The story post egg fertilization and splitting…

Shane and I were born in South Korea. OK, technically there is no South Korea. republic of koreaThe official name is the Republic of Korea, but that’s confusing because North Korea (the place that can’t keep the lights on) is known as The People’s Democratic Republic of Korea, which is too close to the Republic of Kor… oh whatever. Dad worked on the military base and the kids popped out. Mom and Dad didn’t know they were having twins. The doctors said there was a 13 pound baby. When Shane came out at just under 6 lbs. they knew that there was a mathematical error that had occurred somewhere down the line.

Adam was born somewhere. Probably Rose Park, who knows, he’s never admitted it. He later moved to West Jordan where Shane and I moved just after elementary school, which is a perfect segue into this next part of the story.

You Communist Pig – the story of three lifetime friends

The first words that Shane heard Adam speak were, “you communist pig”. It was directed at Shane during a nerf football game. Adam was going through his Jane’s and “Weapons and Warfare” books phase. This was during the cold war, so calling someone a Russian was the ultimate insult. Them’s definitely fighting words. Lucky for us Adam was a wimp, though even luckier for Adam, we were even bigger wimps.

The setting was a sleepover at Mike’s house. BTW, Mike’s dead now. It sucks. He was an awesome guy and we still feel his loss even after so many years. We’ll never forget him. (We miss you, Mikey). Anyway, it was an epic sleepover. Laid back parents, pizza, soft drinks, a huge VHS library, a small betamax library, and cable TV. Betamax Tape

Stop for a minute and add all of that up… weekend sleepover, 14 year old boys, videos, pizza, and late night cable TV. Even a three year old could connect the dots and determine it was an epic sleepover. This was the setting where Adam, Shane, and I met and became lifelong friends and future business partners.

Fast forward. Adam was an awesome near straight A student. Shane and I didn’t even earn a 4.0, combined. For real, my cumulative GPA was 1.999. I couldn’t even break the C barrier. Shane was probably 1.9 or a touch lower. I don’t know. He probably doesn’t either. GPAs don’t pay well after school ends (they didn’t pay all that well during school either).

Our vice principal was G. Norma Villar. Unsurprisingly, Shane and I (and Mike) spent many a day in her office. We got to know her pretty well. She loved using her first initial in her signature even though she absolutely hated her first name. In case you’re wondering it stands for Gloria. If you ever meet her just say, “Hi Gloria” and see what she does (I suggest standing back a little if you do take this challenge). If she asks where you learned her first name, just tell her that two guys she said would be digging ditches for a career send their regards.

After school, Shane and I moved to Hollywood and Adam stayed in Salt Lake. Let’s briefly cover what was happening at this juncture, because it’s kind of important.

While living in Hollywood (yeah, we were trying to become writers and producers) we got some jobs helping companies move computers. hollywood 1990That’s it. Not working on computers… moving them. But that was all it took for us to see the potential for a promising career. We realized that computers meant air conditioned offices and almost no manual labor. You had us at hello. Luckily for both of us we knew how to type. That may seem strange to say, but in the 80’s (when we were in school) you only took a typing class if you wanted to get a job as a secretary. The typing classes were almost exclusively attended by girls (it was awesome). To this day Shane and I maintain that the most important class we took in High School was typing.

Back to Hollywood.
Shane got a job working for Argyle Television. Don’t bother googling them. They were bought out by Hearst television and the owners made millions. Like I said, you had us at hello.

On Shane’s first day at Argyle as the “Computer Guy”, a secretary asked him to help her. She wanted to delete a file. The only computer experience we had was working on an old 1990 Macintosh Classic. The computer Shane was working on for the secretary was a Windows 3.1. Shane looked on the screen for a garbage can (it didn’t exist in 3.1, it wasn’t until Windows 95). So Shane looked on the keyboard and saw a key with the word “Delete”. He clicked it. The file deleted. Shane was the hero. Best of all, the entire office thought he was awesome. It went to his head, totally. We’re talking prima donna crap here.

Shane got better at computers. I’m not kidding, he’s really good. One of the best troubleshooters. He just understands all of the moving parts. His boss at Argyle gave Shane an unlimited budget for books, so Shane purchased (and devoured) every computer book he could lay his hands on.

