Mike Thompson – CEO, Groupware Technology

Mike Thompson is the CEO of Groupware Technology, a Silicon Valley-based data center solution provider. He provides the leadership and strategy to propel company-wide success. He has over a decade of leadership experience at Groupware, where he has led the company to profitable growth, from $2 million to over $300 million in revenue, and has earned recognition from Inc. Magazine, CRN, Silicon Valley Business Journal, and many other business and industry publications.

Tell me about your early career.
Starting as an inside sales representative proved to be the perfect position for me as I quickly gained valuable experience in supporting the efforts of the sales team. I also had the good fortune, while in this position, to learn the mechanics of a strong operational system experiencing the entire business cycle, from the initial quote all the way through the collections process. As I continued to grow as an inside sales representative, the chance to move into a new role as an account manager presented itself and I jumped at the opportunity. Within a short period of rapid advancement as a top account manager, and after just four years on the job, the prospect of an even greater opportunity opened. During my time as an account manager, I began to understand how building strong relationships with business partners would be the foundation for continued success. Shortly thereafter, I found myself within the management circle as the Vice President of Sales and later as Executive Vice President of Sales and Operations. The company experienced excellent growth with revenues from around $18 million accelerating to $120 million at its peak.

During this period in the VAR world, many companies were building out their infrastructures and Sun Microsystems, a multi-billion dollar corporation, was the main provider of hardware for all these businesses. Realizing my business venture with this company may produce a highly lucrative outcome, I committed myself to increasing my business acumen and enrolled in an online MBA program. This investment would help propel my career by providing me with real life work experience and book knowledge simultaneously. And indeed this proved to be the case, though, what happened next is not what I had anticipated.

Though filled with good ideas, intentions, and cutting edge technologies, business operates on the simple premise of making more money than one spends. The company found itself vulnerable to the dramatic shift in the misfortunes of others and to my knowledge no one came out of this unscathed. I felt fortunate at this time because at my age I felt I could weather the storms ahead as long as I stayed focused on the task at hand. This meant having those hard conversations no one else wanted to manage, with our customers and, unfortunately, later with the employees.

All through this time I reflected on the simple, powerful things I had learned up to this point in my career and the one most relevant seemed to come from the opening of a Kipling poem, “If you can keep your head when all about you are losing theirs and blaming it on you…” It goes on, but the advice in the poem was clear: stay focused and avoid being distracted by those wanting to cast blame. I still had a career to build and considering the time invested and experienced gained I believed my future held great promise. In spite of having gone through the tortuous experience of seeing this company through its Chapter 11 and later Chapter 7 filings, I believed there were still tremendous opportunities in the technology industry. I also felt the experiences of managing an organization, through good times and bad, increased my value within the VAR community. My instincts were confirmed as other companies reached out offering me a position.

After much counsel and careful consideration I accepted a position with a smaller company with a business model similar to that of my previous employer. Having built strong relationships with industry manufacturers and distributors, the decision to remain in the VAR world came naturally.

Remaining in the technology space felt right, and at this stage of my career, I believed I had accumulated enough sweat equity and experience to, at the very least, explore new possibilities. Having now worked for two companies in various roles of responsibility and having experienced the positive and negative effects of leadership, I decided my next move had to carry more promise. If I can point to one strategic benefit garnered from my two previous employment experiences in the VAR world it’s understanding the importance of building and maintaining strong relationships with all touch points in the industry – manufacturers, distributors, and fellow employees.

How did the concept for Groupware Technology come about?
During this time period in the VAR business world, Sun Microsystems controlled much of the client-server market share; definitely the business relationship you needed if you wanted to experience any success. Rigid would best describe the reseller requirements for selling their product line. Chief among them – having a medallion (re-sell rights). If you wanted to sell Sun Microsystems products you had to have one, period. My resources (peers) informed me a company with a medallion might be going on the market and should I have an interest they recommended seizing the opportunity.

Conversations with colleagues and friends seemed to generate the momentum needed to complete the transaction while simultaneously attracting a team of dedicated individuals. I believe the word best describing the moment is serendipitous. Fortunately, during this time in the VAR business world, companies were heavily committed to building their infrastructures to maintain a competitive advantage. We were in the right place at the right time with the right attitude. But there still remained one vital factor needed in order for our business venture to thrive and not merely survive – support.

How was the first year in business?
I remember the first day I walked into the office located in a strip mall behind a Mexican restaurant – exhilarating, scary and challenging best describes the emotions I felt. But then the team (six of us) rolled up their sleeves, jumped in on the tasks at hand and I knew we were on to something special. When our distribution partner came by to visit, their eyes lit up as they looked at the team and said, “It’s about time you did this. Let’s get to work.” I confess, this felt really good, not just for me but for the team as well. Because of the limited office space, we had to work on some tables outside the office. With business beginning to show signs of growth, we knew we had to move not just for more work space but also because there had been a seriously bad odor in the office, which we discovered were dead rats in the walls. Apparently their presence had some connection with the restaurant. The move to our new office coincided with a shift in the technology business, chiefly in the area of data center management. The days of being the “middle-man” and pushing boxes out to customers were rapidly coming to an end. At this early stage of the company, we decided to take the team to an off-site we called “The Contender” where we gave out boxing gloves, which, of course, we would use to knock out the competition. We had essentially served notice that we were here to win. We grew the business from under $2 million to $30 million in revenue our first year.

