computers - his grandfather was an IBM fellow - and had worshiped motorcycles and fast cars. He hung out with a crowd in Los Angeles' Los Feliz neighborhood that vowed to be millionaires by the time they were in their 20s.
A practicing Scientologist, Dayton graduated at age 16 from the Delphian Academy, a Scientology-affiliated boarding school in Sheridan, Ore. But ambition moved him to choose entrepreneurship over college. His first venture was a money-losing coffeehouse named Cafe Mocha, located on trendy Melrose Avenue in L.A. Dayton's next business was a graphic design shop, started with long-time friend Adam Walker.
When another friend introduced him to the Internet, Dayton says he spent more than 60 frustrating hours attempting to establish a TCP/IP connection. The experience sparked an idea for a business: An Internet access provider that would make it as easy as possible for novices like himself to log on.
To fund the venture, Dayton talked to anyone who would listen, eventually hooking up with two Scientologists who would become his first angel investors. He raised $100,000 by selling a 40 percent stake to Kevin O'Donnell - the father of a school friend and founder of Government Technology Services Inc., a Chantilly, Va., computer reseller - and Reed Slatkin, a Santa Barbara, Calif., stock trader, financial manager and long-time friend of Walker's family.
Equally important, O'Donnell and Slatkin acted as Dayton's management and financial advisors, filling gaps in his limited experience. Both O'Donnell and Slatkin remain on the board, and although EarthLink's subsequent private and public offerings have diluted their stakes, they still hold 7.9 percent and 8.8 percent of the company's shares, respectively. The only shareholders whose stakes are higher are Dayton, who owns approximately 10 percent of EarthLink shares, and billionaire financier George Soros, who has acquired approximately 10 percent through several private placements.
In 1994 EarthLink introduced its first sign-on software kit, an all-in-one bundle with TCP/IP, e-mail, a Web browser and other Internet software that was among the first of its kind. To help run the business, Dayton hired friends and drew on management courses he'd taken at L.A.'s Hubbard College of Administration International, another Scientology-affiliated school.
Dayton acknowledges the role his Scientology training played in his career: He says it helped him learn new subjects quickly, think for himself, manage people and structure a growing company.
"I've found that the approaches I started with were totally common sense," Dayton says. "Every good manager applies them anyway."
In EarthLink's early days, some employees objected to the company's Scientology techniques and the company drew suspicion after the Church's controversial role in cases involving free speech on the Internet.
But EarthLink's Scientology influence waned as the company grew, according to people who worked there at the time. The change became most apparent, they say, after Dayton hired Betty, a veteran corporate exec who had run networking-software company Digital Communications Associates and had held management posts at modem-maker Hayes Microcomputer.
Acquaintances such as Linwood A. "Chip" Lacy, an EarthLink director and investor since 1995, credit Dayton with a maturity beyond his years, comparing him to computer wunderkind Michael Dell, who started Dell Computer while an undergraduate. The best indicator of Dayton's maturity was his decision to hire Betty when the company was still small, says Lacy, former co-chairman of computer distributor Ingram Micro.
"We've all dealt with founders who can't make that transition, but he wanted this company to fulfill its destiny," Lacy says.
Dayton's admirers also credit him with the prescient decision not to invest in building his own Internet network. While other ISPs were spending precious capital erecting modem banks and high-speed fiber-optic lines, Dayton figured EarthLink was better off buying access from IP backbone wholesalers and spending its money snagging customers.
In 1995 EarthLink signed a wholesale bandwidth agreement with UUNET, instantly transforming itself into a national provider and giving itself an endless supply of bandwidth. EarthLink immedately cut its monthly fee to
