My philosophy around achieving results is simple:
- Focus on Culture first – people power (A-Team) is what allows you to reach and/or exceed your goals. This is a lot more than company values. But to keep it simple…sure, it can start there.
- Establish a Strategy second – you need an anchoring vision and mission. But you also need a clear view of what success is, and a reasonably strong path to it (this means knowing where you are, what the end-goal is, and applying playbooks to get from A to B).
- Execution is third – ok, I’m a data-driven person. So let the data tell you how you are doing – then constantly coarse-correct, and constantly drive change. If you don’t know the key metrics of your business, you are not earning your CEO paycheck.
That’s it. Simple right? It’s never simple, and it’s never easy. I feel lucky having a broad level of experience, as I reflect on what my teams and I have accomplished in the decade between 2009 and 2019. It’s a discussion I have with my staff, my peers, my investors, and ultimately the people who hire me…my Board members. At a high level, most people care about the scale of the businesses you’ve led, and the corresponding growth rates you’ve achieved as a result of your leadership. So, to start, here are my four past businesses:
- $0-$50M: Infochimps Big Data Cloud: Aug 2012 – April 2015 (2.5 years; 3x YoY growth)
- $165M – $250M: CSC Big Data & Analytics: April 2014 – April 2015 (1 year; 51% YoY growth)
- $940M – $1B: CSC Digital Applications: Aug 2015 – Jan 2016 (6 mths; 12% YoY growth)
- $5.5M – $17.5M: Janrain: April 2016 – Jan 2019 (2.75 years; 48% YoY growth on target enterprise revenue from clients >$1B; ending total revenue was $22M – including $ from clients <$1B)
Not only did I love my experience in leading growth with revenues from that magical VC range of $0 to $50M, but I really enjoyed my time leading/operating at mid-market PE revenue size businesses as well – including $250M and $1B. The caveat on all four of these businesses; however, was that we had to reposition / turnaround the business while growing it. Many would view this as impossible – you either have turnaround or you have growth, but not both.
Here is a little more detail on my experiences over the last decade (2009 – 2019):
|Janrain: Digital Identity Security from April 2016 – Feb 2019 (2.75 years)||
[My best source of fact checking: Janrain CFO, Martin Day.]
|CSC: Digital Applications from August 2015 – Jan 2016 (6 mths)||
[My best source of fact checking: CSC Apps CFO, Vaibhav Kalra.]
|CSC: Big Data & Analytics from May 2014 – August 2015 (1.3 years)||
[My best source of fact checking: CSC BD&A CFO, Jamie Kanski.]
|CSC: Big Data Cloud from August 2013 – May 2014 (9 mths)||
|Infochimps: Big Data Cloud from August 2012 – August 2013 (1 yr)||
|PARC / Quantiply: Advanced AI/Machine Learning from October 2011 – August 2012||
|SIOS: Private Cloud from January 2010 – June 2011||
|Express Ventures / StackIQ: Private Cloud from October 2008 – December 2009|
The above was a decade of building my CEO playbooks. Another decade of work (1998-2008) prior to this included:
- Eyespot Video Network: Video SaaS from March 2005 – December 2008
- Integral Semiconductor: Power Semiconductors from January 2005 – March 2005
- INCEP: Semiconductor packaging from November 1999 to December 2004
- CDI: Semiconductor design from November 1998 to October 1999
These four companies were early in my CEO career – not only learning to be a CEO (with initial help from Jack Shemer) but also moving to SaaS as a delivery model. And then there’s the beginning of my career prior to jumping into startups (another decade+ from 1986 – 1998):
- Teradata: BI, OLAP & Data Mining Program Management, Product Management, and Product Marketing from 1996 – 1998
- AT&T: EDW Technical Consulting & Professional Services from 1992 – 1996
- NCR: Enterprise Data Warehousing (EDW) engineering from 1988 – 1992
- Digital Sound Corporation (later PulsePoint Communications): Digital voicemail engineering from 1986 – 1988
- Lockheed Martin: Space engineering in 1986
That’s a time that included electrical and then software engineering, professional services, product management, program/solution management, and finally marketing….I learned various functions of the business before jumping into my CEO game.
