 million in earnings on sales of $75.1 million--extremely healthy figures, especially considering the difficulties encountered during the same period by many other manufacturers.

At the Solana Beach factory, growth has been rapid. The workforce has mushroomed from 50 employees to over 500 in the space of 12 months, and the company has emerged not only as a leader in the U.S. market but in Europe, Asia, and other regions of the world as well. New manufacturing and administrative space is constantly under construction to meet the needs of the evolving company. The design of the plant, however, remains true to strong feelings on the part of Andrew Kay about the need for light, open space, and a human work environment for all employees.

Moreover, Kaypro has maintained its commitment to consumers by constantly improving the product line while maintaining the industry's lowest prices. The prices of the Kaypro II and 4 were both cut significantly in 1983, while the company added new built-in software and other improved features, including add-on boards for IBM compatibility. A variety of new products to meet other consumer needs are now in the development stage.

Kaypro has also developed a keen sense of corporate social responsibility as it has grown. The company has donated more than a thousand computers to California schools, and has recently launched a major program to donate computers to grass-roots groups involved in humanitarian causes in the third world. From archaeological digs in the Mayan ruins of Belize to office automation seminars in China, Kaypro computers are being put to worthy and exciting uses in situations highly demanding from a technological viewpoint.

Looking to the future, Marketing Vice-President David Kay observes, "At a time when some other manufacturers have fallen by the wayside, we at Kaypro can draw on the rich experiences of more than 30 years in business. The historical trend of our company has been to provide better products in smaller sizes at lower prices, and I believe we will be able to continue in that course well into the next century."