Lessons From Three Tech CEO Gigs, With Mike Tuchen

In this episode, J.R. Lowry sits down with former CEO Mike Tuchen, who shares invaluable lessons from tech CEOs. Mike discusses his journey leading tech companies like Rapid7, Talend, and Onfido, reflecting on the leadership challenges and strategies that helped him succeed. With candid insights on building teams, executing strategies, and navigating market trends, this conversation offers a wealth of knowledge for aspiring leaders and tech enthusiasts. Tune in to hear Mike’s experiences and practical advice from his impressive career.

Check out the full series of “Career Sessions, Career Lessons” podcasts here or visit pathwise.io/podcast/. A full written transcript of this episode is also available at https://pathwise.io/podcast/mike-tuchen

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Lessons From Three Tech CEO Gigs, With Mike Tuchen

Former CEO Of Rapid7, Talend, And Onfido

Introduction To Mike Tuchen’s Journey

In this episode, my guest is Mike Tuchen, with whom I went to business school many years ago. He describes himself as an investor, advisor, board member, and recovering CEO. Mike just dropped at his most recent, and he says, final CEO role at Onfido following its sale to Entrust. Prior to joining Onfido in 2020 as CEO, he had two other CEO roles at Talend and before that, at Rapid7.

His earlier career days included time at Sun Microsystems, Microsoft, and Polycom. Along the way, he also cofounded a company and served as a board member and advisor at a number of tech firms. He earned his Bachelor’s in Electrical Engineering from Brown, his Master’s in Electrical Engineering from Stanford, and an MBA from Harvard Business School. He and his wife live in Pebble Beach. Mike, welcome, and thanks for joining me on the show.

Thanks.

It’s good to catch up. I know you just left what you call your last CEO job. We’ll come back to that but let’s go back to the beginning. Let’s start at the beginning. Where did you grow up and how did you end up deciding to go to Brown to do your undergraduate degree?

I grew up North of Boston and a little teeny town. I went to a private high school up there. I had my typical sort of teenage rebellion kind of years there, and I nearly got kicked out of the school. I got sent home for a couple of days to spend time with my family, thinking about life and deciding, “Is this the path I want to be on?” A juvenile delinquent who got booted out of high school. I decided that probably wasn’t where I wanted to spend my life.

My last couple of years did well and things were back more or less on a decent track, but I thought that one of the things that would help me, and this sounds totally crazy in retrospect, but it made sense to me at the time. I thought it would be smart for me to go to West Point to go to a military because they would kick my butt and put me back on the street 0:01:58[Ma1] .

There was a college counselor that said, “No, I don’t think you’ve made it for the Military.” He said, “You can do it if you want. I already had my senator thing lined up and [probably would have gotten in. It’s like, “I’m going to send not just your transcript, I’ll send the backside of the transcript as well, which had the disciplinary record.” That being said, there’s probably not a good chance of getting into West Point.

My main college counselor, who was the head of the college counseling department, was saying, “You should go to Brown.” I thought about it. I said, “There are two paths here. One is having someone outside kick my butt and one is figuring it out myself inside.” Brown was the total free-for-all all-child of the ’60s kind of environment, which ended up being awesome for me. That was the long story of how I ended up at Brown.

I would not have seen you as a teenage rebellious punk kind of kid, but you probably couldn’t pick a more polar opposite place. Brown relative to a West Point just given, as you say, it’s a very unstructured undergraduate experience there. My son loved it. He went there and loved his time there.

I was on the rowing team there, which was a transformative experience for me. I couldn’t speak highly enough about the Brown experience.

You got your undergraduate degree in EE, and then you went to Stanford straight from there. Did you contemplate going right into the job market or were you always going to go for the advanced degree?

The Stanford thing was a little bit of a surprise, and what was happening was, as an undergrad electrical engineering major, I felt like I was just getting into the fun stuff. I didn’t feel like I learned enough as an undergrad to be useful. I felt like I had an instant mile wide, a little bit about a lot of stuff model. I said, “Geez.” At the time, the fun stuff for me was semiconductor device physics and a lot of really cool stuff going on as they’re shrinking all the geometries, super connectivity, and quantum mechanics. Even now, many years later, it is still frontier science. I was like a kid in a candy store. I was like, “I want to go back and learn more about this stuff.”

Did you contemplate going for a PhD or was the Master’s going to be it for you?

