When Leland Stanford founded his university in 1885, California was caught up in the frontier, in the prime of the Gold Rush. Now, Stanford University is caught up in a new Gold Rush--the Internet era that may have the power to push Stanford above its peer schools and into serious contention with Harvard.

Now, more than a century after its founding, the university is still widely viewed as a pioneer. The seed of practicality that Stanford planted at its founding is bearing fruit in overwhelming abundance. The quick financial fix of the Internet is luring students away from more traditional pursuits, and technology is becoming integral to education, as both a tool to enhance teaching and as an area for further study.

And at the heart of Silicon Valley, Stanford University is in the perfect place to take advantage of the country's latest and perhaps most enduring innovation.

Although almost all of the nearly 20 university officials and professors interviewed for this story shied away from saying their schools "compete" with the Californian powerhouse, Leland Stanford's education startup has become one to watch as technology grows increasingly important in higher education.

Can Stanford challenge Harvard? That may all depend on whether the information superhighway hits a dead end--or keeps going forever.

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With the Internet booming on its Silicon Valley doorstep, recent years have seen Stanford in headlines more than ever before--a draw for students and professors. A snapshot of this year alone is startling.

The academic community took notice two weeks ago when Stanford chose a Silicon Valley entrepreneur as its 10th president. John L. Hennessy is currently Stanford's provost. Soon to be the school's first president with an engineering background, he is the co-founder of a successful microprocessor company, MIPS Computer Systems--and he's wealthy enough to never work again.

"I think many people would agree with the fundamental observation...that the importance of science and technology to the strength (and ranking) of a university has increased. Stanford has great strengths in these areas. These include a large engineering program. Stanford's appointment of John Hennessy as their new President underscores its commitment to these areas," FAS Dean for Research and Information Technology Paul C. Martin '52 writes in an e-mail message.

Leland Stanford's foresight means the university has been committed to a practical focus since its founding. In fact, Stanford was once quoted as saying that college-educated young men from the East were "the most helpless." He was determined that Stanford students would not be the same.

And they haven't been.

The Palo Alto of the 1970s was a sleepier, slower place than it is today, according to Dean of Undergraduate Education William M. Todd III, who spent 16 years as a Stanford professor. But Stanford was exciting and entrepreneurial. The university was a frontier where students and professors got to be technology cowboys, building up the industry by creating companies like Yahoo!--the concoction of two Stanford students, and one of today's most profitable Internet companies.

"Stanford was an early leader in computer science and engineering, and is still reaping the benefits of the vision of those behind the efforts to establish a first-rate department 30 years ago," says Dean of the College Harry R. Lewis '68, who is also McKay Professor of Computer Science.

Decades later, transplanted Todd still admiringly remembers Stanford's pioneering spirit. And he's watching Harvard try to nurture its own.

Other universities are following where Stanford leads, investing heavily in the sciences. The allure of quick money is hard to resist. The frenzy for millions, spurred on by Stanford's characteristic entrepreneurial spirit, has helped make the university what it is today. Now programs similar to those at Stanford are cropping up at universities across the nation, including Harvard and Yale.

In February, Dean of the Division of Engineering and Applied Sciences Venkatesh "Venky" Narayanamurti announced a program to teach undergraduates about high-tech businesses--and how to start them.

It will fall under a new institute tentatively named the Technology and Entrepreneurship Center at Harvard (TECH). Starting the institute signals a major shift in College policy, which currently prohibits students from running businesses in dorm rooms.

At Stanford, the five-year-old Mayfield program pairing selected students with mentors at technology companies has already drawn praise.

Narayanamurti says TECH is most similar to a center he helped start at the University of California at Santa Barbara. But he also notes that Stanford was the first school to teach entrepreneurship within the engineering school, rather than just in the business school.

"There are still relatively few engineering programs that teach entrepreneurship, though the need is clearly being recognized in leading schools," he wrote in an e-mail message.

While Narayanamurti has said TECH's aims are broader than to simply follow Stanford's lead, he has also said that Harvard has to catch up to other schools.

"Stanford has a culture where they encourage the high-tech students. That's new for Harvard," he said in February.