Plan vs. Actual
My recent 2009-2019 decade included P&L experience with revenue ranging from $1.4M at Big Data Cloud startup, Infochimps, to running a $1B P&L in the largest cell of the matrix at publicly traded, CSC. So how did my results compare to what was expected? What was my mandate at each company?
|Company||Board Mandate||Versus Actuals|
|Acquisition by Akamai Technologies
|CSC Digital Applications
|Operating Income (OI) from 0% to 11%||OI = 20% (by end of fiscal Q3, Dec 2015 on $1B)
Revenue growth from -5% to +12%
|CSC Big Data & Analytics
|Increase YoY growth of revenue from 0% to >20% on a base of $165M||YoY revenue growth = 51%|
|Company integration w/ 90%+ retention; support plan for 2x revenue growth w/in first year of combined operations ($6M run -> $12M annual)||100% original staff retention; contribution to >33% of pipeline, $50M in revenue by fiscal-end 2016 (20% of total).|
|$0M to $3M in revenue + Series B financing of $10M||$0 to $6M in revenue run rate + acquisition @ >21x Rev TTM of $1.4M|
|PARC||Research technologies available for “spin-out”; launch a startup based on PARC technology||Spun out into Quantiply.|
|SIOS||Build new subsidiary of cloud (as a “spin-in”); launch cloud services based on open source technologies; potentially fund and spin-out subsidiary.||Created Board-approved 5yr business plan; hired 60+ team; established alpha release of private-cloud PaaS product (CASPIAN); established WIPRO as go-to-market partner; secured Citigroup as lighthouse customer (sponsored by Citi EVP/CIO of Retail Banking); created a pipeline of F500 in early proof of value (e.g. UBS, JPMorgan, Flextronics, Walgreens)|
|Express Ventures||Incubate a new startup||Spun technology/team out of UCSD supercomputing center (Rocks) + combined with delivery partner/company (ClusterCorp)+ repositioned to focus on cloud computing = founded StackIQ; helped secure lead investor (Brian Mesic @ Anthem Ventures), which led to successful exit to Teradata.|
A focus on Global 1K
I have focused on B2B all my career and on larger clients with $1B in revenue or more. Here is some of my direct experience with customers by vertical:
- Citi: Enterprise PaaS SW; Digital Applications
- Mastercard: Digital Identity SaaS; Big Data aaS; Digital Applications
- PayPal: Analytics aaS
- Visa: Big Data aaS
- Wells Fargo: Big Data aaS
- AEGON: Big Data aaS
- MetLife: Mongo aaS
- StateFarm: UBI Offering
- AllState: Digital Applications
- Farmers: Big Data aaS
- Manulife/JohnHancock: Big Data aaS
- Esurance: Digital Applications
- CISCO: Big Data aaS
- Rogers Communications: Digital Identity SaaS
- AT&T: Digital Applications
- Torstar Corporation: Digital Identity SaaS
- Fox Media: Digital Identity SaaS
- PostMedia: Digital Identity SaaS
- NBA: Digital Identity SaaS
- McDonalds: Digital Identity SaaS
- PetSmart: Digital Identity SaaS
- EBay: Analytics aaS
- Kroger: Digital Applications
- Procter & Gamble: Digital Identity SaaS
- Coca-Cola: Digital Identity SaaS
- Sanofi-Aventis Group: Digital Identity SaaS
- Johnson & Johnson: Digital Identity SaaS
- Philips Global: Digital Identity SaaS
- Merck & Co: Digital Identity SaaS
- Eli Lilly: Digital Identity SaaS
- Pfizer: Digital Identity SaaS
- HGST-WesternDigital: Big Data aaS
- Huntington Ingalls Industries: Big Data aaS
- CAT: Big Data aaS
- Globe Telecom: Digital Identity SaaS
- Qantas: Digital Identity SaaS
- Oil & Gas
- Shell: Digital Identity SaaS
Sales – Growth & Turnaround
Most of my career has been focused on growth. Janrain, CSC Digital Applications, CSC BD&A, and Infochimps were all turnarounds from the sense that they required “fixing”. But there was always a strong focus on growth while tending to operations. Here’s one way to gauge my sales experience:
- From $15M to $23M (40% YoY bookings growth)
- From $5.4M to $17.5M in enterprise revenue (48% YoY rev growth)
- 3 to 10 AEs (11 ISRs + 3 AEs -> 0 ISRs + 10 AEs)
- CSC Digital Applications:
- $1B (no change)
- 100 AEs ( no change )
- CSC Big Data & Analytics:
- $165 to $250M revenue (50% YoY revenue growth)
- 50 to 25 (reduced HC and increased bookings perf)
- CSC Infochimps:
- $6 to $50M revenue
- 5 to 10 AEs
- $0 to $6M run rate
- 0 to 5 AEs (1 part-time sales -> VP + 4 AEs)
Largest increase of enterprise value at a company
When I was asked to combine consulting and application development practices of IBM, Oracle, SAP, Microsoft, Workday, Salesforce, and ServiceNow we were operating $1B revenue at 0% OI. The soon to be created business unit, Digital Applications, within the Americas was a team of 7,000 (3500 onshore and 3500 offshore) with 30+ direct reports.