No. The Master’s was more than it. As a matter of fact, the Stanford faculty brought me to the faculty club and pitched me on going to continue on to be a PhD. I politely declined, but that was the first and only time in my life where I was being a recruited minority. As a native American English speaker and native American born, I was a rarity in the advanced engineering department there.

When I went to get my Master’s, I did it while I was in the Air Force. I went to Northeastern. I did a combination of Northeastern and BU courses, which was just the way the program worked. The thing I remember was I got my ass completely kicked by the math. I thought I knew a lot of math, and then I got into Master’s engineering level math, and it was like stuff I literally had never seen before. That was probably the hardest part of it.

The whole partial differential equation stuff when you start dealing with electrical fields gets crazy.

Mike’s Early Career In Chip Design

Matrices too. A lot of matrix math. I had five semesters of college math. I didn’t get deep into that. You then went out and did a chip design for Sun, right?

I loved it. Absolutely. It was my dream job.

Did you enjoy being a practicing engineer?

I did because I’m a builder at heart. I was always a geek where I wanted to learn and figure stuff out, and I wanted to build stuff. I was the guy who took apart the toaster, put it back together again, fixed the transmission cable on the kid’s car, and all that stuff. For me, building computer chips was in the middle of what’s been just a massive technology explosion, and I’d say the earlier stages of what’s been just a massive technology explosion was awesome. I love that job.

Back then, the semiconductor industry was well developed, but you think about how much has happened since you were practicing as an engineer and what’s happened with chip design. Moore’s Law gets over-quoted a lot, but it’s incredible how much has changed.

Underlying device geometry got smaller and smaller, but we were going through one of the most significant inflection points in chip design, which is moving from the physical design where you’re drawing literally on a schematic editor. You’re dropping down this type of logic gate connected to this type and so on and moving to a much higher level abstraction where you’re writing a computer program and something that looks like PASCAL, C, or something like that. You hit the compile button and it turns into that logical description, and then you do an automatic placement route, which automatically puts it down onto a chip and does static timing analysis and so on.

We were creating an automatic push button flow where we’d write a program saying, “Here’s what we want to do. Push a button and out the back goes, lay out a ready chip that you then run through the build process. That was transformational. That’s what everything has been doing these days but back then, it was a brand new concept. Our group was one of the leading proponents of that approach.

When you think about the early days, when people were literally etching connections.

Technology has been reinventing itself continuously. That’s why we have such magical devices right now. However, this was one little microcosm there, and as a techie geek, it was a kid in the candy store moment.

When did the idea of going to business school pop up for you?

That was always on the plan. When I do career mentoring, one of the first questions I ask is, “Where do you want to be in 5 or 10 years? What’s your dream?” Most people I talk to will say, “I don’t know.” On the other end of the spectrum, from high school, I was the techie kid in high school reading science fiction and dreaming about all the crazy stuff going on in Silicon Valley, knowing that I wanted to build and run a company someday.

Everything was a step along the path. Now, there are a couple of surprises there. Going back to getting a Master’s in Engineering was one surprise, but the thinking was to learn how to be an engineer, work as an engineer for a while, get deep on it and understand how it works in practice, go to business school, and start a company. That was my high school-era plan for my life. Surprise number one was going to get a Master’s in EE. Surprise number two was going to Microsoft and to B school as opposed to trying to start a company right then. After that, it was something I’d been thinking about and dreaming about for many years.

I can still remember that, early in my freshman year, I got pulled into one of these dialing-for-dollars things. I’m sitting in the press area of the football stadium at Duke, where I went to undergrad, with this list of phone numbers and names to call of people to solicit money from for the university. It was literally probably in the first month of my time as a freshman. Sitting next to me is this woman who makes this casual reference to say, “This person went to Harvard B school, so I’m expecting some kind of good donation.”

I’d never heard of business school before that moment, but that’s the moment that stuck with me. Pretty much from there on in, I started to ask her questions about it. I’m like, “I want to do that someday.” The two of us ended up getting to meet each other. You did very well at Harvard. You were a Baker scholar. You could have gone anywhere. You could have done consulting. You could have done investment banking. You could have done anything. How did you decide to go to Microsoft?

That was some good advice, in retrospect, from a guy I used to work for. One of the senior engineering leaders at Microsoft had left and started a company. I was out talking to startups and venture capitalists, seeing if I wanted to start or join something. He gave me some fabulous advice. He said, “Mike, you used to work for me. I know who you are. I would hire you as an engineer in nanoseconds, but you did something completely crazy from my perspective. You went to business school. You want to do something more business or marketing-related.”

