Season three of Thoma Bravo's award-winning podcast and bonus episodes kick off with a conversation between Thoma Bravo Managing Partner Seth Boro and Mike Capone, CEO of Qlik.
AIR DATE:
February 6, 2025
LENGTH:
18:08
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
SETH BORO:
[00:00:22] Hi, I'm Seth Boro, managing partner at Thoma Bravo. And this is =Beyond the Deal. A special episode of Thoma Bravo's Behind the Deal and I'm here today with Mike Capone, longstanding and hyper successful CEO of Qlik. Mike, welcome to Beyond the Deal.
MIKE CAPONE:
[00:00:38] Great to be here, Seth.
SETH BORO:
[00:00:42] Mike, It would be great if you could tell our listeners a little bit about Qlik.
MIKE CAPONE:
[00:00:47] Sure. I'd be happy to. So, Qlik is really the leading independent provider of data analytics and A.I at scale for large enterprise customers. So we solve the problem of harnessing data, getting the quality and the transparency right with data, and then analyzing that data. And then the last most important piece is getting insights from that data and acting on them. That is a platform that we have built and we market today.
SETH BORO:
[00:01:13] That's great, Mike. Thank you for that. And it's obviously a super, super exciting time in the world of data infrastructure as it relates to A.I you know, with that, of course, brings the need to constantly innovate. And I'd be curious to get your perspective on how you keep that innovation engine going as a leader of a billion plus business that now has a couple of decades of operating history behind it. Plus, what's the secret to that, to make sure that you're always looking ahead?
MIKE CAPONE:
[00:01:49] Yeah. You know, it's a matter of survival, right? You know, a billion dollar SAAS companies go to die. And, you know, we've broken through that. And and it is because we've been able to stay on top of innovation. And really it's everybody's job in the company. I've got a great team. So, you know, we're constantly on the lookout, analysts, publications, things like that. But actually we have the benefit of TB, you know, So we're we're really good friends with, you know, a group that owns a large portfolio of technology companies. So we lean… on we do lean on TB a lot to help us scan the market and see what's going on out there. And then, you know, our strategy has always been a good combination of organic building of technology, but also rapidly acquiring new technology, doing tech tuck-ins to accelerate our innovation as well. So an M&A machine has really been a big part of our staying ahead of innovation.
SETH BORO:
[00:02:37] Yeah, you've done an amazing job innovating organically and inorganically at scale. And you live in a world and a market that moves very, very quickly. Maybe as fast as now it's ever moved. With the advent of gen AI, which you've responded to, you know, very quickly in one that you've been actually, you know, working on and in and around for quite some time. So actually, from my perspective, it's all seemed very natural. You know, when you look back on your time with Qlik and time with Thoma Bravo, you know, you are always working in the public markets before as an operator. What's kind of surprised you in this world of, you know, working with us in a private company that perhaps you hadn't quite realized before you took the job?
MIKE CAPONE:
[00:03:22] Yeah. Well, it was interesting. As you as you highlighted, I only worked in public companies for the first, you know, kind of 25 plus years of my career. So when Orlando called me and proposed I talked to him about the Qlik job. I said “Well, you know, private equity, I don't know. I don't really know much about it” I had sold companies, private equity in the past, and the outcome wasn't always great. I was a little bit skeptical until I got to know everybody, until I talked to Orlando and got to talk to you. I remember meeting you in Chicago for the first time and you said “our model is very different” I mean, the one thing I have to say is absolutely true, and the thing that I was really pleasantly surprised about is sort of the level of collaboration and operating flexibility that comes with the partnership. So, yes, you know, there are things that TB expects, and there's a very successful playbook that we get to take advantage of but we generally agree on the trajectory of the business. But then the amount of flexibility and support I get to operate the company, I would say, surprised me in a very pleasant way because I hear private equity is very prescriptive. But you're not. You're actually, as Orlando likes to say, you hire good management teams, you bet on good management teams, and you let them do their thing. And then you, you, you guide them with the expertise and your experience over all these years. It's been…that's been terrific.
