(FORTUNE Magazine) – We need heroes. This is an old-fashioned, even quaint, notion in our cynical age, but it is true. We want to know that there are those among us who have succeeded against all odds. We long for stories that illustrate the highest reaches of the human spirit: courage, persistence, daring, selflessness, determination, and grace under pressure. We hail the pioneer who plows the new furrow. That's because, ultimately, our heroes define us. They inspire us. They remind us we live in a world of boundless possibilities. By example, they urge all of us to seize the day. FORTUNE sees the handprints of heroes all over the explosive story of small-business growth in the past two decades. Among our heroes are those who created stunning technologies and those who seized the opportunities newly created. Technology gave 19-year-old Michael Dell the means to revolutionize the way personal computers were sold and to mount a competitive assault on IBM from his freshman dorm room in Texas. Some of our heroes took a simple concept and made it better. Bill Rosenberg helped thousands fulfill their ambitions to be the boss when he franchised his Dunkin' Donuts chain. And some claimed our hearts with their generosity of spirit. Paul Newman sells salad dressing in order to give sick children a place to romp, ride horses, and forget for a time the hospital ward.

In this issue we inaugurate the FORTUNE Hall of Fame to honor some of the men and women who have rewritten the rules of business and, in the process, helped change the world--or at least their corner of it. There are no Gandhis in this group. Just about every one of these heroes is a rip-roaring capitalist and proud of it. Profit wasn't the high point of their quests, though.

We present you with 15 heroes. How did we select them? To be honest, the process was more art than science. We searched for men and women, famous and reclusive, boisterous and subdued, who have had tremendous influence on small business in the past 20 years--that time of massive growth and popularity for small business. We polled colleagues. We scoured the stacks in the library. We asked leaders in business, law, politics, and academia, and readers of our Website. We debated our list for months, mulling over dozens of very qualified candidates.

In the end the list surprised even us. We chose academics, lawyers, visionaries, dealmakers, inventors, and even an actor. We did adhere to one rule: We weren't going to pluck our heroes from the history books. All our heroes are alive and, fortunately, still engaged in their quests, searching for the next new thing and gracing us with the chance to watch their stories unfold. This is the first of what will be an annual list, and we welcome your input in nominating candidates for future rosters. (Write us at fsb_mail@timeinc.com.)

What a cast of characters we've assembled! The oldest is 84. The youngest is 35. Some have Ph.D.s. Others didn't go to high school. Some were born to upper-middle-class wealth and privilege. Others had a hardscrabble youth. But most of them suffered setbacks and self-doubt. This year's heroes range from the larger-than-life Steve Jobs to the little-known octogenarian lawyer Louise Raggio. Jobs was an obvious choice. He is an icon for a generation of entrepreneurs who want to make money, have fun, and change the world. (Remember his pitch when he was trying to recruit PepsiCo's John Sculley to run Apple? According to Silicon Valley lore, it went something like this: "Do you want to sell sugar water for the rest of your life, John? Or do you want to change the world?") Jobs made business hip.

Raggio is a name few have heard outside her native Texas. She is a heroine in part because of her outrage. This mother of three put herself through law school only to find that the li'l ladies of her home state were barred from business by laws that limited their rights to property and credit. But in the 1960s her quiet persistence and legal prowess upended laws discriminating against women in Texas. In doing so, she helped open the doors to women entrepreneurs all over the country.

Staples' Tom Stemberg triumphed over a career derailment to scale grander heights, and in so doing he provided small businesses with the tools to compete against giants. In Herb Kelleher, we honor an astute businessman who bucked the establishment to launch Southwest Airlines, arguably the nation's best-run carrier. Along the way he set a new standard for employee respect and loyalty. Paul Orfalea proved that a disability doesn't have to get in the way of success--in his case, a worldwide chain of print shops called Kinko's. His business helped build many successful small companies from scratch. Severely dyslexic, he might have difficulty reading the very words here that laud him.