You’ve ruined yourself as an engineer.

I should tell you the story of my former engineering cohort when I told him I was going back to business school. They were shocked and felt like I was a traitor. His feedback was, “I have no idea if you’re going to be good at that. It’s a hard transition to make, and most people don’t do it successfully.” Here’s the other side of the coin here. Most startups don’t have strong teams. They’re filled with people who are taking risks but not necessarily good at what they’re doing.

You could go to a whole series of startups that aren’t well run that fail one after another and work for people who aren’t necessarily good at what they’re doing and you might not learn anything about this brand new skillset you’re trying to build. Also, you could be 5 or 10 years in and not make any progress. He said, “My feedback is you might not, and by the way, you might go and win the lottery and be in a fantastic environment with a great mentor, and the company could do well and so on, but that’s a 1% chance. If you want to be thoughtful about your career, go to someone who’s good at the sales and marketing discipline.”

You said the three to think about back then were Microsoft, which arguably, I’d say, is still a good choice now, but the next one is Oracle. Back then, Oracle Enterprise sales was one of the best in the world and the other one was Intuit. If you care about the mid-market, then it was back then, and it was the place to go. I thought about that and I went to Microsoft as an intern in between my two years at B school. I knew Microsoft.

They had extended an offer to me, and the pause, while I was looking at other stuff, ended up being great because they kept coming back and saying, “What about this, what about this, and what about this?” I wasn’t seriously considering them until Todd gave me that feedback and then I said, “That’s good advice.” I went back to Microsoft and had a lot of leverage to make that into an attractive in retrospect kind of opportunity.

What did you do specifically? What did you learn about yourself in that time period working for Microsoft?

What I learned was that at that moment in my life, I was still too much of a techie geek to go fully into marketing, which is where I started going. Here’s my journey. I was a hands-on keyboard very technical engineer. I went to business school and I was the odd duck in business school trying to learn this completely different set of stuff. Also, I went all the way over to a marketing role, and I felt I was too far away from what I thought was where the action was, which is where the product is being built. I took a role in the middle, which most companies call product management. Microsoft calls it program management for whatever reason of its own.

That was a perfect fit for me. It combined into some of that business strategy, customer-facing with being in the middle of product decisions and product strategy. I absolutely thrived in that. Microsoft was good at that back in the day. The thing that Microsoft consistently did was make these blended business strategy and product strategy question decisions better than almost anyone else in the market. I was learning from a company that was best in class at that. I was learning how to be a manager and a leader. There are so many great development opportunities. At the time, Microsoft was full of smart, passionate people trying to change the world. It was a great foundational experience to have.

It was a heyday period for them. I think about the late ’90s, the Office Suite was still growing and Internet Explorer was a big source of growth for them. I’ll say some of the challenges that they faced maybe 5, 10 years later where they lost the step, you were there before that happened.

I came back again. I did two stints at Microsoft. In the year 2000, Microsoft clearly had missed the internet and the search wave. What was happening then was a lot of the smart talent was either retiring because Microsoft had done so well for so long or going off to start companies or working in startups. I left during that period. Microsoft saw a lot of brain drain. They went flat and when I came back, it was a very different world.

What Microsoft had always done ruthlessly well was keep their senior leadership strong. You had this feeling that anyone North of you on the org chart was capable and deserved to be there. When I came back in 2003, there were some people there who were empire builders. They had let that classic large company rock creep in and that’s insidious. When you get an empire builder there, they create cancer because they’re not making decisions that are right for the company or for the customer. They’re making decisions that are right for them.

They’re hiring people who are weaker than them instead of stronger than them. You created this whole mess, and we see that happening in multiple places around the company. Ultimately, Satya has come and done a fantastic job and getting it back to some of the mojo. It was a messy period for Microsoft there. I’m glad I went back. I learned some fantastic skills, but knowing it was a transitional thing gave me a very different mindset from people who were thinking they were building a career there.

You went off and did a startup, right?

I did.

What was it?

Nowadays, you call it an ad tech startup. A whole bunch of Stanford PhDs doing rocket science, which we call AIML these days. We call it something else with optimization science but it was that stuff. The idea was that internet advertising was not well targeted and the targeting you could do with now was very explicit. If this, then that, which doesn’t scale. You simply can’t. Also, trying to figure out the cohorts and what was going to perform better than the other didn’t work.

