Issue link: http://www.e-digitaleditions.com/i/59881
I have an engineering degree, so I'd always been focused on technology; but I really felt that VeriSign would give me a chance to hand-pick a team and build a company that would leave a legacy. Whether that legacy was going to be security or some other version of technology was not as important to me as getting an opportunity to build something from scratch and surround myself with people who had those same goals. Our first business model, which was written before I got here, was to sell security services to Apple/Mac users and to Lotus Notes users. The Internet came along just about the same time I did, and we had an opportunity to provide ser - vices for Netscape's original products and, three months later, for Microsoft. Over the last nine years, we have learned a lot about how to build an organization. You must understand your core competencies, but you also must adapt to what your cus- tomers are telling you are the real opportunities to pursue. Had we chosen the Apple/Mac and Lotus Notes market, we would not have survived as a company. You reached the CEO's office without having a degree from business school. What do you think you learned on the job that you never could have learned in school? I think there are two sides to that coin. I had taken my GMAT and intended to go to business school after working for a few years. But I was in Silicon Valley at a time when the best edu- cation I could get about high-growth businesses was occurring right in front of me. In that particular era, I would say I prob- ably was better served not going to business school and just living in what was an incredibly dynamic environment. This was a time when the first microprocessors and the first operat- ing systems for Microsoft and Apple came onto the market. It was the most fascinating time in technology to live through. On the other hand, when I watch business school gradu- ates who work for us, I see that they have a set of skills that I wish I had learned earlier. They understand modeling and financial and strategic analysis. Would those tools have helped me in the early years of Silicon Valley? Absolutely. One thing you don't learn in a hypergrowth mode is disci- plined thought and analysis. I think you need a blend of both kinds of learning—the discipline you can get from a business school curriculum as well as on-the-job training that teaches you that business needs to be adaptive every day. At a time when a lot of other Internet companies were failing so spectacularly, VeriSign was thriving. If stu- dents were looking at VeriSign as part of a case study 20 BizEd JANUARY/FEBRUARY 2005 about successful Internet companies from the 1990s, what would they discover? We were the last of the old-world venture funding companies instead of the first of the new Internet companies. For us it was about building a company in a bootstrap way—spending as a byproduct of growth, not in anticipation of it, and laying a solid foundation for the company no matter what the mar- kets brought in terms of opportunity and change. I think this notion of building something that will leave a legacy, and doing it in a methodical way, gives a company a strong foun- dation from day one. The other thing was that we were willing to adapt our model based on what our customers told us. One of the say- ings I'm fond of is, "Our vision is good but our hearing is better." So, very early on, we listened to what Netscape and Microsoft were telling us about the Internet. We listened to what the government and large corporations were telling us about their security needs. Relatively early on, we understood that running intelligent infrastructures would enable elec- tronic commerce and communication; and if we did it right, we'd be a beneficiary. Listening to customers and following the winds of the market gave us a strong ability to adapt quickly to what we saw. So many technology company founders and business school graduates are taught that they must stick to the strat- egy and stay focused. That's a very, very important lesson. The corollary is, you've got to listen to your customers if your strategy is wrong. I think you need to keep your options open in terms of business direction and strategy, but you shouldn't stray from your core competencies. What should business students learn about the rea- sons technology companies failed during the Internet bubble—and the reasons some of them are so success- ful now? I think that the key lesson is that you need to be No. 1 in your market. During the bubble, there was the notion that a rising tide raises all boats. We could have a thousand online book- sellers, and they would all thrive. In reality, the No. 1 guy makes at least half the profits of the whole industry. No. 2 may make another 20 to 30 percent, and everybody else fights for the scraps. So the notion of being a me-too player, or that being No. 2 or No. 3 is OK, is really a fallacy. And I think that is just as true in the online world as it was in the offline world. All the things we used to hear about—the new business models and disruption of the online economy and disinter- mediation, blah, blah, blah—I don't think that all proved out. I think the reality is, those who got there first with the best