Sebastian Grady - President at Rimini Street

(Joel Beasley at 00:00:00) Hello, my friends. Today we are talking to Sebastian, the President of Rimini Street, and we discuss the innovation and cost savings that they are bringing to enterprise software support, why culture starts at the top with the CEO, and how to take advantage of opportunities when you find yourself at a fork in the road. All of this right here, right now on the Modern CTO Podcast. Here we go. This is the Modern CTO Podcast.

(Sebastian Grady at 00:00:38) I'm a guy that's got close to 3 million miles on just American Airlines. So pre-pandemic, I was very, very used to getting on a plane a lot to the point where you're not even sleeping in your own bed 50% of the time because you're traveling internationally, nationally. You know, it's not just day trips. And getting used to the pandemic and being home, you know, it's nice. It's a nice change of pace, and I'm amazed at how efficient and productive we all can be.

(Sebastian Grady at 00:01:11) And, you know, prior to this, I was no stranger to doing video conference calls. I've always believed in them. I think it's been probably three years since I've set up an audio-only phone bridge. You know, those days are over. There's never a need to do that when you can have access to video and the ability for people to share things on their screens.

(Sebastian Grady at 00:01:32) I think that's just—and they all work great. You know, Zoom, Teams, Webex, whatever you use, they all work great, it seems.

(Joel Beasley at 00:01:40) Yeah, and they're so much more advanced than they were ten years ago.

(Sebastian Grady at 00:01:43) Yep, yep. And it's easy to get to know all of them. And, you know, this has just become routine for everybody. I've got my two daughters upstairs doing schoolwork.

(Sebastian Grady at 00:01:55) My college daughter who's graduating—well, she's finishing school in two weeks—she's in her senior year at Northwestern, and she's upstairs doing her work. And my high school senior's upstairs doing her work, and we can all be on the internet streaming video together with massive bandwidth. You know, technology's come a long way.

(Joel Beasley at 00:02:17) Yeah, and like you said, it's brought the family together. I know my family, we're a hundred times closer. I mean, we just spend so much time together now. And we started going camping, and it's just really changed the bond. It went from all of us being independent contractors, essentially part of the organization, the family organization, to all of us being on the same team.

(Sebastian Grady at 00:02:40) You know, I love the way you put that because even though we've been a great family, in certain ways, because everyone's so in and out, it's like fleeting glimpses of each other. You know, we're just passing in the wind. But, you know, today we've all had to learn to all be in the same house together all day, every day. And it is different, and it's great. You know, we've done a ton more cooking together. Cooking is such a big deal because we don't even want to go out to restaurants, you know, where it's cold out and you have to wear masks and you have to socially distance.

(Sebastian Grady at 00:03:19) It's just not worth the effort until we can all get fully vaccinated, it seems. So it's definitely been a new way of life. We have this old fireplace that's never had a good fireplace door on it. And I went to our local fireplace store, and they said that in 2019, their revenue was just under $5 million a year. And in 2020, it was like $13 million.

(Sebastian Grady at 00:03:50) And I was shocked. I was like, wow. You know, everybody is—since they're really living in their homes as their 24/7 place of work and living—everyone's trying to make their homes a little bit better, nicer, and it's kind of wild.

(Joel Beasley at 00:04:06) Yeah. My wife, she got furloughed. She's working at a veterinary clinic, and when everything happened, everything was completely shut down. She got furloughed, and she decided to repaint our cabinets, turned it into a business, and she's making more money in a month than she made in a year doing the vet thing, just repainting cabinets.

(Sebastian Grady at 00:04:24) Yeah, yeah. It's, you know, we've got a plumber coming next week, you know, and you had to wait three to four weeks just to get on a schedule. Every one of these folks that are doing home things are just so backed up. And it's great. You know, it's great that everybody is—you know, it's a good economy for those types of folks that are able to use their hands. And you almost thought that that whole business was going away pre-pandemic. Like, you know, who wants to be in those businesses? But today, being in those businesses is not a bad thing at all.

(Joel Beasley at 00:04:59) Yeah, they do very, very well. What was it—so we know what it feels like right now, right, with COVID and everything. Let's go to the pre-COVID days. What was it like when you were in college? Or at least I saw that you landed a position right out of college at Oracle. What was the world like then?

(Sebastian Grady at 00:05:19) Yeah, at Accenture I did. That was my first position. So, you know, I think one of the things you guys wanted to know was how I got started in technology, right?

(Sebastian Grady at 00:05:30) You know, what part of the thing with Modern CTO. So if I really unpack this and go all the way back, I remember—and you think, I don't know about you, Joel, but I think so much more about my family these days, just about mom and dad. My dad passed a few years ago at 91 years old, lived a great life. But mom's 89, and, you know, mom really helped me get started in technology by doing my multiplication tables. I remember my dad was a newspaper reporter and my mom was a stay-at-home mom who came to the United States at 28 years old. She was a professional jazz dancer in London, and she grew up during the wartime.

(Sebastian Grady at 00:06:15) She was, you know, raised by nuns in a convent, never knew her dad, and hardly knew her mom even, believe it or not. And she was an only child as far as she knew, right? And she really—boy, she had the patience of Job, and she does with our kids today too. She's got unbelievable patience. And I would remember her doing multiplication tables with me with Frank Sinatra or Shirley Bassey in the background. You know, "Where Do I Begin" or "My Way." Anytime I hear one of those songs today, I almost remember every single word because I've heard them a thousand times. And I would do my multiplication tables. And at five years old, I could recite in a second anything zero to 12 by zero to 12.