What we did was build this magical optimization engine that would allow you to say, “Here are the different choices I have. Here are my different options and here are my cohorts. You go figure out what works best and automatically test and figure out confidence intervals and make the performance go up.” On the one hand, the results were incredible. Your performance went up on average across all of our customers. We only had a handful.

We got to $1 million in revenue, so it was small, but our performance went up by 50%, which was, if you think about it, if you could make your ads today get 50% better, it will be a game changer. This is now early 2000 and 2001. The timing was terrible. Why the timing was terrible was the ad auction model hadn’t been created yet. Things were being priced on a display ad per time. It was shown a so-called CPM model and the prices were off. If you’re trying to do awareness, then maybe, but if you’re trying to do performance-based marketing, which is all this stuff is about, then the pricing turns out relative to the performance was off by about 10X.

What we were doing was sadly shining a spotlight on that by saying, “Here’s your performance right now. Here, it is 50% better on average.” Our customers are saying, “That’s fantastic. This is all a grand experiment for us and you just proved that I don’t want to spend another nickel here because it was out by 10X and you made it 50% better. It’s still out by a crazy amount. I’m just going to go put my marketing mix back into everything else that works better than this.

That was a soul-crushing moment when you felt like you’d solved the technology problem, but you missed the thing glaring at you in the face, which was that the business was just non-functional at the time. As a result, we saw all the carnage in the dot-com era until the ad auction model suddenly made the economics come back in line, and then everyone took off again in the 2003, 2004, or 2005 range.

Hence Google.

Yes.

Mike’s First CEO Role At Rapid7

I’m going to fast-forward a bit. Fast forward to 2008, you joined Rapid7. Did you join as CEO or did you join in another position and then become CEO?

Yes and no. Being a CEO is the highest-risk hire that every board is ever going to make. I was the first CEO. As a risk mitigation approach, they wrote a contract that said, “In twelve months, we will make you CEO and you’re going to start as president and COO.” I didn’t get the title for twelve months. I was effectively running the company since the first couple of days, but it gave them a backup plan in case I didn’t turn out to be a good CEO because you never know. A CEO is qualitatively different than every other role. If you have a great CEO, they can completely transform the company. If you have a terrible hire, you can very likely lose the company. This is a risk mitigation approach to say, “Let’s make sure this guy settles in well.”

It was still a relatively small company when you joined it. Maybe just give our audience a quick overview of what the company does and the kind of growth that it went through, what you took on, and the growth that went on while you were CEO.

It was a great first experience. It was 50 people and $5 million in revenue in the twelve months before I joined, but it had gone flat in the most recent six months. What it does is security assessment. The problem that every company has is they’ve got a whole bunch of equipment of various sorts, software, and systems and they need to figure out where their security vulnerabilities are because they have a lot of different security technologies they can apply, but they don’t know, “Do I have the right stuff and the right place and where my holes and so on.”

We were doing vulnerability management, which is a subset of the broader assessment problem. We were probably the third or fourth player in the market, but we had some pretty unique advantages. I felt like we had a real opportunity. By the end of that year, we were growing in the mid-80s again. We brought in some great hires and made some obvious changes, but then, you’ll know as well as anyone, at the end of 2008 and beginning of 2009, this is the mortgage crisis.

It was impossible to plan at that point. We set a plan for calendar year 2009 for 100% growth. Fortunately, we had a monthly close in January. In the month of January, we were flat so we said, “Stop. We’re going to create a flat plan.” All we’re going to try to do is each month be equal to or better than the previous month. Beat the previous month by a dollar and don’t add in new spend. We just ground it out, and we’ve got to the point where, by the end of the year, we were growing to the thirties or so. The next year was the 100% growth year.

Ultimately, in the four and a half years I was there, we took the company from $5 million to $50 million. Everything from a stuck company to reignite growth to an absolute calamity that we had to grind through back to the salad days. As my first-time experience, I got a chance to see a lot and do a lot. We’ve built that up.

Lessons From Tech CEOs: Surround yourself with great mentors—your odds of success go up when you listen and learn from others.

I think of you and the fact that you were there every time I drive from the north into Boston on 93 right by North Station, Rapid7’s on the building. You can’t miss it. It continues to be a major player in the tech sector in Boston, which is great.

Corey has done a remarkable job there. Corey was someone I’d worked with at Microsoft, and he was my first senior hire in the company. My pitch to him was, “You’re going to be one of the best CEOs in Boston, but you need a stepping-stone role.” I had to convince him and his wife, Anya, to move from Seattle to Boston. “We’re going to start you as VP of Marketing and I’m going to give you as much responsibility as fast as you can take it. Your next role will be one of the most exciting companies in Boston,” and it was. He was my successor at Rapid7, and he’s taken it from $50 million in revenue to, I think, $750 million or $800 million in revenue or more. He has done an absolutely remarkable job.

