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Mercury News interview: Vivek Ranadive, CEO of TIBCO Software [San Jose Mercury News, Calif.](San Jose Mercury News (CA) Via Acquire Media NewsEdge) Sept. 17--With all respect to the guy in those beer commercials, Vivek Ranadive might be the world's most interesting man. Author of a bestselling business book. Vice chair of the Golden State Warriors. The guy who coached his daughter's Redwood City basketball team to the national championships, though he never played the game himself. And the CEO founder of a software company that changed Wall Street. He's even got a black belt in tae kwon do. In person, Ranadive is soft-spoken but intense. His company, Tibco Software, started with the idea of pulling information from different systems onto one screen for financial trading. It has since expanded into analytics software that helps corporations glean valuable insights from mountains of operational data -- a growing market where startups and industry giants are scrambling to stake out turf. Ranadive touts "predictive" analytics in his new book, "The Two-Second Advantage," which debuted this week at a party hosted by venture capitalist Marc Andreessen. In recent conversations with this newspaper, he spoke about software, basketball and why he believes math trumps science. The following was edited for clarity and length. Q: You came to this country as the proverbial penniless student. A: Yeah. I grew up well-off in India, but the rupee wasn't convertible. So I literally had $50 in my pocket when I showed up in Boston for college. But you know, I think one of the mistakes parents make is telling their kids, "I had to walk five miles in the snow to go to school" -- that tells your kids, "You'll never measure up." I just always wanted to have my own company and surround myself with smart people and go after big problems. Q: How has Tibco evolved? A: This company is based on one I founded more than 20 years ago to automate Wall Street trading floors. I ended up selling it to Reuters, but the notion I always had was, why not use that same concept of a real-time system for every business? So I licensed back the technology a dozen years ago, and now we're just under $1 billion in annual revenue. Q: Your main product was software that combines information from different systems. Now you've moved into analytics. A: The old generation of analytics was allowing you to look at things six months later and generate reports. But there's no point in knowing you've lost a customer after the customer is gone, or that fraud has been committed after the money is gone. What we do is allow you to spot patterns so you can act on them before the fact, not after. An example: You go to a store and you buy garden seeds. We show a pattern that indicates a 90 percent chance you'll buy fertilizer and 40 percent chance you'll buy lawn furniture. So there's no point in making you a special offer on fertilizer because you'll buy that anyway. But what if we offer you a deal on furniture -- on the spot, not six months after you've left the store? Q: Your book is subtitled "How We Succeed by Anticipating the Future -- Just Enough." What does that mean? A: It's a lot more valuable to have a little bit of the right information, just a little beforehand, than to have all the information in the world six months later. It's like Wayne Gretzky, who says he skates to where the puck is going to be. The world's most competitive telecom market is in India. One phone company adds 4 to 5 million customers a month, but they also lose a million and a half customers in a month. We found that if you have six dropped calls in a row, there's a high probability you'll switch providers. So after the fifth dropped call, we can offer the customer something, like free SMS messages, if they renew their contract. Q: You've been quoted as saying "Science is dead." A: I believe that math is trumping science. In the example of dropped calls, I don't really need to understand human behavior or psychology, I just need to detect patterns. The pattern tells me that six dropped calls is the key number. Why it's not eight, I don't know. I don't need to know. You just need to know that A plus B will lead to C. I can solve just about every problem in the world with that approach. Q: What sort of opportunity does that create for Tibco? A: We believe that while the amount of data has gone up and up, the useful life of that data has gone down. The Oracles of the world would have you believe that big data equals a big database, but a lot of that information is useless once the moment goes by. Q: It's been reported that Hewlett-Packard tried to buy Tibco earlier this year. Can you confirm that -- or can you speak in general about why big companies are getting into data analytics? A: I can't comment on HP. But in general, companies are trying to reinvent themselves, to get out of commodity businesses and turn themselves into value-added businesses. IBM is our biggest competitor. They get it, with their whole "Smarter Planet" campaign. They're spending their money to get my message across. Q: You're part of the Warriors ownership. Is the team using analytics, either on the court or in the business office? A: We're in the early stages. On the business side, if you find that a lot of people are buying merchandise but not tickets, you might make them an offer to buy a ticket on the spot. On the playing side, there's a lot of math that can be applied, to look at what combination of players produces the best results. It's in the early phase, so I can't say much, but my people have been working with the organization. I'm a huge fan. One of the fun things I did last season was host a Bollywood night. We had the game broadcast live in India. It's catching on there. I believe basketball will be the global sport of the 21st century. Contact Brandon Bailey at [email protected] or Peter Delevett at [email protected]. Vivek ranadive Title: CEO of Tibco Software Age: 53 Born: Mumbai, India Residence: Atherton Family: Single; one daughter, two sons Education: Bachelor's and master's degrees in electrical engineering from Massachusetts Institute of Technology; MBA, Harvard Career: Engineering and management jobs at Ford, M/A-Com Linkabit and Fortune Systems; founded Teknekron Software Systems, later sold to Reuters, before launching Tibco Software. 5 facts about Vivek ranadive 1. His unorthodox full-court-press approach to coaching his daughter's basketball team, which went to the national championships, was featured in a 2009 New Yorker article by "Tipping Point" author Malcolm Gladwell. 2. He's one of the three biggest investors in the Golden State Warriors ownership group, led by venture capitalist Joseph Lacob. 3. As a boy in India, he was inspired to attend MIT after seeing a documentary about the school; he earned both a bachelor's and master's degree in four years. 4. He's authored two previous books: "The Power of Now" and "The Power to Predict." 5. He was a founding board member of San Francisco's Contemporary Jewish Museum, although he is a Hindu. ___ (c)2011 the San Jose Mercury News (San Jose, Calif.) Visit the San Jose Mercury News (San Jose, Calif.) at www.mercurynews.com Distributed by MCT Information Services |