Tandem Computers was founded in 1974 by James (Jimmy) Treybig, a loquacious Texan. Treybig first saw the market need for fault tolerance in OLTP (online transaction processing) systems while running a marketing team for Hewlett Packard‘s HP 3000 computer division, but HP was not interested in developing for this niche. He then joined the venture capital firm Kleiner & Perkinsand developed the Tandem business plan there. Treybig pulled together a core engineering team hired away from the HP 3000 division: Mike Green, Jim Katzman, and Jack Loustaunou. Their business plan called for ultra-reliable systems that never had outages and never lost or corrupted data. These were modular in a new way that was safe from all “single-point failures“, yet would be only marginally more expensive than conventional non-fault-tolerant systems. These would be less expensive and support more throughput than some existing ad-hoc toughened systems that used redundant but usually wasted “hot spares”.
Each engineer was confident they could quickly pull off their own part of this tricky new design, but doubted that others’ areas could be worked out. Those parts of the hardware and software design that did not have to be different were largely based on incremental improvements to the familiar hardware and software designs of the HP 3000. Many subsequent engineers and programmers also came from HP. Tandem headquarters in Cupertino, California, were a quarter mile away from the HP 3000 offices. Initial venture-capital (VC) investment in Tandem Computers came from Tom Perkins, who was formerly a general manager of the HP 3000 division.
The business plan included detailed ideas for building a unique corporate culture reflecting Treybig’s values.
The design of the initial Tandem/16 hardware was completed in 1975 and the first system shipped to Citibank in May 1976.
The company enjoyed uninterrupted exponential growth up through 1983. Inc. magazine ranked Tandem as the fastest growing public company in America.