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Angel Mehta: Let's talk about Liquid Machines: where did the core technology come from?
Mike Ruffolo: The genesis of the technology came from computer science research work done by the technical founder, Mike Smith. Mike is a brilliant guy who is the Associate Dean of Engineering and Applied Sciences at Harvard University. He had been doing some research work around IT security. His belief was that data security would never be effective if it wasn't usable by a typical end user. His vision of making security an enabler of business processes remains a cornerstone of our business.
Today, the Liquid Machines software persistently controls access to and usage of electronic information throughout the entire information lifecycle. What's very cool is that it does this without disrupting the way in which users work. This is a very big idea as the problem we are solving is big and getting bigger. Virtually everything of value is contained in electronic form, and businesses have lost control of their most valuable assets. Our message to prospects is, "We keep your business, your business." This strikes a chord with them as they feel helpless knowing that they can't control the flow of valuable information that is leaving the business and falling into the wrong hands every single day. We all read everyday about information loss or theft and the damage that this causes to a company's reputation, brand and stock price.
Angel Mehta: It seems like the idea of protecting information inside your enterprise has just emerged over the last couple of years as a mainstream phenomenon… prior to that, security was about spending millions to protect your network from external threats. But is there a killer application for the technology yet?
Mike Ruffolo: There are two major killer app categories. First is intellectual property protection, and the second is supporting compliance initiatives.
Intellectual property protection is for sure the most important thing. Confidential data is everywhere and is spiraling out of control. This is a business issue and traditional security defenses are ineffective or unusable. Our technology enables people to securely share information needed to do their jobs without risk of inadvertent or malicious abuse. For example, Liquid Machines enables companies that outsource manufacturing and other key processes to securely share confidential information between themselves and their external partners.
While it is critical to protect your network, the reality is that over two-thirds of the security incidents that occur within enterprises today involve employees or insiders. So what we do is to mitigate the risk of that occurring and at the same time provide companies with the ability to remain in compliance with regulations like HIPAA, Sarbanes-Oxley and other industry specific regulations. Government agencies and enterprises look to us for help in these two areas.
Angel Mehta: You've been leading Liquid Machines for about a couple of years now and while I'm sure you did your diligence prior to joining the company every CEO finds the situation slightly different when they pull back the curtains as an insider. I'm curious to know what surprises there were for you, if any, after joining Liquid Machines?
Mike Ruffolo: The reality is that when you're developing a technology that doesn't exist and you're trying to open up a new marketplace, one of the issues is deployment. Every company deploys technology differently, even when it looks the same on the outside. Preparing for all probable environments is a challenge. Fortunately, that problem is behind us now because we have enough large customers to have put our technology through its paces.
Angel Mehta: You've been through some pretty hectic, rapid growth, rapid change environments with the likes of Xerox, EMC, and Akamai Technologies… do you have a check list for knowing when to change your strategy? Is there a methodology that a leader can go through to understand whether, in fact, they should stay the course because that's what's required versus really changing everything they're doing? What is the thought process you use as a CEO to know how to steer the ship?
Mike Ruffolo: The process really begins and ends with being in front of customers that are thought leaders. The very best CEOs in any company, particularly in the tech industry, are out there meeting with customers. If you're somebody that runs your business behind your computer, you won't be able to anticipate the real trends in the marketplace and your business will likely fail. I like to spend time with customers who are willing to share what they're trying to get accomplished in their business and are able to give you very blunt feedback on whether or not you're moving in a direction that meets their needs. So, the #1 rule is to have a very close ear to the marketplace and develop great working relationships with key customers that can guide your thinking and your strategy.
Angel Mehta: How did you deal with the situation at Akamai, where the company was nearly out of business, had a stock price of .56 and had to cope with losing one of its founders on 9/11?
Mike Ruffolo: It was tough, Angel - serious heavy lifting. Initially, we had to cut costs and refocus the business on the enterprise and government markets. At the same time, we had to rally the employees around the bright future of the company as opposed to lamenting the problems of the past. We had to be very blunt with our team about the hard struggle ahead but asked them to trust us to do our part to put the company back on a good course. We rewarded the people who stuck with us and it paid off - through their work Akamai is now a great company and a market leader.
Angel Mehta: How does that translate to your work at Liquid Machines?
Mike Ruffolo: In a similar way, at Liquid Machines, we are using that same playbook… lots of open and honest communication and instilling a "can-do" attitude and culture. Our team realizes that we can dominate a high growth software category, and we are rallying our team around this mission. In my experience, if you are honest with your team, provide them interesting and challenging work, and earn their trust, success is almost guaranteed.
Michael Ruffolo is President and CEO of Liquid Machines. Mike's career spans more than 20 years of experience in global sales and marketing management, professional services, operations and information technology. As the Chief Operating Officer (COO) of Akamai, he successfully refocused the company on the enterprise and government markets, driving double-digit revenue growth while dramatically improving operating results. For interview feedback, contact Mike at mruffolo@liquidmachines.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. He can be reached for feedback at: amehta@sterlinghoffman.net
