You Say Goodbye, I Say Hello

After six great years, I have resigned my position as CEO of MarkLogic Corp.  I can say that the parting is amicable and the board and I have been working for several months to ensure a smooth transition because we have a shared interest in the company’s continued success going forward.

When I left my job running marketing at BusinessObjects, I wanted to see if I could be a general manager, run a P&L, and grow a company to a substantial size.  I’ve accomplished what I set out to do and then some.  What I do next is unclear:  perhaps grow another startup or return to a large organization in a GM/CMO capacity.  I’ll figure it out in the coming months.

I am proud of what we accomplished during my six years at the MarkLogic:  acquiring over 200 enterprise customers, growing annual revenues at a 75% CAGR, raising $27.5M in venture capital, and growing the company from 40 to over 230 employees.

I am particularly happy to say that I will be leaving the company in a position of strength, having exceeded the 2010 revenue plan targets and with nearly $20M cash in the bank.

I believe that MarkLogic has great technology, great people, great customers, great partners, and great future potential.

I would like to say “thank you” to the large number of people who contributed to MarkLogic’s success during the past six years.  In particular, I’d like to thank:

  • MarkLogic customers not only for buying our software and services, but more importantly for your faith in the company and in our ability to deliver.
  • MarkLogic employees for your hard work, excellence, dedication, and – most importantly – for helping to preserve the professional, high standards, results-oriented culture that enabled us to be successful.  I am honored to have worked with you.

Since I seem to have a reputation for being a rather demanding manager, I’d like to offer a special thanks to the three people on the executive staff who were with the company the day I joined and who have thus shared (and/or endured) my entire MarkLogic tenure:  Ron Avnur, Josh Narva, and Max Schireson.  I can’t think of three finer people with whom to have worked.

Thank you to everyone.

Ave Atque Vale!

The Opportunity Quality / Execution Quadrant

One thing they drill into your head in business school is how to make everything a quadrant.  While I don’t know for sure if it started with the famous BCG matrix — which groups business into dogs, cash cows, stars, and question-marks — I’d bet that the BCG matrix played a big part in initiating the quad-thinking movement.

I’ve been toying with a quadrant lately that compares businesses based on the quality of the opportunity they pursue and how well they execute against that opportunity.  I rate execution from clownish (“Inspector Clouseau”) to flawless (“Swiss Watch”).  I rate opportunity quality from difficult (“Hardscrabble”) to easy (“Fertile”).

When I built the quadrant, I decided to try and place a few companies at which I’ve worked during my career on it.  (I thought about trying to place MarkLogic, but decided against it for a number of reasons.)

Please let me know what you think of my model, what you think of my placements, and what other companies you’d place where on this diagram.  In addition, if anyone has clever names for the four quadrants themselves, I’d love to hear them.

The Loose Coupling of Decisions and Outcomes

There was a great column in the 12/10 Harvard Business Review entitled Good Decisions, Bad Outcomes by Dan Ariely, professor of behavioral economics at Duke and author of the excellent book Predictably Irrational.

In the column, he hits on one of my favorite topics, the loose coupling of decisions and outcomes.   Excerpt from the opening:

If you practice kicking a soccer ball with your eyes closed, it takes only a few tries to become quite good at predicting where the ball will end up. But when “random noise” is added to the situation—a dog chases the ball, a stiff breeze blows through, a neighbor passes by and kicks the ball—the results become quite unpredictable.

If you had to evaluate the kicker’s performance, would you punish him for not predicting that Fluffy would run off with the ball? Would you switch kickers in an attempt to find someone better able to predict Fluffy’s involvement?

In business, he argues that we do just that every day with outcome-based incentive compensation and outcome-based promotions and hiring.

As a (quite) results-oriented person, I very much believe in the “we are paid to get results” mantra that pervades business.  But as a marketing person, I also fully recognize that all market opportunities are not created equal.  Market opportunities  range across a spectrum from Sisyphean to land grab.

Note that I’m not arguing that any particular point on the spectrum is “easy” because they each have their challenges.  In Sisyphean markets the task itself is difficult, but you benefit from few competitors.  In land grabs, the selling task is easy because the need is obvious, but that obvious opportunity attracts swarms of competition.

Let’s take my favorite example.  Rate them:  Hero or Zero?

  • Guy 1.  Grows his business from $30M to $240M in 7 years.

By most measures, Guy 1 is looking pretty darn good.  I’d say Hero.  And then we meet Guy 2.

  • Guy 2.  Grows his business in the same market as Guy 1 from $30M to $1B in 7 years.

Ah, the problems of partial information.  It’s clear that Guy 1 is a Zero and Guy 2 is the Hero.  (The numbers are real, by the way.  Circa 1985, Guy 1 = Ingres, Guy 2 = Oracle.)

The point of this example is that everything is relative.  Today, the Ingres organic growth rate of 42% in enterprise software doesn’t look bad.  But in the mid 1980s, if you wanted to win in the market, you needed Oracle’s 80% growth.  It was a land grab, and poor Ingres never realized it.

