It has been quite a year of change for ServiceMax, the leading SaaS company that specialises in field and asset service management. Having spent two years under GE Digital ownership, following a whopping $915 million acquisition, at the end of 2018 it was revealed that it would once again be spun out as a standalone business following a 90% buyout by private equity firm Silver Lake.
The move wasn’t too surprising, considering ServiceMax continued to be the jewel in the crown at a struggling GE Digital (which still owns a 10% stake in the company). ServiceMax and Silver Lake wasted no time and soon after announced the acquisition of communications platform Zinc, to help blend front-end collaboration with service execution. If you want to know more about ServiceMax’s strategy and future plans, read here.
Fast forward another couple of months, and the company has just revealed that it now has a new CEO - Neil Barua - who most recently was an operating partner at Silver Lake and will replace Scott Berg.
Berg has been with ServiceMax for 10 years, previously serving as COO, before taking the top job back in 2017. We’ve enjoyed speaking with Berg over the years, who was always able to give us a frank assessment of the company’s progress and clear insights into its product development. He will be staying on as an advisor to ServiceMax’s board.
That being said, Barua brings with him a wealth of experience to ServiceMax. Barua has had a varied career - he has worked at start-ups, has been mentored by CEO of T-Mobile John Legere, has helped pull companies back from the brink of bankruptcy, and most recently served as CEO of IPC systems (which was also owned by Silver Lake and was sold under Barua’s leadership for $1.2 billion).
We got the chance to speak to Barua shortly after it was announced that he would be taking over from Berg as CEO, to find out what he has in store for ServiceMax. The conversation was interesting and wide-ranging, but off the bat he wanted to make it clear that he has nothing but praise for his predecessor. Barua said:
“[Scott Berg] is just a wonderful guy. He’s been tremendous with the transition. I’ve actually had the pleasure of working with him over the past few months in my partner role at Silver Lake. He’s going to be great for me and for the company, being a good advisor. I’m thankful for that.”
Barua said that when it was revealed that a new CEO would be installed, he raised his hand and said to Silver Lake - “put me in coach”. He was chosen “amongst many great candidates” and he states that part of the reason is that he already has the trust and experience of working at Silver Lake to quickly progress scaling the company. Barua explained:
“I think from a Silver Lake perspective, alignment with the CEO, who literally speaks their language, the alignment around how we allocate additional capital to capture and create greater customer value in a space that is still relatively nascent - I think I have a unique advantage in that.
“Being on the inside with them as an operating partner, there’s very few candidates that have that experience. I think that alignment will be highly critical. Having a trusting relationship immediately and not spending a year building it, it just gives me a lead to help the company.”
Barua also noted that Berg has been in leadership at ServiceMax for more than a decade and said, on a personal level, when you’ve been doing something for that long, “you’ve got to figure out what gets you up in the morning”. Meanwhile, Barua is motivated by the challenge of taking ServiceMax through its next phase of after exiting GE Digital and scaling it further. He said:
“I think great things happened within GE, but now as a standalone business, there’s several things that need doing - we are in the last stages of carving out all functions. We are going to hire a head of HR. We never had that under GE, it was a shared resource. We are putting in a CFO. We are hiring a head of sales. I’m going through the process of building the company as a standalone business and that requires a level of energy and motivation to do that.
“I’ve got a fire in my belly. I told [Berg], I’m not burdened by some of the stuff he’s experienced and I’m just excited about the future. I know it’s an intangible, but hopefully that will help drive the business towards this amazing opportunity.”
As noted above, Barua has already begun the task of building ServiceMax’s functions as a standalone company after having spent the past few years relying on GE Digital’s huge resources. However, there are critical points that Barua is focused on in the short to medium term - most notably, speaking to customers and employees and learning everything he can, as quickly as he can. He said:
“I just have to learn quickly. I’m trying to meet as many employees as possible. I’m hitting the road from that perspective. I want to make sure that there’s a face to the role, that’s very important to me. Getting their feedback about what’s working and what we need to get better at.
“Then figuring out what are the priorities of the business and the strategy - which I think we are on the right path on. There’s also nothing better than getting feedback from customers, so that will be the focus in the short term.”
In the medium to term, Barua hinted that ServiceMax could adopt a more collaborative approach to its market competitors and partners than it has done in the past. Barua wasn’t explicit in which companies he was referring to, or specific areas of the market, but he certainly hinted at a more open approach for ServiceMax over the coming months. It’s worth highlighting at this point that ServiceMax has been built entirely on the Salesforce Platform. Barua explained:
“There’s also a lot of stuff happening in this space, there’s a lot of funding that’s happening in the VC arena, there are partners of ours that have strategies that are sometimes parallel or competitive to us. I think part of my job is sorting out how to ultimately create value for our customers as the market leader - and I think part of this is having an open, deep relationship, as quickly as possible, with as many of our extremely important partners as possible.
“Without any of burden of experience or history of relationship, figuring out what’s the best thing we can do for customers. I think there’s a way to skin that cat with some of what our big partners are doing. I think there’s a deal to be had where we do something really interesting in terms of ‘one plus one equals four’, rather than beat each other up.
“In this day and age, I’m a believer that within technology you don’t have to do everything yourself. There’s a wonderful ecosystem and if you play nice, it could be really fascinating for the customer.”
Preserving culture, but staying paranoid
Barua made two really interesting points around his priorities for ServiceMax over the coming months and years. The first being that he’s noticed a really strong and positive culture at ServiceMax, which he wants to maintain and not disrupt. Barua said that the company has a unique mix of veterans that have been with the organisation for years and fresh blood that are able to introduce new ideas.
“I’ve done a lot of other portfolio company work, and I have to say, a huge competitive advantage that I’m just feeling, seeing, is there’s a lot of people here that really give a shit. They really, genuinely care about the customer first.
“There’s a camaraderie amongst each other - and I give a tonne of credit to Scott and the other leaders for that. Going into a big behemoth like GE and then coming out of it and still retaining that...wow.
“In technology SaaS companies I don’t see that often, there’s more of a churn. Here there’s a nice balance of it. It’s a pretty unique culture and I’m not going to disrupt that. I’m blown away by that. And I think it’s going to be the reason why we crack the code on this next generation of ServiceMax.”
However, one thing that Barua does want to instil within the organisation is a fear of complacency. This is particularly pertinent, he said, given that ServiceMax is a leader in a market that is still relatively young. Barua explained:
“We have to continue to innovate. It’s a critical element of everything I see at Silver Lake and all the other experience I’ve got. In this day and age, if we rest on the fact that we are the leaders, there’s always someone else, something else, that’s going to try to take our customers. There’s a paranoia there.
“I think we have a head start on it because we’ve got scale, we’ve got an organisation, we’ve got resources, we’re backed by a really great parent in Silver Lake. I need to translate that to my team, the urgency around needing to think differently at every stage - not changing things on the fly - but being very paranoid about losing our customers in terms of providing value. That’s what keeps me up the most at night.”
I really enjoyed my conversation with Barua. He seems enthusiastic and excited about the next phase for ServiceMax, with Silver Lake’s backing. He’s clearly experienced and he seems to care about preserving what makes the company special, which is important. I look forward to observing what’s to come and will be following closely with interest.