Regarding learning computers, I got pretty decent too, but nothing compared to Adam and Shane. That’s why I’m the president of the company.

Adam was (and still is) the bomb. A little backstory here… Growing up, Adam’s family wasn’t a sneeze away from poverty like our was. They could actually (brace yourself) afford a computer when Adam was a teenager.

Adam’s dad was an accountant and he had heard about this new fandangled device, and without even knowing how to use one, he purchased a computer for his accounting business. For a while the computer was kept at the house, which is when Adam started tinkering on it. Adam immediately learned how to program. He just taught himself. He wanted to create a database to track collections of things, the only problem was he didn’t collect anything. At the surface, he really wasn’t that interesting of a person. He didn’t have hobbies. No baseball cards or things like that.. He really had nothing to keep track of. He was a solution in search of a problem.

OK, fast forward to the time when Shane and I were in Hollywood, and Adam was a full-blown software programmer. His focus was on Object Pascal, using Borland’s Delphi. If that last sentence meant anything to you then you are A) a nerd, and B) old.

Adam’s the best programmer I’ve ever met. During this time he did a contract gig at a fortune 50 company. This is where he met Gwen. Gwen is our COO. At 3M she was managing a bunch of developers and she realized right away that Adam was a special kind of developer. He could do anything. Create anything. (He really is amazing). He was immediately Gwen’s favorite. She took him home, chucked him in a well and started reciting “it puts lotion on it’s skin”…oh wait, scratch that, I was remembering something else… (Why am I all of the sudden craving fava beans?)

Roads converge

At the same time that Adam was working with Gwen, Shane and I were working IT jobs in LA. On a trip to Utah I met up with Adam and we caught up. He learned that Shane and I were doing IT in LA and I learned what he was doing with programming. He mentioned that he had an idea for creating a new type of database. Somewhere along the line someone (I don’t remember who, but it was probably Adam) suggested that we start a company together. We were all in. The only question was where? We tried to get Adam to move to LA. He visited and then made his opinion known. “LA”, he said, “sucked”. While we loved it there, it really was (and still is) a tough place to start a business.

So, Shane and I moved back to Utah to start a company with our lifelong high school friend. There was just one small problem. We didn’t know how to run a company.

We’ll cover this next part really fast, because it doesn’t have a happy ending. The database thing never really took off. So we started selling hours as consultants. We focused on Windows servers and support. This was in 1997 and ‘98. We actually got some really good contracts, one of them worth millions. Then in 1999 every guy with a heartbeat got Microsoft certified. The billable rates went through the floor. All of a sudden the money started drying up. This was just prior to the first dot-com bust. Everyone could feel a recession coming.

We thought, “Hey, let’s do something that has high billable rates and is recession proof.” We looked into PeopleSoft and IBM Tivoli. We chose Tivoli for one reason and one reason only. We knew a guy who knew how to use it. We didn’t know anyone with PeopleSoft experience. This was important because PeopleSoft was probably the first big fatality of the dot-com bust. It went totally toe up.

Happily, Tivoli was recession proof, but not the part that we first started working on. The part that we focused on (and became partners with IBM on) was the first release of a program called IT Director. This was a crucial, painful, and ultimately fatal learning experience, the ramifications of which are at the heart of our PDQ products today.

IT Director was a cool little product. It was geared toward the SMB (small-to-medium business). IBM defined SMB as any company below 1,000 computers. We learned this product, became certified, and then tried to sell it. The only problem was that IBM had priced the product way out of the market’s ability to pay. It was astronomically expensive. We closed a few sales, but they were hard won. We were just days away from closing a bunch of sales and finally getting our heads above water, when our sales guy was informed that IBM was scrapping IT Director. This didn’t come from IBM directly, but from a potential customer that heard it from one of our direct competitors. We assured the customer that this wasn’t the case, and that as partners with IBM certainly we would have been the first to know such news.

