Progress Then & Now: Bud Robertson & Anthony Folger Discuss 40 Years of Progres

Welcome, Bud, thanks for coming in today.

Thanks, Anthony, for having me come in. It's a pleasure to come back after 10 years away from the company... 11 years away from the company.

Well, you are the longest-serving CFO at Progress, and actually the first CFO at Progress.

Yeah, that's right. Because when I was first hired back in '96, they wanted a CFO that would effectively go on the road, and they also wanted someone who understood... go on the road, i.e., for the analysts, and also wanted somebody who was interested in business partnering. Because they had the best technology people as far as technical accounting people, they were all basically delight, but they wanted someone with a business background. So that happened to be lucky because I didn't have that technical background. It was a good combination. And I started, like you said, in '96, and I was there until 2010. I mean, 14, 15 years.

Well, and the business partnering aspect of finance is still, you'll be happy to know, alive and kicking and doing very well still to this day. I think that structure has stayed in place and hopefully retained a good relationship with the business. It was interesting to me coming in, I've only been here 18 months, but to have an organization like that that's established and that effective was just a huge benefit. So thank you for that. Now, what do you sort of remember from back in the day? I mean, obviously the company had evolved, gone through pretty dramatic runs of growth. What was it like being part of Progress back in '96?

Well, back in '96, they had gone through a good spurt from basically zero to about $130 million when I was there. And they had basically they were partners, and that's all they had – the OpenEdge business. They didn't have that back then, and they were looking to get some other things. But it was a very technical, not just financial, but very technical company. It seemed like everybody was saying everything was technology driven. They were just a fun-loving, hard-working good company. It was just a fun company to come in the morning. Everybody, when you came in the morning, it was just going to be a fun day. And even when I left, it was like that, just a bigger company.

Yeah. Well, and for me coming in, I can tell you there's still a lot of that. And still, remarkably, there are people here who have been around for 10, 15, 20, 25 years, even longer than that, and there's a good number of them. And I think that says a lot about people wanting to be here and enjoying the people they work with, and really being committed to the company. It's just a really good environment to come to work to. So I think a lot of that still stands. The business partnering got the people, the financial people involved in the business. And when they did that between wherever they supported, you would find out that the accuracy of numbers and everything got better. So part of the whole process was getting not just them involved in the businesses, but also to get the whole company... someone didn't support the businesses to understand that they all made an impact on the business.

Yeah. And it was... I think if you asked people back then, you know, how much was $600,000 of operating profit, they'd say that was equal to one penny, one EPS penny. Everybody knew that. And every quarter I would stand up and say, 'How much is a penny?' The crowd would yell out, '$600,000!' And everybody, I told them, 'Everybody makes a difference. Even if you're a payables clerk and you say, hey, we don't need to buy all these pencils, it may be a small amount of money versus sales who makes a big sale of $600,000, but all the little ones add up to $600,000.' So at the end of the year, when the year-end presentations were done, Joe would also do one – he was in charge of the company's R&D – everyone would do one, and in the end, finance would do one. And at the end, I'd be sitting in the front with the executive team, and then just before my presentation, I got back and changed into an outfit. I changed it enough, and they were all weighted. So if I came out – and as a matter of fact, I have a prop, I have the real thing – if I came out with this... I feel like this is part of history. This is back in the late '90s. And this is... if I came out with a raincoat on and some big boots, it was a downer. And then they'd have the slides with a... being in the ocean and the waves coming over, and it'd be all 'boo hoo, boo hoo.' But then we'd finish it with 'As always, next year.' So if I came out with this shirt on and my shorts, and be 'Yay, we're going to go on a trip,' and I'd wear this out there. It's an awesome shirt. And it'd be... I'd be wearing this more times than not. The shirt was the winner.

Yeah. The other big thing we did was the Nasdaq. You know, back in 2001, the company was on the Nasdaq for 10 years. So we... marketing said we should go down and open Nasdaq. It's a good opportunity. Get some... one of the problems we ran into as a company was no one knew who Progress Software was, like 'Progress who?' So we said, 'Okay, we'll go to Nasdaq.' We took down a bunch of people. And the most fun thing was, when people came from the hotel to the Nasdaq in the morning, we opened it. When they came around the corner and on the tower, if you've ever been to New York, that tower, it would say 'Nasdaq welcomes Progress Software.' And when you see your company on that tower, it's just a different feeling. You say, 'Oh my god, look at that!' And so that was the first one. The second one was we had just started profitability and got back in 2002. Technology was in the tanks, so they brought us back for the second time. Third one was... lucked out. Went down with Mitt Romney because he won the three best companies and growing companies in Massachusetts. We happened to be one of the only profitable ones going. And we get to go back now this year. This will be the 30th... 40th? Yeah, I guess. 30 years public, 40 years in business. But I think it's the first time we've been back since... somebody said 2015. So I think since you departed the company, it's probably only gone once maybe.

