Apple Taught Ubiquiti's Robert Pera About "Perfect Organisms," Now He Owns The Memphis Grizzlies

Pera, 34, left a cushy job as one of Steve Jobs's engineers to start his own wireless communications tech company—and ended up owning an NBA team.

Robert Pera had only one thought when he left his job as a hardware test engineer in the wireless group at Apple in 2005 to start his own company: Don’t screw up.

He’d worked for Apple at that point for two years, following studies at the University of California-San Diego and the Japanese Language Institute in Tokyo. Pera, now 34, had hoped his education would help him find opportunities in hardware design, because his passion was—and is—designing products.

At least at first, Apple appeared to be that opportunity. Pera joined the company partly as a result of his appreciation of late cofounder Steve Jobs’s design philosophy (beautiful products, and hardware and software that fit seamlessly together) and he took a testing job to get his foot in the door.

However, he ultimately came to see himself as an Apple back-bencher who’d be unable to show off everything he could do. That’s why he decided to make a clean break.

He left to start his own wireless communications technology company, Ubiquiti Networks Inc., in March 2005, and Pera’s $600-per-month studio apartment lease down the street from Apple’s headquarters was coming up for renewal. Rather than re-up for another year, he packed up and moved into what he described as "an economical $650-per-month office" surrounded by bail bond shops across the street from the San Jose Courthouse.

It would be his home for the next several months.

"If this doesn’t work out," the 34-year-old Pera remembers thinking, "I am screwed."

Building The "Perfect Organism"

Robert Pera

His own experience notwithstanding, Apple as a whole provided a kind of business model for him. After watching Prometheus recently, Pera went back and re-watched the original Alien. By way of describing his assessment of Apple, Pera recalls the scene where the ship’s crew turns to the android Ash for an explanation of what the Alien is: "a perfect organism," they’re told.

Likewise, Pera sees Apple’s business model, its defensibility and leverage, as a "perfect organism." And he set about building something similar.

"I look at [Ubiquiti] as a combination of Apple's philosophies and the democratization of advanced network technology," Pera tells Fast Company. "Ubiquiti tries to empower our customer base; not exploit them for profitability, which is the current status quo."

Fast-forward seven years. Pera’s Ubiquiti is a publicly traded company (since 2011). It employed 150 full-time workers as of June 30 and recently shipped its 10 millionth device.

Ubiquiti hardware products are now deployed in more than 180 countries around the world. In October, Ubiquiti was ranked the 70th fastest growing company in North America on Deloitte’s 2012 Technology Fast 500.

"With most of the world's population not connected, Ubiquiti is just scratching the surface," Pera says. "We have connected roughly 10 million individuals and businesses with our AirMax platform. In addition, we have diversified to other technologies like scalable Wi-Fi infrastructure, microwave backhaul, machine to machine networking, video surveillance, and advanced routing and switching. We are just getting started both in diversifying towards multiple addressable markets and our penetration into each one. My hope is that our entire business model of democratizing advanced technology for the world becomes the standard hardware technology business model of the future."

As if being a CEO is not enough, Pera also is now an NBA team owner. The self-professed "NBA superfan" last month completed a deal to become the new majority owner of the Memphis Grizzlies. He also brought on a few dozen figures from the worlds of sports, business, and entertainment to act as limited partners with him, including Justin Timberlake and Peyton Manning. Why did he do it? By several accounts, Pera simply loves the game, plays pickup basketball games often and has been known to ask visitors to his company’s office in Taiwan—where there is a gym nearby—"Hey, you wanna go shoot some hoops?"

Playing To Win

By many accounts, Pera appears to bring to the outside world the memory of his personal fitness trainer shouting a Vince Lombardi quote at him whenever he starts to flag during workouts: Fatigue makes cowards of us all.

As an example of his drive, at an industry conference earlier this year Ubiquiti’s chief financial officer John Ritchie shared a story with analysts about how the San Jose-based company got its first injection of capital.

After Pera had left Apple, he developed a product called an embedded radio card. He peddled it at a trade show and started signing up customers. And he was apparently a good salesman, because Pera convinced customers to pay up front for it after telling them his fledgling venture had no money.

After that, Ritchie says Pera went to Taiwan and started lining up contract manufacturers.

"And, literally, from that point through 2010, the company took no external capital," Ritchie says. "It’s kind of a quintessential Valley startup story. Young engineer leaves a big company (to start a new one). Funds the whole thing himself. And he takes the company public in 2011."

Looking back, one of the biggest challenges Pera says he had to learn is "playing for tomorrow versus playing for today." After securing those first customer payments, for example, Pera recalled being "locked in survival mode," focused almost exclusively on supporting his first customers, building his brand, designing new products, making shipment lead-times and similar tasks.

In other words, his company was just focused on the here and now and on living to fight another day.

Increasing Your Insurance

In hindsight, he says he understands why venture capital-backed companies supported by experienced investors that form experienced boards, hire corporate lawyers, develop a public relations strategy and create an intellectual property portfolio are making the right moves.

Because VCs are "playing for tomorrow."

Says Pera: "I really did not always see the importance of living for tomorrow until much later on in the company timeline. One of the biggest regrets I have today is that I did not make the transition earlier.

"But to be fair, if Ubiquiti would have ended up as a failure and shut its doors early, playing for tomorrow would have become irrelevant. Therefore, the best strategy is to incrementally increase your ‘insurance’ as the value of your company increases and resources become more available."

Ways to increase that "insurance," Pera says, include signing contracts to cement the status of relationships with people like distributors, vendors, partners and the like in order to protect the company’s interests.

Bring a knowledgeable bookkeeper/tax accountant on board who not only keeps the company within the law but knows how to take full advantage of tax credits and related strategies.

And finally, to protect against "unfair competition" as product sales climb, he recommends quickly building an investment in an intellectual property strategy.

[Photo: Flickr user Michele Mazzoli]

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