Not true. IBM had canceled the product. They just hadn’t bothered to tell us. oobWe lost every potential company in our pipeline. Sad story, our company didn’t recover. We closed our business. It was heartbreaking. Years of hard work went south because I, as the president, had allowed all of our eggs to be in one basket. I failed to see what was coming. I failed to accept that the wholesale pricing for IT Director was just too high for most companies, and that adding a retail price put it out of range for most. I failed to navigate the company out of this mess. It was a horrible experience, but it did have some bright spots.

We still had the old Sun SPARC unix server and we still had access to the full suite of IBM Tivoli software (the stuff that was used by enterprise businesses and was not canceled). The Tivoli Management Framework (TME) was so expensive only fortune 5,000 companies and governments used it. It really was recession proof. Though our company had gone under, we still had some of the tools. We moved the server to Shane’s basement and we started learning.

The contract work for Tivoli started rolling in, and it never stopped. Though heartbroken at the loss of our company, we each took contract gigs doing Tivoli. Shortly thereafter, Shane and I started a company. This company was different, though. There would be no employees beyond the founders. It was created as a means to have customers pay us for Tivoli gigs. We weren’t employees, we were contractors. The work was steady and the billing rates were going up, not down.

By this time in our lives we were all procreating…. I mean we were all married with children. Life was good. Contract work was steady and the money was always there. But there was something amiss. We were traveling and relocating a lot. That’s how it goes with contract work. You go where the customers are. That’s easy to do when you’re single, or newly wed with little kids. It’s pretty tough when you’ve got teenagers. So we decided to stop selling hours and start selling software.

But we didn’t want to create software that competed with the big boys (IBM and Microsoft). They had awesome products. IBM Bigfix was really good. SCCM was the bomb. But they were just too complex. They were too expensive. We realized that there were likely thousands of companies that just wanted to deploy software. It didn’t require an army of consultants at those (really nice) high rates. It didn’t take racks of dedicated hardware. It just took cases of beer and single malt scotch. Oh, and Diet Coke for me, because of a certain card that I kept and still keep in my wallet (not AA).

After the debacle of Tivoli IT Director you might wonder why we decided to enter the SMB market with our own product. The answer was actually really simple.

IBM had taken their high end, high priced, and highly complex software, and had tried to dumb it down to the SMB market, but at its heart it was still complex and expensive. Whatever they did, we would do the opposite.

We kept our software very simple. Here’s how we defined simple. It would not require a dedicated server to run on. It wouldn’t even require a server. You could run it on your workstation. It wouldn’t require an agent. It wouldn’t require consultants or specialized training to run. And most of all, it wouldn’t be expensive.

We reasoned, correctly as it turns out, that keeping it simple would allow us to keep licensing costs down. The challenge with low cost was that you needed to attract a lot of customers. That was true. But we were patient and we kept our overhead costs low. How low? For the first several years we all worked out of our homes. We didn’t get an office until it was absolutely necessary. We didn’t have a receptionist or even a calling service. We had a virtual phone number that went to a virtual assistant. Lucky for us we didn’t get a lot of calls because I personally hate talking to a computer on the phone. It really brings the rage out.

We started in a 450 square foot office. One month later we moved to an 850 sq ft office. 6 months after that we moved to 4,500 sq ft, then to 7,500, and now we’re at about 19,000 sq ft. All of it in the same building.

pdq cafeAs we grew we focused on making the office a fun place to be. In order to be fun we thought that we would make fun of traditional businesses. A friend once remarked that we were sticking our finger in the eye of traditional businesses. I don’t know that that’s so much the case as we were sticking our finger in the eye of businesses who take themselves too seriously. I mean c’mon, lighten up already.

boozeAnd that brings us to the current day. We have a great workforce. Every employee has his or her own office. No cubicles. No open space work areas. No ping-pong tables. A fair amount of alcohol and a ton of food. There’s a lot that we do for our employees, but that’s only because they do so much for our customers, who now measure over 15,000 (paying) and over 200,000 (free).

We’ve proven that there is a viable market for systems management software for the SMB market. We have an almost 80% renewal rate and our customers love us, or tolerate us, or something. Who knows, maybe they hate our guts but love our software. I don’t really know, but it doesn’t matter. What we do helps a lot of people, it helps a lot of companies, and it has helped every one of our employees and their families.

Oh, and we’ve had a blast doing all of it.