Finally there's the monastic academic, who, of all our heroes, will have had the greatest impact on our lives in years to come: Tim Berners-Lee, the architect of the World Wide Web. He created a legion of multimillionaires--the money continues to ricochet around the economy, gladdening real estate agents, retailers, and charities. But he didn't pocket a dime. He says his greatest ambition is to keep the Web wild, open, and free.

And so, without further ado, we present the FORTUNE Hall of Fame.

Tim Berners-Lee WEB CREATOR

As a software consultant at a physics lab in Geneva in 1980, Tim Berners-Lee began tinkering with a computer program that would allow computers in his lab to share information. Gradually the 25-year-old scientist became intrigued with a bigger vision. "Suppose I could program my computer to create a space in which anything could be linked to anything," he later wrote. "There would be a single, global information space."

The World Wide Web has many builders but one true architect: Berners-Lee. The quiet, self-effacing Englishman devised a way to move documents swiftly and efficiently over the Internet, which was at the time a rudimentary and awkward structure. He set the stage for an unprecedented flow of information that would turn the world's economy on its ear. His network opened the door for many a small business, not only in the U.S. but also overseas.

In the naked capitalism unleashed by the Web, Berners-Lee stands out as the celibate monk. Many inventors clutch their intellectual offspring close until they can wring every penny out of them. Berners-Lee joyfully flung his out to the world. He has turned down every get-rich-quick opportunity offered him, and he is vexed by suggestions that he should have made lots of money off the Internet. "That would be a problem," he once said, "if your only measure of success and happiness is financial gain."

Instead he has chosen a life in academia as director of the World Wide Web Consortium at the Massachusetts Institute of Technology Laboratory for Computer Science, a group that seeks to keep the network open and free. Now 45, he says he shuns the limelight because "celebrity gets in the way of a reasonable life." His latest challenge: creating a network that will understand the intricacies of human language, make logical inferences, and reason on its own.

Michael Dell PC MERCHANT

Michael Dell was supposed to be studying for his premed courses at the University of Texas at Austin in 1984. But all he wanted to do was fool around with computers. He had a nifty little business going in his dorm room, upgrading PCs. Soon that sideline was pulling in $50,000--a month. So he quit school, moved to an off-campus condo, and incorporated as Dell Computer.

The Dobie Hall Room 2713 operation is now the top seller of PCs in the U.S., humbling IBM and Compaq with sales of $25.3 billion last year. Dell did it by being the first to figure out this winning formula: Sell direct at attractive prices, and follow up with good service. Dell's business model not only was innovative but also leveled the playing field for small businesses, providing them with a low-cost vendor. Thirty percent of the company's revenues come from sales to homes and small businesses.

Lickety-split growth led to a few setbacks. Too much inventory in 1989 forced Dell to sell off the excess, depressing profits and postponing his expansion plans. Soon after, an ambitious product line was scrapped because customers weren't biting. Michael Dell, 24 at the time, was worried. "For the first time I started thinking I might be in over my head," he says in his book, Direct From Dell.

Clearly he wasn't. But the startup snags made him an early believer in embracing change and flexibility and, when necessary, sharing the power. Last year he turned the day-to-day operations over to co-CEOs; now he focuses on the future. "To thrive on change," he says, "you must understand how to give in to it, flow with it, and derive strength from it."

John Doerr VENTURE CAPITALIST

In the cannibalistic world of high tech, alliances between entrepreneurs and the VCs who fund them often last only as long as the money is flowing. Partners can become predators overnight, and investors are quick to pounce on failing managers. In this jungle John Doerr stands out as a venture capitalist with a gifted touch and staying power. Ever since he backed his buddy Jim Clark on Netscape Communications in 1994, Doerr has scored hit after hit on the Internet. His list of hot picks includes Amazon.com, @Home, Excite, Drugstore.com, and Healtheon.

Doerr's success comes as much from a commitment to long-term partnerships as from his grasp of technology. A partner at the leading venture capital firm Kleiner Perkins Caufield & Byers in Silicon Valley, he believes a VC's most important tools are a network of contacts and industry expertise. He demands ruthless honesty in assessing up-front risk. His clients say he expertly shapes strategy and picks management teams, then stands back and lets them go to work.

