Rick Faulk knew what it took to ramp sales for a venture backed software company. He’d done exactly that for WebEx prior to its sale to Cisco. Then he was asked to do the same thing as co-CEO for three merged social software companies. Listen in as Rick shares what he learned from this cat rodeo about M&A diligence, merging corporate cultures and decisive leadership.
Rick Faulk has more than 30 years of experience in executive management, sales and marketing in the software industry. He’s worked for some of the world’s most successful SaaS and technology companies, including Lotus Development, j2 Global, Cisco, WebEx, Intranets.com and PictureTel.
Currently Rick is the Chairman and CEO of Intronis, a provider of white label cloud storage solutions. Prior to Intronis, Rick was General Manager of Cloud Services for Sales & Marketing at j2 Global. As President & co-CEO of Mzinga, Rick worked to merge two learning management software companies with a social networking software company. Immediately prior to Mzinga, Rick was Chief Marketing Officer of WebEx Communications and President of WebEx Small Business, where he was responsible for the company’s worldwide go-to-market and customer acquisition strategies.
Rick currently sits on the boards of Yodle, SkillSurvey, Bidding4Good and BatteryCorp and is an advisor to other start-up businesses. Rick holds a Bachelor of Science degree in Business Administration from Bowling Green State University.
The Take Home Lessons
My conversation with Rick centered on his experience at Mzinga. The Company is still operating, but did not achieve the market success that Rick and the venture capital investors had hoped for. It’s a strong niche player in social learning and customer communities, but all involved had hoped for much greater growth and market presence.
Rick boiled down the lessons he learned into a few headlines:
- You’ve really got to dig in and do your own diligence when companies are being merged. Ask the hard questions and search for the skeletons in closets.
- While it seems obvious, there needs to be real clarity about the future direction of the merged company. Leadership then has to step up and make the hard decisions to move in that direction, i.e. goals, responsibilities, compensation all have to be in alignment. Compromise isn’t necessarily a good thing.
- Co-CEOs and merged management teams can make alignment particularly difficult. Approach this organizational structure with great care.
- Financial systems and a quality CFO are critical. Mzinga ran into trouble when financial reporting wasn’t timely and accurate. You can’t steer a business with bad data. Further more, cleaning up financial systems creates a huge distraction.
- The ultimate lessons “buyer beware” and “change is really hard” are somewhat obvious. In our conversation Rick dives deeper into these and looks at the nuances and signs of trouble.
Resources & Links
Why a Venture Capital Podcast About Failure?
From early childhood you’ve always heard the saying “Learn from your mistakes.” In the venture capital industry you frequently hear “Fail fast” to learn and get to the right idea. Great advice. So, for this venture capital podcast I interview venture capital backed entrepreneurs about what they learned when their start-up didn’t go as planned. I hope you can learn from their valuable experience.