This episode features a conversation with Thoma Bravo Partner Adam Solomon and SMA Technologies CEO Todd Dauchy.
AIR DATE:
April 24, 2025
LENGTH:
12:56
DISCLAIMER:
This podcast is for informational purposes only and does not constitute an advertisement. Views expressed are those of the individuals and not necessarily the views of Thoma Bravo or its affiliates. Thoma Bravo funds generally hold interest in the companies discussed. This podcast should not be construed as an offer to solicit the purchase of any interest of any Thoma Bravo fund.
Transcript
[MUSIC IN]
ADAM SOLOMON:
Hi, I’m Adam Solomon, a partner at Thoma Bravo and this is Beyond The Deal, our bonus episode of Thoma Bravo’s Behind The Deal. And I’m here with SMA Technologies CEO Todd Dauchy.
[THEME MUSIC DOWN]
ADAM SOLOMON:
Hey Todd. Good to see you. Thanks for coming on the show.
TODD DAUCHY:
Thanks, Adam.
ADAM SOLOMON:
I really appreciate you taking the time. Maybe we can start by just giving us your quick elevator pitch on SMA Technologies for our listeners who maybe haven’t heard the Behind The Deal episode yet.
[MUSIC OUT]
TODD DAUCHY:
Yeah, you got it. SMA is an automation company that's spending most of its time in the BFI, banking federal institution category, where we help our customers with some of their most mission-critical workloads. And that can be anywhere from batch processing with things like ACH payments and check processing, all the way through helping them with their efficiency on loan origination, to compliance across a variety of different lending platforms.
ADAM SOLOMON:
Let's get personal a little bit. I think you've got a fantastic, and I won't say unique, but pretty darn differentiated leadership style. Would love for you to describe what your leadership style is and what inspired it, where did it come from?
TODD DAUCHY:
I think my leadership style is very much in evolution. And I would say that I learned my style by watching a lot of other people throughout my career. And I’d say like the first thing that I learned is like a lot of CEOs are just very, very inspirational. They're like from the front leaders, get everybody rallied and charged.
And as an introvert, that's really hard for me to be that style. And I found that the more I pushed on that, the harder it was to perform,the more I felt like I was letting myself down.
And really, what I learned is that I'm a lead-from-the-middle type of guy. I love working with my team. I love helping them figure out tough problems, and I love making them lead. And one of the things I pride myself on the most is, as CEO, I actually make very few decisions. I force my team to have hard conversations and work things out, and we get alignment. And with that, everybody gets engaged in the decision-making process. We make better decisions, and everyone's bought into where we're going.
ADAM SOLOMON:
That's great, and from one introvert to another, I empathize with a lot of what you're saying there. And I know that you grew up in upstate New York, and as a chess player. How does that impact the way that you see business?
TODD DAUCHY:
I mean, I started chess as a really young kid. I was definitely more of the mathlete than the athlete. And I started playing when I was probably like six or seven years old. And I had a first-grade teacher that really got me interested in chess. She started coaching and teaching me. I started playing at the tournament level, and I became pretty advanced in the game.
And what I really learned through chess was, if I treated it like a tactical experience and I just responded to everything that came my way, I lost a lot of games because I was playing somebody else's game. And I learned that the further ahead I thought, the more I actually thought about where I wanted the opponent to play to, the better I got in the more tournaments that I won. Didn't really realize there was a life lesson there when I was so young, but later in life, I realized that was a critical skill set that I figured out about planning and strategic, and just being ahead of everybody else.
I spend a lot of my time thinking five to seven years down the road. And it's about setting up the situation where everybody else is going to be down the road rather than where they are today.
ADAM SOLOMON:
Terrific. And maybe walk our listeners through what does a day in the life of Todd Dauchy looks like? What does the CEO of SMA Technologies spend his time doing?
