Steve Case

• Born: August 21, 1958
• Place of Birth: Honolulu, Hawaii

• Cofounder and former CEO of America Online
• Primary Field: Internet
• Specialty: Commerce
• Primary Company/Organization: America Online

Introduction

In 1990, only 15 percent of American households owned home computers. Over the next seven years, computer ownership climbed, and time spent computing more than tripled. The so-called Super Information Highway promised by the Internet was difficult for some individuals to navigate. With America Online (AOL), Steve Case gave new computer users a tool for entering the world of technology. A service provider, social network, and Internet browser, AOL became one of the most respected names in the computing industry. After negotiating the merger of AOL with Time Warner, Case left the company in 2003 to devote his time to Revolution, a venture firm that manages his network of real estate and media investments, and to the Case Foundation. He and wife Jean have signed the Giving Pledge, through which American billionaires promise to give away at least half of their fortunes within their lifetimes.

Early Life

Stephen McConnell Case was born in Honolulu, Hawaii, on August 21, 1958. His father, Daniel, a lawyer, and his mother, Carol, an elementary-school teacher, had also been born in Hawaii. One of four children, Case was particularly close to his brother Dan, and the two brothers established their own business, Case Enterprises. With Steve running the business end and Dan serving as front man, they sold greeting cards and seeds and managed a paper route. Steve attended Punahou School, a private school where he served as the editor of the newspaper, Ka Punahou. He also wrote music reviews and articles for Youth Unlimited. He graduated in 1976.

At Williams College in Williamstown, Massachusetts, Case started his own band and worked as a disc jockey. Although he enjoyed political science classes, he did not like the computer science classes, which required him to use punch cards. Case graduated with a bachelor of arts in political science in 1980. That year, he began marketing hair care products as an assistant brands manager in the marketing department of Procter & Gamble. He left in 1982 to take a job in Wichita, Kansas, in new development at Pizza Hut. In his spare time, he built a Kaypro computer, and he and a friend established a marketing consulting company.

Life's Work

Case's brother Dan grew up to become an investment banker with Hambrecht and Quist. When Dan invited Steve to attend the Consumer Electronics Show in Las Vegas in 1983, Case met William von Meister, the developer of The Source, an interactive computer resource used by Atari gaming consoles. Case signed on as a consultant for von Meister at Control Video and ultimately became a full-time employee. Atari's fortune faltered as more sophisticated gaming consoles reached the market. By that time, Jim Kimsey, a Control Video executive, had already begun grooming Case to take over the company. Case began marketing interactive services to IBM, Commodore, Apple, and Tandy, but Apple opted to launch its own service and withdrew from the fold.

In 1985, Steve Case cofounded the company that became known as America Online, forging what could be salvaged from Control Video into Quantum Computer Services, using his computer skills and technical know-how to create the user-friendly interface and his marketing skills to sell the product to the public. He launched a direct-mail campaign (the AOL setup CD would become ubiquitous in people's mailboxes). With Case as chief executive officer (CEO) and Kimsey as chairman of the board, the company became America Online, Inc., in 1991. The following year, AOL became the first Internet company to be publicly traded, selling at $184 per share and raising $66 million. Case used the money to grow AOL. However, AOL was still in third place, trailing both CompuServe (the first major online service) and Prodigy. By 1994, however, AOL had gone global and was claiming a million subscribers.

At the same time that AOL was on its way to becoming the best-known name in the field of Internet service providers, Microsoft, under the guidance of Bill Gates, was turning Windows into the most popular operating system in the world. Gates allegedly offered to buy 20 percent of AOL in 1993 but was turned down. Instead, AOL began purchasing other companies, acquiring Advanced Network Services and Book Link Technologies in 1994. The subscriber base grew from 600,000 in early 1994 to more than 1 million by March 1995. In August, Microsoft introduced Windows 95, which included the web browser Internet Explorer. Instead of competing, the two giants made a deal to promote each other. By 1997, AOL had 17 million subscribers, and Case was chairman of the board. AOL acquired its rival, CompuServe, in 1998 and purchased the Internet browser Netscape the following year.

In 2000, AOL had 32 million subscribers. That year, Case led AOL into a merger with the venerable Time Warner in what became known as the largest in American history. For $164 million in cash and stock, AOL shareholders gained a majority interest in the new company. However, Case agreed to step down as CEO while remaining with AOL Time Warner as chairman of the board of directors. Gerald Levin of Time Warner served as CEO. When the merger was completed, the company was valued at $290 billion. In addition to the AOL subscription base, the combined media conglomerate comprised thirty-five magazines, the Little, Brown publishing company, television channels (including HBO, CNN, and TBS), and a host of film and television properties. Projected earnings for AOL Time Warner included $8.07 billion from films, $6.88 billion from the Internet, $4.7 billion from publishing rights, and $3.08 billion from music rights. Both Disney and Microsoft opposed the merger, claiming that it gave AOL Time Warner a media monopoly. The Federal Trade Commission based its approval of the merger on the sharing of company technologies.

