Bart: [00:00:00] Gary, really happy to have you in today,
[00:00:03] Bart: [00:00:03] So let’s go back to the beginning. is is the beginning business school? I know you went to Kellogg.
[00:00:09] Gary: [00:00:09] Yes, I did. Well, the, the beginning for me was when I graduated from undergraduate. school at the university of Utah, I went to work for Proctor and gamble, and that was important because it guided the decisions I made about careers from the future.
[00:00:25] Principally. P and G knows how to market. And I wanted to understand that from them. I thought it was important. Maybe more importantly, they grow at 7% a year, every year. And that was very frustrating too to me. And so when I went back to visceral school and then graduated, my first criteria was I didn’t want to be with a business or even in, in an industry that grew slowly as Proctor and gamble did.
[00:00:49] So it was important for important for me to get, to a place that. Real quickly. And of course Intel was the obvious choice because that industry was growing much more rapidly than any others that I looked at.
[00:01:03] Bart: [00:01:03] Yeah. It’s interesting because 7% a year doesn’t sound like a lot unless you’ve been around for a hundred years
[00:01:10] Gary: [00:01:10] and it
[00:01:12] Bart: [00:01:12] starts to compound and it’s pretty interesting.
[00:01:15] Yeah. But no, I understand. And I, I, I love, you know, fast growing startups. That’s what blip is right now. It’s exciting to be a part of. and so, I mean, where did you go from there? You, you say Intel, was it growing at that pace? At that time?
[00:01:30] Gary: [00:01:30] Well in those days, Intel was around a $200 million company, which at the time sounds large, but by Intel standards, it was a really small, small company.
[00:01:41] Gordon Moore, Andy Grove, and Bob noise, all roam the halls and were all working there. I had an opportunity to work reasonably closely with the both Andy and Gordon. More of, which was an incredible, is amazing, credible opportunity. And, Intel is just gone through a really difficult phase where they almost a, almost a liver die phase because they early on were heavily into digital watches, into calculators, and into, memory.
[00:02:06]and all three of those things turned out to be commodities. And until I ended up writing off. you know, a large portion of their investment.
[00:02:13] So it was a, it was a fascinating time to. To join.
[00:02:17] Bart: [00:02:17] So how long were you at Intel?
[00:02:20] Gary: [00:02:20] So I stayed there for two years, and, I loved my time at Intel. Probably better than. Any other, any other position I’ve had.
[00:02:28] It was such a wonderfully run company growing so fast and, but I had an experience at Intel that really laid the groundwork for me to go. To work at Oracle. So I knew about Oracle. There were only three people when I first learned about Oracle three, Larry, Bob miner and felon, and Bruce Scott.
[00:02:48] Bruce was a close friend of mine, and he kept trying to get me to take a look at, at Oracle, and I wasn’t. Interested because until was so, we’ll so good.
[00:02:58] Bart: [00:02:58] How long had Oracle been around at that point?
[00:03:00] Gary: [00:03:00] About three years. So we were still on Oracle version one, well, which we call version two.
[00:03:06] Bart: [00:03:06] Did it include revenue at that point, or,
[00:03:08] Gary: [00:03:08] yes. Yes. Yes. When I, when I ended up joining the joining the company, Larry told me our revenue was $5 million. And I thought, well, that’s, that’s respectable. And then I’d been there for two or three months and we went into the conference room.
[00:03:21] We were having a big celebration. And I said, what are we celebrating? And. The marketing director turned to me and said, we just hit $1 million in revenue. Well, I turned to look to Larry looks at Larry and said, a million or 5 million, and he sort of rolled his eyes and then we went on. We went on with a celebration, but to, to leave, to leave Intel was, was difficult.
[00:03:45]I, I. Talk to Larry for about six months before I actually ended up joining. We had frequent lunches and I finally realized that Larry had a vision for the business. That, that to me at least was, was unique in the business world. He phrased it as, Gary, I think business ought to be a lot more like baseball.
[00:04:06] And I sort of looked askance and said, what do you mean by that? And he said, well. In baseball when babe Ruth was, was, the best player in the major leagues, he was making $100,000 a year and some rookie pitcher would make 60 or $70,000 a year. Now, of course, this was in 19. 82 now, so you’ll recognize the name.
[00:04:28] Reggie Jackson makes $4 million a year, and some rookie pitcher makes two or 300,000. So, they’ve recognized baseball teams have recognized that if you can hit home runs in October, and if you can fill a ballpark, you’re worth the infinite amount of money. And that’s not, that wasn’t the case.
[00:04:45]previously in baseball. In fact, he said, you’ll be surprised, but we have three or four programmers here, who make over $200,000 a year. Well in those days, that was a lot of, that was a lot of money for a programmer. But he said, if you, if these guys can do something in a few hours, that would take someone else months to do, how can you say they’re not worth that?
