New F5 CEO Manny Rivelo is just getting started, but already he’s experiencing a headache that comes with running an industry giant in one of the country’s hottest tech markets: the battle for talent.
The security software and network infrastructure company was hoping to bring in around 100 new workers last quarter, but it was only able to secure about 75. Next quarter, it’s aiming for somewhere between 125 and 150 hires.
Rivelo said startups have been one of his biggest competitors in the recruiting market.
F5 is an industry leader in tools to help companies deliver applications over the Internet. It’s publicly traded and has nearly 4,000 employees. But still, Rivelo said he’s finding that whenever the markets get as hot as they are right now — with record-setting IPOs and off the charts venture funding — technologists want to “roll the dice” on a startup.
But he said that won’t last forever.
“When that cycle self corrects, everybody flocks back to quality: companies that are stable, companies that are profitable, companies that can guarantee that I’m going to get paid,” he said. “We’re not in that cycle right now; we’re in the frothy cycle. That will correct itself, at which point in time we’ll see that shift and it will become easier to recruit talent.”
Don’t get him wrong, Rivelo won’t be excited to watch the bubble burst because of what that would do to the entire tech landscape. But at least for recruiting, it may make his lift a little easier.
I chatted with Rivelo as he weathered his first earnings report as CEO on Wednesday, which beat analyst expectations and sent the stock price up on a 10 percent climb in revenue. Here are some other highlights from our conversation.
Q: So what was the pitch F5 used in 2011 to pull you away from your 20-year career at Cisco?
Rivelo: “One of the things that became very clear to me during my later years at Cisco is that the world was becoming much more application centric. … What I realized, it’s not just connecting things that becomes important. Obviously the interconnection of the internet is fundamental to that, but then it’s the delivery of those applications. Can you deliver those application in a fast, secure and available way? That was something I saw that was vital. I would say the DNA in my old company was lots of the infrastructure. They do an incredible job of providing infrastructure technology, but when it comes to application delivery that wasn’t their forte and eventually an area they backed away from. It was a mutual thing. For me, it was looking for the right opportunity. … It was a marriage on both sides that was logical for me.”
GeekWire: We hear a lot about how F5 is in the middle of a transition from its roots in data centers to the cloud. Was that happening when you first came aboard?
Rivelo: “There was talk about the cloud but nobody knew really what it meant at the time. As a matter of fact, there was so much confusion around some of those topics that they were viewed as being headwinds for F5 as a company because of the misunderstanding of that. Part of my job when I came into F5 was to help F5 from a strategy point of view align to those trends. Because if they did materialize, you wanted to be capture those market trends. So we aggressively pushed in the early days I was here toward cloud-based architecture.”
GeekWire: Do you think your role in helping to steer that transition was one of the reasons you were tapped for the CEO role?
Rivelo: “I think that contributed, obviously. The board went through a big due diligence process. From the point [previous CEO John McAdam] announced he was going to be stepping down until my appointment was approximately three quarters. That was three quarters where the board did due diligence, looked at candidates, lots of interviews. So toward the tail end of it I was ready for a decision to be made. I have big shoes to step into because John has done a great job for the past 15 years.”