My point is about relativity:  the quality of any performance should be judged on a relative basis to others performing a similar task  in a similar timeframe / market phase.

Ariely’s point is more about noise in general.  I think my argument helps to damp out a lot of Ariely’s noise, but it isn’t always possible (e.g., when there are no easy comparison points) and it certainly does not eliminate all of it.

Corporate Trust and the Little Things: 2.5 Servings per Package

In a age where some 30% of the US adult population is technically obese, if you’re like most people, then you’re probably trying to keep an eye on your weight, and therefore on your daily food intake as measured by things like number of calories, grams of fat, or grams of protein.

The good news is that 20 years ago, the US government decided to make it easier to know what you’re eating by passing the Nutrition and Labeling Act of 1990 which, among other things, required a Nutrition Facts label on most food products.

The bad news is that many marketers have tried to subvert the intent of that act by using a non-integer number of servings per package, thus making it quite hard for most of humanity to figure out what they’re actually getting.

Let’s take a concrete example:  Buitoni Light Four Cheese Ravioli.  Let’s look at the Nutrion Facts label, assuming that we’re interested in calories and grams of fat as our key metrics.  The label says the product has 250 calories and 6 grams of fat.  But, not so fast, those figures are per-serving.  So how many servings are there in a package?  2.5.  Really?  Wait, 2.5?  Come on, did they really design the size of the package so it would feed precisely 2.5 adults?   Were they targeting that small market segment of two adults and one eight year-old child who wanted to have (light) ravioli together for dinner?

I don’t think so.  While a hungry teenager could devour the package alone, for most adults I believe the package size is pretty clearly designed for two, which also makes sense when you think about the target market.  In my experience, if anything, it runs on the low side of two portions, not the high side.

So why would they say a package that was almost surely designed to feed 2 people contains 2.5 servings?  There’s only one reason I can think of:  to obfuscate the Nutrition Facts.

Quick, what’s 250 times 2.5 divided by 2?  Not so easy, huh?

Quick, what’s 625 divided by 2?  Easy, that’s 312.5, which is also the answer to the previous question and the actual number of calories you’ll get by eating half a package of Buitoni Light Four Cheese Ravioli.

So, by doing this trick, I’m sure they get most people to think “uh, 2.5 is about 2, so it’s about 250 calories per serving” thus understating the actual calories by 25%.

In researching this post, I learned that there are additional reasons why marketers might play with the reported servings per container (e.g., “healthy” claims are based on per-serving information), but this isn’t a food blog — it’s a business and marketing blog.  So why do I care?

The answer is trust.  Specifically, corporate trust.

Corporations spend billions every year on brand building and communication programs.  If you asked any of those companies about their brands, you would hear phrases like:  brand promise, brand trust, or faith in the brand.  Or if you asked about their desired corporate reputation, you would again hear words like:  integrity, trust, or faith.

The thing about trust is that’s hard to earn and easy to lose.

Nestle  can — and presumably has — spent lots of money trying to convince me to trust the Buitoni Brand.  To trust the quality.  To trust the consistency.  To trust — I was rather surprised to learn — its genuine Italian-ness.  So that when faced with that agonizing moment of truth, staring in utter horror at the confusing array of fresh pasta products, so that at that moment, my hand would guide itself to the Buitoni label.

And then you manipulate the servings-per-container and that trust is gone.

Trust doesn’t just come from what you say.  It comes from what you do.  Too many companies forget this and, in little instants, undermine billions in marketing and communications spend.

Don’t let yours be one of them.

A Short Missive on Culture

I wrote this short note on culture a while back for the MarkLogic website, but since it wasn’t  terribly “poppy copy,” the marketing and recruiting folks buried it behind this, relegating me here.  I’m OK with that because I think their copy sells better, but I do believe that my note better describes MarkLogic culture.

So to try and get the “legit” culture memo a bit more visibility, I thought I’d post it here.

MarkLogic culture can be derived from one statement — create a place where smart people want to work. To do that, we want:

  • More smart people. This, more than any other thing, keeps the workplace stimulating and fun.
  • Diversity of opinion. We want people who speak their minds, and believe in balancing debate with action.
  • First-among-equals management. We view hierarchy as a necessary evil. Reason should be the primary basis for corporate decision-making.
  • Pragmatism. We want practical people who can solve problems.
  • Transparency. We value straightforward people and provide an unparalleled degree of corporate transparency in return.

Part of our culture is what we’re not. Unlike some Silicon Valley companies, MarkLogic culture places a high value on professionalism.

  • We are not a “bring your dog to work” kind of company. There’s no foosball, ping-pong, or masseuses. We enjoy coming to work because we enjoy the work itself and the people with whom we do it.
  • We are not a “we do everything together” kind of company. While we do enjoy spending time together, we believe that work life and personal life are two different things, and we want you to be able to have both.

I hope you like it.