Too old for tech? Not these Silicon Valley CEOs
- 03 November, 2008 11:44
Silicon Valley is the epitome of California's youth worship, geek-style. It's the stage where wunderkinds emerge and are feted: Yahoo's Jerry Yang and David Filo, Netscape's Marc Andreessen, Google's Sergey Brin and Larry Page, Facebook's Mark Zuckerberg -- all in their 20s when they hit it big. Going farther back, let's not forget Steve Jobs and Steve Wozniak, who were 21 and 25, respectively, when they started Apple Computer.
The flipside is the subtle but pervasive bias against older executives, the feeling that, as Wired magazine's Clive Thompson puts it, "If you're ending a third decade [turning 30], you're obsolete." The assumption is that the technology changes so quickly, and the work style in Silicon Valley so draining, that they simply can't cut it.
"There is a central casting version of the standard Silicon Valley CEO type, and I don't fit it," said Mike Braun, 59, CEO of Intacct, a hosted financial software provider. "I'm three standard deviations from the mean, and I'm proud of it."
The prevailing attitude seems to be summed up by gossip blog Valleywag, which last month ran pictures of top tech execs -- all of them, with the exception of 64-year-old Larry Ellison of Oracle, in their early 50s -- with the headline "Power geeks do not age well."
CEOs such as 64-year-old Philippe Courtot, head of hosted security provider Qualys, naturally resent the pressure to be sidelined.
"A lot of people ask me, 'You've made so much money, had so much success. Why keep working?'" said Courtot, a five-time CEO whose resume includes successful stints at cc:Mail, Signio and Verity. "My answer is very simple. I like to take very small companies and forge them like a sculpture. That is my art. No one asked Picasso why he continued painting until he died at age 91. Why should what I do be any different?"
And is technology all that different from other fast-paced industries? Take retail, whose CEO ranks include James Sinegal, 72, of Costco; Leslie Wexner, 70, of The Limited; and Ralph Lauren, 68, of Polo Ralph Lauren. Pharmaceutical maker Forest Laboratories is led by Howard Solomon, 80; 75-year-old Sheldon Adelson is in charge of The Venetian hotel in Las Vegas; and Milton Cooper, 79, is at the helm of real estate developer Kimco Realty.
Maybe older executives just don't get this New Media stuff. Tell that to Sumner Redstone, the 85-year-old active chairman of National Amusements, which owns CBS, Viacom, MTV, BET, Paramount Pictures and Dreamworks; 80-year-old Si Newhouse of Condé Nast; 77-year-old Rupert Murdoch of News Corp.; or 72-year-old billionaire investor Carl Icahn, who bullied both Yahoo and Microsoft earlier this year.
Page BreakIn this article, Computerworld talks to four CEOs of Silicon Valley start-ups, three of them in their 60s, one on the cusp:
- Kate Noerr, 68, co-founder and CEO of MuseGlobal, a private content management software vendor.
- Mike Braun, 59, a three-time Silicon Valley CEO (currently of Intacct ) who has also been an executive recruiter.
- Donald Massaro, 65, a five-time CEO whom Braun recruited three years ago to run messaging infrastructure provider Sendmail.
- Philippe Courtot, 64, also a five-time CEO (currently of Qualys ).
What drives you to stay in the game?
Braun: My wife complains about how I can't sit still. There are guys who are wired to work, who can't not work. I'm one of them. Not everyone is wired that way. I have plenty of friends younger than me who have retired.
Courtot: I look at my father. He was a lawyer who went into business. He died in his 80s but worked until his very last day. I would visit him in France every six months, and I could see that he got even more intelligent as he got older.
How much do you work?
Braun: I work 70 hours a week, start in the office at 7 a.m. I get home, I eat and then I'm on e-mail until 10 p.m. I've always worked those kinds of hours. Being a recruiter was the only time I didn't. I worked 30-40 hours. It felt like a vacation.
Massaro: I've slowed down a lot. I used to work 70 hours a week when I was younger. Now, I don't put in more than 50 hours. I also like to take a 20-minute nap every afternoon.
Noerr: If you have to ask, I probably work 60-70 hours a week. But I'm not a clock-watcher.
Massaro: Work is only work if you'd rather do something else, and there's nothing else I'd rather be doing.
Page BreakHow did you come to your current gig?
Noerr: MuseGlobal is my fifth start-up since the late 1970s. It's just my thing. I like to build companies. My two main skills are having a vision of where the market is going and having a good sense of timing. Both have gotten sharper over time. Hey, there need to be some perks with age other than free bus passes.
Braun: When I started my career selling IBM mainframes to banks in New York City in 1972, you just expected to retire at age 60, since that was IBM's mandatory retirement age for senior executives. I actually retired in 2000 [at age 51]. But I flunked it. So I started my own recruiting firm and ran that for six years.
Then Intacct hired me to find a new CEO. I joked with them, "If I can't find you a great guy, I'll do the job myself and save you the fee." In the end, I did pull a Dick Cheney and find myself [for the role].
