HP numbered its first product 200 to make a two-man company look established. First-year revenue: $5,369

HP’s first product was the 200A audio oscillator. The record explains its model number this way: 200 was chosen to suggest that HP was a company that had been around for some time. There was only one product, and the only employees were the two founders.

In 1939 that company’s revenue was $5,369. HP’s official timeline lists the figure beside that year’s headcount of two.

In the founding years of legendary companies, the garage often becomes the stage of a story. In HP’s case, the garage survives not as a story but as a record, in the company’s timeline and in a state landmark designation. What follows looks in turn at the model number, the $538, the $5,369 and the record of the garage. Listed companies fall outside this site’s criteria for cases, so only the first two years are covered here, as a column.

From graduation in 1934 to $5,369 in 1939

Almost all of the founding-era numbers come from the company’s own timeline. This company wrote down the amounts of its own beginning.

Model 200 was a number to make a two-man company look bigger

The 200A had a technical idea behind it. It used an ordinary light bulb in the part that stabilized output, producing sound with little distortion. The 200A is credited as the first commercial oscillator to use this method.

The model number, though, was not about engineering. Starting at 200 rather than a small number was meant to look like a company that already had a product line. The first thing a two-person company made was a product and the appearance of a line that product would sit in.

What the desk wants to state plainly is that this number was a design rather than a lie. Engineers buying equipment infer a company’s history from its model numbers. The two founders got ahead of that inference with the name of their very first unit. For a company that could not pay to build a brand, a model number was one of the few signs it could put up for free.

The $538 included a used drill press

The official timeline gives working capital as $538 and spells out its contents: cash and a used Sears drill press. It counts a tool, converted into dollars, as part of the founding money.

Stories about starting money are usually told as a cash amount. HP’s record counted the tools on hand as part of it. For a company starting small, that way of counting is closer to reality, since every tool already owned is one not bought with cash.

The first big customer bought eight units

Disney bought eight 200Bs, an improved version of the 200A. They were reportedly used to check sound systems for the film “Fantasia.” The official timeline puts it in this order: Disney asked for modifications, and those became the 200B.

Revenue in 1939 was $5,369, with two employees. The timeline does not say how much of that year’s revenue came from Disney’s eight units. Still, a well-known customer asking for changes and buying several units in the first year of a one-product company became the centre of the later legend.

This garage survived as a record, not a story

The garages of legendary companies often get corrected by their own founders. Apple co-founder Wozniak himself called Apple’s garage an overblown myth, as told in the column on Apple’s first document.

HP’s garage is different. The company timeline gives the address and even who lived where and who rented the shed. In 1987 California designated the garage State Historical Landmark No. 976, naming it the “Birthplace of Silicon Valley.” In 2007 it was added to the National Register of Historic Places. The state added it to the record 48 years after the founding, and the nation 68 years after.

The same kind of garage story was denied by its founder in one case and became a public record in the other. The desk reads the difference as whether the company itself had kept its first numbers in its timeline.

A small record of someone keeping their own first-year numbers

Records of someone writing down their own first revenue exist for much smaller businesses too. The record of three indie apps reaching 200,000 yen a month publishes eight years of figures, starting from a first sale of 30 yen. The list setting HP beside other legendary companies is in the column tracing 22 founding legends to their sources.

What could be confirmed

The limits need stating. The origin of the model number was checked against an encyclopedia entry citing HP’s company history pages, not the founders’ own words at the time. The prices of the 200A and 200B and the amount of the Disney sale could not be confirmed in the sources read. Nor is it known how much of 1939’s $5,369 came from Disney. The year the 200A was first built appears as 1938 in one account and 1939 in another.

The two-man company looked big in its model number and wrote small in its timeline

Follow HP’s founding years through numbers and two directions show up at once. The first product got a model number that made the company look bigger. Meanwhile the company’s timeline wrote down, as they were, that the $538 included a used drill press and that first-year revenue was $5,369.

Look big when selling, write small when recording. Because the outward sign and the inward ledger were kept separate, the company’s beginning can still be checked more than 80 years later. The legendary garage became a state landmark because that ledger came first.