(Sebastian Grady at 00:07:02) And so I became good in math, and it was really because mom focused on doing multiplication tables with me while I was home. My dad's hours as a newspaper reporter were 2 p.m. to midnight. That was his shift, or 2 p.m. to eleven. So when I woke up, dad was sleeping. And when I came back from school, dad was at work.

(Sebastian Grady at 00:07:24) And when dad came back from work, I was sleeping. So most of the formative time was spent with mom. And love our dad equally to this day, you know, but mom really, really got us started. And then I remember we moved to Queens, New York, in New York City, one of the five boroughs. I've lived in four out of five of the boroughs. And mom said, "Hey, your junior high school is starting a computer program. You might want to check it out." And in New York City, there wasn't a whole lot of money. You know, it wasn't these private schools that Bill Gates went to or these schools where there was a ton of money. So this was a needle in a haystack opportunity. And I joined the, quote unquote, "computer club."

(Sebastian Grady at 00:08:06) And this was the old punch card days, Fortran, BASIC, PL/1. Learned some cool stuff. And I also drove a cab during the summers when I was figuring out how to pay for college. My dream was to go to State University of New York Binghamton. That was one of the best SUNY schools out there. And I ended up taking the SAT, and I got a 750 on the math part.

(Sebastian Grady at 00:08:35) And my guidance counselor said, "Hey, you should apply to other schools besides the SUNY schools." You know, so I applied to Cornell, and I applied to Rensselaer Polytechnic Institute, which I ended up going to. And it was like the mini-MIT back then. And, you know, it was a pretty cool idea. But at 17, 18 years old, I was driving a cab, and I was making a hundred dollars a day on the 6 a.m. to 6 p.m. shift. And I had buddies that had the 6 p.m. to 6 a.m. shift, and they, you know, would get robbed at gunpoint. Maybe at the third time, they decided there was a better way to make money. So I went into my local temporary agency, and I said, "Hey, what's the highest paying job you have?"

(Sebastian Grady at 00:09:16) And this must have been back in 1982. And they said, "Well, do you know computers?" And I said, "Yeah, I do know computers." They said, "Well, there's this word processing language called WordStar."

(Sebastian Grady at 00:09:32) WordStar was the precursor to WordPerfect and even Microsoft Word today. So I said, "I don't know it, but I'm going to go figure it out." So I went to my local library, and I got a 98-page book out in big font on WordStar. And I read this thing cover to cover in two days, and I went back in to take the test.

(Sebastian Grady at 00:09:53) I think I got—I know I got a perfect score, and I think there was 20 questions. And the lady at the temporary agency said, "Wow, I've never seen this." And I'm thinking to myself, really? This was one of the easiest tests I've ever seen.

(Sebastian Grady at 00:10:05) From a computer standpoint, you know, it's like you put Control-B in front of a word, you put Control-B at the end of the word, and that makes the word bold. This was the beginning of word processing packages. So I said, "Okay, great. What's the best job you have?" They said, "Well, Cushman & Wakefield pays the most money, like $17, $18 an hour." I'm like, "Wow, really?" "And but it's in New York City and Manhattan, and you need a suit."

(Sebastian Grady at 00:10:29) So I went to Filene's Basement, and I bought my first suit for $99 and got on the E train every day and went into Cushman & Wakefield. And my job was to teach maybe 30 administrative assistants who were all in this big room, which was part of the MIS group. They all had their IBM Selectric typewriters on their desk. And the head of MIS said, "We've got to teach them to use their computers." You know, and their computers were these things that you would consider ancient today.

(Sebastian Grady at 00:10:59) But I was getting paid $17—I think I got a raise that summer to $18 an hour—to go into work and teach people how to use WordStar, and I couldn't believe I could make money doing that. So that's really how I completely got into technology. And when I went to Rensselaer Polytechnic Institute, I ended up graduating with a computer science degree. And I'll tell you, in retrospect, in my freshman class, I was easily bottom 20% because all these kids—you know, my school didn't have AP classes. All these kids had two years of AP physics, and this was my first real physics class. So I found out I was always playing catch-up. And I finally maybe caught up in my junior year.

(Sebastian Grady at 00:11:48) I was always good in math. You know, the math wasn't the problem. But then I felt on the rest of the subjects, okay, by the time my junior year, maybe I'm at the level academically as the rest of these kids. But the only way I got there was locking myself in the library every night from after dinner till midnight. I'm going to say Sunday through Wednesday nights. And that's really what I had to put in to catch up. And that's what people have to do, it seems. So that's how I got the technology. And then I had a friend that worked for Andersen Consulting, which was the name of Accenture before it became Accenture.

(Sebastian Grady at 00:12:27) And he said he just loved this job. It was so great. He traveled all over the place. He worked with all these different clients, and I didn't get an opportunity in college to interview with them. So I wrote them a letter.

(Sebastian Grady at 00:12:39) Maybe it was August of my senior year, and I said, "I'll be home in New York City for Thanksgiving. And is there any chance that I could have an interview?" My friend, Ed Starr, who's a great friend of mine, ended up being a roommate. We were in each other's weddings, and he's had a great career at Accenture and other places. He says he just loves your company, and, you know, "Could I have an interview?"