Doerr's network is legend. To stay wired he uses five phone numbers, two cell phones, a two-way pager, and two laptops. On occasion he slips a cell phone into his helmet so that he can ski at Aspen and chat with members of his keiretsu--the Japanese term he uses to describe the tight federation of companies he and his partners have funded. To date the firm has invested more than $1.3 billion in 250 U.S. technology companies, creating more than 192,000 jobs.

Earl Graves PUBLISHER

Think back to 1970. America was reeling from riots, the Voting Rights Act was five years old, and business was a dirty word for a generation that saw empowerment as a purely political issue. Earl Graves, then 35, had a different idea. With a $175,000 bank loan, guaranteed by the Small Business Administration, he started a magazine meant to inspire African Americans to get into business and teach them to thrive. His first target--and first skeptics--were advertisers. The publishing industry in those days hadn't started slicing and dicing the population into demographic niches. More important, a mostly white Madison Avenue had no interest in Graves' particular niche: As one exec told him, advertisers had one image of black customers--"drinking half-pints of liquor and driving used cars."

Over the next 30 years Black Enterprise magazine helped change that mindset. Today there are 880,000 black-owned businesses in the U.S., and Graves' empire is one of the biggest, with a magazine circulation of 375,000 and sales of $47.9 million. The magazine has made alliances inside the old boys' network--with companies such as Walt Disney and Pepsi--and helped black Americans build their own.

Graves' biggest critics now may be within the black community. Harry Alford, president of the National Black Chamber of Commerce, thinks that Black Enterprise--which coined the word "buppie"--promotes a rosy picture of black America that has helped create the backlash against affirmative action. Graves, who favors affirmative action, makes no apologies. "I didn't start out to build a magazine that was skewed to people making $20,000. I was looking for those people making a difference in the marketplace so they could be examples."

And those role models now operate on a scale unimaginable--except maybe to Graves--in 1970. One of the magazine's first cover stories was "How I Started a Business With $1,000." Graves' latest enterprise is to team up with Citigroup to fund African-American entrepreneurs with sums that start at $10 million.

Irv Grousbeck PROFESSOR

Without Stanford University, would there be a Silicon Valley? That may sound extreme, but it starts to make sense when you consider the long list of famous companies that got their start on its campus: Hewlett-Packard, Sun Microsystems, Silicon Graphics, Cisco Systems, Yahoo. Stanford feeds the new economy a steady stream of engineers, lawyers, bankers, and moguls-in-training. At the heart of the academic machine is H. Irving Grousbeck, co-director of Stanford's Center for Entrepreneurial Studies.

Grousbeck teaches one of the most popular courses at the business school, Seminar in Selected Entrepreneurial Issues. Second-year graduate students vie to snag one of the coveted 66 seats. Grousbeck gets the stars of Silicon Valley to come to class to participate in his case studies of their companies. A lecture on Intel? Chairman Andy Grove is likely to be sitting in the front row, answering questions. A lesson in venture capital? John Doerr will be there.

Students say Grousbeck pushes them to think through startup glitches. He teaches from experience. After getting an MBA at Harvard in 1960, he co-founded Continental Cablevision in 1964 with $650,000 in financing. It grew to become the third-largest cable company in the U.S. But Grousbeck left the world of management early. After teaching at Harvard, he accepted a one-year gig to teach at Stanford in 1985. Smitten with the high-tech hothouse, he stayed. Grousbeck, 66, says he doesn't make entrepreneurs, and he takes no credit for his students' successes. "I try to demystify the process," he says.

Steve Jobs MARKETER

In the three-ring circus known as Silicon Valley, Steve Jobs is the man on the high wire. His act is an aerial ballet full of grace, agility, daring, and moments of unbearably painful suspense. Jobs is a showstopper. You can't take your eyes off him--even when Apple's stock tanks, as it recently did. No one has since 1976, when he and Steve Wozniak founded Apple Computer. Jobs' computers quickly found a small but passionate legion of fans. Booted out of his own company nine years later, Jobs was vindicated when he was begged to rescue the failing company in 1997--which he has done spectacularly, debuting a batch of flashy products that include the colorful iMac and the iBook.