Within the 6 months we achieved +20% in OI. This was an improvement of 20% in profitability on $1B for EBITA improvement of about $200M trading at about a P/E ratio = 10 in Jan, 2016. You can do the math. This equates to about $2B in enterprise value. It was the most political of my adventures, and the first time in my career where my focus was not on growth, but rather on profitability. But I’d do it all over again. It was a strong chapter in my career.
If you are wondering how we were able to achieve such an incredible impact on the business within only 6 months, it comes down to math. We knew that billability, which was less than 50% needed to be brought up to the absolute max of 90%. This was achieved by hiring Beeline and Pantoon to create a virtual temp to hire workforce that we could draw upon at a moment notice. Then for full-time staff, we instated a “1-day bench” policy. If you were on the bench for >24 hours, you were RIF’d. Of course, our operations staff was available to help you find jobs well in advance of the completion of your current assignment. So, if you were proactive, work could be found before you finished your current assignment. Only 3 people were on the bench out of 7,000 when we handed over the business.
Biggest Career Accomplishments
So “what are your biggest career accomplishments?”
- Successful turnaround and sale for PE-backed startup ($125M on $20M revenue at time of term sheet = 6.25x (no hidden fees or earnouts); 44% IRR; 3x CoC; closed 2018 @ $23M in revenue)
- CSC Digital Applications
- Successful turnaround from 0% to 20% OI; -5% to 12% rev growth
- CSC Big Data & Analytics
- Successful turnaround from 0 to 51% YoY revenue growth
- CSC Infochimps
- Successful M&A integration with 100% retention
- Successful turnaround and sale of VC-backed startup ($30M sale on $6M annual runrate; $1.4M revenue TTM = 21x)
- PARC / Quantiply
- Successfully commercialized graph analytics technology (Quantiply “Genome”) & later spun out team to start Quantiply Corporation.
- Business plan to first banking client in less than 12 months – Recruited team, built private-cloud platform (CASPIAN) MVP, partnered with WIPRO, and sold to Citi.
- Express Ventures / StackIQ
- Successful spin-out to form StackIQ which later led to acquisition by Teradata
- Created profitable mobile video-add network as part of video streaming aaS which was sold to PixelFish
- Captured Intel design win for Itanium 64-bit microprocessor chip packaging / power supply and sold to Molex
- Led Development of in-database analytics (breakthrough in industry)
- Helped invent BYNET (1 of 5 engineers), which made Teradata platform linearly scalable (allowing Teradata to maintain #1 position in Enterprise Data Warehousing)
Turning Points in my Career
As anyone reflects on their results over their past, you have to also reflect on the events/people that shaped your career philosophy?
- Personal Interest in Engineering:
- When I was 5 years old, I disassembled my remote control car (TransAm) that I received at Christmas. This later led me to becoming an EE/CS engineer.
- Personal Interest in Business:
- When my father (US Army Ranger) could afford to buy our first house (San Jose, CA), it was a true fixer-upper. This led me to understand the link between your job and having enough money to live comfortably. This later led to my wanting to get my MBA and start my own company as an entrepreneur.
- Leaving Engineering:
- When I accepted the side-role to support a Customer Sponsorship Program at NCR/Teradata (as a technical resource to the sales team on marquee customer accounts like BofA), I knew that I wanted to be closer to the customer. This led to my taking a “technical consulting” job later – which essentially accelerated my jumping to the “dark side” of business (I was no longer technically an engineer anymore).
- Success at TRW Credit:
- I took on our largest customer project at NCR/Teradata (driving over $40M in new revenue) as a program “lead”. It was a failing project which we turned around within six months. This led to my interest in managing multiple aspects of the business and ultimately launched me into a Product Management role. This was my final transition from being a techy, and Product Management would forever secure my thinking that I needed to start my own company eventually.
- Data + Business Intelligence = Insights:
- I took over all analytic products (OLAP, Data Mining, Query Tools, BI Tools) at Teradata. This secured my love for data and being data-driven (using data to run my business, and using data as a way to differentiate products/services). This Product Manager role led to my developing the skill sets to becoming a data-driven CEO.