TODD DAUCHY:
I would say this is, uh, kind of new for me. Having gone through the massive transmission that we had at SMA. For a while, I was in, like, a heavy tactical space working directly, figuring out a lot of things, working with my hands, and making a lot of things happen. And I'm really proud over the last couple of years of the caliber of team that we've built, and I'm surrounded by experts of people that just get the day-to-day gun. And it gets me the opportunity to think on a different level.
So, now I spend most of my time working with leaders and secondary leaders, talking with them about what's going on in their environments, helping them elevate their decision-making, and getting them to be able to take their thoughts and get them to action more quickly. The other area I spend a lot of time on is working with you, Adam. Thinking about the transformation of the business, thinking about a lot of M&A activity that we're working through right now, how the pieces of the puzzle fit together, and how we actually navigate that game plan that I've been thinking about for the past 13 years now.
ADAM SOLOMON:
And I mentioned you grew up in the Frozen Tundra of upstate New York. You're now a proud Houston resident and have gone a little native in terms of becoming a huge rodeo fan, which is, I think, pretty abnormal for someone from upstate New York or pretty new for someone from upstate New York. How did you find out that you loved rodeo? What do you like doing in the rodeo? Tell me all about the rodeo.
TODD DAUCHY:
I guess I go back a little bit to my roots. I grew up in a very, very small town, upstate New York. I had several relatives that worked on farms and owned farms. So, I was always around livestock growing up; I was involved in anywhere from cleaning stables and milking cows and haying, and all of that stuff. So, just have always had an attraction to animals, loved the hard work nature of it. And that's just the reward that you have of working with livestock.
And when I came to Houston, I'd never been to a rodeo. I heard about it. My wife and I are like, “Well, heck yeah, let's experience something native and local here in Houston.” We went to the rodeo, and we're just fixated on it, like just immediately drawn to it, loved everything about it. Specifically, a thing that I like about the rodeo here in Houston is that all of the proceeds go to scholarship funds, which I'm really big into education. And we immediately became season ticket holders and we've been that for 12 years now, and just enjoy going all the time.
ADAM SOLOMON:
That's great, and I know last week you had a lot of family and friends in town. We're recording this, I guess, a week after the big Houston rodeo. What's your favorite event?
TODD DAUCHY:
You have to acknowledge the bull riding, I mean, that's just fantastic and thrilling. But I wouldn't say they're my favorites. Probably the most exciting, but I really like steer wrestling, and I would also say barrel racing is another fun one. I just love the skill that goes into that one. And then at the end of every rodeo, there's always the kids get to come out and ride the sheep, and there's just something just magical and entertaining about a six-year-old riding a sheep. I don't know what it is, but it's a lot of fun, and I enjoy, and I love doing that.
ADAM SOLOMON:
I'm having a lot of fun just picturing a six-year-old riding a sheep. That sounds–
TODD DAUCHY:
Bring the kids on over, let's go have fun with it.
ADAM SOLOMON:
Next year, next year. My kids, I don't think they could ride a sheep, but they can try. And a little less glamorous than riding a bull, but can you tell me about the largest career hurdle you've had, or a setback that you've had over your career, and how you overcame that?
TODD DAUCHY:
Yeah, I would say probably the hardest thing that I've had to navigate in my entire career would be, like, right after I joined SMA, when I joined the company, it was an understanding that I was gonna become the guy running the company. We didn't really define what that title looked like, what it meant, not really sure where that was gonna go. And working with a guy that had worked his entire life in this company, and he was just very focused on customers. But more importantly, it was like a lifestyle business, and didn't really know how he was gonna navigate–we were trying to figure each other out, and six months into the relationship, he decided to sell the company, and it was a really hard situation to watch him go through that.