(Sebastian Grady at 00:13:04) They said, "Yeah, sure. Come on in." So I had a two-and-a-half-hour interview. An hour and a half, they spent on nothing but me being a cab driver. I couldn't believe it. I was, you know, I prepped for all the technical questions, all the computer questions I was going to get. They didn't care about it. All they cared about was my experience as a taxi cab driver. And in retrospect, I look back, and I could tell these guys were really professionally trained interviewers because at a company like Accenture, a management consulting company back then, you had to be—you couldn't freak out when you were in front of customers.

(Sebastian Grady at 00:13:48) You had to be able to just roll with the punches wherever they took you. And because of my experience, I think, growing up in the streets of New York City, being a cab driver, being maybe a little bit more gritty, but still having the table stakes of a technology background, they said, "This is our guy," and they offered me a job on the spot. And I couldn't believe it because it was my dream company to work for. So I worked for Accenture for six years, from '87 to '93. And during that process, the way it works is you do a lot of coding yourself.

(Sebastian Grady at 00:14:25) And then within two years, you're supervising other newer people doing coding, and it's kind of with this "up or out" philosophy. And I love the technology. And again, this was back in, you know, by this time it was early nineties, and technology was exploding like Moore's Law, especially software. You know, we were in the infancy of application software. And I said I wanted to work for one of these companies that make the software.

(Sebastian Grady at 00:14:52) With Accenture, it was great. I got to implement all this software, but I wanted to work for the companies that make the actual stuff. So I looked at Oracle. I looked at PeopleSoft. I looked at a company called Walker Interactive that doesn't exist anymore. And I joined PeopleSoft. And I remember there were only 200 employees in the company, and I had a few other friends that went there first. But then at Accenture, you know, you're taught a certain way to do things. And they said, "Oh my god, you're going to that small little company. You know, I think their assistants do their proposals. And are you really going to leave Accenture to do that?" And it ended up being one of the best decisions I've ever made. In the first five years I was there, we doubled the number of employees, customers, stock price.

(Sebastian Grady at 00:15:40) The stock was, I think, the fifth best performing stock on the NASDAQ stock market for that five-year period, and it ended up just teaching me so much. And when you're at one of these fast-growing companies, the number one thing you have to learn to do is you have to scale much faster than you ever possibly thought about. And we ended up doing that. And I think that was something that I could reach back to, and I have, all through my career.

(Joel Beasley at 00:16:07) Give me some specifics there. Like, you watch this company go through stages of hypergrowth. What were some of the—I mean, yes, it's important to grow and responsibilities change—but what are some of the tangible takeaways?

(Sebastian Grady at 00:16:21) Yeah, so, you know, if I compare it to Rimini Street, for instance, right now, where I'm the president. Rimini Street is a company that does third-party maintenance for Oracle and SAP software. And, you know, we do application management services and consulting, and we support Salesforce now as well. So we're expanding into quite a few things. We're a 1,400-person, $300 million company. Back in the old days at PeopleSoft, I ended up running the maintenance division. You know, when I took it over, it was a $70 million group. Within a few years, it ended up being a $600 million group. And when my—the people that took over for me—and one of them was a person that I hired at PeopleSoft, Seth Ravin, who is the CEO of Rimini Street, and he returned the favor and he hired me here.

(Sebastian Grady at 00:17:17) He and another gentleman named Kevin Maddock and Brian Slupko were also on our executive team, ended up taking that business to over $1,000,000,000 at PeopleSoft. So they learned a ton, as I did, about that business, and Seth had the brilliant idea to start his own third party maintenance company, which most people thought was impossible to do. So a lot of our management team at Rimini Street came from PeopleSoft, and so we all were in this hyper growth, how to scale mentality. Right before I took over the maintenance business unit, I ran customer services.

(Sebastian Grady at 00:17:56) So one of the issues, the issues that you run into where there's not enough consulting resources, there's not enough training classes. We want more features than you can possibly put into the software. And this was back in the early days where customers had no problem paying the money they did for annual maintenance because every six months or a year, they were getting new releases of software that were chock full of new features and functionality. And I don't know if you remember, but PeopleSoft was the first client server software company back in the day. Everybody was running on mainframe, so they weren't taking advantage of the power of the PC.

(Sebastian Grady at 00:18:36) And the PC, if you look at Moore's Law, has become really powerful and just, you know, doubling every ten years. And people want to take advantage of the local clients, so we invented this client server technology. And the application that we happened to know was human resources or human capital management. And we became the number one human resources company in the world by far, just destroying everybody because they loved the new technology. It's kind of like cloud today.

(Sebastian Grady at 00:19:07) Anything that's cloud, it almost doesn't matter if the functionality is great. Companies just want to say, I'm on the cloud, even if it's going to take a little time to get the functionality to be better, if that makes sense.

(Joel Beasley at 00:19:21) Yeah. And it makes me wonder, so the way you're describing your company, who is your customer?

(Sebastian Grady at 00:19:29) Who do we sell to?

(Joel Beasley at 00:19:30) Yeah. Are you selling, like, are you a partner of the SAPs and the Oracles and you work, do you sell to small businesses? Do you just have large companies as your contractors? Help me understand the business model better.