[00:05:05] And so I, I embraced that philosophy. Same thing with sales. And I knew that no matter how, No matter how tight it was for the company, they’d recognize achievement in a, in a big way. And that, that was attractive to me.
[00:05:20]Bart: [00:05:20]
[00:05:20] Gary: [00:05:20]
[00:05:20] Bart: [00:05:20] So Oracle was looking for, Larry was looking for more of that account management from you?
[00:05:26] Gary: [00:05:26] Yeah, he was, he was looking for sales and I joined, I joined with the understanding that I’d become a vice president of marketing. And two or three days after I joined, I learned that the fellow that they’d hired at Oracle, they’d fired at Oracle, decided to come back.
[00:05:44] And so, I went into Larry’s office as well. What does this mean for me? And he said, well, we’re going to make you a salesman. You’re going to go to Chicago and be a sales salesman. And I said, well, it wasn’t exactly what I signed on for. Wasn’t what I had in mind. but he said, look, in this, in this company, if someone can sell and learn how to present relational database in a way that people, understand it and accepted, the sky’s the limit, and that’s where the greatest opportunity is for you.
[00:06:14]trust me. It’ll work out well. And so we moved back to Chicago. We, we’d been, we lived there during business school. But it was basically, it was moving back and having a 10 state area and, and, being a sales rep.
[00:06:27] Bart: [00:06:27] did people recognize the Oracle brand at that time? Probably not as much at all.
[00:06:31] Gary: [00:06:31] Yeah. The, the only thing they would recognize is that relational database in some people’s minds was the technology of the future. IBM had a product and there were several competitors had relational databases in those those days. But we, we struggled and they struggled to articulate the value proposition in a way that people really understood why they needed relational database.
[00:06:55] Cause there were. There were various kinds of databases out in the marketplace and they weren’t relational. And so we were the first relational database out there, and we had to convince people, not only that they wanted Oracle, what more importantly, that they needed a relational database management system.
[00:07:11] Bart: [00:07:11] So it’s easy to look back now and be like, this was Intel, this was Oracle.
[00:07:16] You know, these are big names that most everybody recognizes. did you at the time have any sense for how. Big tech was going to be in general or how successful Oracle would be.
[00:07:29] Gary: [00:07:29] Well, nowhere near what it actually became. I remember when I told my father who’s a coal miner and a union man up in Northern Utah and in Wyoming, and who is of the belief that you have.
[00:07:46] Get one job and to stay though the rest of your career. So when I told him I was leaving Intel, he was really upset. Well, why would you do that? And then he asked me the salient question, which is, what do you think the chances are that this company will succeed? And he was talking about Oracle, and I said, well, I think there’s about a 25% chance they’ll succeed about a 25% chance they’ll.
[00:08:08] Go under and about 50% that they’ll sort of languish in mediocrity. And at that point it was like, you have to be kidding. You’re, you’re leaving this great job with Intel for a 25% chance that we’ll succeed. And I said, Oh, dad, you don’t understand. I mean, if it succeeds, it’s, it’s, it’s such a big market in such a huge opportunity.
[00:08:29] It’ll be easily. It’ll be easily worth it. That the other factor is that when, when you’re betting on a company, I like to be in a situation where you have. Part a of the ability to control the bet you’re making. And I knew from spending the time I had with Larry that, if we could articulate a value proposition that people would buy and we could actually sell this stuff, so to speak, I knew that Oracle was going to be successful and I figured, why not?
[00:08:57] I mean, I’ll go into a situation where I can perhaps learn to sell it. Show people how to sell it, and if I do, the worlds that are feet turned out to be the case.
[00:09:06]Bart: [00:09:06] Can you remember if there were any big competitors at the time that you, you know, that had the name brand that were doing anything similar.
[00:09:15] Gary: [00:09:15] IBM was, had established the ratio relational database marketplace had announced a product as usual. They hadn’t delivered on it, but they had announced a strategic intent. And then there was a company in Berkeley called ingress that, was. Frankly, technologically was superior to Oracle, is superior in almost every, every way.
[00:09:38]the trouble is they had no ability to market or sell the product. And so, we, we competed against them on a head to head basis and we finally got to the point where we just absolutely shut off their oxygen that we had. We had our equivalent of the crush program. At Intel, and this was a shut off the oxygen program where we, we did literally anything that was necessary, anything that was ethical, unnecessary to win against them.
[00:10:06] So if we had a normal price of 40 or $50,000 for a single license, and we competed against ingress, if we needed to, we’d go down to 10 or $15,000 just to take them out of the marketplace. And, and we did. They became a. They became a non a non entity.
[00:10:22] Bart: [00:10:22] You know, this is really interesting. I find the like seventies 80s and nineties kind of competitive strategic environment to be so different from today.