"In some ways, obviously, Harvard's had some very entrepreneurial students over the years, but on the other hand, emphasizing technology and entrepreneurship is not one of the things Harvard did. As a institution or a division, we did not nurture it the way Stanford did."

Dean of the Faculty Jeremy R. Knowles also says that entrepreneurship is becoming increasingly important.

"I don't doubt that Dean Venky's idea of TECH will improve the opportunities for our undergraduates in what (despite the recent fall in the Nasdaq index!) is an important area, of entrepreneurship," he writes in an e-mail message.

According to Narayanamurti, TECH is expected to begin activities this fall.

Only a day after TECH was announced, university officials at two schools confirmed that Yale, Princeton and Stanford had formed an alliance to explore online distance education. The three schools plan to jointly offer courses for alumni. (Harvard, although invited to participate, declined to join.)

The alliance was only the surface of a larger trend: Yale and Stanford collaborating and exchanging information to better round out their curricula.

Yale has long been considered one of the nation's leading schools in the humanities. Stanford has long been considered one of the nation's leading schools in the sciences. Outgoing Stanford President Gerhard Casper and Yale President Richard D. Levin are friends--and Levin is a Stanford alumnus.

Some of Yale's highest administrators even paid a visit to the lush Palo Alto, Calif. campus this fall. In October, the Yale Corporation took its annual retreat to the Stanford campus, where they spent time talking to Casper. Those familiar with the field of university governance acknowledge that the trip was unusual.

"A field trip by a whole board to another university is certainly unusual," Harvard Associate Provost Dennis F. Thompson says. "But I can understand why the Yale Corporation might want to take a trip to Palo Alto."

According to the Yale Daily News, on the retreat, the corporation members listened to three days of presentations about Stanford.

Madeleine F. Green '67, vice president at the American Council on Education says such collaboration can benefit higher education.

"To have three days of discussion with a university that is perceived as the 'competition' is unusual and probably a good idea," she says.

Yale also recently announced a massive investment in the sciences.

Now, administrators there are hoping for more students interested in science. In January, Yale Dean of Undergraduate Admissions and Financial Aid Richard Shaw told the Yale Daily News, "Any kind of extraordinary investment in the future is going to have a huge impact on students' impressions."

Yale is hardly alone in its interest in Stanford: according to Stanford Dean of Admission and Financial Aid Robert M. Kinnally, university administrators from all over the world regularly visit the lush Palo Alto, Calif. campus to figure out what's behind the university's success. He sees about a dozen a year, and turns another dozen away.

"They want to know how we do things here," he says.

Todd points out that at this particular moment in history, the sciences are the quickest route to the top--the financial top, that is. Yale may foster geniuses in French literature, he says, but shining stars in the humanities are more likely to appear later in life, while math and science whiz kids have the opportunity to make it big and flashy before the age of 30. Although both universities are known for offering excellent overall academics, he says, Stanford's traditional strength in the sciences may mean its success is sometimes more apparent, earlier.

This adds another piece to the puzzle. Stanford may be able to capitalize on young alumni with deep pockets.

When TECH was announced in February, Stanford Tech Ventures Program assistant director Tina L Seelig told The Crimson that donors are attracted to Stanford's ties to start-ups.

"Stanford is very aware of the possible relationships with these companies," she said.

With a strong boost from Stanford donors--say, a capital campaign similar to that run by Harvard over the last six years--and strong markets, the gap between Stanford's $6 billion endowment and Harvard's $14.4 billion might narrow considerably.

In fact, last year's endowment figures in the Chronicle of Higher Education suggest Stanford's endowment is already ballooning. Despite ranking only fifth in endowment size--behind Harvard, the University of Texas system, Yale and Princeton--Stanford has the fastest rate of endowment growth, at a staggering 31.7 percent.

Its nearest competitor, fellow technology-oriented MIT, is listed with an endowment of $4.3 billion. Its endowment growth over the previous year is only 16.6 percent.

"Just as Harvard must benefit from time to time from its proximity to Route 128...so Stanford will naturally try to exploit Silicon Valley," Williams Professor of history and political science Roderick MacFarquhar wrote in an e-mail message.

