The Prince of Silicon Valley: Frank Quattrone and the Dot-Com Bubble »

RANDALL SMITH is an award-winning reporter for The Wall Street Journal who has covered the Street and its denizens for nearly three decades. He is a graduate of Harvard, and with other Journal reporters has shared the George Polk Award and a Pulitzer Prize.

RISE, FALL AND RETURN

The Prince of Silicon Valley traces the rise of the foremost investment banker of the Internet stock-market bubble, from the back streets of South Philadelphia to the peak of finance as the highest paid banker on Wall Street.

From Cisco to Netscape to Amazon, Frank Quattrone took some of the biggest names in technology public. During the bubble years of 1999 and 2000, his California-based technology banking group led the most hot initial public offerings, which lifted the entire stock market to record heights.

But after the bubble burst, the hot stocks cooled and ordinary investors lost billions. It emerged that brokers in Quattrone’s firm had created lucrative investment accounts, stuffed with hot IPOs, for banking clients who became known as “Friends of Frank.” Some of the brokers, regulators charged, cut off other investors who refused to pay back a share of their IPO profits.

And so Quattrone and his firm became embroiled in no less than four different investigations of bubble-related misconduct, culminating in two criminal trials against Quattrone for obstruction of justice, the first resulting in a mistrial, the second in a conviction in 2004. After his conviction was overturned by an appeals court in 2006, Quattrone returned in triumph to the banking business, advising no less than Internet search giant Google on corporate strategy.

But the story of his fall from grace, however temporary, remains a cautionary tale of ambition gone wrong—of a Wall Street Icarus who flew too close to the sun. 'The Prince of Silicon Valley' is an absorbing noir detective story of the investigations and trials that brought him to the brink of disaster.

Publishers Weekly

There is probably no single figure better suited to embody both the successes and excesses of the late 1990s tech bubble than Credit Suisse First Boston technology banking leader Frank Quattrone. The man behind some of the hottest technology IPOs of the decade, Quattrone's rise from South Philly street tough to the highest echelons of the banking industry, and the questionable practices that took him there and ultimately landed him in court for obstruction of justice, is the stuff of modern-day myth. Unfortunately, in the hands of Wall Street Journal reporter Smith, Quattrone's story is buried under a thicket of detail and minutiae without a clear line of analysis to help lay readers understand exactly what went wrong (for example, the author details instances where stock analysts were pressured to give positive coverage of companies doing business with Quattrone's group, without explaining what an analyst does or how their work affects the stock market). While an important and frequently compelling account, the book conveys little about the central personalities and reads very much like the court transcripts upon which it is based. (Jan.)

Bk. 1 The Banker

1 Bubbles 5

2 South Philly 11

3 Morgan Stanley 17

4 The Prince of Silicon Valley 21

5 Miniscribe 27

6 An Early Brush with the SEC 33

7 Tech Tales Off 37

8 The Dream House 40

9 Building a Powerhouse 46

10 Netscape 52

11 The Dream Team 58

12 Amazon 64

15 The Senator 68

Bk. 2 The Bubble

14 Credit Suisse First Boston 75

15 The Mule in the Lobby 80

16 The Flaming Ferraris 85

17 The Friends of Frank 88

18 Monarch of the Valley 96

19 Leaning on the Analysts 105

20 Denver 110

21 Mike Grunwald 115

22 The Hottest IPO Ever 121

23 Grunwald's Blunder 128

24 JohnDoe526 135

25 A Secret Weapon 138

26 "A Concerned Citizen" 141

27 A Last Hurrah for Hot IPOs 146

28 The Gumshoes Go to Work 154

29 Culture Clash 159

Bk. 3 The Bust

30 The Prosecutors 167

31 "Time to Clean Up Those Files" 176

32 The Denver Traders Talk 187

33 Damage Control 195

34 The Unwritten Rules of Research 204

35 A Vote of Confidence 212

36 Eliot Spitzer 219

37 Spinning 226

38 Obstruction 237

Bk. 4 Judgment

39 The Courthouse Steps 247

40 Quattrone Takes the Stand 260

41 Juror Number 1 275

42 A New Attitude 283

43 "You Did a Fine Job" 290

44 The Verdict 296

45 Reversal 305

Epilogue 318

Cast of Characters 323

Notes 329

Index 355