[00:10:33] So fascinating. How. Intel and even into the two thousands, like Intel crushed AMD, they crushed other competitors earlier. And it was all a big strategic, you know, they, they were very conscious in the way that they did that. And it sounds like Oracle was to also, I feel like today you certainly, there’s competitive, you know.
[00:10:55] Kind of jockeying out there. I feel like today it’s turned into, there’s less, kind of strategic positioning in terms of being able to block people out. And EV and a lot of it’s more based on just value creation and getting to. Almost like a majority or a category leader type of position first, kind of that first mover advantage or category leader thing.
[00:11:22]and then it’s really more just being top of mind for most people and creating an ecosystem and all that thing, but it’s less like I could just go and crush someone. It’s more like I have to compete on the value that I’m creating and then getting there first. Is that,
[00:11:36] Gary: [00:11:36] do you think that’s fair?
[00:11:37] Absolutely. You’re absolutely right. the, the bare knuckles days of the eighties and nineties, just or even even early 2000, are just behind us. And, and frankly, it’s a lot to do with company strategies. They, they literally want to put together a strategy where they aren’t dependent on, winning, had to, had sales sales battles.
[00:12:00] They want to. Maintain a higher share of mind. They want to get more, get more clicks than the other guy. They want to get more leads in the, and, and when you, when you’re in a business where you’re selling subscription revenue, the actual sale itself isn’t quite as competitive as as it is when you’re, when you’re competing with someone.
[00:12:20] And if you, if you win the deal, it’s, it becomes a standard forever. I mean, theoretically, someone who subscribes to your service. Can can an unplug you a month later if they’re not, if they’re not happy. And so, I think that as I talk to companies, I think one of the big mistakes they’re making, but frankly, the pendulum is swinging back, is that they don’t value,
[00:12:41]Good old fashioned marketing. Like, I mean, how many companies would have a marketing brochure that specifically lists three other competitors, what the competitor does and what they do and you know, bullet points under each one whether it’s benefit. Well, of course we used to do that all the all the time, but now, you know, it’s just, it’s almost like it’s, people have their white gloves on and, and white shoes and don’t want to really get.
[00:13:06] Don’t want to really get their hands dirty. But, that’s, that’s, that’s what’s missing from, you know, the, the ability to go in and win a head to head sales battle. It’s just missing from a lot of companies today.
[00:13:18] Bart: [00:13:18] So maybe there’s some things we can learn from that kind of competitive environment back in the day.
[00:13:24] We may be swung too far in some ways.
[00:13:27] Gary: [00:13:27] I think that’s the case. I, I, I talked to a lot of companies and I, and I advised some companies, and it would, it would shock you how many companies have raised 50 to a hundred million dollars. Have. The seeds of a good product, but when you’re really sit down and ask them, okay, how does your product, compete against so-and-so in such and such marketplace?
[00:13:50] It’s like, well, we don’t exactly compete against them. We’re a little bit different. I mean, people’s favorite phrase is, well, no one competes with us. We don’t have any competitors. Well, believe me, there’s some good things to that, but there’s some really bad things to that. There’s nothing quite like having.
[00:14:06] When you don’t, when you’re talking to someone and they ask, can you, what does your product do? It’s, it’s, as long as you’re better, it’s really convenient to be able to say, well, we’re just like, so-and-so only we do this better. And we do that better. Because at that point, they know exactly what you, what you are, rather than trying to grapple for a value proposition.
[00:14:28] Bart: [00:14:28] Right. Yeah. That’s a really good plan. So. It’s both beneficial potentially in the sense that if you have a good competitor, you can kind of learn from them. They can kind of learn from you. You both are creating better products than you would otherwise. But two, it’s easier to just help people understand how you’re unique.
[00:14:46] Right,
[00:14:46] Gary: [00:14:46] exactly.
[00:14:47] Bart: [00:14:47] I love that. So tell us a little about, you’re a tenure Oracle. I mean, you started. Out working in Chicago and sales and you had 10 territories, it sounds like, or 10 regions, 10 States within your region. And you eventually were president and kind of part of that growth until when did you work at Oracle?
[00:15:08] Like
[00:15:08] Gary: [00:15:08] what year? I was there from 1992 to mid 19, late 1990s. So I was there about nine years.
[00:15:16] Bart: [00:15:16] Okay. And, what was that like? Was it, was it crazy growth?
[00:15:22]Gary: [00:15:22] yeah. I mean, it was a, it was a time that. almost can’t be, it can’t be described. It was said a little trite to say it was the best of worlds and the worst of worlds.
[00:15:31] Bart: [00:15:31] To
[00:15:33] Gary: [00:15:33] give you an example, when I went to Chicago, we had no customers in that 10 state region. All of our customers to that point were, Federal government agencies with, you know, three letter agencies, who needed Oracle for top secret projects. So we just hadn’t penetrated the commercial marketplace whatsoever.
