SM: Your technology background is nominal by Silicon Valley standards, it seems. LD: Absolutely. At that time I was a little more humble. I thought technology was intimidating even though I had used it in my different jobs.
For example, when I was doing that merger of all those companies, people were talking a lot about the Internet and it was funny how they were talking about it. For example, take the multibillion dollar food distribution company Sysco – I am trying to explain to the CEO of my company about Cisco and he thinks I am talking about Sysco. I was talking about routers, and he was hearing food distribution. That is what it was like in big business and why Jack Welch had an initiative called e-business as if it were some sort of big, fancy thing. It was just a very different world.
I knew I had to figure out what the potential really was. I had a subscription to Wired magazine, and found out about the Netscape developer conference. I decided to attend the conference in San Jose, which was the greatest thing in the world for a guy like me that had no technology background. I found a little project called NetObjects that you could build an Org Chart with and took it back to Unilever in Holland.
The VP of HR was always such a loser because he would just sit there and whine in the board meetings. I asked him, “Why are you always whining?” and he said, “Because nobody wants to talk to me and everybody is always moving people around without telling me and I find out afterwards”, and I was just like “What the hell is wrong with you? It is not interesting when you are coming with binders of stuff that does not mean anything; it is already outdated the second you print it.”
I brought back the NetObjects program, built everything out myself and went to the IT department and said “Hey, I need a server because the instructions here say I need a server”, their immediate reply was “No! We can’t give you a server because we are waiting for NT.” I learned that was something Microsoft was releasing in two years, and of course that was not going to work. I then went out and bought my own server down at the local store and charged it to the company and built a dynamic org chart and gave it to our VP of HR. It changed his role in the company fundamentally. He would sit there and show everybody where people were moving. The whole process gave me a feel for the power of technology, if there is a will.
In a sense, that is how we started SuccessFactors. Through some friends at business school, I was able to find a company that had built a really great little company over the web, and a very scalable one.
SM: Before we go there, what filled the gap between 1999 and 2001, before SuccessFactors? LD: I thought I had to learn what all the technology was all about. A Danish guy who had joined some bioinformatics guys from Stanford which had just won some business school competition had started the company two years earlier and they felt they needed some more business leadership.
The other Danish guy was the CEO, and had come over from Affymatrix. I told him I would not mind being his VP because I felt I could learn a lot, although it was a big step backwards in my career to be a VP of a little startup after I had been CEO of a real company two times. It was worth it for me because I did not care about the title, I cared about learning.
I met a bunch of really great engineers, I really loved them. They were from China, India, Wisconsin, and everybody was just working together. In my own bones I started to feel the infrastructure of Silicon Valley. I had no clue about any of that, you don’t read about that anywhere! The CEO was at McKinsey and then business development at Affymatrix – he had never run a team, ever, and that was something I had been doing for five years at the time. People could not talk to him; he built this little box for himself, and he would sit inside of his office while all of the engineers would come find me to find out what they were supposed to be doing and where we were going.
I learned about how to manage engineers. Engineers think differently; they are so much smarter than the average bear. If you do not argue extremely succinctly and exhaustively with them and explain all of the data and you try to just tell them business speak, they do not listen to you. If you can explain the basics, all of the data from the ground up, and give them the true logical answer regarding why you are doing something, then you have them bought in and they will work incredibly hard for you.