Baidu Reveries — just discovered a time capsule from 1998

I first met Baidu co-founder Eric Xu 20 years ago, and I just had dinner with him again this weekend. I helped him make a documentary on Silicon Valley in 1998 (more on that later), and then we invested in the company in 2000 when they were still brainstorming business models. That $8M investment is worth $20B today as if held… one of the best venture investments I have seen.

Today, Xu pointed me to the documentary he made back in 1998, and emphasized its role in the formation of Baidu and the inspiration for the founding team. “To me, this movie is the prelude to making of Baidu,” he wrote.

My contributions start here with the Hotmail story about Sabeer Bhatia: (gosh, I look like a kid), and after some back and forth between my partner Warren Packard and Michael Moritz, and more here, here and finishing with the Chinese entrepreneurial opportunity in the economies of the mind.

(An aside: can someone recommend a translation & subtitle service? I’d like to do this as a gift to Xu.)

The book Silicon Dragon interviews the Baidu founders about the early days and the role of this 1998 documentary:

“The Baidu saga began in Silicon Valley in 1997, when Baidu co-founder Eric Xu and Li were introduced by Li’s wife, Melissa… Not only was Xu entrepreneurial, he was well connected to key investors in the valley. Xu made those connections in 1998 and 1999 while filming a documentary called “A Journey to Silicon Valley,” which later aired on the Chinese national television network CCTV. In some 120 hours of taping, Xu interviewed Valley legends such as Cisco Systems CEO John Chambers, Albert Yu of Intel, and venture capitalists Steve Jurvetson of Draper Fisher Jurvetson and Bob King of Peninsula Capital. After watching Xu’s documentary at Stanford, Li was energized. He asked Xu to lunch the next day to discuss his brainstorm. At a Chinese restaurant in Sunnyvale, California, Li pitched Xu to become his partner.”

“Just a few weeks after returning to their homeland, the cofounders opened their shop doors on January 18, 2000 in Beijing.”

“The serious-minded cofounders named their young firm Baidu, which translates as ‘seek for truth’ from an ancient Song Dynasty poem.”

“Xu relates how engineers were hired straight out of China’s top universities. The new recruits were cheered on with examples from the Valley to persuade them to work hard, grow the company, and get rich. ‘We share the overall vision with them. We brainwash them about why Silicon Valley has become so famous,’ says Xu. ‘We took the secrets of the Silicon Valley culture: tolerance of failure and tolerance of differences and free flow of information with no barriers. We tell them we have a democratic environment and that they, as bright engineers, can turn their ideas into products. These are the fundamentals of creating innovative products,’ Xu tells me. ‘It was a tremendous startup experiment. We were not sure we were going to make it.’

Indeed, they almost didn’t. Xu relates how Baidu failed with three near clones of successful U.S. Internet businesses (Inktomi, Akamai, Verity) before finally turning a profit with a fourth plan: a Google-like search engine designed for consumers.”

— From Silicon Dragon, p.10 onward