The business was not investable. There was a lot of things that needed to get done. And he was just struggling awfully, that he knew he needed to do something different, wanted to do something different, but his baby was a little ugly at the time. And I spent the next several years working with him. He went through a couple more failed transactions, and I had to spend very, very large amount of time and a lot of tears along the way, helping him basically figure out what was important to him, what he wanted to do, and to make those hard steps to get the company in an investable state. And it came at a lot of just personal sacrifice to make that happen, but I felt it was part of my duty to help him actually get on his journey, which actually became the beginning of my journey as CEO. So it was a win-win for everybody, but a very hard journey to go through.
ADAM SOLOMON:
And as you look back at your career and could talk to younger Todd, what's one thing you wish you had known at the beginning of your career?
TODD DAUCHY:
I think one thing that I just, I'm really intrigued by is this world that we're in now. I love working in small companies and transforming them, the opportunity of working with private equity to just dramatically change course of a business.
An earlier version of Todd, I worked for a big Fortune 500 company. It was stable. It was perceived to be like, you're gonna go there, you're gonna work, you're gonna retire, and the company takes care of you, and that may be a true statement, but what I realized is that really wasn't for me. And I love the space that I'm in now. And I just wish I had found this industry 20 years earlier. I can't imagine where I'd be now, but that experience of working and transforming small companies just fits my DNA. It fits my lifestyle. It fits everything about me, and I just wish I'd found it earlier.
ADAM SOLOMON:
Super.
TODD DAUCHY:
Adam, I'd love to know the same question right back at you. If you could find a younger version of yourself, what would that look like?
ADAM SOLOMON:
Oh boy, I'd probably start by telling him to take it easy and calm down a little bit but beyond that, I increasingly say this more and more, is the world is small and life or career is long and just the personal relationships, and this is maybe taking a page out of your book a little bit, the personal relationships you build along the way are kind of what makes it all worthwhile.
And being really focused and intentional on that is something I think a lot of younger professionals maybe doesn't totally compute. But as I said, the world is small and life is long, and those people that you meet come back up again and again and again in your career and in your life. And like I said, that's the part that makes it all fun and worthwhile.
TODD DAUCHY:
That's great. Maybe one more question for you, as I think about your answer. I spend a lot of time working with my leadership team, as I mentioned before, they're all early in their lives in terms of family and everything else. And we have these high-profile jobs. There's a lot of stress that goes into it. You're in a similar situation. How do you manage a work-life balance with everything that you've got going on?
ADAM SOLOMON:
Yeah, it's such an important question, and I've got two young kids, and from travel and just the daily demands of the job, it's a tricky balance. I would say that what, at least I've realized when I had children and really wanted to spend more time with my kids and my family, is there's a lot of fluff in life. And when you have a demanding job plus a family, and you really want to spend time with your kids, it just makes you realize how much other stuff you don't wanna do.
And you just, at least for what I've done, is stop doing it. 100 % of my time, effectively, is work or family, or friends, and I've started– I take the, commit unnatural acts on flights to make sure that I'm home for bedtime and home for as much as I can be while still obviously doing all that travel. Just because maintaining that work-life balance A, it's the right thing to do, and B, I think, just makes your career longevity much more manageable.
TODD DAUCHY:
I couldn't agree more. I think that's why we have so much in common with how we think about the world, and it makes a great relationship between the two of us.
[MUSIC IN]
ADAM SOLOMON:
Couldn’t agree more. Well, Todd, thank you again so much for coming on. As always, it's so much fun to spend time with you just chatting about SMA, but also as you said, is how kind of our relationship got started and continues to this day. So, thank you for doing this. It was a ton of fun.
TODD DAUCHY:
I agree, Adam. Thank you so much for having me on. And as one introvert to another, I'm excited to get back to my day and get back to work and keep working on this journey that we're on together. Thanks so much for having me here.
ADAM SOLOMON:
That's well said. Take care.
ORLANDO BRAVO:
Behind the Deal is brought to you by Thoma Bravo in partnership with Audacy's Pineapple Street Studios. Join us next week for more stories Behind the Deal. Thanks for listening.