Jobs' life in business illustrates the power of a good idea sold well (and the importance of a constant flow of good ideas in the growth of any size business). Apple's machines transformed computing from an occupation dominated by a secret society of hobbits to a tool for the masses. Jobs is an aesthetic genius, coaxing engineers into creating products that are sleek, colorful, friendly, and fun. His marketing prowess is renowned.

From the start, Jobs was a shrewd businessman and a dogged competitor. In the years he was away from Apple, he created two other companies--Next, a software company, and Pixar, the Academy Award-winning animation studio that created the box-office hits Toy Story and A Bug's Life. Back at Apple for three years now, he has learned how to marshal the armies of a big company to work in unison, though he is said to be a hot-tempered and mercurial boss. F. Scott Fitzgerald once wrote, "There are no second acts in American lives." Jobs, 45, is the exception.

Herb Kelleher AIRLINE CHIEF

Zany, with chutzpah. That's the classic profile of an American entrepreneur--at least the Hollywood variety. And Herb Kelleher, founder of Southwest Airlines, could be straight from central casting: a chain-smoking, hard-drinking, hard-driving type who loves to take on the big guys.

But in this case, he's the real thing. Kelleher launched his no-frills, low-cost airline in 1971, years before airline deregulation inspired many another upstart. "A lot of people figured us for road kill at the time," Kelleher says in an article on his company's Website. But customers flocked to the rock-bottom prices ($20 for the first Dallas-Houston flight), and competitors were scared. The now-defunct Braniff, among others, chased Kelleher all the way to the Supreme Court. Kelleher won.

The big airlines were right to be worried. While many of Southwest's imitators quickly failed, Kelleher's baby is now a $4.7 billion operation with 2,600 daily flights to 29 states. It ranks ahead of all the majors in customer satisfaction and on-time arrivals. Most remarkable, perhaps, Kelleher does this at costs 22% below industry averages; he hasn't lost a penny since 1973; and he keeps peace with his 30,000 employees, most of whom are unionized.

Clearly, Kelleher's brilliance wasn't just in seeing the hole in the market but also in fostering the culture he has created at Southwest. His philosophy has everything to do with size: "Think small, act small, get bigger." Kelleher was one of the earliest models for the kind of anticorporate, iconoclastic leader lionized in the late 1980s by gurus such as Tom Peters, who featured him in his 1988 book, In Search of Excellence. Even today it's hard to imagine many bigtime CEOs doing something like this: When flight attendants and schedulers sparred recently over flight schedules, Kelleher had them trade jobs for a day to get some perspective. He may be one of the few CEOs to consider humor a strategic advantage. Employees are screened for it, and Kelleher sets the tone. He has appeared at company events as a teapot, and he once arm-wrestled another CEO for the rights to the slogan "Plane smart."

The downside to such inspired leadership is the danger that your company's charmed life may depend on yours. Now fighting prostate cancer, Kelleher is getting calls from Wall Streeters anxious to hear his succession plan. No comment--yet. "Just because you don't announce your plan," he has told the press, "doesn't mean you don't have one."

Paul Newman PHILANTHROPIST

Paul Newman is teaching the get-rich-quick generation how to succeed by giving it away. In 1982, at the urging of a friend, the actor launched a company to sell a salad dressing he'd whipped up in the kitchen of his home in Westport, Conn. From the start he donated every penny he made to charity. His salad dressing was such a hit that he soon turned his hand to pasta sauces, salsas, lemonade, ice cream, steak sauces, popcorn, and even a line of cookies called Fig Newmans. To date, Newman's Own has given more than $100 million to 2,000 charities.

