If you’ve been conscious lately and haven’t heard of Apple Computer, you’d better have your ears examined. But don’t worry if that name zooming up from the Apple tombstone doesn’t ring a bell. Hambrecht & Quist, which co-managed Apple’s (AAPL) first public offering with the prestigious Wall Street firm of Morgan Stanley, is a San Francisco upstart only 13 years old. In 1980 Merrill Lynch, the industry leader, did 45 times as much underwriting business as Hambrecht & Quist. But when it comes to financing small high-technology companies like Apple, Hambrecht & Quist has a special touch.
The firm is both underwriter and venture capitalist. It has five venture-capital funds, with about $100 million in assets, which it manages primarily for large institutional investors. The oldest one invested in over 100 companies in ten years and returned an average of 29.8% a year, compounded. The second fund, launched two years ago, has returned a breathtaking 59.9% a year. A competitor, Sanford R. Robertson, a partner of San Francisco’s Robertson Colman Stephens & Woodman, remarks: “If you can beat them it’s like winning a game of golf against Arnold Palmer.”