Yeah. There's been a long time coming, and yeah, I think it'll be fun. We're looking forward to it. Yeah, we went 10 years in a row, and then you're right, it stopped. But I think when you go back like you said, it just depends how many people you can bring, but it's such a fun environment for people to go and see.

Well, it's unbelievable. The company's been around for 40 years, been public for 30 years, and is still unbelievably strong financially, still has phenomenal technology, even though we've divested and reacquired a bunch of things. It really is a remarkable company. You know, as you sort of look at Progress today and see how things are moving forward, and you think back to the time when you were here, what are you most proud of?

Well, obviously the fact that the people are still so motivated and excited about working. And that says the culture's good. Because that's what drove it in the beginning. Everybody was willing to learn and try hard and do something different because there was a different change for them. Going to business partner was a huge shock for people. And now... and then getting everybody in like we talked about going up the earnings and stuff, and then this part of the growth strategy back then, and I think you guys have it today too, but back then was this 'double-double' strategy we called it. So it was... we wanted to get to double-digit organic growth and grow earnings faster. That was the double-double. So the way we... we couldn't do it with just OpenEdge, so we said we're going to go acquire some companies. And the double-double strategy was you would acquire a company so it wasn't... the first year organic growth. And then the strategy... but you had it when we acquired it, you had to make sure in the model and when you set up the earnings, when you set up the P&L, that you believed that the next year you could grow that group you bought double-digit. Because sooner or later, if you buy all these things for double-digit, you're going to bring the mothership up, who couldn't grow double-digits. It was growing very profitable, very nice single digits. So the double-double was that strategy. So we bought companies, and the reason we could grow many... the analysts would say, 'You just can't add something and grow a double-double.' I'd say, 'Well, you buy companies that are $20, $40, $60 million, and they don't have any presence outside of North America. You can grow them double-digits.' That's right. We have a huge network. DataDirect was probably one of the better acquisitions, and that's still here, still stable, still profitable. Just solid technology. OpenEdge, same thing.

And you're right, we are now using acquired to drive growth, and we're trying to find companies that have a little bit of growth. They don't need 20%, right? But if we've got companies... and Ipswich was a great example of this. It was a company that really wasn't growing pre-acquisition, and we bought it, brought it, integrated it into our business, and I think we've got expertise in-house, and we can run these businesses efficiently. We can open things up, maybe in other geographies where they didn't have opportunity before, and we've seen growth in an asset like Ipswich that wasn't growing before. And you do two of those, and all of a sudden you've bought $150 million worth of revenue that's got a little bit of growth to it. And if you string that strategy together, it's exactly what you're talking about – just trying to improve your product portfolio, your customer base, and maybe your growth profile overall. And so, yeah, it's a strategy that... it's funny you say that. I think everything old is new again.

Right. We always used to remind employees to make sure they got involved in the Employee Stock Purchase Plan, which is one of the best plans I think in the world, and also to get into the 401k because the match was so good. So we always, in addition to promoting year-end, we'd always say, 'Listen, for your own sake, get into this. Because if this goes up by this much, that's going to pay for college education.' And the way this plan works, unless the company fails completely, this is going to be a great program. And many, many people are in it.

I'm happy to make this a commercial for the ESPP, because it's still here. It's the best... same one, same one. And it's probably gotten better over time. If we've been able to improve any of the provisions, we've tried. But it is the most generous Employee Stock Purchase Plan I've ever seen at any company I've ever been at. It's the most generous plan I've ever heard of at any company. And I think if people are not enrolled, and they listen to this interview, they should go do it immediately.

We already said, 'Listen, when you get a raise, go into the stock purchase plan. Just make sure you didn't get it.' And then when that thing matures, you're going to have a pile of money, plus the discount you get with it. It's fantastic. And the 401k was the same thing. That was another good, rich program, which is even better because it's always pre-tax. So those were the two programs. And people if they were in it... it was a very financially friendly company to work for. I mean, you worked hard, you had a lot of fun, but even sales kickoffs and company kickoffs, they were always just a fun time. And more to inform people of stuff, but a fun attitude when we did it. It was always about informing them about numbers, informing them about this formula, but it was always in the whole context of a fun time. It was clearly a great 14, 15-year environment for me.

All right, well, Bud, it was a pleasure having you in today. Thanks a lot for coming back.

I feel like... you know, the 30, 40 anniversary feels like a much bigger deal to me now, so I'm looking forward to it. And thanks for coming today.

I was excited to come in just to be able to live the past and see what the future is, so it's great to be together.

Great to be here today. Thank you.