Massaro: I retired for six months in 2004. I hung around the house and built a lot of stuff. I ripped my two garages down to the studs and rebuilt them from scratch. There was sawdust over the entire house. When that was over, my wife pleaded with me, "Please go and find some work."
Courtot: I started off simply as an investor in Qualys. It was part of the 1999 generation of SaaS firms: Salesforce.com, NetSuite and SuccessFactors were the others. But when it came time in 2001 to make a second bigger round of investment, the VCs had disappeared. I was in South America at the time, trekking, scuba diving, getting caught in a hurricane. I cut my sabbatical short, invested [US]$25 million of my own money and took over as CEO.
But aren't you financially set?
Massaro: I could've retired when I was 33 and Shugart [Associates, an early leading disk drive maker] was sold to Xerox. I'm not a workaholic, but if I take a one-week vacation, that's a long one for me. Retirement is going to be a coffin.
Courtot: I could've retired after selling cc:Mail [at age 47]. I was financially set. I felt accomplished both from a recognition and a financial standpoint. I could've decided to take it easy, gone and become a VC. But I wanted to continue.
Noerr: After every company, I think I won't build another. But then I start to think, "You know, this sounds fun." It's not a disease -- but it is a bit of an addiction.
Braun: I'm plenty comfortable. My kids will be plenty comfortable. But I'm not Silicon Valley landed gentry. Steve Jobs and Sergey Brin all live in my neighborhood [in Palo Alto], but in much nicer houses.
Page BreakIs it ever wearying to get back on the start-up treadmill?
Courtot: No, because I know deep down what Qualys is doing is the future. We have 4,000 customers and had [US]$40 million in recurring revenue last year. Honestly, it's taken longer than anticipated -- I thought we'd be at this stage two years ago. But the fundamental thing is: Are we providing something of value to customers? That's the path. The rest is irrelevant.
Noerr: I'm driven by wanting to make a name for my company. It doesn't bother me if I go to a party and no one's heard of us. I look at it as an opportunity to be an evangelist.
Massaro: I've done several turnarounds, mostly as favors for VCs. They're never very satisfying. I restore cars as a hobby. The statement that it's harder to unbuild something than to build it -- it's true with a car, it's true with a company. So my preference is always to do a start-up.
What special qualities do you bring to the CEO role?
Courtot: I am like a coach who constantly focuses people on two things: exercising quality and putting yourself in the customer's shoes. I don't have to micromanage on this technology or that. The mind has to trust the body, and the body will react the way it should.
Noerr: I have more drive and persistence than many people I employ. I certainly don't think of myself as old. The only difference is that now when I have to do long-haul travel, I'll treat myself to a business or first-class seat.
Massaro: When I was CEO of Shugart, we were successful because we weren't too smart. If you have too much experience, sometimes you become too afraid of making a mistake. And then you can't create anything original.
[So] I encourage my people to make mistakes. My only requirement is that it's an original mistake, the result of trying something different, not because you didn't do your homework.
How much age-based discrimination is there in the Valley?
Braun: Most tech entrepreneurs are in their 20s and 30s, and the VCs who fund them and sit on their boards are in their 30s and 40s. It's harder for older execs to fit in with this crowd. I wouldn't call it discrimination, but it is way different than other industries where at 50 you're rarin' up your career and the boards are filled with guys in their 60s and 70s.
[As a recruiter] I placed more than 50 CEOs in Silicon Valley, and most were 40-45 years old. The oldest was Don Massaro at Sendmail. I think he was 62 at the time. He's a fabulous guy, full of energy and highly qualified. But there are always extra questions and obstacles to overcome for older candidates.
I think Silicon Valley is race blind. Let's say three equally qualified CEO resumes are presented to a search committee. Two are age 42, an Indian and a Chinese executive, while the third candidate is white and aged 60. Assuming they have comparable English skills, the toughest sell is the older executive.
Courtot: I think VCs size up people and they size up the opportunity. If you're a good VC, you'll pick the right person, whether young or old.
Braun: When I asked Intacct's board what they were looking for, they basically described my background, except for one thing: "We are looking for someone who can be a leader in the SaaS industry for the next 10 years." That was code for "someone younger than you."
Noerr: I'm 68 years old. Age is without a question a bigger issue for me than gender.
Page BreakHow about personally -- even something as subtle as a surprised glance when you come into a meeting?
Courtot: If I've talked with someone a lot on the phone, and then they meet me the first time, sometimes there will be surprise. "I thought you were much younger!" they'll say. I think it's because I look my age, but I don't really act it.
Massaro: When I come into a meeting, it's not like Father Time just walked into the room. I don't look my age, and I certainly don't act it. We also sell to large corporations. There are a lot of senior people in their 50s and 60s at those meetings. The people making decisions are a lot closer to my age than that of my salespeople.