(Sebastian Grady at 00:19:46) Yeah. No. Sure. Great question. So we're not partners with SAP and Oracle.

(Sebastian Grady at 00:19:52) Both SAP and Oracle are $40,000,000,000 plus or minus companies. And I would think that almost every Fortune 500 company in the world runs some product from SAP or Oracle. We have about 175 Fortune 500 companies ourselves at Rimini Street. So this is enterprise software for big companies. It's not for mom and pop shops.

(Sebastian Grady at 00:20:19) It's not, you know, QuickBooks. This is really the most sophisticated, hardcore, feature rich application software probably ever written in the history of the world. In fact, SAP's flagship product is called ECC six, and it has 400,000,000 lines of code. I don't know if there's another application software product out there that comes even close. And it works, you know, it's got hundreds of different modules and works across so many industries: manufacturing, distribution, supply chain, financials, human capital management.

(Sebastian Grady at 00:20:58) It's really the workhorse back office software out there. And Oracle has their own versions of that, including PeopleSoft, where I came from. So our buyer is typically the Chief Information Officer. Sometimes we get involved with the Chief Technology Officer, especially if they want to know, you know, if I'm replacing this old security with this new security, how does it work? And you might get a CTO involved there.

(Sebastian Grady at 00:21:23) But essentially, if you look at this software, this SAP and Oracle software, it's thirty, forty year old mature software. It's not changing that much anymore. And both SAP and Oracle are really focused on trying to be relevant in the cloud. So they're not putting a whole lot of new features and functionality into the on-prem software, and we support it all. So customers are saying, wait a minute.

(Sebastian Grady at 00:21:50) You know, the concept when you buy software, every year you pay an annual maintenance fee, which is typically 22% of the original software fee. So when customers are buying $50,000,000 worth of software licenses, they have to pay $10,000,000 a year in annual maintenance fees. And they're all looking at these costs, millions of dollars a year in annual maintenance fees, and they're saying the juice just isn't worth the squeeze anymore. I'm not getting a whole lot of new features and functionality out there. So is there another company that can support my SAP and Oracle software better, faster, cheaper than the original OEM vendor?

(Sebastian Grady at 00:22:33) And that's where we come in. And we own 80 plus percent of the third party maintenance market for ERP software like SAP and Oracle.

(Joel Beasley at 00:22:43) That's pretty neat.

(Sebastian Grady at 00:22:44) It is. We kind of invented the space. And when I joined the company ten years ago, we were probably $30,000,000 in annual revenue, and now we're 10x that. And we've gone public, and there's just so much that we do today. Everything regarding Oracle and SAP and Salesforce and security and consulting and application management services.

(Sebastian Grady at 00:23:09) All of these things are tightly integrated and related. And customers are saying, you know, just about every customer that we talk to, you asked who's our client. They think that they want to be a cloud first company, and they want to go digital. So they want to take advantage of all these cool new technologies, like, let's say, artificial intelligence. But 90% of their IT budget is spent keeping the lights on, paying for things like SAP and Oracle maintenance and constantly doing these unnecessary upgrades.

(Sebastian Grady at 00:23:41) And that's where we come in, and we drastically reduce that total cost of ownership. And I'm talking we can take $8,000,000 a year spend down to $2,000,000 overnight because of things like we guarantee support on every version of the software that a client's running for fifteen years, whereas Oracle and SAP constantly make them upgrade because they're dropping support on the old releases. So customers aren't upgrading because they want the new features and functionality. They're upgrading because they have no choice. And that upgrade cost avoidance might be the biggest savings that we bring to most of our clients.

(Joel Beasley at 00:24:21) It's like your company is almost like a perfect model of digital transformation disruption. Right? Because, of course, they're not your partners. They're kind of probably upset that you guys exist. You came in and you're doing it for cheaper and better.

(Joel Beasley at 00:24:36) And what are some of the objections you hear? Like, some of the things that come to my mind first is, okay, if they were upgrading because of support, right, what about, like, security patches and releases?

(Sebastian Grady at 00:24:50) Yeah. Sure. There's two major questions that come up, and you're correct. SAP and Oracle are not our partners. They are our competitors, and they would much rather us not be in this space.

(Sebastian Grady at 00:25:03) If you look at, and I'll tell you why. You know, it comes down to money at the end of the day. SAP and Oracle, let's say they're both $40,000,000,000 companies. They both get roughly 50% of their maintenance, or half, from maintenance. That's $20,000,000,000 each.

(Sebastian Grady at 00:25:19) And their profit margins are enormous. I think, you know, people would say, if you look at Oracle and SAP's financials, Oracle might make 96% profit margins. SAP might make, like, 92% profit margins on their maintenance. So this is their cash cow. This is something that they want to keep as desperately as they can, and prior to us coming along, it was kind of a monopoly. So now there's competition out there in the space, and from a client's perspective or a customer's perspective, they think it's great because now they finally have flexibility and choice.

(Sebastian Grady at 00:25:53) So the big questions are, you know, no one's ever gotten fired really for paying their Oracle or SAP maintenance. So this is kind of, you're in some ways asking them to commit an unnatural act. It's like nobody ever got fired for buying IBM back in the day, and you have to come in there and you have to say, okay, your world's not going to fall apart, and in fact your world's going to get better. And I didn't cover this yet, but our price is 50% less than whatever you're paying Oracle or SAP. So if you're paying $10,000,000 a year in annual maintenance, our price is $5,000,000. So the biggest objections that we get are, okay, today we understand that we get patches, whether they're code patches or security patches, you know, code patches to fix a defect in the software or security patches to keep the software secure.

