mark leslie

Copyright M. Leslie 1

The Story of VeritasAnd Some Things I Learned…

[email protected]

Copyright: Mark Leslie 2007

Veritas…The Journey

2

$95K $1.5 Billion

12 6,000 employees

Startup Fortune 1000

…In 11 years

VERITAS – A Story of Strategic Transformation 1982 – 1993 Hardware to Software OEM business

1982 – 1988: Tolerant Systems $50 M startup in the high availability fault tolerant systems business,

(Tandem built with microprocessors and Unix)

1989 – 1993: Tolerant Veritas the OEM company Revenue $0 – $10 M

“Restarted” from Tolerant Systems (200 12 employees)

Established industry standard file and disk management software for Unix

Novel OEM Business Model

Closed 60 OEM agreements and became industry standard

IPO in 1993, $64M market cap post money

However, the business as constituted would likely top out at ~ $50M / Yr…


VERITAS – A Story of Strategic Transformation 1994 – 2000Emergence as the leader in Storage Management Software

Revenue: $15 M – $1.2 B

Established Strategy for TRANSFORMATION in 1994

Additional System Products to sell to OEMs

Build EU products to sell to OEM’s customers and restructure OEM agreements: Reseller (Revenue Center)+ OEM (Cost Center)

Acquire Backup Business and Direct Channel

Enter NT Market

1995: Acquired High Availability Failover Business (Strategy Element 1)


VERITAS – A Story of Strategic Transformation 1994 – 2000Emergence as the leader in Storage Management Software

1997: Acquired Open Vision

Veritas and OV each had trailing revenues of $36M (shed ~ $15M of OV products)

Acquired Direct and high-end Reseller Channel (Strategy Element 2)

Entered Backup / Recovery business (Strategy Element 3)

1999: Acquired Seagate Software and entered NT market (strategy element 4)

2000: $1.2 B revenue, F 1000 company


VERITAS – A Story of Strategic Transformation 2001 +

Woulda, Coulda, Shoulda…

2001: Hired new CEO

Revenue of $1.5 B – growth in revenue and profit in nuclear winter of bursting tech bubble

Next Strategy for company:

Acquire VMware (2003)

Acquire Red Hat, Jboss, MySQL, etc., to build the complete server stack to compete with Microsoft

Unfortunately…



And Some Things I Learned…


Great Businesses Great Product / Great Market / Perfect Time

Rich in DEFENSIBLE and SUSTAINABLE BARRIERS to ENTRY Intellectual property Network Effect Unique business models Other

Yields: High growth

High market share

High gross margins

High profits

High stock multiples

Market consolidation

…And the Rich Get Richer9


Software is a Great Business

Making money in high-tech is all about getting paid for your IP The better (and more unique) the IP, the more valuable

In the hardware business the IP is embodied and delivered in the form of a “machine” The business of making and shipping machines is error prone, which

can sap the profit from the business

In the software business you just deliver the IP – sometimes in the form of bits transmitted over the ether…

At Veritas At the extreme delivered a $1.50 CD in exchange for $20 million

Raised a total of $20 M including IPO, and ended with > 2.0 B in cash

10


The More Grandiose the Plan, the Less Likely to Succeed

Tolerant Systems, Go Computing, General Magic, WebVan and Zaplet were “grand plans”

… and so many others

But many of the great companies started out with small goals and very little capital, and became “overnight successes”

…after many years

Like HP, Dell, Apple, Oracle, Microsoft, Veritas, Ebay, Google, VMware

… and so few others

11


Transformation – The Signature of Great Companies

BankruptcyStartup

Decline

Peak

Growth

time


Transformation – The Signature of Great Companies

Startup

time

Transformation

Transformation

New

Tra

ject

ory

Transformation – The Signature of Great Companies (or NOT)

Apple

Cisco

GE

HP

Intel

Microsoft

Oracle

Sun Microsystems


Chrysler

Computer Vision

Mainframe BUNCH companies

Digital Equipment / minicomputer companies

GM

Silicon Graphics

Sun Microsystems


And Some Things I Learned About Leadership…

Be a Steward, Not a Proprietor

T H E F I R S T P R I N C I P L E of leadership

Proprietorship is about “ME”

…and what you can do for me today

Stewardship is about “US”

…and what we can build together for the future

Copyright: Mark Leslie 2007 16


Be Visible, Be Invisible

Be Visible There is a large part of leadership which is public (and mostly obvious)

MBWA Many and varied public meetings

Be exceptionally accessible

Be Invisible The real work of leadership is behind the scenes, OFTEN ALONE

Leadership is creating an environment where: You attract the best and the brightest people …who can independently apply their intellect judgment and energy …to advance the vision and goals of the organization …and achieve a personal sense of accomplishment in their work It is NOT “management”, which is accomplishing complex tasks through

others.