What was your first CEO stint, as you mentioned? How did you find the experience of being the person on whom ultimately everything comes through you at the end?

It does and for me, it was a dream job. There is plenty of stress. I don’t know how to do this kind of moment where you’re trying to figure out what the right path is. There are so many great founding moments and mentoring moments where I learned from other people who have been there and done it before.

It’s because I feel like the tech world is very much an apprenticeship world, probably more so than a lot of other careers. It’s certainly in a CEO role where the more you have, if you can surround yourself with great people on your team, your odds go way up, but if you also have other people that you can reach out to that can give you feedback that you can listen to, then you’re odd of success go up. Also, it’s very repeatable, by the way.

What did you learn from that experience that you took to your later CEO gigs?

I developed a philosophy that when I talked about being a tech CEO being repeatable, my view is that if you do three things well, it’s a little bit of a take on the GE model, you have a very high chance of success. The first one is you need to build a great team. A great team isn’t just smart people who are great at what they’re doing. A great team is a team that learns and grows together and supports each other as the true capital T team. If you do that, I think that’s 75% of the job. The odds are so dramatically in your favor if you have that versus if you don’t.

The second thing is you have to have a strategy that makes sense. You have to understand what’s going on in the market, some of the trends, what your competitors are doing, and, ultimately, the chess game. What moves are you making and how are you beating the other guys and winning in the market? The third one, where you finally get paid, but it doesn’t matter if you haven’t done the first two, is execution. Can you create a set of goals, line the team around it, charge the hill, and at the end of the day, hit most or all of your goals and lather, rinse, and repeat?

If you have that repeatable model where you can set clear goals, align people behind them, course correct along the way and get there, then you’ll get paid for all the stuff that you did. That model is the one that I formulated before at Microsoft, tried out, and experimented with at Rapid7, and then revised and hopefully improved at Talend and then on Onfido.

You mentioned Talend. Talend was the next stop. Tell us about Talend and how you ended up there.

When I left Rapid7, I asked my wife who had been badgering me. We’d both gone to school at Stanford. We met in Boston at a Stanford alumni event. I said, “Honey, do you want to go to the Bay Area? Now’s the time to make the decision. We can either go now and we can spend the rest of our careers there or I can do another stint here in Boston. I’m 5 or 6 years in Boston before we have another decision to go out there.”

Lessons From Tech CEOs: Building a great team isn’t just about smart people; it’s about creating a team that learns and grows together.

She said, “Let’s go to the Bay Area.” I rented someone’s pool house and an Airbnb. I brought my bike and my golf clubs. We’d see each other on weekends, but I was mostly out there meeting the venture capital community and seeing where I could be helpful and that led me to Talend, a new $50 million business that had also gone flat.

However, in an important area, it is clear that data was becoming a strategic currency for every company. The big problem they had was that data was at a lot of different places. It was messy. It was inconsistent. You need to clean it up, bring it together, and put it in the right shape in the right place. That was what Talend did.

Again, they had some core of something that I thought could be differentiated, and they were competing with a bunch of big, slow dinosaur companies like IBM, Oracle, and a big company in the space called Informatica. I felt like that was a market that mattered with a core of something that could be great with some trends that I felt like we could bet on that and bet on a better and faster way than the other folks with competitors that were slow and clumsy. That was what brought me in.

What were some of the things that you did similarly, and what were some of the things you did differently? Obviously, the company was ten times as big as Rapid7 when you joined, but as you say, experiencing a bit of that flattening off needs to be addressed.

In terms of what we do, that was similar, that playbook that we talked about. First, making sure we had a great team. The second is to make sure we have a strategy. What were the bets we were going to make that were going to differentiate us? It’s because if we’re trying to be just another Oracle, IBM, or Informatic, we are going to lose on every dimension, and we’d be crushed. What are we going to do differently and better?

We made two bets. One was on what was called big data at the time, and the other was on the cloud. Those are the things that ultimately took the business from flat to 100% growth and took us public. We put in the execution model, iterated and improved version of the execution model that we’d started at Microsoft, installed it at Rapid7, and then here. Those were variations on the theme of something we’d done before.

