Why I Quit the Company I Helped Launch
These days, Dave Hersh describes himself as an investor in early-stage tech companies. (He hangs his hat at Andreessen Horowitz.) He was 29 when he became CEO of the startup Jive Software, a pioneer in social-business software, which allows employees and customers to communicate via Facebook- and Twitter-like tools.
By the time he stepped down, Jive was gearing up for its IPO. (It is trading just below its offer price. Revenue is expected to be around $145 million in fiscal 2013.) That was almost five years ago. Hersh says he is ready to take up his next position as soon as he figures out what it will be.
In the meantime, he has launched a management blog at davehersh.com. Hersh spoke with Inc. editor-at-large Bo Burlingham, who is finishing a book on business exits for Portfolio, about the toll the company took on his life.
How long after you founded Jive Software did you decide to step down as CEO?
About nine years. I was actually what's called a founding CEO. The software was developed by two guys I knew who were doing it as open source in their spare time. So anyone could download and use it for free. But it was getting popular enough that they decided to incorporate in 2001 and become a real business. I came on shortly after to take what they had built and turn it into a company.
Did you have investors?
Not to start out. I think the founders paid $70 for business cards. Other than that, no one put in capital until 2007, when Sequoia invested $15 million.
Of course, once you bring in venture capital, you know that you're eventually going to sell or go public. Was that why you stepped down as CEO?
It was a factor. But mainly I did it to repair my marriage. In 2009, Jive had had a great year. While our competitors were hunkering down because of the economy, we just kept growing. But in order to get to that level of success, I put a lot of pressure on myself and was on the road a lot. I was so preoccupied with the company that my marriage started to suffer. We had been married eight years and had two kids under 6, and our communication completely broke down.
What did you do?
We tried moving from Oregon, where Jive had its headquarters, to California, where we were opening an office, and where my wife is from. The idea was to reestablish the family in a place we wanted to be. But it became clear that I couldn't play the role the company needed while also playing the role I wanted to play at home. By then, the board had begun talking about taking Jive public. I said I didn't want to be a public-company CEO. So I became chairman, and Tony Zingale, who was on the board, became CEO.
Was that hard?
It was incredibly hard. I'm a very loyal leader. What motivates me are the people whose lives I affect. By moving out of the CEO role, I felt I was letting people down. But I also understood that my family needed more from me than I could give while I was CEO, and so I knew I'd made the right choice, and I would find my way in the world again.
Is it behind you now?
Most of it was out of my system when I stepped down as chairman a year later. But it's a long process. Parts of it I'm still not totally reconciled with. Maybe when I do my next company, I'll fully be out of it.
How will your next company be different?
I want to do it my way and have complete ownership and flexibility in the way I run it. I think I can do it at a more relaxed pace and create a culture that works for me and the people I surround myself with.