(Sebastian Grady at 00:26:49) Rimini Street, since you're not the original author of the software, you're not the vendor, how are you going to keep me secure and keep me in a spot where I don't have to worry about those code fixes? And it's really not that difficult. So there's all kinds of tools that are purpose built for this software, configuration changes, changing parameters, building new features and functionality. Make the software work. You can make it function perfectly fine.

(Sebastian Grady at 00:27:22) And in fact, we can do it better most of the time than whatever fixes Oracle or SAP would have given their clients. Because those fixes are not tested against the client's custom code or the client's specific data. They're just generic fixes that they throw out there, and then the customer has to make them work. And then on the security side, we've picked two products from real security companies that we resell. One is our advanced database security product, and one is our advanced application and middleware security product.

(Sebastian Grady at 00:27:56) For the Oracle side, this keeps the database far more secure than you would find with Oracle critical patch updates because they're dated. And a lot of customers can't even implement them because they're very difficult to implement. They come with hundreds of other fixes, and they're very expensive. And if you're on a certain release of software like Oracle database nine, ten, or 11, you don't even get security patches anymore. So they're only doing them on releases 12 and above these days.

(Sebastian Grady at 00:28:28) And that's very difficult because, you know, we have big clients where 80% of their landscape is still running versions nine, ten, and 11. And the upgrade cost avoidance is something that's really important to them. So we think we've built a better mousetrap, and we've proven it. And we've, you know, we have over 3,000 customers since the beginning of time. And you can't Google out there and find customers that have had problems with Rimini Street because of security or because they're missing patches.

(Sebastian Grady at 00:29:01) So, you know, this model works, in fact, not just as good, but it works better than the original OEM model.

(Joel Beasley at 00:29:09) That's interesting. Now do you provide any sort of support, like, if I have a problem, I can call you up and you have support people?

(Sebastian Grady at 00:29:18) Oh, yeah. No. That's exactly, that's what our whole model is. So it's break fix support. When you pay maintenance to Oracle or SAP, you essentially get two things at the highest level.

(Sebastian Grady at 00:29:29) You get new product updates, and you get the ability to call their help desk when something breaks. So the new product updates aren't as important anymore because, let's say, the average customer is running a release of Oracle or SAP in production that's eight years old. That means it's probably two or three releases back, and it was GA'd or made generally available in, you know, 2013, 2014. And the reason that is is because customers don't want to be on the latest and greatest release. And these upgrades are incredibly expensive and disruptive and time consuming.

(Sebastian Grady at 00:30:10) So customers like to stay in a safe zone, but still innovate around the edges of their core Oracle and ERP software. And there's so many different ways to do that. So customers plug salesforce.com in on top of SAP or Oracle. They move their whole data center to the cloud, and they run it on Amazon Web Services or Google Cloud Platform or Microsoft Azure. These are the type of innovative things companies are doing while we're supporting the software.

(Sebastian Grady at 00:30:45) And when you think of the SLAs or service level agreements, ours are much better than Oracle or SAP. So for example, if you have a severity one or P1 production down problem, we guarantee we'll call you back in under ten minutes. If you have a P2, we guarantee we'll call you back in under fifteen minutes. We've averaged under three minutes for both of those severities. Oracle and SAP, I believe, are one hour and two hours respectively for sev one and sev two issues.

(Sebastian Grady at 00:31:16) So we crush them on the SLAs. And then our ability to fix the problems, which is what really matters, is I think a lot better as well. Because the average person that we have doing this, they're 46 years old. They have ten, fifteen, twenty years expertise on Oracle or SAP. Most of them have come from consulting or development, you know, at Oracle or SAP or a great systems integrator where they have real life experience, and they're not just book trained resources in the help desk that try to match up an error code to an existing fix that may or may not exist in their library of existing fixes.

(Sebastian Grady at 00:32:01) So we find that 70% of the time, roughly, there's no fix that exists from Oracle or SAP for a problem because the problem's on custom code, interfaces, integrations, performance tuning, how-to questions, configurations. It's not something that's actually broken in the software. It could be how to use the software, or the software broke because it was changed, it was modified, or it sees a piece of data that has never been tested for before and something breaks. Because software doesn't wear out. It really breaks when you change the code or you change the data, so it sees a condition that it's never been tested for before. And that's where we come in and we have all this expertise and years of functional and technical experience. And I'll give you an example.

(Sebastian Grady at 00:32:52) We had a customer who, $10,000,000,000 technology company who was running 61 Oracle products. And prior to coming to us, they had 300 cases a year with Oracle. In the first year with us, we had 573 cases. We used 172 separate primary support engineers from 11 different countries throughout the world in a 24 by seven by 365 time frame. So we mapped on a twenty four hour scale when all these cases came in, and there wasn't one time, one hour of the day where more than 10% of the cases came in.

(Sebastian Grady at 00:33:37) So this company had data centers in the West Coast United States, which is where their headquarters were, in the East Coast United States, in Europe, in Asia Pacific. And this needs to be 24 by seven follow the sun support. So that's what we provide, and we provide it at a much better level than the original vendor because we just have these level three expert PSEs. We don't have the level one or level two people that answer the phone and talk to the customers. Now the next question might be, how do we know that works?

