Flamboyant billionaire cofounder relinquishes CEO role to two trusted lieutenants
Nothing expected to change as Oracle battles to stay relevant in a cloud world
NEWS ANALYSIS LAST week, the enterprise IT world got a shock when Oracle Corp announced that Larry Ellison, chief executive officer (CEO) of the company he cofounded, will step down after being at the helm for 37 years.
The news came in late on Sept 18, during a conference-call senior executives were having with analysts, in which the Redwood City, California-based software maker revealed that it had once again missed Wall Street’s latest revenue expectations.
There was a flood of news reports on how the 70-year-old college dropout founded Oracle with a mere US$1,200 and built it into a tech behemoth, making him the seventh richest person in the world. He will bow out of day-to-day running of the company he had helped found in 1977.
In a press statement, Oracle said its board of directors has appointed Ellison its executive chairman, replacing Jeff Henley who has served as chairman for the last 10 years, and who will become vice chairman of the board.
Ellison will also become Oracle’s chief technology officer (CTO), with the software and hardware engineering divisions reporting to him, and he will still have a direct hand in the company’s product roadmaps.
Meanwhile, the leadership baton has been passed to two of his faithful lieutenants Safra Catz, co-president and chief financial officer (CFO); and Mark Hurd, also a co-president.
The two will share the CEO role, with Hurd continuing to lead sales, services and marketing; whilst Catz continues her reign as CFO, legal, regulatory and operational head, as well as being in charge of Oracle’s manufacturing division.
The Wall Street Journal noted that Ellison was amongst the last of the cofounders and CEOs of Silicon Valley’s pioneering companies to have handed over leadership.
Microsoft Corp’s Bill Gates, at one time his nemesis, did so over a decade ago, passing the helm to Steve Ballmer, who himself resigned as CEO earlier this year, handing over the reins to Satya Nadella.
Then there was Apple Inc’s iconic cofounder Steve Jobs, who passed away in 2011, but not before handing over the reins to Tim Cook.
Although Ellison is vacating the CEO role, analysts see his roles as executive chairman of Oracle’s board and CTO as a transitional strategy.
Still, his resignation as the CEO is in itself a milestone given that Oracle only has had one CEO since its inception.
Flamboyant, eccentric billionaire
There is little doubt that Oracle would not be where it is today without the passion, drive, perseverance and life-force imbued by Ellison (pic).
Described by the industry and media as ‘combative,’ ‘brash’ and even ‘egotistical,’ Ellison is one of the Valley’s most controversial, recognisable and ostentatious old-school startup billionaires.
He lived his life his way, often with panache, and was never one who shunned publicity, even appearing in a cameo role in Marvel Studios’ Iron Man 2 in 2010. Oracle’s brand was also clearly featured with product placements in the movie.
Ellison lives in a US$100-million Japanese-styled mansion in Woodside, California. He owns several luxury items including private jets, a McLaren Formula One race-car, and yachts, one of which is 400-feet long.
In 2012, he even bought up 88 acres of land in the private island of Lanai, Hawaii, reputed to be worth US$325 million, according to one media report.
In business, Ellison often derided his competition with sarcastic jokes, employed hostile takeover tactics with companies he wished to buy when owners didn’t want to sell, and faced off with US government’s antitrust law suits and competitive battles in his nearly four decades of being in the tech business.
I first got a taste in person of Ellison’s acerbic wit when I was covering Oracle OpenWorld back in 2003, and then again in 2005 and finally in 2011, with two other different publications.
On stage with him in 2003 were some of the industry’s most talented and successful IT leaders including the likes of Scott McNealy, then CEO of Sun Microsystems Inc; and Carly Fiorina, then CEO of Hewlett-Packard.
But as talented as they were in trading barbs and banter with Ellison, it was the latter who always came up tops, managing to put the thousands at OpenWorld at the Moscone Centre in San Francisco in stitches.
That was also the year he engineered one of the industry’s highest-profile hostile takeover bids, that of enterprise resource planning rival PeopleSoft Inc, in which Ellison was quoted as saying that he believed “hostile takeovers do work.”
After a protracted battle lasting 18 months, he finally got his way, winning the bid for US$10.3 billon.
Some of his more famous quotes came at the expense of his business rivals.
For example, he said this SAP’s executives when they introduced the company’s new big data analytics platform called SAP HANA in-memory database: “When SAP, and specifically Hasso Plattner [SAP’s cofounder], said they're going to build this in-memory database and compete with Oracle, I said, ‘God, get me the name of that pharmacist, they must be on drugs’.”
Of Microsoft’s Gates, Ellison said, “Bill Gates wants people to think he’s Edison, when he’s really [John D.] Rockefeller ... though I wouldn't mind being Rockefeller either. But referring to Gates as the smartest man in America isn’t right. I’m not the fourth smartest man in America. Wealth isn’t the same thing as intelligence.”
Of Salesforce.com’s Marc Benioff – Ellison’s one-time protégé whom he booted out of a speaking slot at Oracle World 2011 – he said, “I started NetSuite. NetSuite was my idea. I called up Evan Goldberg and said, ‘We’re going to do ERP (enterprise resource planning) on the Internet, Software-as-a-Service.’ Six months later Marc Benioff, finding out what NetSuite was doing, kind of copied it.”
And of cloud computing, he once said, “The interesting thing about cloud computing is that we’ve redefined cloud computing to include everything that we already do. ... The computer industry is the only industry that is more fashion-driven than women’s fashion. Maybe I’m an idiot, but I have no idea what anyone is talking about.”
He also made some moves not typical of a top IT executive.
For example, at the turn of the century he hired private investigators to sift through garbage dumped by a research group he thought was funded by Microsoft when in the midst of a lawsuit against the company.
And last year, Ellison courted controversy and incurred the wrath of his customers when he blew off his own keynote address at Oracle OpenWorld because his Oracle Team USA America’s Cup sailing team was at that time at the cusp of snatching victory from New Zealand.
He was also absent from Oracle’s quarterly earnings conference call with analysts a week before OpenWorld so that he could be close to the racing, reported Business Insider.
Next up: Analysts don’t expect any real change at Oracle