Noerr: I was once sitting in a train and the conductor came by and patted my hand and said, "Dear, you don't have to pay." And I asked why not. "Because you're elderly." I should've pleaded with him to take my money. I hope I don't look or act that old. But that doesn't matter. It's just vanity.
What have age and experience taught you?
Massaro: At my age today, I've had it all happen, so I've got a lot of confidence. Now I try to encourage an open environment where people feel comfortable challenging me. For [less important] decisions, I've learned to let others do it their way, even if I disagree. Unless I'm sure they're going to electrocute themselves.
Noerr: I know that management is not my strong suit. I've learned to create a layer between me and the rest of the company. I used to try to get companies to run before we could walk, or spread our resources too thin. We haven't made those mistakes with MuseGlobal.
Courtot: I understand now that ego and drive aren't intertwined. Without the impatience of youth, you can look at things with a more detached eye. You don't have ego interfering as much anymore. You don't also lose your drive to achieve or the ability to act aggressively. When I was younger and I read about senior leaders, I couldn't understand that.
Noerr: I'm in a club that's literally called the Grumpy Old Ladies Club. We're all about the same age, and have all done something like start or run a company. And we're all grumpy. We say what we want, say what we mean. If we get bored at a talk, we don't stay.
What has failure taught you?
Massaro: My very first gig [as 29-year-old CEO of Shugart] was a success. It goes straight to your head. All of a sudden, you feel like Superman. A really serious failure, where you fall flat on your face, teaches you that sometimes you can't get there from here. It also helps your management style when you've failed big time and can convey that to people. You're human to them.
Courtot: With cc:Mail, we essentially beat Microsoft with just 45 people. Then we made the mistake of selling to Lotus. I got a very good price. But within one and half years, Lotus replaced cc:Mail with Notes. And IBM shut cc:Mail down despite 20 million users. I felt very sad.
Massaro: I was CEO of an environmental products company that I funded myself and lost a ton of money on. They call that self-embezzlement.
Seriously, I've learned that so much success in the Valley comes from being in the right place at the right time with the right product. At the same time, you have to know what time it is and where you're standing.
Page BreakIf you were hiring an older person, what would you look for?
Noerr: The most telling thing I think is if they have enthusiasm or passion. If they don't, then it doesn't matter what age they are, I won't hire them.
Braun: For every John McCain, there are a lot of people that age who are so set in their ways, or so tired out, they lack the energy or creativity to be really creative. But there are others who have more energy than most 30-year-olds. We're running marathons, doing pushups.
Noerr: Whatever you think about McCain [politically], he is not keeling over into his grave. He may have a toe in the grave, but not a foot.
Massaro: My main criterion is enthusiasm. I have taken younger people without much track record. I'm willing to because I was once CEO at a young age.
Braun: I like that comment Ronald Reagan made when he was running for re-election [against Walter Mondale in 1984, at age 74] -- "I will not make age an issue of this campaign. I am not going to exploit, for political purposes, my opponent's youth and inexperience."
How much pressure is there for you to do the typical Silicon Valley thing -- cash out, invest, serve on boards, play golf?
Courtot: Absolutely, there is a lot of pressure to do the done thing. I'm not the VC type. I'm on very few boards because I'm not the type who can manage multiple companies. I like to be directly involved with just one.
Massaro: I've seen a lot of that, where money was the objective, and as soon as they made it, people retired. I'm not against that, but it's always been the result, not the goal, for me.
Noerr: Golf is absolutely not my kind of thing, nor is hanging out at the bar smoking cigars. I don't really know what I'll do after this company is sold. I've been offered opportunities to be on boards. I think my nature would be to tell them what to do, and then they would get pissed off. Chances are that I'll go on and build another company.
Page BreakAny trouble staying young and refreshed?
Courtot: As long as you exercise your mind, you'll be OK. It's not that difficult to be healthy. I lift weights. I play tennis. I eat well. I drink green tea, because I like it. I avoid processed foods, because I don't like them. I'm also the very happy father of an 18-month-old girl.
Massaro: The companies I've done include disk drives, then systems, then software-based slots, then security and now messaging infrastructure. My only requirement is that I get to do something new each time, because I'm such a technology nerd and want to learn something new. My wife maintains I am a 65-year-old kindergartener that way.
Noerr: When we sign a big seven-figure deal, it is still just as sweet as the very first deal I ever signed.
So when will you finally retire?
Noerr: I'm grooming my president, Kristina Bivins, who is in her late 30s, to replace me in a few months' time. She is infinitely better than I ever was at things like process and marketing. I'll keep doing what I do, which is think about where the market is going.
Courtot: I have no timetable for retiring. But I can start to see the end of the line. And I do want to enjoy my little girl. When you're a young man, you're so busy you don't have time to see your children the same way. So I certainly want to spend time with her and for her. On the other hand, I've still got to build a very good team. I've got just a few more management holes to fill.
Massaro: I have three kids. The youngest is just going into college now. That's a boundary condition for my wife and me to start traveling. But I don't have a date here. My afternoon naps might be getting longer, but I think I've got another five years in me.