(Sebastian Grady at 00:34:08) So the one thing that everybody at this company gets paid on, which I'm very proud of, is our customer satisfaction ratings. We solve over 30,000 cases a year across our customers, and we receive about a 40% response rate on the surveys, which is kind of unheard of. Right? Microsoft, you know, might get a few percent response rate, and they're a great company, but people just don't take the time to respond to the surveys. With our stuff, they really want to.

(Sebastian Grady at 00:34:34) On a scale of one to five, where five is the highest score we can get, we average a 4.8 to 4.9 rating. And it's really just because we have such high quality individuals that get the right fix the first time.

(Joel Beasley at 00:34:50) I want to talk a little bit about culture. Right? Because you have all these people. You're growing. You've got these, you know, level three experts.

(Joel Beasley at 00:34:57) Right? And you're expanding. And you also mentioned Salesforce. I've got to talk to Parker. He's fantastic.

(Joel Beasley at 00:35:03) He's one of the founders of Salesforce. They have an amazing culture there. I got to talk to Brian. He's the CEO of CodeScience, and they're one of the largest partners on the AppExchange for Salesforce. They've, I think it's like 300 of the apps on the AppExchange that they've made.

(Joel Beasley at 00:35:20) So but one thing they both had in common was their culture. They had a really, really strong company culture. And I was curious, like, how do you approach culture?

(Sebastian Grady at 00:35:32) Yeah, so it starts from the top. You know, it starts with our CEO. One of the things I'll start with is everybody at our company really seems to work hard. They seem to be invested in being good at what they do.

(Sebastian Grady at 00:35:49) They seem to take pride in what they do, and we're a very collaborative environment. We're a very collaborative environment because we've been forced to. If you think about the business that we're in, it's a David versus Goliath play. Right? You're a little $300 million company that once was a little $30 million company competing against two $40 billion behemoths.

(Sebastian Grady at 00:36:18) There's no individual contributor that can take on those types of challenges and opportunities with a prospect or client that might be thinking of moving their support from Oracle or SAP to Rimini Street and not do that with a team. We call that team the village. And one thing that I'm incredibly proud of is how all for one and one for all we are as a company. We have to punch above our weight all the time because we're a David versus Goliath play. And that means we have to have a ton of experts, not just putting marketing material in front of people, but actually rolling up our sleeves and showing customers through real life examples how good we are and how we can fix their problems and provide a safe, non-risky approach to take over their ERP support, which runs the mission-critical systems in these companies. So it's not for the faint of heart, and I think we do that by being extremely collaborative. I'll also say that there aren't too many places to run and hide at a company like Rimini Street as well, because your peers expect a certain — because they need you so much, they expect us to be all for one and one for all.

(Sebastian Grady at 00:37:52) And if they're trying to take the hill and earn business from a prospective client or trying to make an existing client happy and satisfied, they typically need help from others. So it's a self-fulfilling prophecy in a way, but it's that type of culture that I think permeates the company. We do a ton, like Salesforce does, in charity, in projects where we help the needy. We have all kinds of drives that people get together with. I'm on the board of the Boys and Girls Club of Oakland, and we've had Rimini Street people go to their places where these kids in Oakland — where, you know, 80% of them do not live with a blood-related mother or father.

(Sebastian Grady at 00:38:44) They need a place to go after school from the critical time frames of, let's say, 3 p.m. to 7 p.m. And these kids — you know, what's great about this is you see these kids having much better GPAs in high school than the typical Oakland student that may not have the opportunity to build a community. And it's things like that that are important. So we put our money where our mouth is, but we also put our time and effort where our mouth is as well, if that makes sense.

(Joel Beasley at 00:39:18) Yeah. I love it. I love that you were doing that. It's incredibly important to their development. Otherwise, where would they be hanging out on the street getting in trouble?

(Sebastian Grady at 00:39:26) Yep. Yep. We've all, you know, in all our lives — you know, growing up in Queens, driving a cab — there's been so many forks in the road where myself or my friends, and I've seen others, you know, take the bad paths as well. We all have those choices. And every now and then, we'll get an opportunity that we have a choice that we can take advantage of or we can kind of blow it.

(Sebastian Grady at 00:39:54) And I think, you know, those of us that have been lucky enough, it's because someone else gave us a chance sometime in our lives. So if you're lucky — and everybody on this call, you, myself, anybody that's prepped for this, we've all had that opportunity, obviously — and it's time to pay it forward or give back, I think, in life.

(Joel Beasley at 00:40:16) 100%. Yes. I mean, you're exactly right. Everyone that's been through something or that has a certain amount of experience, you get presented with those forks in the road. It's a part of life. And then it becomes you and your journey of learning how to make good decisions. And then as you make those good decisions, your life will get better. And then you'll still always be presented the opportunity again to make it better or make it worse.

(Joel Beasley at 00:40:44) And it's just this constant revolving cycle, and that's why you'll see some people start to do really well and then sabotage and go down far. But some people can keep it going. And learning how to make these choices in life is critical. And then finding people to surround yourself with and building a culture and building a team of people who are making positive choices, it creates momentum. And, honestly, I have limited experience as a founder. Right? I'm only in my mid-thirties, but I've started a couple companies. And one thing I'm certainly aware of is that momentum is the most valuable commodity at an organization. And you either have it or you don't.