By giving away all his after-tax profits, Newman has raised the philanthropic consciousness of many business owners--and challenged the conventional corporate notion that generous giving was somewhere in the range of 1% or 2%. Asked recently why he gave so generously, Newman answered, "I don't exactly live low on the hog. I have what I need. Why would I need more?"

Lots of celebs have tried to squeeze a few extra bucks out of their famous names and faces with any number of ventures. (Remember Sinatra's spaghetti sauce?) Few had the business acumen to create a successful company. Newman has been rolling out winning products for 20 years. His signature spaghetti sauce, though pricey, is serious competition for market leaders Ragu and Prego. Sales of Newman's Own products topped $90 million in 1999. The Oscar winner is taking his favorite cause to a new stage these days. He recently spoke to graduate students at the University of California's Haas School of Business about his experience as a philanthropic peddler. "I don't look at it as philanthropy," he said. "I look at those dollars as an investment in a community."

Paul Orfalea COPY KING

School was a struggle for Paul Orfalea. A severe dyslexic, he flunked second and ninth grades. He graduated eighth from the bottom of his high school class of 1,500. "To be honest," he once told an interviewer, "I don't know how seven people got below me." But early failure didn't derail the tall, gawky kid with the curly red hair. The son of Lebanese immigrants, he knew his calling was business--and he figured he'd hire someone to do his reading and writing. He got started early, as a student at the University of California at Santa Barbara in 1970. For $100 a month he rented a small garage behind a taco stand where he sold school supplies and copies. And he put his nickname over the door: Kinko's.

Looking around campus for a business idea, Orfalea noticed what college students needed: notebooks. He began selling them on campus sidewalks. When he opened his storefront, he didn't know whether the business would become a photo store, a stationery store, or a copy center. His customers pointed the way.

From a self-serve copy shop on the edge of campus, Kinko's has grown into a huge chain of 850 stores--and it has been at the epicenter of the small-business explosion. Its stores offer copying and printing, of course, and a host of other essential business services such as teleconferencing and Internet access. Open 24 hours a day, Kinko's has become a clean, well-lighted place where a driven soul can work on a project deep into the night. Millions of small-business owners and fledgling entrepreneurs have made it their second home. Countless business plans have been crafted, revised, debated, and printed on its premises. Kinko's can rightfully claim to be the birthplace of a legion of enterprises.

In 1997, Orfalea turned over active management of the chain to a team of executives so that he could devote more time to peering into the future looking for opportunities for Kinko's. He also gave himself a title more suited to a visionary in the billion-dollar, global enterprise: chief wanderer. Now 52, the chain's famously eccentric founder recently offered some advice on starting a business. "The best place to learn business is at the poker table," he told FORTUNE. "There you learn how to deal with ambiguity, chance, and change. A good poker player calculates the odds and makes his bet. That's what you do in business every day of the week."

Louise Raggio LAWYER

Five years of law school at night while raising three sons was a challenge for Louise Raggio. Passing the bar was a chore. But neither prepared her for the crushing disappointment of job hunting. No one would hire her. In Dallas in 1952, women weren't welcome in law firms--that is, unless they wanted to type and file. Raggio started her own practice, writing wills from home at $15 a pop. That's how she learned that the law was a velvet prison for women. In Texas a married woman had virtually no property rights. Without her husband's signature, she was barred from getting a bank loan or signing a bail bond. Result? "Women simply could not be in business on their own," Raggio recalls.

Outraged, she set out to change the law. Her fight took decades, but she persisted and eventually won. Ultimately Raggio's victories in Texas helped pave the way for women in every state to gain equal access to credit and to start their own businesses. The little-known lawyer is an unsung heroine of the boom in woman-owned businesses.

Her battle took persistence. She lobbied for years for passage of the Marital Property Act. Passed in 1967, it gave women some control over property earned during a marriage. Later she and a group of women lawyers successfully sued several banks, airlines, and accounting and law firms on charges of sex discrimination, opening doors for women in many new professions. She also co-founded one of the most successful women's credit unions in the nation, Women's Southwest Federal Credit Union in Dallas.