[00:15:53] We had a few accounts in Europe, where they were using relational database commercially, but not, not in the United States. So. I went, I went out there, and frankly, it was tough. I was there for 18 months without any, without, he went to do presales. So every demo that we gave, I had to put together, we’d give demonstrations via an acoustic modem.
[00:16:15]you probably don’t know what that is, but it’s a coupler that you put into a phone, you know, a phone that, records the. The bits per second and we were using were giving demos at 1200 bits per second. If you can have, you can imagine that. And so I had to learn how to use Oracle. I had to learn how to write SQL at Warren, how to give demonstrations, get the product, get the product ready.
[00:16:36] And it was largely frustrating because the product wasn’t quite ready and, and every time I’d sell one, someone would try it for 30 days and then it would corrupt their database or something. Something bad would happen. And so we’d end up giving them their money back. So it got to the point where after about 18 months, I decided that my conscience wouldn’t really allow me to sell it anymore.
[00:16:58] So I went to, went out to California and met with Larry and resigned, and. Larry said, well, what are you, where are you going? And I said, I have a job as a venture capitalist, and it looks like a good opportunity. And he said, look, area, I know all the VCs. I mean, we were still on Sandhill road in those days.
[00:17:16] He said, I know all these guys, most of their offices are upstairs. He said, if you’ll give us six more months, if it doesn’t work, I’ll get you another job with a venture capitalist, better one than, than you have. And he said, our new versions coming out. and. You know, I’d heard that before, so I wasn’t so sure it was actually going happen.
[00:17:32] Right? But as I thought about it, I decided to give him six more months, and it turned out to be, the most precisely true thing Larry ever said. He was absolutely right. It, it came out a few weeks later. To give you an example, For that 18 months, I was the we, we grew to seven sales people and I was the lowest on the totem pole.
[00:17:53] So I was worst worst salesman, which is part of the reason I resigned because we’re Oracle’s culture is if you’re low man on the totem pole, you, you get fired. Yeah. So, but after. After the new version came out. and it helped that I hired a presales person named Tom Siebel, who was a founder of Siebel systems, and, and is, it was very successful in his own right.
[00:18:17] But I hired Tom straight out of. Straight out of university of Illinois, Tom and I, in the next six months, we sold more than the other seven guys combined down. Wow. So why
[00:18:27] Bart: [00:18:27] did that turn around? Cause they all had access
[00:18:29] Gary: [00:18:29] to them. The last two, the last two, the first,
[00:18:32] Bart: [00:18:32] last of the first. But they all had access to the same news
[00:18:35] Gary: [00:18:35] version.
[00:18:36] They absolutely did. They, they hadn’t, They hadn’t gone through all the difficulties that I, that I had. I mean, most of them joined a sales people. They had a presales person, so they didn’t really understand the product. And, and frankly, Tom was a great presales presales person and it, and I recognized that this was just.
[00:18:56] Down-home fighting. I mean, we, we, we want 16 deal, 16 deals in a row against our competitor, which was ingress in those days. And we kept track of every one of them. And, and I mean, it was, it was just, it was really An effort in, in, you know, can’t, can’t fail kind of thing.
[00:19:14] Bart: [00:19:14] Why do you think Larry wanted to retain you when you resigned, when you were at the bottom?
[00:19:19] Gary: [00:19:19] You know, it’s, it’s, it’s a good question because, there was no reason to think that I’d be successful. I was the lowest lowest guy. And, I think Larry was, Larry was prescient in, in many ways, and maybe, maybe in this way, felt like I could, I could somehow succeed. But, after the, after the next six months, then I was promoted to.
[00:19:42] A national sales manager. So I went from salesman to national sales manager. I had the entire country working for me, and I was still living in, in Chicago. So I took that position for a year, year and a half. And then I was promoted to, president of Oracle USA. And I went back to, went back to California.
[00:20:02]we moved to, we moved to Atherton and, and, I was president of Oracle USA for about four and a half years. And every year, except the last year, we doubled in sales. So, you know, we went from 13 to 27. We go from 27 to 50, and we went 5,220. And last year, last complete year I was there.
[00:20:24] We went from, We went from 200 and went from 240 to 500 million in sales. Holy cow. So I mean. Doubling when you’re, when you’re small is fairly easy. I, it’s, it’s, it’s not a, not a difficult thing, but building a company, building the infrastructure for, for a company to grow from 250 million to 500 million is a very difficult thing.
[00:20:49] Right.
[00:20:50]Bart: [00:20:50] so there were managerial challenges.
[00:20:52] Gary: [00:20:52] Yes. There were hiring. Hiring challenges. we got to the point where software industry was relatively small enterprise software. We got to the point where we literally had hired almost every, talent talented salesperson in enterprise software.