(Sebastian Grady at 00:41:24) Yeah. Yeah. No, momentum. You know, carpe diem. Right? When you have that — that's a great point you brought up, Joel. When you do have that momentum as a company, you need to drive a truck through that hole when you've got it. You know, when something opens up and you realize that there's a few similar prospects or clients that sign up with you and you see all these dominoes falling for a specific product line or a specific industry, drive a truck through that opportunity. I remember at PeopleSoft when one of our bibles was Jeffrey Moore's "Crossing the Chasm."

(Sebastian Grady at 00:42:03) And I remember the CEO of Documentum, Dave DeWalt, was in that book. And Documentum basically provided optical OCR, optical character recognition of paper. You know, you just scan the paper into a computer, and it turned it into a file where you can edit or you could at least store the paper. And they were pretty successful in a ton of different industries. And Dave sent an email out to all his employees, apparently, and said, "Hey, if we were to focus on just one thing and we want to be the best and do that better than anybody else, what would it be?" And one of the answers he got back was the pharmaceutical industry. If we could scan all these documents, these millions of pages that it takes to get a drug approved, and if we could decrease the time frame, let's say it's a seven-year time frame down to five or six years — and I forget what the exact math was — how much money would that save these pharmaceutical companies? And Dave heard enough, and he said, "We're going to go 100% after the pharmaceutical companies and drop everything else that we're doing." It didn't mean that they didn't service these other companies, but they didn't focus on them.

(Sebastian Grady at 00:43:17) And I think he got 28 of the top 30 pharmaceutical companies to use Documentum to scan all these papers, and the ROI proved true. The time to get a drug approved went way down. Billions of dollars saved for these companies, and that just expanded everywhere else throughout the organization. So he found an opportunity at the right time, you know, kind of like Zoom in the pandemic, if you will. Back in the day, Webex, which was acquired by Cisco, owned this video conferencing space. How did Zoom, all of a sudden, which we're using today, become the de facto standard, you know, like the Xerox or like the Kleenex of video conferencing? And at the end of the day, when I look at these technologies, whether it's Webex, Zoom, Microsoft Teams, do I see a whole lot of difference between these? I don't know. Not really. But Zoom had an opportunity to do something and capture — just basically crush the market share.

(Joel Beasley at 00:44:17) Do you know the background story of Eric and how he started Zoom?

(Sebastian Grady at 00:44:20) I do not. I do not.

(Joel Beasley at 00:44:22) The most abbreviated version of it I could give would be he was at one of these major companies and he was one of the heads of engineering or product development. And he said, "This new technology over here is going to crush us. This is an emerging thing and we need to rewrite our platforms." And basically, the team was like, "We just spent all this money to build this platform. We're just going to sell it in profit." So he left the company, went and raised money, and used the newer technology, and he completely ate their lunch.

(Sebastian Grady at 00:44:49) Wow. Wow. Yeah. I did not know that. But I — there's a gentleman who runs either all sales or some level of sales right here in Oakland, California that works for Zoom, who, you know, we talk about in the neighborhood like, wow. What a turnaround for his business.

(Joel Beasley at 00:45:07) Yeah. And Harry is a great guy too. Harry's, I think, the CIO or CTO. I'm not sure what his official title is, but I've gotten to talk with him a couple times, and he's brought his puppy on the podcast. And he's a super cool guy. He's up in New York too.

(Sebastian Grady at 00:45:22) That's the other kind of cool thing about these technologies. You know, I have a huge call in ten minutes with a monstrous potential client. And, you know, sometimes my 90-pound Labrador retriever will start barking in the background because he wants to do something. And I think in the first few months of the pandemic, you know, people are like, "I hope that guy shuts his dog up or that gal shuts her dog up." But today, it's like, "Oh, what kind of dog do you have? That's cool. Who is that barking in the background?" You know, it's just become part of our fabric and just much more accepted and part of doing business, which humanizes — and oh my gosh, if there's one thing that I could beg for is just humanizing everything we do. And, you know, I'm an older generation than you and my daughters are a younger generation than you, but I think both your generation and my kids' generation learned and care a lot more about the humanization of things than was part of our culture growing up. You know, I almost look at my life as kind of this bell curve where we were taught to be such hard drivers and hard chargers. And in certain ways, growing up in Queens, you know, you just — in order to put the next meal on the table, everybody had to contribute and bring money home.

(Sebastian Grady at 00:46:48) And, you know, up until maybe 30 years — I'm 30 years old — I was so hardcore focused, worked a ton of overtime. You know, work just drove my life. And it, you know — I still work hard. But there's this balance of life that I think has become much more the norm and expected. And when you talk about culture as a leader in an organization, if you don't emanate that and have empathy for that type of work-life balance, you're not going to get the best talent in your organization today. And at the end of the day, you know what? There's plenty of hours in the day to do both.

(Sebastian Grady at 00:47:29) And that's something that I've discovered much more in the last ten or twenty years of my career than I have in the first ten or twenty years of my career. And the other thing I try to do is empower people. So don't do their jobs for them, but impart the things that are important that you've learned in your career. There's a lot of things that I can impart, but there's also a lot of things that the new generation can impart to me. And if I'm open to that and I'm always open to continuous learning, even at my age of 57, that's a great thing.