The National Association of Women Business Owners recently honored Raggio for laying the legal groundwork for the Equal Credit Opportunity Act. That 1974 law made it unlawful for lenders to discriminate on the basis of race, color, religion, national origin, age, or marital status. Today woman-owned businesses total more than nine million, up from fewer than one million in 1977.

"When I tell young women about the discrimination many of us faced, they think I'm out of my mind," says Raggio, 81 and still practicing law with her three sons at Raggio & Raggio in Dallas. "They think it has always been this way. And, of course, that's the real danger."

Richard Riordan MAYOR

In the early 1990s, Los Angeles was fast becoming an economic anorexic. Corporations were fleeing the city. The firms that were left behind were strangling in red tape and regulation. Surrounded by prosperity, the city itself was wasting away.

Time for shock therapy. Elected in 1993, Richard Riordan decided that one of the keys to economic health was to attract and retain small business. "Bureaucracy was the enemy," he recalls. He privatized the offices that hand out film permits, making it easier for small production companies to film locally. He streamlined the permit process, cutting the time it took to collect permits necessary for business to three months from as long as three years.

Today Los Angeles is enjoying an economic revival, thanks to a flourishing small-business sector. Once-struggling neighborhoods now crackle with the youthful vitality of new media and technology companies. Westwood, for instance, went into a ten-year slump after a series of violent gang incidents in the late 1980s. Today Internet companies fill once vacant buildings, and shops are filled with shoppers. Rents are among the highest in the city.

Riordan the Republican is hardly the man you'd expect to be running the nation's second-largest city. Hollywood's glitter doesn't stick to him. Nor does its Democratic liberalism. A Princeton philosophy major, he made a fortune in the law as co-founder of a private equity firm and as an investor before that. He also owns the Original Pantry, a landmark Los Angeles diner.

He understands business but doesn't worship money. A devout Irish Catholic, he once told a reporter, "God put me on earth to help the poor." His private foundation has given away $30 million, mostly to support education. As mayor he takes $1 a year in salary. His term ends in a year, and he says he won't seek higher office. His next act? Maybe something in education, he says.

Bill Rosenberg FRANCHISOR

Bill Rosenberg was an eighth-grade dropout who got his start hauling a catering wagon from one factory back door to another in the late 1940s. He knew how to please the lunch-pail crowd, with sweet fried dough and a cup of joe. That mid-morning snack was such a hit that he figured he would park the wagon and set up shop in Quincy, Mass. His store: Dunkin' Donuts.

Rosenberg dreamed of scores of doughnut shops dotting the countryside, but he didn't have the money to build an empire. So he decided to share the wealth and franchise. Today there are 3,500 Dunkin' Donuts in the U.S., 99% of them owned by franchisees.

Rosenberg didn't invent franchising, but he came close to perfecting it. Back in the 1950s the industry was booming, but it was rife with scams and failures. Many franchises went broke. Not the folks behind the counters of Dunkin' Donuts, though. Rosenberg sold franchise rights to cabdrivers, retired schoolteachers, and veterans. For $3,000 they got not only the secret to his high-calorie concoctions but also an education in running a business. He wrote manuals that explained every aspect of running a shop, from plowing the driveway to putting the jelly in the doughnut. Rosenberg understood how to win at the franchising game."You weren't just in the doughnut business," said Sid Feltenstein, a former executive for the chain. "You were in the business of making people successful."

Rosenberg sold Dunkin' Donuts to a British conglomerate for $330 million in 1990, but he is not entirely retired. At 84, he is chairman emeritus of the International Franchising Association, a 30,000-member trade group he co-founded in 1960 to clean up the industry. Despite bouts with cancer and a long-running battle with diabetes, he never misses a meeting. "Franchising is the epitome of entrepreneurship and free enterprise," he says. "People want to be their own boss."

