Sramana Mitra: What does the internet do to your business? Let’s say we are talking about the time period from 1994 to 1996 when the Internet was happening. How does your company change?
Dean Guida: It was way back when it started. So, we had to create a website, which helped us a lot. We got into writing user interface components for Java. Charles Schwab and FedEx built their trading and shipping applications with our development tools and our UI component. I spoke at the second Java 1, which was the best software development show in the world at the time.
About 20,000 of the best architects all over the world came to this event. To this day, it is the biggest audience that I spoke in front of. I was talking about building the UI, user experience, and the front end in Java. There were so many people in the audience that they had to put this 45-foot screen that would project to the next half of the audience. That was great.
The recession happened shortly after. The dotcom blew up. All these people that were using Java blew up. Microsystems then decides to repurpose and reposition Java as this backend heterogeneous language. We were like, “No, don’t say that.” That really hurt our Java business, because we were all front end.
Sramana Mitra: Fast forward a bit because we are still far back in history. What is the next major inflection point for your company? What was the next point where you did something interesting and strategic that changed your company? For example, Java was a big business for you and they repositioned Java. I presume that created problems. How did you tackle that?
Dean Guida: We tackled it by doubling down on our C and C++ market opportunity. At the time, Microsoft was shifting technology platforms to dotnet. It was a year before they announced the alpha version at their professional developer conference. They invited us and a bunch of our competitors out to Redmond. We had to compete to be up on stage with Microsoft.
We competed and won. We wrote one of the ASP.NET tree UI controls. We were up on stage when they announced .NET. They distributed an alpha version of .NET as a PDC. We had a big technology shift, which is both good and bad for tech companies. It was bad because you had to rebuild all your technology, but it was also good because everyone is going to rebuild for the new platform. You have a big market opportunity in that way.
Our director of sales at the time met up with our number one competitor’s CEO. He came back and said, “Hey Dean, you should talk to Bob Wolf.” We were both going to have to re-write our technology for this .NET and go back to the market to retain our old customers and acquire new ones. We met up. For me, I just wanted to keep on building. I just love technology and being in the tech space. I wanted to make sure that they just didn’t want to put two companies together and exit.
They didn’t do that because they shared the same values. You have to have great technology to enter the game and the arena; but in order to win, you have to have great sales and marketing. They shared all these go-to-market principles. We ended up merging on Halloween in 2000. We just had a great team experience. I remained the CEO. We had to define how our products would be going forward. We rebranded, repositioned, re-messaged, and redid everything.
Even our competitors and channel partners commented on the great work that we did. We doubled down on .NET. I don’t know if we could claim that we were the first company, but in the mid-90s, we were one of the first companies to start charging on a subscription basis. At the time, everyone was charging a perpetual license and then you would charge maintenance fees.
We went to subscription early on and we shifted three times a year. That was a powerful business model for us because it created this cadence and rhythm of the business that made our teams ship every four months. We were also able to respond to customer needs and add those features quicker. It was a whole event where we would go out with PR and Marketing to add value to our customers to deliver on that subscription value.
That was a good rhythm to our business that helped us. It created that recurring revenue model that is the norm of today. We were one of the early companies to do that in the mid-90s. We kept the focus on .NET. We did well there, and we grew fast.
This segment is a part in the series : Bootstrapping for 30 Years