CEO Transition, Founder Liquidity, and More: Bill Daniel, CEO AllWebLeads (Part 4)

Sramana: How long did you stay at Vignette?

Bill Daniel: I left Vignette in 2003. I was there for just over five years. At that point, I took some time off. I spent a year working on my golf game. There is something about starting a company from scratch or working with a fledgling company that is in my blood. I could not stay away from it.

A few of the Austin Ventures partners contacted me about a business they had funded in the heyday of the dot-com boom called Surgient Networks. They had built a single-purpose server that was disguised as a network box. It was a server designed for high transfer rate video streaming. It was a very complicated hardware product with a lot of processors and components. They had mistimed the market and had spent most of the $70 million they had raised. The broadband market penetration, believe it or not, back then was so low that there was not a lot of streaming video going on. By the time that video streaming became mainstream, it was pretty clear that standard servers from Dell and everyone else were going to be so powerful that nobody was going to buy from Sergient. They were trying to figure out what to do with this company that still had a little bit of cash and some interesting software IP.

They asked me to come in, spend some time, and give them an assessment. My first recommendation was to shut down the company and take the $20 million remaining and distribute it to the partnership. They turned that idea down because it did not align with their philosophy. They felt there had to be something there of value. Working with their CTO, we came up with a concept for managing multiple virtual machines. This was in the early days of virtualization, and of course that is huge today. They had written their own virtualization layer to abstract away the software that drove video streaming away from all of the other underlying software functions. They had done that mainly because they needed to do that in order to get the throughput that would justify spending money on their box.

That virtualization management layer looked to me like it could be very valuable with the standard products out there like VMWare. I suggested that to the VCs. They said it was a great idea and asked me to become the CEO and make it happen. I accepted that offer, and we turned that company into a software company. In 2008 the company was sold to another software company before ultimately being acquired by Dell. It made its way into Dell’s software stack now. That was essentially a complete reboot of the business. Virtually none of the people were the same after we were done.

This segment is part 4 in the series : CEO Transition, Founder Liquidity, and More: Bill Daniel, CEO AllWebLeads
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