How Citrix’s CEO Made Citrix the “Madonna of the Virtualization World”
Written by: Douglas A. Brown, MVP, CTP
That being said, one of the questions I was asked was, “What do you think about Citrix buying XenSource for $500 Million dollars?”
I replied with asking him if he really wanted to know and he and a few other people shouted out, “YES”. I think they thought “Grumpy Doug” would say something like that I thought it was a bad idea, but that is as far away from my beliefs as possible.
I then replied with a short explanation why I thought it was an amazing move, but I must admit I don’t think I gave justice in my answer to how great of a move I think it was, so I would like to take this time to explain to you why I think it was the greatest move in our neck of the IT world for as long as I can remember. Yes, that is a very bold statement and I think I can back it up.
I must start by saying I’ve been around Citrix for a long time. I first started playing with Citrix technologies in the very early days of Citrix (1996-1997), and I’ve watched the company grow over that time. I saw the rise of the stock price to well over a hundred dollars a share and I watched it fall to as low as $5.00 a share. I worked for Citrix from 2001 through 2004, and in that time I experienced the struggle from the inside to take a one product company to a multiple product company, and all the trials and tribulations that entails.
Over those years, I was not always a fan of the Citrix CEO, Mark Templeton, and if we are truly honest with ourselves, who can be a fan of the CEO when the stocks you own are valued in the mid-thirties and the current stock price is hovering around five, six dollars a share. Who do you blame? The CEO is who gets blamed and we did. (Of course what did I know about all that??? I was just unhappy about the stock price.)
BUT, Mark T. assembled a team, made a plan, and raised the stock price. He set a goal to become and multi-product company and raise revenues to 1 billion dollars! I will be honest, I did not like that goal. It should never be a goal to achieve x amount of money. Money is a result of a goal not the goal itself. Regardless, Mark set it and they achieved it in record time. That is great, but that is not why I think he deserves kudos and this is not the greatest move in our neck of the IT world. It can be argued any CEO worth his weight could do the same thing, but the reason Mark deserves kudos is much better that this…
While all this is going on, the IT world was changing. Virtualization was coming in to its own and companies like VMware were going through the roof with sales. Microsoft was about to release Windows Server 2008 with the amazing Terminal Services enhancements and Citrix was looking more and more like they were losing their grip and slipping more and more out of being relevant in the changing face of IT. Citrix had a 1.0 desktop broker that was nothing more than just so-so compared to the others in the market and, of course, compared to Presentation Server (now XenApp). Citrix was losing employees to VMware left and right. VMware was about to go public and as history told us shoot to become a 28 billion dollar business over night and where was Citrix? Just hovering around 1 billion with no technology that really fits the virtualization bill. (Please nobody post a comment telling me XenApp or Citrix’s streaming technologies are application virtualization. Let’s agree to disagree and for the sake of this article, they are not!)
This is where Mark steps in….
The story I heard and this is nothing more than rumor so take it with a grain of salt but the story I heard is that Mark took it upon himself to go to the Citrix board and present his case to buy XenSource. Mark would not take no for any answer. Mark put Citrix on the line, Mark put his reputation on the line, and Mark put his job on the line . As we all know Mark got his way and XenSource is now part of Citrix.
As I said in my Geek Speak presentation, it put Citrix on the top of the mountain with the likes of VMware and Microsoft. Every article talking about virtualization now includes Citrix as a key player. It made Citrix more than relevant again, it made Citrix a force to be reckoned with in one of the biggest growth markets in IT and all because the CEO took charge, put his job on the line and did what he thought was right no matter if it was popular and/or seen a popular at the tine. In the humble view of this engineer, I think Mark’s move was worth well over the five hundred million paid!
At the Citrix Synergy show, there where boatload of vendors vs. the Citrix conferences just before the acquisition of XenSource where the number of venders where dwindling . It was getting boring to attend as it was the same old, same old and/or a bunch of hard-core networking solutions that no matter how beneficial they are just did not excite me or others the way virtualization is exciting the IT world. But not now! Now there is an excitement in the air and everyone in the Citrix / Virtualization world feels it. All this is a result of Mark’s brave move to buy XenSource…
At Geek Speak, I also made the statement that if Citrix never made a single dollar off XenServer (the product they got through the acquisition), then they will still end up ahead of where they were without XenSource… Although we all know that this will never happen. XenServer is gaining traction within the Citrix channel, and as we have learned over and over again. If the Citrix channel pushes something, it becomes a success. Just look at the Citrix Access Gateway. Don’t think for a second Mark did not know this…
The Citrix marketing team is renaming all the Citrix products to include the “Xen” brand to capitalize on its extremely positive connotations. MetaFrame, Presentation Server, Desktop Server was the past… XenServer, XenApp, and XenDesktop are the future and a very bright future I think it will be… (until someone buys Citrix, which I think will happen before VMware’s VMworld but that is a topic for a whole different article. The writing is on the wall and I think that too would have never been made possible without Mark’s amazing move! Just think what it would be like if Microsoft end’s up buying Citrix, even to prevent a foe from picking them up. Think about ICA as the “standardized remoting protocol” for virtual desktops, no more RDP. But, I digress)
The stock price is as high as it has been in a long time (minus a climb here or a drop there). The Citrix morale is like it was in the heyday of the late 90’s. There is an era that something amazing is happening again. The community is enthused, the customers are excited, the channel, who once was VMware only is now chomping at the bit to start offering the new Citrix solutions acquired and made possible by the XenSource acquisition. This is the sign of good things to come and again, all because Mark took a big risk and did what might of seamed to not make a lot of sense to the untrained eye (like mine) but he came out ahead and in return we all did.
Oh, did I leave off the amazing engineers and visionaries Citrix picked up too? Do I need to even say anything about this amazing pool of talent? I don’t think so… Again, worth well over the half a billion spent. You just don’t get guys like Simon Crosby for nothing… This guy brings fire, punch, and an amazing brilliance to the Citrix team.
To Mark Templeton I say, Many Kudos to you Sir, and thank you so much for getting us all excited again!! Job well done, Mr. Templeton, Job well done…
Now, what’s next.. 😉