What was different was I spent much more time actively building the board at Talend because when I came in, there was a lot of dysfunction on the board. I had to clean the house there. I pretty much put my badge on the table in the first month and said, “You guys either need to clean this up or you need to go find yourself a new CEO,” and that was helpful because had I not done that, the company wouldn’t have been successful. That was a learning based on Rapid7 that you need to have a functional board to be able to do your best work as a company.

Being in a position where you felt like you could do that, it’s a risky move. They may take you up on that offer and then you’re back looking for what’s next.

For sure but on the other hand, if you have conviction that this is the deal breaker, that if you don’t fix it, the company won’t be successful so you’re going to waste your next 4 or 5 years anyway, then you have a lot of conviction. The other thing is recognizing that making a CEO change is a high-risk move, and they’ve just forcibly removed the founder, so they’ve put you in. You are very much first flying everywhere.

It is a very unclear outcome at that point. If they were to boot you out, hit the reset button, and try again, they’d almost undoubtedly lose the company. As much as you think like, “I don’t know what this is,” you have a lot more leverage than you think. By the way, the changes that I was making were obvious to the board. They knew that this was a problem. It was a classic situation where no one wanted to have the big-boy conversation.

“I know that’s a problem, but I don’t want to be the one to call that out.” As an example, my first board meeting had been on the job for about a month and I was presenting a budget. I was setting what I thought was a budget that was achievable and the board is pushing for this to be a 100% growth budget. I was going to say, “The business has been flat for the last year, and 100% growth is a pipe dream. I am targeting 30% growth and here’s why. Here are the budgets based on these five assumptions. Here’s what I’m planning on doing in each of the five, and hold us accountable to that.

I’m going to set a new tone here that we haven’t seen before, which is budgets are things that we’re going to start meeting and beating as opposed to things that you feel good about for a week and then feel terrible about for the next 51 weeks as you get crushed by it.” It turned into an absolute food fight. They were screaming and yelling and calling everyone on the team idiots and so on. I was sitting there with my job, and I said, “This is even worse than I ever thought a board could ever be.”

After that meeting, all of the exec team was in my office and saying, “I quit.” I was like, “No. You don’t quit leaving. I’m going to solve this. Don’t worry about this. I got this.” Mind you, we had to make many changes with those people but if they all quit at that moment, the company would’ve failed because it takes time to hire.

I went back and individually called down the board members and said, “Do you understand that the behavior that we saw at that board meeting yesterday was unacceptable? It was like a kindergarten brawl. Here are the ground rules that we’re going to have to agree to or you’re going to have to find a new CEO thing. Thing number one is you brought me in, and the conversations we all had over the last couple of months were about how we’re going to partner together to build this company. We’re either partners or I’m going to be out of here.”

What that means to me is if you want to call me an idiot, you can do that anytime. In the board meeting or outside the board meeting, I’m fine. I have thick skin and if you’re right, I’ll probably even listen to it, even though he just called me an idiot, but you cannot call my team an idiot ever in the board meeting because what that did was they all tried to quit. If you had caused them to quit, you would’ve lost the company and we would’ve failed together. That’s not acceptable. You guys need to have a little more self-control than that.” They hunkered down and said, “Yeah, you’re right.”

The second thing I realized was that we had a couple of independence that I could make a change on. I said, “We need to get rid of these guys because they’re causing half of the problem.” They agreed and we did. We also had a power vacuum because we didn’t have a chairman. We had two very capable board members who were trying to prove who was smarter than the other.

I had to get the right one to be chairman, and the other people recognized that. We had a lot of restructuring to do, which we did then for the next month, and then once we had that, we had what was one of the best board experiences I’ve ever had, a group from which I learned an enormous amount. Y I tell you, walking into that was an eye-opening experience. It was bad.

So many boards certainly historically, I think about the class that Jay taught on boards and so many of them are nepotistic, friends of the CEO and the people who will let him or her do what they want. There’s so much value in having a board that brings value to you as a CEO and as an executive team. If you can put your ego in check enough to appreciate that, it makes a huge difference.

That’s exactly right. Also, you need the right people on the board. You need to have the right CEO relationship. You need the right people. If you can get all that together, then it can be a wonderful win-win learning experience.

Taking Talend Public

How did you decide to take the company public, and what was that experience like for you?