[00:21:08] I mean. You could like go across the 20 or 30 companies that offered it. And we had the top two or three guys from that company and we’d already each of them.
[00:21:17] Bart: [00:21:17] So at the time, I mean, these were big contracts in general, big dollar items. They probably could easily justify an implementation team who would put in some customization, things like that. Today, you know, with SAS software, with cloud based SAS software.
[00:21:36] And subscription prices. I mean, we’re talking about much lower monthly fees in general or subscription prices. do you think there is less of that customization today because of that? Like it’s harder to justify customization and you just have a one size fits all?
[00:21:53]Gary: [00:21:53] Well, I think that the tools used in the industry.
[00:21:57] Things like force.com and some other products out out there are much easier to customize than, the applications that we had in the late nineties and early, early two thousands. So I think there’s a comparable amount of customization might even be a little bit more, but it’s, it’s just so much easier to, easier to make today than it was was in those days.
[00:22:19] I mean, it was not uncommon to sell a. Three or $4 million software contract and to have a 10 to $15 million implementation contract in those in those days. So yeah, it was several, several words, words larger than, than the software contract. And, And sometimes we would recommend our own services organization from Oracle, and sometimes we would recommend some of the large consulting organizations like Anderson and delight and, Deloitte and others like that.
[00:22:49] Right. That
[00:22:50] Bart: [00:22:50] makes sense. Okay, so you’re president of Oracle, it’s just gone from 250 to 500 million in one year. It’s hard to manage, but I’m sure it was like, in many ways it’s like this crazy. You know, awesome. Like you say, best of times, worst of times type of thing. What happened? You left?
[00:23:10] Gary: [00:23:10] Well, I had, I’d sent signals to Larry for two or three years that I wanted to step back. And it was, it was too taxing on me and on my family. And I was, I was 35 at the time. And so it was, It was nonstop, nonstop pressure all around the, all around the year we doubled for 36 consecutive quarters, if you can imagine that, not, not doubled from the previous quarter, but from the same quarter a year, a year ago.
[00:23:41] And so, it was, it was important to us that we, not, we not step back. And so I had, we’d agreed to hire a successor. I’d hired a successor, he was national sales manager, and I thought he’d be great to step into the. And to the position. And, and then we had a, we had a really bad first quarter in 19.
[00:24:01] Well, first fiscal quarter in 1990 and at that point, I didn’t want to, I didn’t want to leave the company in a, in a lurch. I thought it was a bad time to leave. I’d rather leave when things run on top. So as I sat down and talked to. Talk to Larry, it became pretty obvious that we needed to make some fundamental changes in the in the business.
[00:24:23] And some of those changes were that my organization, Oracle USA, was going to lose a lot of the responsibility we had. So we had responsibility for finance, we had some responsibility for marketing, we had some responsibility for porting products. All those things were going back to corporate and we were going to, we were going to move away from this highly decentralized model.
[00:24:46] To basically being in a situation where running Oracle USA meant running sales, running service, and running consulting, and that just wasn’t, that wasn’t attractive to, it wasn’t attractive to me.
[00:25:00] Bart: [00:25:00] You had been working many, many hours a week. Investment banking hours
[00:25:05] Gary: [00:25:05] or worse. Yep. Well, so my plan was to take some time off and at.
[00:25:14] Almost from the day that they announced that I would be leaving. I started getting calls and, and I didn’t really respond to any of them except for, from recruiters, from recruiters and companies. I received a call from Ray Norta who, who was obviously running a novella at the, at the time, and that seemed like a.
[00:25:36] Something that would be interesting to me. I also received a call from a fellow that I knew really well, and, whose name was Nolan Archibald and Nolan Ron ran runs, maybe still does a black and Decker, and black and Decker had just acquired a systems integration company that was about a billion dollar company, 7,000 employees.
[00:25:56] And, and there was no. It was a technology company, but it was part of a conglomerate that they purchased at black. And Decker didn’t have any clue on how to run this technology company. So, Nolan asked if I was interested in. Moving out to Potomac, Maryland. Initially I wasn’t, but as I investigated the company more saw the opportunity, it looked like it was a great opportunity.
[00:26:19] Black and Decker was planning on spinning off the company, taking it public or selling it, which, which they ended up doing. And so it, for me, it seemed like a. A new, it was kind of a classic turnaround. The company wasn’t succeeding very well, and I hadn’t done a turnaround and it, it, it seemed like a chance to move out from under Larry’s thumb, no matter what happened at Oracle or what our organization did.
[00:26:42]it was Larry’s company and, and he deserved the. Deserve the credit for it. I like the idea at this new company called PRC that I’d be sort of the person to, to make it or break it, so to speak,
[00:26:55] Bart: [00:26:55] a challenge, a new
[00:26:56] Gary: [00:26:56] challenge. It was, it was wonderfully fulfilling and rewarding. It didn’t actually work out.