- Marketing & Sales is the Magic:
- I took on a Dir of Marketing role at Teradata because I was curious about how to segment, market, and sell to customers. It was the most nebulous role in my mind. My job was to create a new Teradata offering (on NT), partner with Microsoft, and sell into a smaller mid-sized customer base running their business on MSFT NT (Mid-market). This later led me to taking on a VP of Sales & Marketing role in a startup, and helped me later to become a sales & marketing-centric CEO.
- My CEO Role inspired by Jack Shemer:
- I co-founded my first company, INCEP, with Jack Shemer, co-founder and CEO of Teradata; and his co-founder, David Hartke. Jack was Chairman and my mentor. David was our Chief Scientist. Jack helped us recruit a power-house set of board members: Phil Paul (Paul Capital, Top Tier Investments, grandfather of the VC model at Hillman Ventures), Bob Adams (president of Xerox’s Printing Systems, CEO of Xerox Technology Ventures, Founder of Documentum), Art Collmeyer (grandfather of the fabless semiconductor model at Weitek Corporation). We had a “dream-tream” as a Board of Directors and I had the “Jack Welsh of data warehousing” as my mentor. Jack and this Board gave me my wings as a CEO.
- G2M is everything:
- When Mike Fister called me to tell us that the Itanium 64bit Intel microprocessor was dead, my dreams of making it big were lost. Mike was the SVP of the Enterprise Platforms Group reporting to Craig Barrett, CEO of Intel. We only had resources to place one bet – and that bet was on the future of microprocessors at Intel – the Itanium. That was a turning point in my career. G2M became my focus after that day – I no longer could rely on just technology innovation.
- Cloud as a delivery Model:
- When both our primary and secondary data centers went down at Eyespot, a video streaming and ad-network service, it reinforced my appreciation for cloud with AWS and now Azure, and GCP. This was a turning point for me as an executive. I look for cloud as a delivery model for everything I’m involved with at this point.
- Spin-outs and spin-ins:
- My very first company was a technology spin-out. INCEP Technologies was spun out of technology and people from my first startup, Convergence Design Inc. I held the “day job” while working evenings and weekends to spin out and form INCEP Technologies. I also led a spin-out at the UCSD Supercomputing Center to help form StackIQ; then effectively a spin-out at PARC, a Xerox Company to help form Quantiply, and finally I got creative structuring a spin-in at SIOS Technology, a publicly traded firm in Tokyo, where we secured $20M in a funding commitment over 5 years from the CEO and his Board to establish a new cloud computing business. A “spin-in” is a form of R&D in which a company is the sole investor in a startup. It sends a team of employees off to build an experimental product and then buys that startup for a predetermined and very healthy price. Having reflected, each was a tipping point for me, and each has since shaped my perspective on how companies should get started.
- I’ve been invited into four “turnarounds”, where existing leadership has not been successful in leading their team through a much needed change in the business.
- At Infochimps, the last investor, John Frankel, founder of ff Ventures, convinced me to jump in where I helped the team pivot their business from a data marketplace to a Big Data Cloud service.
- At Janrain, John Kim and Brian Peters, Managing Partner and Managing Director, respectively, at PE firm HighBar Partners, convinced me to jump in where we pivoted their business from a marketing-centric company focused on SMB to a security-centric company focused on Global 1000.
- At CSC/DXC I was viewed as a turn-around leader for their Big Data & Analytics and then their Digital Applications businesses. With BD&A, G2M had stalled due to a lack of focus – too many offerings, too many unproductive sales people, too many client targets. Reducing sales from 50 to 25, reducing offerings from 30 to 5, reducing client prospects from 3,000 to 77, and aligning by industry…all these changes created the growth demanded by the business. With Digital Applications, moving from <60% to 90% billability was accomplished by creating a “1-day bench policy” where people were only given 24 hours to find new billable work. This was supported by providing an operations team that helped staff find new work well ahead of the completion of their existing projects, and outsource partners (Beeline and Pontoon) who could provide a virtual bench with a 90-day temp to hire business model.
- I’ve been invited into four “turnarounds”, where existing leadership has not been successful in leading their team through a much needed change in the business.
My core philosophies as a CEO have evolved across all my experiences – 10 years at a NCR/AT&T/Teradata, 3 years at CSC, 9 years at startups. I’ve learned that success comes from the power of your people. In fact, in my world of high-tech our competition will always have access to similar technology; we’re all selling to the same 1000 clients globally; we have access to the same capital (VC or PE); and we’re recruiting from the same resource pools….so, true competitive advantage doesn’t come from these, but will ultimately be created through the team you hire, nurture, and invest in.