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CEO Spotlight: Matt Glickman, Merced Systems

By Angel Mehta, Managing Director, Sterling-Hoffman Executive Search

The phrase 'serial entrepreneur' comes to mind when Matt Glickman is in the room. In the dotcom bubble, he founded BabyCenter, a website for soon-to-be moms and dads. His current venture? An enterprise software vendor focused on revolutionizing customer operations performance management. Angel Mehta, Managing Director of Sterling-Hoffman, chats with Matt Glickman, CEO of Merced Systems, about lessons from the rustbelt, finding the right business partner, and what to do when you don't know why things aren't working.

Angel Mehta: Was entrepreneurship something you always felt destined for, or was it something you fell into almost by accident?

Matt Glickman: Even at a young age, I liked business. I always thought Iíd grow up and run a manufacturing company as I just loved making things, and manufacturing and operations is what the Midwest has a lot of. Also, my dad was a lawyer for a lot of small businesses so I had exposure to a lot of small manufacturing shops, and then in my first job out of college, I was exposed to big auto assembly plants. So yes, I always thought thatís what I would do because I loved leading people.

Angel Mehta: How did growing up surrounded by manufacturing companies, as opposed to high tech or investment bankers, have an impact on your business philosophy, if at all?

Matt Glickman: It had an impact, for sure. Watching the Rust Belt go through problems in the Ď70s and Ď80s, I saw complacent managers who ruined peopleís lives because they just were running companies into the ground and people were getting laid off as a matter of routine Ė I saw that bad management ruins lives.

So I think that it shaped me in the sense that I think it is really important to manage well and execute well and lead well because I had first-hand exposure as to what happens when leaders screw up.

Angel Mehta: This is the second company youíve founded with Mark SelcowÖ Describe the partner-dynamic you have with him, and why it seems to work so well.

Matt Glickman: At Stanford, one of the things I wanted to do was find a partner because I knew I was the type that would need to work with someone to do the heavy lifting of building a company. I met Mark Selcow there (at Stanford)Ö itís not the usual business and technology partnership that you think of when you think of two people out here.

Though it does have the typical dynamic between a sales guy and a product guy; Mark is the sales guy, and Iím the product guy. Markís instinct is to go out and sign up customers and mine is to make sure the product works for them, which are, of course, the two most important pieces of the puzzle. But really our partnership is based on shared values and mutual trust. While we have our differences, we see the world in similar ways, and we can rely on the other without hesitation.

Angel Mehta: Do you think starting a company right out of school is a smart career choice?

Matt Glickman: Iím not sure, but I can tell you that when we got out of school, we felt we were quite young and didnít feel like we could go start a company; we wanted to get more experience first. I went to Intuit, which was a small company but known for good products, good marketing. One of the great things I learned from the company was how to conceive and build great products that meet a real market need. The founder of Intuit, Scott Cook, was one of the first to apply the consumer marketing tenets from his old employer P&G to the software industry. Those ideas have been instrumental in building and marketing great products at BabyCenter and at Merced. While everyone in Silicon Valley says that they are customer-driven, not technology-driven, I have found itís more of a rarity to think product and customer first and technology second.

Angel Mehta: So how does one go from Intuit to a dotcom for baby stuff?

Matt Glickman: It was fortunate that the Internet was emerging just at the time that I was thinking about what I wanted to do next and thatís why, in í96, a combination of the emergence of the internet, and my wife and I considering having a baby gave me the idea for BabyCenter. Prior to the Internet, you couldnít really create a one-stop shop for everything that an expectant or new parent needs Ė general information, health information and product sales. So, we built something new that was good for consumers but was also a really good business. Our information attracted users without spending on marketing, and we were able to not only sell advertising but sell products as well, which was a better business model than the one that existed in the pre-Internet world.

Angel Mehta: So was it difficult making the switch from a venture focused on the consumer (BabyCenter) to a venture focused primarily on the enterprise (Merced)?

Matt Glickman: Not as much as youíd think. The common theme in my life now is that I like to figure out how to use technology to improve the way people do things. Obviously there are a lot of differences in terms of who you are selling to: consumers versus businesses. But first, even in the case of a consumer business, like BabyCenter, we were selling to big companies like P&G, J&J and Blue Shield of California. Second, the general skill in either case is figuring out how to make technology work for every day people and build the business and team around that. The consumer world and the world of application software are pretty similar to me in that sense.

Angel Mehta: Are you required to be passionate about the product of the company in order to be successful at it?

Matt Glickman: I think you have to be passionate about some piece of the puzzle, whether itís the end customer or market, the product, or building a great company. I get as much satisfaction out of the challenge of building a great organization as I do about the product or the market.

Angel Mehta: Is it your perspective that an entrepreneur need not be a domain expert before entering a business?

