Michael Dell On How (And Why) His Company Is Named Dell

Michael Dell could have done worse naming his company.

KeePass, PiKock, Vungle and Foodler -- all real startup names that go down in the nerd encyclopedia as the worst names ever for tech startups. So how did Michael Dell end up calling his company Dell? It may surprise you.

If Dell founder and CEO Michael Dell had his way, the company might still be named its original PCs Limited. That's the name Dell gave his company back in the early '80s when he was still building PCs out of his dorm room at the University of Texas at Austin.

[Related: Dell: An Amazing Journey From A To Z]

But then along came a lawyer, as Dell recalled it during the Dell Channel Partner Summit in November in Austin, Texas. He was responding to a partner that asked: "If your name had been Smith, what would you have named your company?"

"I was still working out of my dorm room and I had a customer who was a lawyer," Dell recalled. "And the customer says to me 'Oh, you should incorporate.' And I said, 'Why do I want to do that?' "

Begrudgingly, Dell said he struck a deal with the lawyer. He would upgrade his PC's hard drive and Dell would have his PCs Limited name incorporated. "So I go, 'OK, fine. It's a deal. I'll update your system with a hard drive, you incorporate my business and we are done.'"

And, of course, they were not done.

"I install the hard drive and he comes back to me and says there are two problems," Dell said.

The attorney told Dell the first problem was the name was too generic, so he took it upon himself to name the company Dell Computer Corporation, Doing Business As PCs Limited.

"I said 'OK, whatever,'" Dell said. But then, as lawyers often do, the attorney asked for $1,000. "He tells me you can't incorporate a company unless you have a thousand dollars."

"I don't have a thousand dollars. I tell him it's going to take me a few days to build some more stuff, and I'll come back with the money," Dell said, "and then incorporate PCs Limited as Dell Computer Corporation Doing Business As PCs Limited."

Fast-forward several years to 1987, Dell recalled, and he is establishing Dell's first European beachhead in Great Britain.

"We are launching in the UK, and Andrew Harris [former president of Dell Computer International] says we can't be PCs Limited because as Dell was expanding the word 'limited' made no sense at all," Dell said. "So, what am I supposed to call this thing?"

"We are back in Austin working and are so busy we don't even have time to worry about a name," Dell said. "We are like, 'We don't know.'

"So [Harris] goes, 'I'm just going to call it Dell Computer Corporation because that's the name of the company,"' Dell said. "And so there was a time where we were Dell Computer Corporation in the UK, and we were Dell Computer Corporation Doing Business As PCs Limited in the U.S.," Dell said.

It wasn't until 1988, when Dell completed its initial public offering, raising $30 million with a market capitalization of $85 million, that Michael Dell was finally convinced to change the name to just Dell Computer Corporation.

"A bunch of people convinced me -- and it was not my idea -- to change the trading name in the U.S. to Dell," Dell said.

In 2003, Dell's board of directors is credited for changing the name again from Dell Computer Corporation to Dell Inc. At the time, the board members said the name change, most importantly dropping "computer" from the name, more accurately reflected the company's expansion of selling primarily desktops and laptops to a strategy based on a broader product line that included servers, storage and software services.

But, of course, Michael Dell points out, the real credit goes to his parents.

"That's the story of how our name became the name we have today. But I really thank my parents. Sometimes you're just lucky, and stuff happens," Dell said.

PUBLISHED DEC. 5, 2014