[00:27:02] Maybe as much as I’d like it to. First two years were were great. We made lots of progress in the company, but then I got a, I was diagnosed with having a brain tumor. So, so I had to have brain surgery and it was one of these 18 hour, three doctor surgeries, you know, going into the base of my brain STEM to try to cut this tumor out.
[00:27:23] And after they did that, then I had to learn to walk. I was bedridden for about. Nine months, I guess, after that surgery. And so, at the end of, well during that time I was asked to do missionary work down in San Paulo, Brazil, by the church of Jesus Christ of latter day saints. And it seemed like, that was a good move for me at the time.
[00:27:47] I wanted to, I wanted to give something back to the community and, and to serve also really wasn’t, while I was capable of a full time job, I wasn’t really mentally ready for, the rigors of going back into an Oracle or something like that. So this was kind of a, a good step toward that.
[00:28:06] And, and it turns out it was a lot of effort, but it wasn’t anything like a regular. CEO kind of job. Right, right.
[00:28:14] Bart: [00:28:14] you came back from mission and where do you pick up after a mission?
[00:28:18] Gary: [00:28:18] Well, my, my plan was to retire. We, we owned a ranch up in Wyoming and, by Jackson hole.
[00:28:24] And our idea was we’ll just retire on the, on the ranch fairly young at this point. Yeah, I was, I think I was 39 or 40 and not sure which, But, but as I spent a lot of time, a lot of time fly fishing, and I don’t know whether it was the winter in Wyoming or whether it was, the fish weren’t biting, but, I just became a little restless.
[00:28:47] It wasn’t very good at every tyrant. And, and one of the, one of the people that, I’d worked closely with at Oracle, who was our CFO, Jeff Walker called me and said, Hey, we started a company. here in San Francisco, if you’ll take over the company, you can move it to salt Lake city.
[00:29:05] And I flew out San Francisco a few times, like the value proposition, like what they were doing and like the technology. And so, I decided to take over the company and we moved, we moved here from, from Wyoming.
[00:29:17] Bart: [00:29:17] Hmm. Okay. You moved to Utah?
[00:29:19] Gary: [00:29:19] Yes.
[00:29:21] Bart: [00:29:21] And what company was that?
[00:29:22] Gary: [00:29:22] What was called tenfold?
[00:29:24] So we, we, There were, I think there are about 25 employees. When I, when I became the CEO, we didn’t, we didn’t have any sales yet. We had a, we had one customer that was trying our product but hadn’t made a commitment. And, and frankly, the technology and the value proposition were very good because in, in four years, we went from no revenues to 97 million of revenues and took the company.
[00:29:53] Took the company public
[00:29:54] Bart: [00:29:54] right around 2000
[00:29:55] Gary: [00:29:55] yes. Yes.
[00:29:56] Bart: [00:29:56] Okay. That was right before the bubble burst.
[00:29:59] Gary: [00:29:59] The tech bubble, it sure was. So even though we weren’t, we weren’t really, An internet, company. And, and so when the tech bubble burst, and a lot of the dotcoms really suffered, initially, it didn’t bother us.
[00:30:14] But then what we realized was that even though we weren’t a.com some of the people we’re selling to are dot-coms. And maybe we should have seen that earlier, but it wasn’t. The case that we were selling to some new startup that had been funded, what we were selling to all state insurance and to, Southern bell and people like that, but we were selling to a new initiative inside these companies that was typically their digital.
[00:30:41]digital path forward.and, and all of these, all these people that we sold to as soon as the.com bust hit, a lot of them had their funding. Revoked from their parent company. So we, about, it was about a year after we went public.
[00:30:55] I, I think a year and a quarter after we, we had a bad quarter, didn’t, didn’t make our revenue projections, and we went, our SOC went from 70 to 20 in just a matter of few weeks. Wow. So it was a, it was a very, very difficult time. What do you even
[00:31:12] Bart: [00:31:12] do after that?
[00:31:13]Gary: [00:31:13] it’s a good example of.
[00:31:15]Sometimes the, sometimes the. The cure is worse than the disease. So, we, we, we had $100 million company. We had a stock price at 20, and, and we went public a year earlier at 17. So it wasn’t like anything was, was that wrong. But from the board’s perspective, it’s like, well, they focused on the 70 to 20, and not, not that we still had.
[00:31:42] A lot of good things going.
[00:31:43] Bart: [00:31:43] It’s a huge loss of value for a lot of investors.
[00:31:46] Gary: [00:31:46] Exactly, exactly. And so, I mean, the board eventually came to the conclusion to another quarter or two that I was the problem. And if we felt if we changed, the CEO would suddenly make the company better. It didn’t help.