SETH BORO:
[00:04:42] Well, we've not said A.I enough yet in our discussions, so we're going to say it again.
MIKE CAPONE:
[00:04:45] Yes.
SETH BORO:
[00:04:46] You know, one of the things that I always have been, you know, very impressed by with Qlik is you were very early in this thought process around AI governance. Can you maybe walk through the council, the AI council that Qlik has led, and how you're thinking about it? Because, of course, one of the big issues today and of course, we're dealing–everyone's dealing with in real time and trying to figure out how to govern this new world that we're in that's hypercomplex but moving fast. But I think it's really interesting that you were so early on that and maybe tell our listeners about the council and its objective.
MIKE CAPONE:
[00:05:20] Yeah, there's a couple of dimensions to this. Obviously, you know, to be a good leader, to be a good company, you have to admit what you don't know, right? And there's just a lot. It's a fast moving space, as you talked about. And so how do, you know, how do you admit what you don't know? And then, but then you go figure out how to get that information. And the second, dynamic's going on the market with A.I right now is, look, this technology, like many technologies, but I think this is on steroids is going to be, it's going to outstrip society's ability to actually regulate it right. So governments always are lagging on the regulatory aspects of it. A.I is moving really fast. And so what we decided to do was go out to market, not get technologists, but actually get people from academia, from public sector, but people who are really intellectually very far ahead on these very topics. I'm an advisor, so we did form an A.I. Council that works with us on these obligations we actually have to do A.I right, both from a transparency and governance standpoint and yes, from a technology and monetization standpoint as well. And that group not only advises us, but we actually source them into our customers. And it honestly has been incredibly valuable to us, something we plan on keeping going forward.
SETH BORO:
[00:06:32] What's one of the things that you wish people knew about QLIK that perhaps they don't?
MIKE CAPONE:
[00:06:38] Yeah. You know, I think you know the obvious answer, which is, you know, marketing, marketing, marketing. I think people don't understand the breadth of our portfolio, right? So either you view us as a visual analytics company competing with Tableau or Power BI, or you view us as a data integration company competing with more of the likes of Informatica. So the one I'd say the one business thing is understanding that we've got a full breadth of capabilities around the data, you know, the world of data. I think that's really important. And I think the fun thing, the non business thing really, is the company was founded in Sweden. I don't know if everybody remembers that in a little town in Sweden, but since that time, we've really, uh, we've really stretched. So through our data integration acquisition, we brought in an Israeli company, Attunity. And then with Talend, we brought in a French domiciled company. So we've really built, I think, kind of this really fun global company that has just terrific routes around the world.
SETH BORO:
[00:07:33] It's so true. And one of the things that, you know, I always loved about your background was how international it was, especially given the company started in Sweden and really moved its headquarters to the U.S. But really, the the DNA and the soul was still over in Lund, which is a really cool town. And of course there's a lot of great hockey in Sweden. So it does, it does have a soft spot in my heart. When we were building the business, as we built the business, I should say, we would make acquisitions in regions that a lot of executives, American executives would- not you but others -would kind of get nervous about. But you never had any issue, you know, with operating around the world. And it was always, you know, just so comforting because we could make these great business decisions without, you know, a lot of anxiety around those international operations. But I'd love to hear a little bit about that leadership style and what inspired it and kind of how you got to that point of being so comfortable. That international purview that I think has just been so important to the company.
