Redgate Software CEO Simon Galbraith says while 2016 was tough, 2017 should be a record year

PUBLISHED: 23:26 22 March 2017 | UPDATED: 00:20 23 March 2017

Simon Galbraith at Redgate, Cambridge . Picture: Keith Heppell

Simon Galbraith at Redgate, Cambridge . Picture: Keith Heppell

Iliffe Media Ltd

In a searingly honest interview, Simon Galbraith, CEO and co-founder of Redgate Software, tells us why 2016 was such a challenging and painful year for the Cambridge company – and why he’s confident this year will be very different.

Simon Galbraith at Redgate Software, Cambridge. Picture: Keith HeppellSimon Galbraith at Redgate Software, Cambridge. Picture: Keith Heppell

There’s a sense of anticipation at Redgate Software. The company, which is 17 years old, had never endured a year like the last – but it hopes this year will be like no other for different reasons.

Simon Galbraith speaks openly about the challenges of 2016 for the company, which specialises in providing software for companies which use SQL Server.

“Last year was a really tough year for us,” he says. “We had been more or less flat for about five years and we came to the somewhat uncomfortable conclusion that the way we had set ourselves up and the number of people we were employing were actually an impediment to us succeeding as
a business.”

After thinking long and hard about the company’s mission, Redgate moved to refocus in its
core activity of making software for people using the Microsoft
data platform.

Simon Galbraith at Redgate, Cambridge. Picture: Keith HeppellSimon Galbraith at Redgate, Cambridge. Picture: Keith Heppell

“The really painful thing was that we realised we would have to make redundant some of our friends, none of whom had done anything wrong and who had been loyal servants to the company and worked really hard,” says Simon.

“It was a tough decision and there was a lot of conflict among the senior management about whether we should do this. In the end, we had to say goodbye to some of the management who didn’t believe it was the right thing to do.

“That was really tough because
we value being a company that
cares about its people and their humanity in a way that’s not just a financial contract.

“This company exists to be a place where people love their work. It felt like we were attacking that potentially, which we were really worried about. But we realised the fundamental mission of the company isn’t to be an employer but to be a successful business and that had to come first.”

Through a combination of redundancy and natural change, Redgate reduced its headcount from the 2014-15 high of 300 to 220 in the middle of 2016.

“We spent a lot of energy on making our business simple and easy to run,” explains Simon. “To tell us if that was working we wanted to have a quarter where we made $12.5million. The last quarter of 2015 had been $10.7million in bookings. We worked really hard – we had survivors’ guilt – but by the last quarter we reached $12.45million, which we’re taking as a sign that we can do well with a smaller number of people focusing on our core.”

Redgate had identified three challenges: It needed to adapt its business model to the way the market had moved, it needed to release some brilliant new software and it needed a more fruitful relationship with Microsoft.

“We’ve made in the last six months pretty significant progress, but at the moment it’s hidden from the world. This year, we will see the early fruits of those labours. So we think we’ll make more money this year than last and I would be disappointed if this isn’t a record year by any metric – profit, revenue… I feel as confident as I’ve ever been that we’re going to hit the record this year,” predicts Simon.

“We’re also hopeful, though not betting the farm, that we’ll come to market with a new product that’s going to have a really good impact this year and that we’ll have made very significant strides with the way you work with Microsoft. There’s a quiet sense of anticipation that this might work.

“In the past, we had a 10- or 11-year run where we just always grew by 30-40 per cent. That took us from being a self-funded, two-person start-up to being a 300-person business. But after a long period of things not really working for us, there’ll be almost a bigger sense of satisfaction from turning that around…”

Simon Galbraith…on Brexit

“Brexit has an enormous positive influence on Redgate from a financial point of view because Redgate spends money in pounds sterling but earns money in US dollars.

“Brexit, which has caused a long-term massive permanent drop in the value of pound sterling, is tremendously good for our profitably.

“So with my financial hat on, I’d like the British government to continue mismanaging the economy for as long as it can.

“But there are a few things I very much regret about Brexit. Redgate sees itself as an international company and a citizen of the world, rather than little England. We have always employed European citizens as part of the Redgate family and probably 15 per cent of our workforce are citizens of the EU. To see them going through the stress and uncertainty caused by Brexit is something I dislike intensely. We also want to continue to see Europe as a place we can do business and employ people and at the very least there are going to be significant barriers put up, which I think is going to be a lose-lose situation for Britain and Europe.

“I sent an email to all staff after the Brexit vote and said I would commit our money to ensuring that any court cases about them being deported would be fought on our money rather than theirs as I really don’t want our people to feel anything other than welcome here.”

Simon Galbraith…on DevOps

“DevOps is a term that describes a newish approach to the way companies and organisations create and maintain software. The fundamental difference is rather than doing a lot of very careful planning and shipping software maybe at the end of a three-year phase, you do things far more incrementally.

“The most any team at Redgate will do before they ship software will be two weeks. Many teams will be shipping software every day or several times a day, so it’s continually creeping forward. What’s more, that software is put in the hands of users. If you are using our software you can opt to be on the very latest version, which might change several times a day, or you can choose to be on the steady Eddie version, which might only change every three months.

“DevOps is hard. It’s embracing the idea of lots of incremental change but it represents a profound difference in the way people work together – different practices, habits and tools.

“Redgate was one of the first companies in the world to begin working in this way and we won various awards for it, like the ‘best agile company in the UK’. It’s far more mainstream now. One of the things that we offer through our products is allowing you to do distinct DevOps through the database.

“The database represents a particularly challenging thing to do with making lots of incremental changes which is a business opportunity for us but also a problem.

“When you change a database it’s a bit like trying to change the saddle on the horse as you ride it along.

“There are a few types of software where it wouldn’t lend itself – software for a nuclear power station would need to be written slowly and carefully, planned out in advance and rigorously tested. But for most types of software, you don’t know exactly what your users truly need before you start, or what they are going to use, so this much more iterative approach uncovers where customers find value far more rapidly and prevents you working on things that nobody is going to use. By shipping our software more frequently, there’s far less wasted effort.

“I think everyone has woken up to the idea that time to market is more and more critical success factor.”

Simon Galbraith…on innovation

Redgate encourages its talented team to innovate during ‘Down Tools week’, in which employees put forward ideas for new software.

“People put their challenges in and we put them on a whiteboard and people coalesce around those areas. None of the people are chosen by management – it’s completely organic,” says Simon.

“SQL Search came out of a Down Tools week. We just released a new version in December – over two or three days between Christmas and New Year, more than 100,000 people tried it out.”

Sometimes, it leads to software work for social benefit – like aiding a charity.

The firm has also adopted the idea of 10 per cent time, allowing staff to work on something else for a small period of their week.

“We also have a process called Catalyst, whereby people can put forward ideas that could be really impactful for the business. Last year we had about 100 ideas,” says Simon.

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