After my last interview with Idera's CEO, Rick Pleczko, I had a number of people ping me both to request more interviews and to offer themselves up for some questions. I had the opportunity to get a few minutes of Simon Galbraith's time, most likely while flying on an airplane somewhere in the world, to answer a few of my email questions. Either he was flying or spooning baby food into a hungry youngster's mouth :)
SSC: Can you tell me a little about Red Gate as a software company; how you started and the focus of the company?
Simon: Red Gate is a five-year-old ISV. We sell simple tools for SQL Server and .NET developers and DBAs.
Neil Davidson and I founded the company in 1999 when we were in our late twenties. Neil and I came from different perspectives – I’d worked for one of the biggest companies in the world, and he’d worked mainly for small ISVs. The common thread was that both ISVs and big companies were spending too much money on expensive software development solutions ($50,000s) and not enough money on simple software development tools (sub $1,000).
We believe that the model for software development tools is broken. It’s a vicious circle: A majority of DBAs and developers never buy third-party tools; they use what has been bought for them by a CTO. To sell to a CTO, you need to subsidize sales calls and other resources that push the price of the software into the $50,000s. The selling costs are high, the products are complex, and they are poorly tested: developers and DBAs don’t get the tools they need, and the CTO becomes dissatisfied with investments in new development tools. The only one celebrating is the person who made the big-ticket sale.
The Internet made it possible for us to try a different business model with a virtuous circle – a high-quality product focusing on a very specific area of need and lower prices. Using the Internet, we are able to get almost immediate feedback from customers and rapidly improve our products. A key element is having evaluations online – people can prove to themselves that the tool is worth it – without a lot of unnecessary and expensive intervention from us.
This business model has worked well: In the last five years we’ve had to move five times to cope with company growth. We have more than 12,000 customers and sell more SQL tools than all the other vendors combined. We’ve proven that if you give DBAs and developers great tools that make a difference in their working lives, they’ll find a way to get the CTO to approve a purchase.
SSC: You have quite a few comparison products available. How do you differentiate your products from others?
Simon: We sell three comparison products: SQL Compare for comparing and synchronizing schemas, SQL Data Compare for comparing and synchronizing data, and DTS Compare for comparing server-level settings. They are wildly popular for four major reasons.
- What they do – once you’ve tried them it is impossible to imagine your working life
- The simple design – they are intuitive and simple to use.
- The solidity – we employ nearly as many testers as developers to make sure that test cases are rigorously explored; customers get a rock-solid product.
- The price – they can be purchased without any extensive ROI studies or budget justifications.
SSC: What's the most popular tool from Red Gate?
Simon: Our most popular product is the SQL Bundle (which contains SQL Compare, SQL Data Compare and DTS Compare). Of those tools, SQL Compare is the most popular, with SQL Data Compare running a close second.
SSC: What's the typical experience level for your developers?
Simon: Our developers and testers usually have either undergraduate or post-graduate degrees in Computer Science and at least a few years of professional experience. We do our best to identify developers who are gifted and have some experience in areas relevant to us. We don’t look for cheaper, inexperienced workers. We’d much rather hire (and pay more for) people who are amazingly capable and delight us and our customers with their awesome work.
SSC: You develop tools for SQL Server as well as .NET developers. Do those teams interact in their development or are they separate?
Simon: They interact. Our teams consist of developers (UI and engine), testers, usability engineers, and documentation experts. Everyone sits in the same open-plan office with their main focus being one of the three projects we run simultaneously. We move people between teams to benefit from fresh perspectives and new ideas.
SSC: What do you do to retain employees?
Simon: Retaining our employees is important to us. Experienced people who have a deep understanding of our products, our customers and each other add a lot of value to Red Gate and our customers. There are two related philosophies we have: We try to be reasonable with each other and we try to treat other people as we would like to be treated.
These philosophies translate into a number of specific policies. We have a weekly free lunch; we celebrate achievements; we invest heavily in training; we provide the opportunity for international travel for those who enjoy it; we allow flexible work breaks (such as taking 4 months off to travel in Peru); and we provide salaries that are above the market rate. Being successful has made these policies possible – having 100,000 people using your software allows for security and long-term thinking, and growth brings new professional opportunities.
The biggest factor in retention is not benefits, however. It’s very satisfying and rewarding to be associated with gifted, hard-working people, in a constructive, no-blame atmosphere. Here’s an example: A few years ago one of our products wasn’t doing as well in the market as we’d hoped, so we convened a meeting to discuss what we could do about it. Everyone came up with things that they could do better (sales said they could sell it better, marketing said they could market it better, testers said that they should have tested it better, etc.) – everyone looked at what *they* could do, as opposed to what other people had or hadn’t done. That’s really rare and makes a place a pleasure to work in.
SSC: Red Gate has made some acquisitions of SQL Server tools. How did that come about and are you looking to continue to do more?
Simon: When we first researched the backup market we could see that our approach could add a lot of value. However, there was a satisfactory, if complacent, product being sold at an adequate price. Soon after we researched the market, that product was sold to another company that quadrupled the price. This presented a great opportunity to do what we’ve done elsewhere – to provide the best product on the market, at a price that the average DBA or systems administrator can afford.
We built a fully functional prototype internally to understand the issues; then we faced a buy-vs.-build decision. We found Yohz’s backup software, which, upon analysis, looked to be very good. We spent three months testing and improving it, and did a beta program with 150 participants. The result is an affordable, very high-quality, simple tool for compressing and encrypting SQL Server database backups.
