The Tech Take: Will There Be Another Ellison?


Some major leadership changes rocked the tech world this past month. Larry Ellison’s September announcement that he was stepping down as the CEO of Oracle felt like the final in a series of bows from the industry’s prominent early founders.

NetSuite CEO Zach Nelson said as much, telling the New York Times: “By a lot of definitions, it’s the end of an era. He is the longest-tenured founder and CEO in the Valley.”

After this transition from the head of the pioneering company he founded in 1977 to executive chairman and chief technology officer, Ellison has more than a decade on the longest currently active tech CEO (Robert Kotick at Activision Blizzard), according to Bloomberg.

On the other end of the spectrum, and just before Ellison’s big move, Peter Karpas stepped down as Xero’s CEO of North America after just six months with the company.

“Peter Karpas has voluntarily stepped down as Xero’s head of North America,” Xero told me in a statement. “Ross Jenkins, Xero’s CFO, will lead Xero’s operations in the U.S. until Xero appoints a new leader. We are grateful to Peter for his work and recognize his contributions in helping Xero become the fastest growing cloud accounting company across the globe. In his time at Xero, Peter helped establish strong foundations for Xero in the U.S. market and we look forward to his continued success.”

Xero also noted it has begun recruiting for the next North American lead, with the selection to be announced in the coming months. That process would also seem to delay any plans of a U.S. initial public offering, which Karpas spoke to me about in July.

Where Ellison’s announcement was inevitable if a bit earlier than expected—and, as a founder, still keeps him close to the source of his vast personal fortune—Karpas’ exit is more emblematic of the current state of the industry.

The demand for talent is so high that companies have not only stepped up their recruitment and training efforts, but some have allegedly colluded in wage-fixing, according to Department of Justice and class-action settlements earlier this year. Named in the complaint and lawsuit were Apple, Google, Intel, Adobe, Intuit and Pixar, with the class of 60,000 tech employees citing emails between late Apple CEO Steve Jobs and former Google CEO Eric Schmidt regarding a pact not to recruit each other’s staff. While the companies admitted to having no-hire agreements, they denied these were in place to depress salaries.

The competition has only amplified for experienced talent to occupy the current tech bubble, recently expanded by the busiest year in IPOs since the bubble last burst in 2000, according to Reuters, and led by Chinese e-commerce group Alibaba’s massive U.S. market debut.

That struggle is felt in the accounting reseller community, with many top executives responding to our 2014 VAR 100 survey that attracting and retaining talent remained their biggest challenge. It has also been long-apparent in the larger accounting community, as Baby Boomer leaders prepares to retire. And while the accounting profession’s need for experienced leaders is more due to the aging of long-serving partners, their sobering lessons in succession planning are equally applicable for the tech sector.

From one perspective, the wealth of new leadership can be viewed as invigorating—Jon Roskill, appointed as Acumatica CEO in April, was energized when recently telling me his plans to grow the relatively youthful ERP provider. As he and his team kept touting transparency throughout their partner summit, he even explicitly addressed the competition—namely Sage. Acumatica had quite literally treaded on the accounting software provider’s turf during this year’s Sage Summit, handing out coffee to attendees on their way to conference sessions.

During his keynote, Roskill displayed a bill for $10,000 Sage reportedly gave Acumatica for infringing on its non-compete clause with Mandalay Bay, where the conference was held. Similar stunts by vendors to lure VARs from the competition have been mounted in the past, and Roskill was proud to showcase the consequences of theirs.

Still, the larger war wages on. While the top tech providers are as enthusiastic as ever to promote their solutions to customers more rapidly adopting the cloud, the cloud is a big place.

Before Roskill joined Acumatica, he was with Microsoft. Karpas had come to Xero an Intuit veteran. And NetSuite CEO Zach Nelson could speak so well to Ellison’s role because he previously served under him.

It seems unlikely there will be another Larry Ellison, based on his early impact and sheer tenure, but competition has never made anyone complacent—especially companies with the explicit mission of continually perfecting their next generation.  

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