Special Report -- Silicon Valley -- The Next Generation
TOM SIEBEL--CEO, Siebel Systems Inc.
It's safe to say that few people love their work more than Tom Siebel, CEO of San Mateo-based Siebel Systems Inc. "I have the best job in Silicon Valley!" he exclaims from his sleek, minimalist office overlooking Northern Californias Bayshore Freeway.
Its no wonder Siebel's spirits are soaring. He started his company -- which specializes in software used for supporting sales forces -- without the backing of venture capitalists in 1993 in a rundown warehouse in East Palo Alto. Today, it is headed toward $100 million in annual revenue and has a $1.5 billion market capitalization. "It's the fastest-growing independent enterprise-application company in history," says Cristina Morgan, managing director of investment banking at San Francisco-based Hambrecht & Quist, the lead underwriter for Siebel Systems' initial public offering last year. "Tom can smell a big market miles away."
Did somebody say big market? "Just as it is inconceivable today that somebody could be running a business without automated finance, accounting, a general ledger, it would be equally inconceivable in five years that a company would run its sales or its marketing organization without an information system to support it," Siebel declares. "The market is virtually every company in the world." Eric B. Upin, senior software analyst at Robertson Stephens & Co. in San Francisco, puts demand at 20 million copies of such software worldwide.
Siebel's software tracks a customer from the initial lead, through the pitch, the sale, and post-sale service. It eliminates a lot of the manual labor traditionally associated with such work, thus cutting costs. And better tracking, marketing, and servicing of customers should boost revenues for most salesforces, Upin says.
Born in Chicago, Tom Siebel is the son of Arthur F. Siebel, a Harvard lawyer, and housewife Ruth Siebel. After graduating from high school in 1971, he moved on to the University of Illinois at Champaign-Urbana, where he got a BA in history, an MS in computer science, and later, an MBA. In 1984, he took a job at Oracle Corp. and within a year was named the company's top salesperson worldwide for selling 280% of his quota.
In 1989, he became the general manager of Oracle's direct-marketing division and noticed that there was a lot of time wasted in recording information about clients. So he developed his own sales and marketing information system, which is still used by Oracle and which gave him the idea for his existing line of products. "If somebody built a commercially viable system in this space, I thought that would be the basis for a pretty good company," he says.
Siebel's career continued to soar. In 1991, he went to work for multimedia software maker Gain Technology in Sunnyvale, and in 1992, as CEO, sold it to Sybase Inc. for $107 million. Using his winnings--he had held about 15% of Gain--he started Siebel Systems with a purpose that goes beyond grabbing loot. "Our company is not about making money, or creating an insanely great technology, demonstrating to the world what great entrepreneurs we were, or that we could show everybody all the Ferraris in the parking lot," he says. "Were trying to build a great, world-class company -- an Intel, Hewlett-Packard, a Xerox, a Charles Schwab -- a company where we achieve unprecedented levels of company satisfaction, where were recognized as a clear market leader, a company thats recognized globally as a great place to work." And where the workforce prospers: Siebel Systems is 70% employee-owned.
So far, so good. Siebel's rapidly expanding client list includes the likes of Xerox, Compaq, The Los Angeles Times, Matsushita, Montgomery Securities, Informix, Lucent Technologies, and Charles Schwab. Analysts say Siebel is the market-share leader among roughly 400 competitors.
Worth more than $450 million from his current venture, Siebel could be doing pretty much anything he wants these days. In his free time, he flies his Palatus-Porter recreational plane or goes skiing. But like a lot of Silicon Valley types, he seems motivated primarily by basic things. He lives with his wife, Stacey, 34, and three kids in a plush ranch home in Woodside. He gets up at 4:30 a.m. to retrieve E-mail, then works out with a trainer at 7:30 four mornings a week before heading to the office. "I suppose if I were a scratch golfer, I might be on the golf tour. Or if I were a talented musician, I might be out with the Rolling Stones," he says. "But I don't play golf and I don't play the guitar. So this is what I do. This is my idea of fun."By Gabrielle Saveri in San Francisco