The era of the Growth of Cisco Systems

In 1988 Bosack and Lerner were forced to turn to a venture capitalist, Donald T. Valentine of Sequoia Capital, for support. Valentine, however, required that the owners surrender to him a controlling stake in the company. Valentine thus became chairperson and then hired an outsider, John Morgridge, as the company's new president and chief executive officer. Morgridge, who had an M.B.A. from Stanford University, was chief operating officer at laptop computer manufacturer GRiD Systems Corp. and prior to that had spent six years as vice-president of sales and marketing at Stratus Computer. Morgridge replaced several Cisco managers, who were friends of Bosack and Lerner, with more qualified and experienced executives. In February 1990, Cisco went public, after which Bosack and Lerner began selling their shares. Sales for the fiscal year ending July 1990 were $69.8 million, net income was $13.9 million, and the company had 254 employees.

Under Morgridge, Bosack had been given the title of chief scientist and Lerner was made head of customer service. However, Lerner reportedly did not get along well with Morgridge and, in August 1990, she was fired, whereupon Bosack also quit. When they left the company, Bosack and Lerner sold the remainder of their stock for $100 million, for a total divestiture of about $200 million. The couple subsequently gave away the majority of their profits to their favorite charities.

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