What do you get when you combine raw brainpower, 80-hour workweeks and 50-pound sacks of rice and beans?

The Millionaires Next Door

by Tia O'Brien

THE FIVE GUYS waiting in line for burritos look like college kids--shlumpy in a slacker-dude kind of way with their flannel work shirts, blue jeans and 10-year-old running shoes. Success is so new to the founders of Excite Inc. that they're not sure how to wear it, except maybe on their license plates--like the one on Ryan McIntyre's Volkswagen Golf, which reads "XCITE."

"Like these guys pulled up next to my car the other day," McIntyre, '93, tells his buddies who quickly gather around, forgetting their burrito orders. "They rolled down the window and said, 'Wow, are you one of the guys who started Excite?' And I said, 'Well, like yeah.' And they said, 'Wow!' "

Just four years out of Stanford, the founders of Excite still marvel at the wild rocket ride that blasted them from their Stanford dorms to millionaire status at the tender age of 25 (one was 27). But in a world of unbridled hype about the high-tech revolution, these guys are authentic: They built one of the top Internet "search-engine" companies out of nothing but an idea, $15,000 from their parents, maxed-out credit cards, 50-pound bags of beans and rice--and a slogan: "Unencumbered by reality."

Now a sobering reality stares the young entrepreneurs in the face. Excite made it big because the founders devised a powerful way to help a new world of Internet users find what they wanted among millions of websites. But in the race to cater to the digital hordes, the company is up against life-threatening competition. Excite ranks a notch behind the undisputed leader of the search-engine world, Yahoo! (another start-up founded by Stanford alumni). Of the dozens of Internet search engines, only a couple are expected to survive as key players. And Excite is determined to come out on top, disproving some Wall Street seers who predict that it will be swallowed altogether by America Online (which already owns 20 percent of Excite) or a cash-rich competitor.

While Yahoo! has become something of a household name, Excite is spending millions to capture its share of the exploding consumer market. A recent TV advertising blitz, aimed at web users, featured Jimi Hendrix singing, "Are You Experienced?"

To understand why Excite's founders are so confident they'll emerge winners, you have to understand something about these innocent- looking recent grads: They are killer competitors who talked their way into venture capitalists' offices and won financial backing without having a clear idea about how they could turn their technology into a commercially viable product.

In all, there are six Excite founders. Five of them are, well, nerds from Stanford's computer science department. One is a political science graduate. The fact that the six are still business partners and friends is remarkable in itself. The entrepreneurial highway is littered with exploded partnerships, detonated by feuds over money and power. But the Excite men still are standing shoulder-to-shoulder, even though only two are officers of the company and are worth millions more in stock than the other four.

The birth of Excite can be traced back to whoever allotted freshman housing in 1989. "We all were assigned to the same freshman dorm--then called Madera--in the Wilbur Hall complex," clean-cut Joe Kraus, '93, tells me in an interview in his office. He's the poli-sci major and born entrepreneur who earned the nickname "Phone Boy" for his relentless pitches to potential investors. The Excite men agree that without Kraus's moxie and penchant for wearing ties, they never would have gotten beyond the drafty Palo Alto garage that served as their postgrad corporate headquarters.

In the company's early days--way back in 1994--Kraus held the title of company president. Now, with seasoned businessmen at the top, he's senior vice president in charge of business development.

The six friends from Madera stayed tight; three of them formed a jazz and funk band named Where's Julio? (and even cut a CD, which they'll hand out to anyone who asks). In the winter of '93, with graduation looming, reality began closing in on Kraus. He turned to his brilliant freshman dormmate, Graham Spencer, who was also set to graduate in the spring. "I didn't want to work for anyone else, so I said, 'How can I get this guy [Spencer] who's really, really smart to do something?' " Kraus recalls. His former dormies, just as eager to avoid life under a boss, all agreed it was time to convene a let's-plan- our-lives-together meeting over burritos at Rosita's Taco Stop in Redwood City.

Kraus: "When we got there, we said, 'Let's start a company.' But we didn't know what we wanted to do. So we looked at Graham and said, 'What should we do?' And he said, 'Well, I think we should build technology for searching through big databases. That's a problem that no one's really solved well.' "

Note that Spencer, '93, MS '94, wasn't specifically talking about a navigation service for the Internet. On this day in 1993, the infant Internet was merely a network used mostly by government and academic types; it would be another two years before millions of regular folks got hooked.

But Spencer, a low-key brain who lists his hobbies as "attending punk-rock concerts, reading philosophy and searching for UFOs," shrewdly foresaw the need for a powerful search tool. He figured they'd sell the tool to companies that wanted to do in-depth data searches. So, in the final months before graduation, the boys started researching search-and-retrieval tools at Stanford's libraries. They requisitioned conference rooms in the history department for corporate huddles; they logged on in the computer lab. By the time they got their act together, the Internet was making the cover of Newsweek. Their search-engine tool couldn't have been better timed.

But it wasn't that easy. Standing between these would-be millionaires and success was a couple of years of 80-hour workweeks and a ton of anxiety.

After graduation, they borrowed $15,000 from their parents, purchased an old Sun Microsystems workstation from Stanford's electronics graveyard and set up their "office" in a South Palo Alto Eichler home. "Very nasty" is how Kraus describes the funky tract house that served as headquarters as well as home to Mark Van Haren, '91 (the former resident assistant for Madera and the band's lead singer) and Spencer. Two of the founders----Ben Lutch, '94, and Martin Reinfried, '94--still lived on campus while finishing a fifth year of classes. McIntyre had moved in with other college buddies.

"We all were terribly naive about how much work would be involved. But we thought it would be kind of fun to work together," explains Reinfried as the five techie founders and I convene our reenactment burrito dinner at the Redwood City taqueria. (Kraus is off at a meeting with Dean Witter finance folks.) Seated around the ersatz-wood table, they smile and chuckle as they tell their tale, one finishing the other's sentence, much like Lotto winners relating their incredible luck.

They set to work in the drafty, frigid garage because there was no room inside the cramped Eichler. For heat, they ran the clothes dryer. When it blew a fuse, the screens went dark. "You'd always see Mark programming with his little wool hat and his fingerless wool gloves," McIntyre recalls.

A Los Angeles Times writer who visited the garage described it as looking like "the group house you shared with your friends after high school--the vacant refrigerator, the tumbleweed-sized dust balls, the cloth sofa that gave off a cloud of dust every time someone sat on it."

I ask if they picked a garage so that one day, when famous, they could boast about their gritty start