Stanford, more centralized and able to mobilize than some of its older peers, may be able to capitalize on the technology industry unlike any university ever before.

Fighting for Faculty

At the same time, the hated and debated U.S. News & World Report rankings are nudging Stanford even farther into the public eye--and closer to Harvard. This year's rankings show that Harvard's closest competitor among graduate schools is now as likely to be Stanford as Yale. For example, Stanford Business School edged into a tie with Harvard Business School. And in a kind of academic Manifest Destiny, prominent experts in technology as well as other fields are making Stanford the school of choice for many professors.

With the growing financial rewards of technology, Stanford may soon be able to compete even more aggressively for faculty members from Ivy League schools. And this may not be limited to just science and technology.

"Stanford is one of our major competitors for distinguished faculty now, certainly more so than Yale," Thompson says.

One department that's already been hard hit is the American section of the government department, where in 1998, Thomson Professor of Government Morris P. Fiorina packed his bags for a tenured position at Stanford. Theda Skocpol, another big name in that department, told The Crimson last year that she has talked to Stanford officials about heading West.

There's no doubt about it: Stanford has people worried.

"Stanford has been trying to make big raids," MacFarquhar told The Crimson in an earlier interview.

"We have to guard against those sorts of moves," adds MacFarquhar, who also chairs the department.

One college official recalls the Stanford of the 1960s, which cobbled together an outstanding history department from the faculties of the East Coast Ivy Leagues.

"They have a history of doing this," the official says.

According to history professor David Blackbourn, the Harvard-Yale rivalry over faculty is no longer as exclusive.

"It certainly seems to me that there's no longer any very meaningful sense in which the two schools go head to head," he says. "The days of Harvard-Yale narrowly conceived are definitely gone."

As acting chair of the history department last year, Blackbourn twice competed with Stanford to recruit faculty. Once, Harvard won out. But another faculty member ended up going to Stanford.

"Stanford is definitely on our radar screen when it comes to these issues of recruitment," Blackbourn says.

"As one Stanford colleague put it, Harvard is better for undergraduates, Stanford for faculty," MacFarquhar writes.

Head West, Young Men and Women

And where academic luminaries go, students are sure to follow. Stanford's yield rate--the percentage of admitted students who choose to attend--has been steadily increasing over the past several years. Although this is true of a number of top schools, over the past five years Stanford has consistently--albeit slightly--beaten Yale in matriculation rates, coming in second only to Harvard.

Both Yale and Stanford saw the rate jump about 10 percent between 1994 and 1995, when they adopted Early Decision policies.

Marlyn McGrath-Lewis '70-'73 says that Harvard's yield against Stanford, MIT and Caltech is about consistent with the overall yield of 80 percent.

She adds that the admitted student overlap with Stanford is higher than that with the other two, specialized schools.

"There may be interesting developments on the way there, but so far we don't have data to support them," she writes in an e-mail message.

The Pieces of the Puzzle

Last week, as the stock market took a serious nosedive--especially in technology areas--some debated whether Stanford could sustain its meteoric rise.

Dean of Undergraduate Education William M. Todd, offered a word of caution about Stanford's newfound endowment wealth.

In response to the market's recent dive, he said, "If you wait a few days to publish the article, this may be a non-problem, although the rest of us will have dropped off proportionately."

But no sooner had Todd spoken than stocks began rebounding. The Internet is not about to disappear--and neither is its university cohort.

Martin observes that any well-funded organization is a better contender in its field.

"If enough people give any organization enough funding, it can--with excellent leadership--become a strong competitor," he writes.

And as Kinnally says, "I do think that when you think of the computer industry...you think of Stanford."

Over a hundred years old, Stanford is still new, still different. To Kinnally, it's that same pioneer spirit.

"We're the frontier... and that's what we do," he says. "We push it. And I think students like that.

What it takes to be one of the top schools in America is constantly evolving. The challenge for schools like Stanford--and Harvard--is to stay ahead of the game.

"If you want to stay on the cutting edge of Silicon Valley, you've got to keep inventing it everyday," Kinnally adds. "And we do."