Matt Glickman: In my case, it wasnít necessary. You just have to be a quick study, be humble about what you donít know and be aggressive in learning what you need to know. Iíve stepped into consumer software, Iíve stepped into retailing and Iíve stepped into media. Now Iíve stepped into Enterprise Software and there was certainly a learning curve in each case, but thatís part of being an entrepreneur: understanding and learning your industry. At the same time, you need to figure out some rules to break or else thereís no new opportunity to create. In one sense, being naive about an industry is an asset because youíre not afraid to try and solve problems that Ďexpertsí wouldnít dare touch. Weíve tackled some incredibly difficult technical problems that no one in the industry has tried to tackle before, and we did that because we didnít know what we were getting into. Of course, years later, we have really strong experience and unique intellectual property around some things that are quite valuable for our customers.

Angel Mehta: Letís talk a little bit about Merced. Help me understand the core business problem you are solving for customers right now and how you position yourself against big ERP vendors in a way that allows customers to seriously consider you as a viable option.

Matt Glickman: Merced sells Performance Management software for call centers and other customer operations groups such as retail, field service and back office operations. Our product integrates data from all the different transactional sources that exist in these different environments. We cleanse it, store it, create one version of the truth and then distribute it in very personalized and relevant ways to everyone from the top of the organization down to the front line employee and then give them the means to take action to make improvement.

Customers who deploy Merced see really big improvements in productivity or efficiency in short time frames. The reason we can do that is that end users can change their behavior in a way that helps the company; thatís usually about efficiency gains and cost reduction. Itís also about increasing sell rates and sales rates. There is considerable variation in performance across people, teams and businesses in customer operations, and little changes have a big effect on the bottom line

We are different from ERP systems and other choices on the market because we are built from the ground up to do performance management in complex operations environments. The traditional ERP systems arenít designed for the kind of analytics that we do, and the traditional BI players arenít designed to make it easy for end users to actually take action on the data. They are really more about serving up the data.

Angel Mehta: Can you describe a couple of instances, perhaps at either Merced or at BabyCenter, where you felt over your head as an entrepreneur or as a CEO?

Matt Glickman: Well, I think as an entrepreneur, you feel over your head almost every day because you are charting new grounds, whether itís starting a company or growing a company to a new level. Iím always trying to figure out if I am making the right choice about who weíre hiring, how weíre staffing the team, what products we build next, what features we add. Thereís no road map.

Angel Mehta: One of the biggest challenges entrepreneurs have is trying to pinpoint the reasons things arenít going the way they should, and whether a key member of the team needs to be replaced. How do you know when the problem with someone on your team is a problem with someone on your team and not the market or just bad luck?

Matt Glickman: Youíre right, itís a really hard problem when youíre a small company and you have only one person or a few people in each role and have only one or two customers. You really canít figure out if you have a product problem, a person problem, or a customer/marketing problem. As you get larger, though, you can start to see patterns. You have multiple people in different roles and some people are better than others at leading engagements to implement the product and some developers are more proficient than other developers and some sales reps more successful than others. But itís tough Ė thereís no magic solution and no clean way to isolate what is leading to success or problems.

Angel Mehta: What do you spend most of your time on as CEO?

Matt Glickman: My job is to be the glue across all the different functions and everyone. One of the advantages of not sitting in any one department is that you can look holistically across the company and at customers holistically. Often times, the problems and opportunities donít break cleanly into a product issue or a sales issue or services issue. So I balance, I spend my time on internal organizational issues, I spend a chunk of time with customers, both prospects and existing customers, and then I spend some on the ecosystem - partners, analysts, investors. One of the nice things about co-running the company with Mark is that I can spend my time a little more internally, and he can spend his time a little more externally, and that lets us do more for the company. Itís really hard to do both well, and our partnership gives us a better chance of doing that.

Matt Glickman is CEO and co-founder of Merced Systems. He has over 10 years of management experience in the software industry and in building successful software companies. Prior to Merced, Matt was CEO of consumer retailer BabyCenter, Inc. (currently a subsidiary of Johnson & Johnson), the leading eCommerce company. He led the development of Intuit's Quicken software product line. Matt has also served as a management consultant to Fortune 500 companies at Bain & Company. He graduated an Arjay Miller Scholar from the Stanford Graduate School of Business. Matt also holds an M.A. from the Stanford School of Education and is a Phi Beta Kappa graduate of Amherst College. For interview feedback, contact Matt at matt@mercedsystems.com

Angel Mehta is Managing Director of Sterling-Hoffman, a retained executive search firm focused on VP Sales, VP Marketing and CEO searches for enterprise software companies and lead investor in http://www.softwaresalesjobs.com , the #1 site for software sales jobs. Angel can be reached for feedback at amehta@sterlinghoffman.net

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