If things continue as they are now, SQL Backup will be the top-selling backup software by the end of this year. Future versions are going to have some very neat features in them.
Our objective is to deliver simple, high-quality tools that fill a defined need at a low price. If we can do that by buying and adapting an existing tool, we’ll definitely consider that option.
SSC: What are the implications of Quest's $61M acquisition of Imceda?
Simon: It creates uncertainty for Imceda's SQL Server backup customers in four areas: cost, support, commitment to the full user base, and future development directions.
Let's start with cost. If you've just paid $61M for something you are going to need to get that money back somehow. We don't know how Quest plans to do that, but you can be sure they aren't ruling out price increases. That is what happened last time Litespeed changed hands.
Next is support. With this acquisition, LiteSpeed will have changed hands twice within a short period of time. All the upheaval you get from acquisitions is going to hit customers and staff. It's inevitable that processes and verification systems will be disrupted and people will leave the company, including those who really know the product and the answers to customers' questions. No matter the company, this kind of instability almost always has an adverse effect on customer service.
Commitment to the current user base is another issue. Quest is very focused on "The Enterprise" (terabyte-type production systems). With this acquisition, I'd expect Quest to concentrate on LiteSpeed's valuable enterprise customers; other customers might become either low-priority or expendable. In particular, existing users with only a few licenses might find themselves left out in the cold.
As for future product direction, I imagine that Quest will try to appeal to enterprise customers by integrating LiteSpeed with its other multi-platform offerings. But, if your overall strategy is provide a backup solution to Oracle, Exchange, MySQL and SQL Server, then it is inevitable that you'll have to compromise on something. I suspect that the customers who just want to back up their SQL Server database might suffer from the compromise.
All of these factors are probably good news for Red Gate. It should further accelerate growth for our SQL Backup product.
SSC: With SQL Server 2005 being delayed again and again, how does
that impact your development cycles? Do you continue to work on new versions of
your products or is there downtime for the various developers?
Simon: It hasn’t really affected us, since people tend to buy tools for databases that they are actually using in production. For that reason, we don’t have to be at the bleeding edge. We also anticipated the delays. For the last year or so, we’ve been working based on an expectation of SQL Server 2005 coming out around September 2005.
SSC: Is SQL Server 2005 changing the types of tools you are developing?
Simon: It’s not changing the tools yet, but it will. We are addressing SQL Server 2005 in three stages: compatibility, extension and innovation.
We’ve already achieved compatibility: Our existing products work with the publicly available betas of SQL Server 2005 (except for DTS Compare, because DTS is changing too radically for that to make any sense). When the final version comes out, our existing products will work with that as well.
We’re now into the second stage, working to extend our products so they make the most of what SQL Server 2005 has to offer. At the lowest level this might mean making the most of all the new schema objects SQL Server 2005 provides.
The third stage gets to the guts of your question. The way DBAs and developers use SQL Server will change with all the new functionality and power at their disposal. Since SQL Server 2005 can run .NET stored procedures, we might extend our .NET profiler to work in that area. Maybe we’ll come up with some completely new tool that helps people in areas like that. We’re excited about the innovation we’ll be able to apply to SQL Server 2005, but for now our customers need us to concentrate on stages 1 and 2.
SSC: Since you are located in the UK, how do you handle the support calls from the rest of the world?
Simon: Our products don’t require nearly the level of support of others on the market. But, we know that it is important to be responsive to customer needs. We have people in the office 8 a.m. to 9 p.m., which provides good coverage in Europe and America. Although we have telephone support, 95 to 99 percent of queries start with email. If we can’t resolve something that way, we’ll call at a time convenient for the customer.
SSC: What can we look forward to from Red Gate in the next year?
Simon: We’re going to be releasing a tool called SQL Log Rescue that will allow you to “undelete” what you’ve done with SQL Server. It will be an incredibly useful tool that every DBA should have. As usual, we’re not going to sell something for $100,000 to your CFO; we’re going to sell a $495 tool that can potentially save an individual DBA’s bacon.
There will also be major version updates for all of our tools.
SSC: What's the best way for DBAs to get approval for your products in their companies?
Simon: Good question. My tip would be to focus on the benefit to your boss rather than what the product does – it is probably better to say how you are going to save hours of time every week than to talk about a technological benefit that your boss might not understand. If your boss is technical, the opposite is true – provide an overview and demo of the product and the boss will probably realize how a small amount of money will make things much better.
A senior member of a development team wrote an article for us about this topic that I think it is worth reading: http://www.red-gate.com/other/win_purchase_decisions_software_tools.htm
SSC: You were trained in physics. How is it you are working
in marketing for a computer software company?
Simon: There is no one on the planet who can tell you with a greater degree of certainty that software marketing isn’t rocket science ?! I think that not having a marketing background in many ways has been an asset. We’ve taken a scientific and analytical approach to determining market needs and how to fill them. Because our products are simple and satisfy very specific, customer-driven needs, we don’t need to resort to hype or bold claims. We market our products by telling people what they do, such as “compare and synch databases.”
There are other reasons we don’t need to engage in traditional marketing: the people we are marketing to, the way we offer the products, and price. Because we don’t need to sell to the CTO, we don’t have to claim that our products will not only compare their databases, but make them healthy, happy and wise. We show our potential customers what a product can do, let them test it for free, and offer it at a price that enables them to buy it themselves. We look at marketing like we look at our products: simpler is better.
Many thanks to Simon for answering a few questions about the SQL Server software world. If you've got additional questions, people you'd like interviewed, or things I missed, add your comment to this article.