MIKE CAPONE:
[00:08:32] Yeah, it's an interesting question. I would say, you know, the style, just to encapsulate the style, it's always been: lead from the front and never ask your team to do anything you wouldn't personally do. And I try to live that every day, you know, in every decision that we make. And when tough decisions need to be made, how you communicate them. And I never delegate that stuff. Right? That's all that's always on me. But the really funny story is when I was working at ADP, we acquired a French multinational company. It had operations in, you know, probably 15 European countries. It also had a bunch of businesses that we knew we wouldn’t want to hold on to long term. There was a payroll business that we wanted, but then there was a banking business and a logistics business. And so the CFO literally said to me, “Get on a plane, go to France. Don't come back until you fix it all.” That's it. And that was my entire marching order. Of course, I was 29 years old and I was single. So and, you know, living in France on the company dime. So that wasn't bad. But it was a real lesson because now we had to go, we had to restructure companies, we had to exit companies. We had to sell companies. We had to deliver good news, we had to deliver bad news. And this was, you know, me traveling around Europe doing that. And so talk about getting thrown out of the nest. That's exactly what happened. It was the best learning experience in my life. I lived internationally, I worked internationally, and I really didn't have anybody looking over my shoulder to tell me what to do. So I really had to immerse myself in the culture and learn how to do these things the right way.
SETH BORO:
[00:10:02] It's so true. I mean, I remember, at least for myself, until I spent time with a company we had bought in France, you know, probably a decade ago, this notion of the Works Council.
MIKE CAPONE:
Yeah.
SETH BORO:
And it used to make Americans so nervous. And I remember I went over there, and we grabbed dinner like, there's no council. It's just employees of the company that want to do the right thing for the business and are looking to work at a business that's growing and innovating and people are generally the same.
MIKE CAPONE:
Yeah. People just want you to be transparent with them. You know, they want you to just, you know, just tell it straight. Explain the decision. Explain why. Be transparent. They may not agree with you, but you get so much credit for actually not trying to pull the wool over somebody's eyes or try to make, you know, make decisions sound different when they're what they were, why they were made. Once you get past that hurdle with people in the trust is there, you can pretty much accomplish, accomplish anything together. And then you just have to understand cultural differences. You know, in the US we tend to walk into a meeting and dive right in. It's like, okay, what's on the agenda? You know, in France, you have to, you know, you got to talk a little bit. How's your family? how was your weekend? and you spend a little bit more time building a social bond. And those are the nuances you pick up through experience. But at the end of the day and again, this is a true trait of Orlando and you and. Everybody at TB is just transparency. Just tell us.
SETH BORO:
[00:11:41] Totally. And those social bonds, of course, pay huge dividends because at least in your experience with- at Qlik or in my observation of Qlik, you get incredible employee loyalty and retention, which, of course, then drives growth in innovation because there's nothing like tenure at companies, especially in industries where, you know, people can move a lot, especially in the U.S. So some of these geographies that we are in at Qlik have been probably the most important, you know, for the company over its time. And I think as a result of your leadership style has been those incredible geographic locations that we have around the world that continue to deliver.
MIKE CAPONE:
[00:12:22] Yeah, I get asked that question a lot, which is, “How are you able to get the yield you get on R&D and on sales?” As you know, our ARR per employee is, is really good and it is the culture of the company that attracts people. And then we purposefully chose not to put big employee populations in Silicon Valley in areas where loyalty is not valued, right? And in Sweden, where we have our R&D team, in Ottawa, Canada, soft spot for Ottawa.
SETH BORO:
[00:12:51] Best city in the world.
MIKE CAPONE:
[00:12:51] Best city in the world yeah and honestly, in Israel, when you talk to people, they're really, really proud to work at Qlik and they cite the culture and the value system of the company as reasons why they love working at Qlik and why, even though they get offers all the time to go to other companies, they don't very often for more money. In fact, they, they don't, because they value the family. That is, that is Qlik and the mission that we're on.
SETH BORO:
[00:13:19] Speaking of the mission, the company has always been very socially conscious. From your perspective, where does that come from and what are some of the interesting projects that you're working on today in that realm?