“Glamorous” is the Opposite of Leadership

Don’t get confused -- It is not about “ME”

A Leader must always think of others and put them first

You can be a comrade to your followers, but you can never be one of them

When you are doing the “glamorous things”, you are just doing your job on this team

Warning of Danger: GLAMOUR IS VERY

SEDUCTIVE…


If You Are Loyal to One, You Are Loyal to None

A leader must be loyal to the mission above all else

A leader is responsible for the well being of ALL of his people

A leader is the keeper of fairness and equity in the organization


The Further You Are from a Problem the Less You Know About It

Trust those on the front lines – they really do know more than those “back home”.

The first line manager knows less about the specifics, and THE NEXT manager knows even less.

When you get to the top you don’t really know anything about anything anymore!

You trade situational knowledge for judgment, experience and perspective


The Higher Up you Get, the Fewer Decisions You Should Make

Everyone “offers” you the decision

What is the impact of the decision

Have they thought about it?

Are they, more or less, in the right quadrant?

What is the downside?

Allowing others to make decisions has real meaning to them, and develops their judgment and maturity


The More Power You Give Away, the More You Have

You empower individuals by giving them Knowledge;

Authority; and,

An acceptable margin of execution error

“What I know that you don’t know makes me more powerful than you.” A leader has the power to level this playing field!!!

And diminish politicization of the organization

Empowered individuals will be loyal to the company and loyal to the leadership

A loyal empowered workforce is a force multiplier for the leader


Know Thyself

We all want to know everything, and be best at everything

It is a hallmark of great leaders that they know their own Strengths (the easy part) and Weaknesses (the hard part) Likes Dislikes

Augment your weaknesses with other people’s strengths

If possible find others to do the things you don’t like

Check to see if your self-assessment is shared by others


Trust and You Will Be Trusted

The first level of trust is based on the “fair play” that is visibly exercised

Great leadership comes from a deep sense of trust between the leader and the led

As a leader, you MUST take the first step, you must trust first!

You may occasionally get disappointed, but the payoff is greater than the cost


Listen to Everyone, but Trust your Own Judgment

Each business is complex and unique There are no formulas, fads and gurus with quick and easy answers

Be genuinely open, listen constructively and learn Hold your opinions in abeyance while you collect information – this is

counterintuitive to all we have learned. It is very hard to do!

At the end of the day, trust your own judgment

“If something does not seem to make sense…

…it most probably isn’t sensible”


Confront the Issues Directly,But be Thoughtful, Gracious and Caring

There are many tough things that you need to do

Firing one of your executives who is a friend

Negotiate hard deal

Go after a competitor

Reduce your work force

But you can do all things with caring and grace

Treat each and every person (and company) you meet with dignity and respect

And…, you never know when you will run into them again…


The Truth, the Whole Truth, and Nothing but the Truth…

A key job of leaders is to “Fix Broken Stuff”

If you do not know what is broken, you can’t fix it

Everyone wants to tell you what they think you want to hear…

… in a way that will make them look good…

You must find a way to convince people that you need to know the truth…

…and you must always “Honor the Messenger”


There is Life after Death

In the course of events there WILL BE black days

…days so black that all you will see is despair

Everyone will be looking at you! Communicate candidly and directly Be calm and show them a little bit of light at the end of the tunnel, but

not false hope Focus on the things that you can do to make a difference Overcoming adversity together forges teamwork and trust

Dark days are “leadership opportunities”

When things are great, remind people that there will be dark days again

Only Those Who Are Both Paranoid and Courageous Will Survive

Every Idea has a finite lifetime You never know where and how the world might change – it’s just a

matter of time

It is all about Strategic Transformation Do it early rather than late.

You may have to put your whole company at risk in order to save it

You need the courage to stay the course in spite of many who tell you otherwise

It is the critical differentiator – it is what makes

Great Companies Great



There is No Finish Line…

Building a great company is like building a cathedral

Those who start it hopefully will not see its completion

Each accomplishment is a prelude to the next challenge

The IPO is not a “harvest”, simply one step on the long road


Values and Culture make it worthwhile

We spend more time “at work” than any other single activity in our life

The outcome of our efforts is not always predictable so the quality of the daily experience is important

Values and culture define the character of the company

Values and culture permit us to do our work with integrity, and to conduct business in a civilized and honest environment

Values and culture help the organization to recruit the best, the brightest, and the principled

Values and culture do NOT sap the competitive capability


We All Have to Make Choices

Each time we make a decision, we leave a “road untaken” – we can never know what “could have been…”

Success in anything requires:

COMMITMENT

FOCUS

INTENSITY

ENDURANCE

Whatever success we achieve, we will by definition sacrifice other dimensions of life’s opportunities


If you want a friend…

…Buy a dog

ROXIE


One Final Thought…


it is regret for the things we did not do that is inconsolable.

Sidney J. Harris (1917–86)

Regret for the things we did can be tempered by time;


The Story of VeritasAnd Some Things I Learned…

[email protected]

mark leslie - leadership and veritas

Business

software business

software oem business

backup business

hardware business

tolerant veritas

high growth high market

b revenue