[00:32:02] So the stock went from 20 down to when I left. The stock went from 20 down to four or five, and eventually just, Kept going down. About nine months after that, the board came to me and asked if I’d come back. And even then, the company still had, still had plenty of opportunities. We had good technology.
[00:32:22]but it just, it just felt to me like the, the market for. Client server kinds of enterprise applications, which is what we sold was just going away. We didn’t have a cloud based product, didn’t have a product that would operate in some of the new environments. And so I felt like it was not a wise, not a wise decision to go back.
[00:32:44] So eventually tenfold ended up selling the company socket 30 cents or something like that. So it was a, it was a, it was a really difficult time for. For everybody. And, and, you know, I believed in the company to the point that I didn’t sell a lot of stock when it was at 70, or if I sold some at 50.
[00:33:05] But in retrospect, you know, it’s easy to look back and think it would have been wise to have sold a lot, a lot more. But on the other hand, it was, It was important that I, showed my belief in the company by not, not selling stock.
[00:33:19] Bart: [00:33:19] Right. And I imagine much of your compensation package was stuck.
[00:33:23] Gary: [00:33:23] It was indeed. So, our board of which I was a member committed the kind of the ultimate sin by, seeding our compensation scheme to wall street. Mmm. because the vagaries of the stock price determined what our compensation was. And that’s, that’s a pretty poor way to. Pretty poor way to, to decide compensation ought to be based on, on results, not necessarily, the vicissitudes of the marketplace.
[00:33:54] Bart: [00:33:54] Right? Results, value creation, benchmarks against Jacqueline market demand. okay, so this is a wild ride. You were there at the beginning with. You know, companies like at the pivot point for Intel, you were there for Oracle’s, you know, wild initial growth. It’s much bigger these days, but you were there in the beginning, and that’s amazing.
[00:34:17]and then you had. A tumor, and you recovered. So that’s already
[00:34:23] Gary: [00:34:23] major ups.
[00:34:24] Bart: [00:34:24] A big downer. Yeah. and then tenfold itself was a, it sounds like a wild ride up and down. did you revisit thoughts of retirement at that point?
[00:34:35] Gary: [00:34:35] Well, actually, I actually, I did after, After tenfold. I had my second attempt to retirement.
[00:34:40] I’m in my third now, and I hope, I hope to some that more successful than the first, first two. After about nine months, which I spent building a new, a new, home up in Wyoming,I decided to start a healthcare software company called remedy informatics.
[00:34:59] And I spent. Eight or nine years, trying to build that, trying to build that company. and, and I did a lot of other things. I invested in four or five startup companies. I invested in. Overstock, I think might’ve been the first investor outside investor in overstock, and was on the board of overstock.
[00:35:19] And I started four or five other. Other companies as well, but I was just, I was just an investor. I had, I have an investment firm called double Eagle ventures. So most of the funding for these companies came out of that, came out of that entity. But my real efforts went into, went into tenfold, and the, the market for medical software was, was ripe in the end.
[00:35:45] It was something we really felt like we could, we could do. All
[00:35:48] Bart: [00:35:48] right. Your real efforts went
[00:35:49] Gary: [00:35:49] into. All right into remedy. I’m sorry. Remedy. Okay. Yes. the company did some incredible things. We were able to develop technology that, could help pinpoint, causal relationships between, someone’s.
[00:36:05]genome typic data and their phenotypic data. we combined all of their user data, with their electronic medical record and started spotting patterns and trends. We, we weren’t as successful as we’d like to have been. And we sold the company to Merck when it, it just became obvious that the company, to build a business like this, we needed, I won’t even say tens.
[00:36:28] I might’ve been $100 million a week needed. And so, Had invested some in the company and they, they purchased the company from us and, and sold it to another one of their partners that has since taken it public. So it’s, it’s been, it was a, it was a real opportunity, but I’m, I’m seeing the same opportunity in healthcare software right now.
[00:36:49] A lot of other people are trying to do it and it’s, it’s a tough thing.
[00:36:53] Bart: [00:36:53] Yeah. I think healthcare is tough in part because of regulations in part because it’s just like you’re trying to get the next, level in science and research and development. And there’s, there’s a lot there. Okay. So, I want to get to some advice.
[00:37:07] You have such an interesting career, such, such amazing experience. I’m sure you have some things that you can. Kind of advise us people who are building businesses, you know? What do you, what do you tell people? What are some of your top three or five pieces of advice that you’d tell people.
[00:37:29] Gary: [00:37:29] Well, I always look for a, for an unassailable compelling value proposition. And I really don’t invest in a company unless, unless they’re able to articulate that. And. By unassailable. I mean, it’s something that’s just not transcended. It’s a value proposition that can continue over time because sometimes people build a company and it’s almost like they become their own worst enemy.