MIKE CAPONE:
[00:13:33] Yeah, well, it comes from day one. You know, Qlik was founded in the south of Sweden in a university town for the most part. But from that day forward, it was always this balance of running a business and being profitable and, you know, growing, but also just doing well for society and using our capabilities to make the world a better place. And literally, you know, 25 years later, we continue to do that. So, some of things I'm most excited about, we have an amazing partnership with the United Nations. So we work with them on things like detecting human trafficking. So we work with international borders, looking for patterns in data to see where we can detect human trafficking, you know, crossing borders. Another one that is really important is climate change. So, we work with the U.N. on climate change. We underpin the cop conferences around the world, like all the all the pledges that were done in Scotland, for example, are tracked on Qlik technology. All our employees are allowed to take time off to work for a not for profits. And we give our technology in kind to facilitate some of that stuff. And it really is another reason why people really love working at Qlik.
SETH BORO:
[00:14:40] That's awesome. It's not something that you do because you think it looks good. It's just a core part of the company's DNA, and it always has been, which is just makes it really important and valuable. And and we're very proud to be affiliated with that. Mike, what is something that you'd wish you had known at the beginning of your career?
MIKE CAPONE:
[00:15:01] Yeah, honestly, this is going to sound super gratuitous, but it's 100% true. Is, I wish I really knew about private equity earlier in my life. I have no regrets about my public company. Time in both my experiences at ADP or Medidata were great. But honestly I. I found a new self inside of private equity mostly because of the velocity which it moves out is better suited to my, you know, kind of my DNA being able to make decisions fast, execute fast, not agonize over decisions and then let you make some bad decisions. You fix it and you move on. And that was just something– and it's probably more unique to TB than to a private equity. So maybe I should say I wish I'd discovered TB earlier, but it's been it's been invigorating to be able to just move at the velocity. We've been able to move out together and accomplished so much in such a short period of time that would have been very hard to do in a large public company.
SETH BORO:
[00:15:52] Yeah.
MIKE CAPONE:
[00:15:55] All right. So that's, you got to ask me a lot of questions. I'm going to, I'm going to take the opportunity to ask you just one. You get to look across so many different portfolio companies, so many successful exits. What's the one common thread if you had to pick one? I know it's hard to pick one. What's the one common thread in those companies that has helped you be so successful with the outcomes that you've gotten?
SETH BORO:
[00:16:13] It's actually a pretty easy question to answer. It used to be harder, but as I've gotten older and as I've now been doing this since 2000, as an investor, it all comes down to one thing, and that's leadership. Leadership is everything. It's amazing the difference in companies with the right leaders versus companies with the wrong leaders. And that's not even at the CEO level. It's all the operational functions. Having the right leader is literally everything. It allows you to get through complex times. Success is the result of a lot of small decisions. Great leaders make a lot of small decisions that pile up into big ones over time, and the wrong leader makes a lot of bad decisions and ends up with a lot of headaches and headaches take a lot of time to deal with. So for me, it comes down to leadership. Leadership is the most important thing. You know, I wish I knew that when I was starting in this industry, but it's just become so clear over time.
MUSIC IN
SETH BORO:
Well, Mike, this has been awesome. It's long overdue. But, you know, now that we are an established podcast, we finally could cut your deal with your agent. So thank you for showing up on episode one of season three, and we really appreciate you being here. Beyond the deal. it's been an absolute joy to work with you and talk with you today. Look, we greatly appreciate the partnership and your time.
MIKE CAPONE:
[00:17:44] Thanks. It's great to be here. I really love doing this podcast with you. And more importantly, I really love working with you and the Thoma Bravo team. I consider myself very fortunate.
DISCLAIMER:
Certain statements about Thoma Bravo made by portfolio company executives are intended to illustrate Thoma Bravo's business relationship with such persons rather than Thoma Bravo's capabilities or expertise with respect to investment advisory services. Portfolio company executives were not compensated in connection with their podcast participation, although they generally receive compensation and investment opportunities in connection with their portfolio company roles and in certain cases are also owners of portfolio companies, securities and or investors in Thoma Bravo Funds. Such compensation and investments subject podcast participants to potential conflicts of interest.