What was your marketing strategy?
We developed a two-tiered marketing strategy: first to add value and establish our relevance with our customers and vendors by improving the value-added reseller experience and second, by establishing Mike Thompson (me) as the face of the company and how in doing so it can influence the company’s success. To achieve our set marketing goals, we first rebranded the company by changing the name from Groupware Technology & Computing to a more easily-stated Groupware Technology. Then, we held an off-site strategy planning session to determine what kind of company we wanted to be, and how we were going to get there. Since many of us (all six of us) had already developed close relationships from past experiences, we knew the basics of the industry and were mostly looking for differentiators. Considering how small we were in numbers, this hurdle would not be easily overcome. During a particularly engaging exchange, one of the team members phone rang, and rather than ignore the call and let it go to voicemail, he answered the phone and headed toward the door. Looking at him with perplexed expressions, we asked why he was taking the call in the midst of this important strategy session. His response, while seemingly in passing, resonated with everyone in the room,”We answer the call.” Needless to say, during his absence, the discussion in the room quickly turned to those four words, and we soon realized the power behind his statement. Right then and there, we knew we had a serious differentiator. From this statement, we decided whenever anyone called our company a living, breathing person would answer the phone and manage the caller’s inquiry. No voicemail, “Dial 1 for sales, or 2 for finance”; ad nauseam. The conversation for the rest of the strategy session revolved around this statement. Now, “We answer the call” had a much more significant meaning. It gave us a better understanding of how we were going to operate as a company and we knew then this would be the differentiator in both adding value to our customers and establishing relevance with vendors.

How fast did the company grow during the first few years?
We quickly grew the company from under $2 million in revenue at acquisition to $30 million in our first year of new leadership, and the community began to take notice. Especially when in 2007 Inc. Magazine listed us as the #1 fastest-growing IT services company. We grew the business to $100 million in our fourth year and now we are $300+ million in revenue on our way to $500 million.

How do you define success?
Every time I come into the office, I see careers being built, families growing, and a culture of caring for each other. While having financial success is critical to the success of a company, the positive impact our success has on our employees makes one appreciate and understand the true meaning of success.

What is the key to success?
Creating a culture centered around core values. At Groupware, our core values of excellence, customer service, fun, and giving back, along with building and maintaining strong relationships, have been the driving force behind our successes. People like to do business with people they like.

What is the greatest lesson you’ve ever learned?
“Seek to understand before asking to be understood.” The power of listening is the lesson learned from the experience of our first off-site strategy session, which led to establishing our tagline, “We answer the call.”

What are some quotes that you live by?
“The greatest leader is not necessarily the one who does the greatest things. He is the one who gets the people to do the greatest things.” – Ronald Reagan

“In times of change those who are prepared to learn will inherit the land…While those who think they know will find themselves wonderfully equipped to face a world that no longer exists.” – Eric Hoffer

“I never wake up in the morning and tell myself, ‘Today, I think I’ll be mediocre.’” – Mike Thompson

What are some of your favorite books?
The Five Dysfunctions of a Team by Patrick Lencioni
Leading Change by John P. Kotter
The One Minute Manager by Kenneth H. Blanchard

Tell me about one of the toughest days you’ve had as an entrepreneur.
The “Great Recession” served as a reality check. After many conversations with our customers, we realized our customers were on the verge of a major shift in their data centers. So, instead of dialing back the business, we saw an opportunity to take marketshare and doubled down on expanding our integration, proof-of-concept, and testing labs. Our motto at the time was, “We refuse to participate in the recession!” This offered our customers who were looking to update their data centers an opportunity to essentially “try before you buy.” Of course, this also meant creating a new model centered around engineering prowess. Fortunately, the recession availed us with an excellent engineering team and we were able to support the investment. Lots of sweat equity during this time.

When faced with adversity, what pushes you to keep moving forward?
Belief in what you’re doing and trust in your team to execute the plan. Support from business partners, but more importantly, from family and friends. I also reflect on those who faced adversity much more dire than I.

“The ultimate measure of a man is not where he stands in moments of comfort and convenience, but where he stands at times of challenge and controversy.” – Martin Luther King, Jr.

What advice would you give to young entrepreneurs?
1) Lead by example but know where you’re leading your team.
2) Business is truly about people – surround yourself with good people and empower them. When you let your people do what they do best, they will both amaze and surprise you.
3) Stay curious – every day is an opportunity to learn and share something new.
4) Establish your company’s core values and stay true to them. They will determine your company’s culture and provide you with direction during difficult times.

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Interviews are conducted for research purposes by author Jason Navallo for his upcoming book, Underdog.

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