Fred W. Smith DELIVERY SERVICE CEO

In 1969, when Frederick W. Smith was peddling a new business plan in Little Rock, he had to rely on some pretty basic communications tools: the postman, Ma Bell, and some of his own shoe leather. No fax, no e-mail, not even an overnight delivery service. In those days the U.S. Postal Service was no endangered species, speedy delivery had more to do with pizza than with documents, and globalism was but a gleam in some academic's eye.

So it's all the more impressive that Smith was able to round up a record $80 million for a not-so-sexy idea: an overnight delivery service. At first FedEx delivered only freight. But by 1981 it had added the overnight letter; in 1984 it went overseas. By 1998, when FedEx pilots threatened to strike at Christmastime, the story was front-page news: FedEx was a necessity of daily life.

Smith had the eureka moment behind FedEx while writing a term paper for his economics class at Yale. He also got

$4 million in starter money from his family. (His father had built the Greyhound bus system in the South.) But Smith had plenty of hardscrabble moments. Once, when cash was so low that the company faced a shutdown, he flew to Las Vegas, won $27,000, and kept the doors open. FedEx changed business life for everyone, but most potently, perhaps, for smaller companies. In 1969 few small-business owners would have dreamed that they'd one day want worldwide, overnight connections. And they need those services precisely because companies like FedEx have leveled the global playing field. Thanks to FedEx, small companies not only can act big but also appear big.

Tom Stemberg RETAILER

Thomas Stemberg gives hope to anyone who has ever been fired. At 35 he was ousted as president of a grocery chain and joined the ranks of the unemployed. On a hot summer weekend he was wandering the aisles of a warehouse club searching in vain for a typewriter ribbon. After all, there were resumes to write and letters to send. At first he was annoyed, then inspired. Why not create a vast bazaar of office products modeled after the wildly successful Home Depot?

That was 15 years ago. Today Stemberg's Staples is a $9 billion retailer of office products with 1,200 stores worldwide. Small-business folk hail him as a champion for bringing them the same low prices on office products that large corporations once enjoyed exclusively. In the entrepreneurial frenzy of the past decade, his stores became a mecca for the self-employed, the moonlighter, and the struggling small-business person, for all of whom saving a few cents on copier paper meant a lot.

Now, using the Internet, Stemberg aims to do the same for his customers with a sweeping array of services, including payroll, printing, insurance coverage, Web design, and domain registration. His goal: "Level the playing field."

Stemberg has enjoyed the sweetest revenge in Staples. It is one of only six companies to reach $5 billion in sales within a decade of its founding. Recently the company stumbled badly in its efforts to launch its Web venture. But Stemberg is undaunted. He remembers opening day at his first Staples, when virtually no one showed up. The moral of the story? Don't ever count him out.

Ann Winblad BUSINESS COACH

Ann Winblad has been confounding the skeptics all her life. One of the first female venture capitalists in Silicon Valley, she made software her specialty back in 1989, when veterans of the money game wouldn't take such a gamble. Software was seen as dull, risky, and a servant to the real star of the tech world, the PC. "People said things like 'Don't those assets walk out the door at night?' " she recalls. Not as it turns out.

Today Hummer Winblad Venture Partners has $850 million under management. Among its successes: Wind River, which boasts a market capitalization of $4 billion, and Powersoft. Winblad and partner John Hummer have backed more than 75 startups. Twenty have gone public. She was one of the first VCs to lead novice entrepreneurs by the hand, nurturing their business acumen and increasing their chances for success instead of handing over the money and running. "They require a coach," she explains.

Winblad speaks from experience. In her early 20s she co-founded an accounting software firm. She and her partners sold it ten years later for $15 million. Winblad's reputation makes her a target for moguls-to-be, who stalk her, waiting for an opportune moment to thrust their business plans into her hands. Last year she got more than 10,000. Only a fraction of them will pass muster.

One that did belonged to Gerry Kearby, co-founder of Liquid Audio, a Web infrastructure company. Before she gave him a dime, Winblad put him through her "Excalibur test," as in pulling the sword from the stone. In his case she wanted him to forge crucial alliances with established companies. He managed to do it, and called her, jubilant. Her response: "Let's build a company."