That was something that the board wanted to do from the outset. They were bringing me in, betting that I was going to be able to do that. That was another absolute career-defining moment. We brought in the two founders who had left the company when I joined, their wives, the E team and their significant others. Also, all of the early team and a bunch of our high performers are celebrating that moment together. We went public on the NASDAQ. First off, you can fit 50 or 60 people there who can all celebrate as part of that in their location right in Times Square. You walk out. They buy all the billboards and put your name and your story all there.

It truly is a magical experience. It was truly incredible. Here’s a fun story. The board was riding me some months before that about how I needed to get a new CFO. I said, “Why? I think he’s doing a great job.” They said, “Because he’s never taken a company public.” I was like, “Yeah, great. Everyone’s going to do it for the first time. I haven’t done it either.” I said, “Unless you have some other news from me, you’re not saying you need to replace me either.” They said, “That’s the problem because neither one of you has done it. You need to have some experience in there somewhere.”

I was like, “Let me reset the conversation a bit. What is it that concerns you about him? He’s a smart guy. His team loves him. He is doing a good job. There’s some gap that you’re pointing to.” They said, “This is now the legitimate part of the feedback.” They said, “The big difference between being a private company CEO and a public company CEO is your audience. You need to be much more charismatic. You need to be a much better communicator and speaker. He doesn’t instill confidence.”

I was like, “You’re right. That’s good feedback, but our belief and history proved that out, that presentation skills are one of the most trainable and learnable skills out there.” There was a guy here in Silicon Valley who trained something like 50% or 60% of all exec teams that were going public. He did the presentation training for them, and a majority of that was Jerry Weissman. We brought our E team in and we trained Thomas as a CFO on how to do this different level of communication.

My feedback to the board was, “Trust me on this. If you don’t see a step change difference over the next couple of months, then we’ll have this conversation.” They came back and to their credit, after the IPO, they said, “You were right. That was the right choice to make.” This is a moment where, having a functional board and the right relationship, they phrased it incorrectly, but they had really good feedback that was ultimately valuable to us as a team.

Also, credit to you for having conviction. A lot of CEOs would’ve thrown the CFO under the bus because it was the easy thing to do, taken the board’s recommendation, and moved on with life. You stuck to your guns and it worked out.

I’ll tell you the final half of that. I had to stick to my guns on that one twice because that night after the board meeting, Thomas came to me and said, “Mike, I quit.” I was like, “No. You’re not quitting. Why are you even considering that? You’re about to take a company public, which is a CEO’s dream of doing?” “Yeah, but I heard the board doesn’t want me there.”

I was like, “Screw that. The board gave valuable feedback, which I agree is something we can both learn from, but you are going to do an incredible job, and we’re going to do this together.” He says, “Okay.” He came back and thanked for it later, but for him, it felt like it was a gut punch that he’d lost the confidence of the board. I was like, “No, you haven’t lost the confidence. They’re saying that you don’t create confidence when you present. We can fix that. Let’s go talk to Jeff.”

The third stop was Onfido. At that point, where were they when you started, and what further adjustments did you make to the Mike Tuchen playbook?

When I left Talend, we’d gotten that to about $250 million and Onfido was back to about $50 million in revenue. What they do is digital identity. As the world moves more and more digitally, every company in every single sector needs to prove who you are at some point. If you want to be an Uber driver, if you want to get a bank account, or if you want to trade Bitcoin. In every different walk of life, you have to prove your identity.

The old-style way of doing that is going into a bank with your driver’s license and so on doesn’t work. You do that with a smartphone with a whole bunch of AIML built into it. A market that I thought was super meaningful and I joined in the middle of COVID at an inflection point where the world was accelerating its move to digital. I had to take a company that was $50 million and was growing well. It was probably growing at 50%-ish when I joined. It was at a meaningful scale with solid growth at the same time.

Selling Onfido To Entrust

By the way, when you and I had dinner together last time, I did not use your software but subsequently did. It worked great. It was very easy. I thought of you then, too, not just driving down 93 on the way into Boston and passing the Rapid7 building. Did you decide to sell the company or were you approached by somebody who wanted to buy the company? You’d gone through the IPO experience. How did you end up going down a different route here?

In this case, again, the board initially thought that this was a company they wanted to take public. We got it from $50 million to $150 million. We had eighteen months of over 100% growth in there and it was rocking and rolling, but a couple of things. To your question of did people approached us or did we decide to sell, the answer is yes and yes.

Every successful company is going to have people approach them. That’s not unusual. What was different here was that we, as a board, decided that was the right path to go on because what we realized was that the market had some longer-term questions about where it was going. It was also a business that was completely unpredictable. You’re selling to a company’s marketing department because where they did the verification is when they’re onboarding new customers.