[00:37:56] The more successful they are, the more they attract competitors, and they haven’t built a fence around their business, and so the other people take them. Take them out. So you have to be really wise about defining your value proposition so that it’s something you can uniquely, you can uniquely deliver.
[00:38:13] And then you spend your time protecting, protecting that unique competitive advantage.
[00:38:19] Bart: [00:38:19] So let’s apply that to maybe an example of, you know, someone doing a local business like, a restaurant in a, in a city. what might they think about. In terms of unique value proposition?
[00:38:31]Gary: [00:38:31] Well, it, it, it could be something as, as pedestrian as the, the type of food they they serve or the service they, they offer.
[00:38:42] It could be a combination of their, of their location and, and how quickly they, how quickly they provide service or the kind of ingredients they use. I mean, there, there are. There are myriad opportunities to differentiate yourself. You just have to, you have to be really honest about, okay, what can we uniquely do and what can’t we do?
[00:39:06] And one of the, one of the things I learned most strongly from Oracle, from Larry Alison, is we, we would never, we’d never. Advertise or position ourselves, based on a feature set that somebody else could claim. Like, I mean, it’s just silly to say, you know, we’re the best at this, or we, we do that better than somebody, or we run faster than they do it because all you’re really doing is, is establishing an equivalency in their mind that you’re essentially the same as somebody else.
[00:39:42] And so, if you look at Oracle’s advertising, I mean, sometimes they. Point out our arcane features just because they want to. Differentiate themselves from everybody, everybody else. But that that becomes really a culture and, and every time a new product comes out, first thing you talk about is, okay, how is this product different than what everyone else can provide now might be that.
[00:40:08] How it’s different is it has a unique interface to the rest of Oracle. And maybe that would make it, maybe that would make a different. So, it really requires people to, to not just think, but oftentimes it requires them to, to take two seemingly contradictory ideas, and hold them in their mind at the same time.
[00:40:30] So I spent a lot of time in, in strategically positioning value proposition so that they really are. Really are unique. And then when you spend money advertising them, you’re advertising something that will really uniquely identify you as a company and you and you as a product as opposed to just spending money, enhancing the image of the industry, which, which is, money foolishly spent.
[00:40:59] Bart: [00:40:59] Yeah, that makes a lot of sense. so number one, unique value proposition, and you gave us some advice and how to think about that. Do you have other things that you typically look for or advise entrepreneurs about?
[00:41:12] Gary: [00:41:12] Well, I’m a big believer that you, you build companies, and, and. And the objective of building companies is to, is to create something that has life of its own, has a culture of its, of its own and, and lasts.
[00:41:35] I, I’ve never built anything that I thought was really short term oriented. Now it turns out some of them haven’t lasted as well as I’d like, and some have lasted much beyond what I, what I’d expect. But to me it’s a mindset when when I start, building a company, I’ll get questions from investors.
[00:41:55] Always the same thing. What’s your exit plan? What’s your strategy to, to. Move this company into the next 10 years, and I always say the same thing. I don’t have an exit strategy. I have no interest in, in thinking about that right now, I want to build a company that doesn’t need an exit strategy.
[00:42:11] I want to build a company that can run itself profitably for as long as, as long as I can imagine it. And as soon as you start getting into those short term, well, what about an exit strategy then? Then you start making decisions that aren’t right for the company for the long. For the longterm. So I, I think you have to define, after define a longterm strategy that will fit with your unique, with your unique value proposition.
[00:42:41] And then, then it’s to a large extent, it’s about precision execution. You, you have the strategy, you have something that will last for longterm, and then you just have to be very careful and patient, about. Executing, evaluating your execution. If it wasn’t perfect. Okay. How do we get better?
[00:43:01]never, never is perfect the first time. But, one of the cultures of Intel that I, I’ll never forget is that they evaluated everything. And even if something was, was. Anything less than perfect, they’d go back and do it again and get it, get it right. And in those days, Andy Grove would stand up in front of the entire company and present his, objectives and his key results for the.
[00:43:23] For the company. And at the end of the quarter, he’d stand up and say, well, we made this one. We didn’t make this one, and here’s what we’re going to do, what we’re going to do about it. And I’ve always brought that mentality to any company that I, that I work with. I think it has to be driven by setting, aggressive objectives and then moving mountains to make sure that you accomplish them.
[00:43:44] Bart: [00:43:44] I love that. Gary, this has been an amazing interview. We really appreciate you coming in today. giving us a little bit of a peek into, you know, what I consider some of the really founding days of our almost technology driven economy these days. And, yeah. Really appreciate it. So is there anywhere that people can find, you know, of you, like maybe your investment firm or where should they look for anything more about you?
[00:44:14] Gary: [00:44:14] I, I, I’m in the process of writing a book and. it’ll probably out six months from now. Fantastic. And so they’ll, a lot of this will be contained in the book. If they’re interested, they can find their way to it.
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