(Sebastian Grady at 00:48:16) And people like that. And I think the folks in our organization love that we have this all for one and one for all attitude. You know, there's not a situation that I'd be afraid of. And when there are tough times, you know, you talk about the momentum. Right? What about when there's tough times in your company? And we've had tough times over the last ten years. If I look like I'm crumbling under pressure, even if I don't have all the answers, don't underestimate how much everyone observes your every single move when things are not going as great. And you really have to be that General MacArthur that's willing to lead by example and pick people up by their bootstraps and say, "We're going to fix this. We got this. Don't worry about it. Let's do a little bit of this. Let's do a little bit of that." Rome may not be built in a day, but it's these iterative improvements and innovations that all of a sudden lead to these big breakthroughs where it's like, "Okay, we got it. Let's go."

(Sebastian Grady at 00:49:20) And there's going to be times like that, I think, in all of our careers. I don't know anybody that's just seen a — you know, maybe my first year at PeopleSoft, it kind of went like this, and we were managing scale, and there weren't too many dips. But, you know, then when client-server moved to Internet, we kind of missed the boat on that at PeopleSoft. And we had to kind of recoup and recover and say, "Wait a minute. Client-server is not the future. It's the Internet." And if you look, you know, it's funny how everything comes full circle. We went from mainframe to client-server to the Internet to software as a service, and now everything's cloud. And five years from now, there might be a different word for it.

(Sebastian Grady at 00:50:03) And when you really unpack, when someone talks about cloud, cloud is not cloud is not cloud. You have to really be able to understand. Are they talking about moving off their hardware and moving their data center to an AWS, a GCP, an Azure? Or are they talking about going to applications like Salesforce.com or Workday, which are true multi-tenant applications where you don't own this on-premise software? Every customer's running on the same version of the software, and they have to take the four upgrades a year, and it's true software as a service. Whereas, SAP has a cloud product they call S/4HANA, their cloud product. But 90% of the people or 80% of the people that implement it, they implement it in an on-premise version. And that defeats the whole purpose of you thinking that you're in the cloud now. So you really have to get underneath everybody's marketing pitch and understand what's really going on. And that's where there's no replacement for having these table stakes of some level of core knowledge, whether it's technical or functional.

(Sebastian Grady at 00:51:11) I think it's really important.

(Joel Beasley at 00:51:13) I love it. I want to be respectful of your time here. As we wrap up, is there a specific call to action? Let's say someone's listening and they hear that you can, you know, cut their support cost in half. What do they do? Do they go to your website?

(Sebastian Grady at 00:51:28) Sure. Sure. Go to our website. There's a ton of information out there. Call up, or file a case on the website. You know, you could chat live with somebody, do a little research, talk to companies like Gartner Group who follow us very closely or Forrester. Ask them what they think about the third-party maintenance market. Ask other peers in your industry, whether you're in retail, financial services, manufacturing. Have you ever heard of these guys? What do they do?

(Sebastian Grady at 00:51:56) What are the pros and cons of going to third-party maintenance? And, you know what you'll find these days too is before somebody calls you, they've already done — I don't know what it is, 50, 60, 70% of their own research — so they're reasonably informed before they have specific questions for you. And sometimes, you know, people will call and say, "Hey, we've heard of this thing. My CIO wants me to look at it or my CEO wants me to look at it. Tell me about it. I haven't done all that research." So you have to be prepared and to be able to react to any opportunity you get.

(Joel Beasley at 00:52:33) Excellent. We'll put the link to your website in the show notes. And it's just riministreet.com?

(Sebastian Grady at 00:52:39) Yep. www.riministreet.com.

(Joel Beasley at 00:52:42) What's that name mean? How did you come up with that?

(Sebastian Grady at 00:52:45) So, our CEO, Seth Ravin — you want it to be kind of a fancier story than it is, but — he was, years ago. I think fifteen years ago it was now. He was incorporating the company and he had X number of days to do it, and I think he got a lot of external advice and thought about what would be a great name for this third-party support company. And he lived in Las Vegas and was running out of time and looked out the window and saw that he lived on Rimini Street.

(Joel Beasley at 00:53:18) There you go. That's something.

(Sebastian Grady at 00:53:19) That's how the company got the name. And it's funny because there's a famous place in Italy called Rimini Beach and the town of Rimini. So whenever we're in Europe or really anywhere outside the United States, people call us Rimini. And we've given up on trying to correct them and say, "No, no, it's Remini."

(Joel Beasley at 00:53:42) Well, by the way, for months around the office, we just found out, like, because we started working together, like, three months ago. And so you've been being called Remedy Street, and I tried to train myself a hundred times before this episode to weed that out.

(Sebastian Grady at 00:53:59) That's funny. That's funny. We don't really care, you know?

(Sebastian Grady at 00:54:02) Call us anything you need either way.

(Joel Beasley at 00:54:02) Yeah.

(Sebastian Grady at 00:54:04) Anything you want. And thank you for the opportunity, Joel.

(Joel Beasley at 00:54:10) Thank you so much for listening. And if you found this episode useful, please share it with a friend or colleague who you think would get value from it. And if you have topics that you would like to hear discussed on the podcast, either add me on LinkedIn or send me an email: [email protected]. Every time I get an email or LinkedIn message, it absolutely makes my day and inspires me to keep going.