In a time where they’re growing aggressively, they throw more money into it, and a time where they were shrinking or dialing their budgets back. The most variable part of a company’s budget is its marketing budget, and we had a variable revenue model. If you have a SaaS-based model, it’s fine. People dial back their budgets. Your growth is slow, but you have this inherent stability.

We had a consumption-based model like a lot of the cloud players so people dial back their business. You get hit on the bookings front, the renewal front, and the revenue front. We had a business that was going into a quarter, and you had no idea how to predict where you were going to be at the end of the quarter. I started to realize that in the first year of the business, the business was going crazy because of this COVID boost.

However, I also pointed out to the board, “This isn’t a company that’s ever going to go public.” It’s only a question of when we’re going to sell and not what we’re going to do. We got an alignment on that and then we did a look-back and I said, “This is an unusual experience for me. I’ve had seven strategic players reach out to me in the last twelve months, saying they wanted to buy us.

I continued the conversation with all of them at a background level, but I think we need to do an evaluation right now. Do we think we’re more valuable now or in the next twelve months or three years from now? If the answer is yes, we think we’re more valuable now even though the market is terrible. It’s a terrible time to sell a company, but if we feel like, as a business, we’re more valuable now, we should sell and start entertaining these conversations, bringing a banker, talking to everyone else who looks like them, and finish the path.

If we think we’re more valuable by holding, we should keep the conversations going on a back burner, do what we’re doing, and grow the business.” We came to the conclusion looking at a whole bunch of different attributes that the company’s more valuable now, more than likely than it will be in three years, so let’s go and complete the deal, which we did.

You just closed that in so now you describe yourself as a recovering CEO.

You are exactly right. We closed that deal and I had a three-month transition. Now, I’m trying to get my golf handicap from embarrassing[Ma8]  back down to where it should be.

What else is ahead for you?

My wife and I took all of our equity proceeds from this and put it into a charitable fund. Something that we’ve talked about is being much more generous and this is an opportunity for us to put our money where our mouth is. We’re looking at joining a couple of charitable works, one of which we might do together in the Monterey area. We also have this dream of potentially getting into the wine business. It’s truly a terrible time to get in the wine business, so my belief, in the next couple of years, there may be some opportunities to go and have some fun there as more of a passion project.

It’s good to view it as a passion project because, as I said to you, there are a few ways that are almost ways to lose money and one of them is buying a winery. The other is buying a horse. I’m not sure if you’re doing that as well, but it’s great that you’re focused on the charitable stuff as well. That’s fantastic.

It’s an opportunity for us to feel like we’re making a difference, particularly here in the Monterey area. A similar thing is I’ll probably look to join a couple of high-quality technology boards as well where I can go and help the company, help the CEO involved, and see if I can take some of what I’ve learned through my operating career and help make it there as well.

I didn’t get to all my questions, and I never do, but it’s good to walk through the different stints you have along the way and everything you learn from that because I think people like hearing how you go from a 22-year-old college graduate to what you ended up accomplishing in your professional career so far. There are a lot of lessons there, so thanks.

Thanks for having me. I enjoyed the conversation.

I did as well, and I look forward to seeing you.

Likewise.

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I want to thank Mike for joining me to go back over his career journey and discuss his various CEO roles. Also, what he learned about himself and some of the situations you know that he went through over the course of that fifteen-year period. If you’re ready to focus more on your career journey, you can visit PathWise.io, become a member, and take advantage of the wealth of resources that we offer. Thanks.

Important Links

• Mike Tuchen
• https://www.LinkedIn.com/company/pathwise-io
• https://Twitter.com/pathwise_io
• https://www.Facebook.com/PathWise.io
• https://www.YouTube.com/@pathwise-io
• https://www.Instagram.com/pathwise.io

About Mike Tuchen

Mike Tuchen is an investor, advisor, board member and self-described recovering CEO. He recently wrapped up his third – and he says final – CEO role at Onfido following its sale to Entrust. Prior to joining Onfido in 2020 as CEO, Mike had two other CEO roles, at Talend and, prior to that, at Rapid7.

Mike’s earlier career days included time at Sun Microsystems, Microsoft, and Polycom. Along the way, he also co-founded a company and has served as a board member and advisor at a number of tech firms. He earned his BS in Electrical Engineering from Brown University, a Masters in EE from Stanford, and an MBA from Harvard Business School. He and his wife live in Pebble Beach.