In 2002, AOL reported a subscriber base of 27 million. By that time, however, the focus of the Internet was changing, and cable modems and digital subscriber line (DSL) connections were making dial-up access obsolete. AOL membership steadily declined, and stock in the merged company fell by 75 percent. Ultimately, the company lost nearly $100 billion, making it the largest loss ever reported in a single year in the United States up to that point. Both the Securities Exchange Commission (SEC) and the Department of Justice launched investigations into the company's accounting practices. The company ultimately paid $360 million as a result of the SEC investigation and spent another $3 billion settling various lawsuits filed by shareholders. Case left AOL Time Warner in 2003.

In 2010, Time Warner divested itself of AOL, putting the erstwhile Internet giant up for public trading. On its own again, AOL set out to reestablish itself as an advertising business and the owner of a number of online communities that include Engadget, a technology blog; WalletPop, a personal finance website; and Slashfood, a food website. In only a short while, AOL began showing a small profit.

Personal Life

Case married Joanne Barker, whom he had met while attending Williams College, in 1985, in her hometown of Rumson, New Jersey. After having three children, they divorced in 1996. He married Jean Villaneuva, a former AOL executive, in 1998 in a ceremony presided over by the Reverend Billy Graham. The combined Case family, which includes four daughters and one son, live in McLean, Virginia, in the childhood home of Jackie Kennedy Onassis. Case is still heavily invested in his home state of Hawaii, and he donated $10 million to Punahou School to build a new junior high named after his parents. In 2011, Case's net worth was estimated at $1.5 billion. It had grown to $2.4 billion by 2024.

In 1997, Case founded the Case Foundation, which focuses on promoting technology, health care, and community development to underserved groups, particularly children and youths. Jean heads the foundation. In 2000, Case and his brother Dan established Accelerate Brain Cancer Cure (ABC2) to promote research on brain cancer. The brothers had a personal reason for establishing ABC2: Dan Case had been diagnosed with brain cancer; he died in 2002.

In 2005, with a $250 million investment, Case founded the Washington, DC–based Revolution, which was made up of companies networked under the umbrellas of Revolution Growth, Revolution Ventures, Revolution Health, and Revolution Places. Revolution Money was sold to American Express in 2009. Revolution Health was acquired by Everyday Health Group in 2008. Revolution Growth invested in fast-growing companies that include Zipcar, Living Social, Draft Kings, and Exclusive Resorts. Revolution Ventures invested in technology companies that were on their way up. Revolution Places invested in real estate and hospitality businesses such as Grove Farms and Maui Land and Pineapple.

Living in the Washington, DC, area allowed Case to maintain his interest in politics. In 2011, President Barack Obama appointed him to head the Startup America Partnership. Case also served on the President's Council on Jobs and Competitiveness. That same year, he was appointed to the Board of Regents at the Smithsonian. He has made a number of appearances on CNBC's Squawk Box to discuss the activities of both groups.

In April 2016, Case published his first book, The Third Wave. In the book, Case discussed the transforming effects of what he termed the first and second waves of the internet and speculated on the next steps, or the third wave, of internet use and how it will further change society. He published his second book,The Rise of the Rest: How Entrepreneurs in Surprising Places Are Building the New American Dream, in 2022.

Bibliography

Bulik, Beth Snyder. “Steve Case, a Man with a Medical Mission.” Advertising Age 79.11 (2008): n. pag. Print. Focuses on Case's career after leaving AOL Time Warner.

Kinni, Theodore. "Tech Savvy: Steve Case on Surfing the Internet's Next Big Wave." MIT Sloan Management Review, 8 Apr. 2016, readingwritingmanagement.blogspot.com/2016/04/tech-savvy-steve-case-on-surfing.html?m=0. Accessed 16 Oct. 2024.

Munk, Nina. Fools Rush In: Steve Case, Jerry Levin, and the Unmaking of AOL Time Warner. New York: HarperCollins, 2004. Print.

“Parted from Time Warner, AOL Posts a Small Profit.” New York Times, 3 Feb. 2010. Print.

Plosker, George R. “How Do We Get Here from There? Entrepreneur Steve Case Talks about Early Online Days.” Information Today 22.5 (2005): 22–28. Print.

Sloan, Allan. “Don't Blame It All on Steve Case.” Newsweek 139.14 (2002): 47. Print.

Stives, Steve. “The (R)evolution of Steve Case.” Fortune 152.10 (2005): 88–96. Print.

Swisher, Karen. AOL.com: How Steve Case Beat Bill Gates, Nailed the Netheads, and Made Millions in the War for the Web. New York: Times, 1998. Print.

“Steve Case.” Forbes, 2024, www.forbes.com/profile/steve-case/. Accessed 16 Oct. 2024.

“Steve Case Net Worth – How He Made It And What He Does with It.” Capitalism.com, 18 Nov. 2022, www.capitalism.com/steve-case-net-worth/. Accessed 16 Oct. 2024.