'It was a crazy idea' - Mimecast CEO on building a tech company in the wake of the dotcom crash

Peter Bauer on the company's humble beginnings, how he deals with the 'not so good' days as CEO, and why he doesn't regret going public in the US rather than the UK

"Brazenly ambitious" is how Mimecast CEO Peter Bauer describes the decision he and CTO Neil Murray made to co-found a tech company after the dotcom bubble of the late 90s and early 00s disastrously burst.

However, the two had been in the tech game long enough by that stage to notice a pattern of growing reliance on email by large companies. They had two motivators as they plotted the creation of Mimecast, the chief exec said.

"I was working as an email system engineer in the mid-90s - at a time when it wasn't a particularly smart career move because email wasn't that important to companies - but in a short space of time I saw email move from being in the background to something that was having a considerable amount of employee time spent on it and having massive business dependency," he explained to CRN.

"Along with that, most people never saw the additional amount of complexity that IT folks had to manage to make it work for businesses; there were lots of solutions but they were solving different problems, and collectively creating a bigger problem of complexity for companies.

"We took a brazenly ambitious decision to take on the entire email security industry and transform it by delivering a single, one-stop-shop solution that almost every company in the world might find ideal as a companion to their corporate mail system.

"It was probably a crazy idea given we had no external funding."

With these observations and their own technical backgrounds, Bauer and Murray - who were both living in the UK at the time - started developing their idea in 2002, before establishing Mimecast the following year.

They had both built up their own companies during the 90s and sold them off at the height of the dotcom boom, and used that money to fund their fledgling company.

"We were picking some pretty significant fights with incumbent vendors," Bauer admitted. "But we knew we would be building something particularly useful.

"We also understood that by being on the right side of an architectural evolutionary divide, we could also have a lot of opportunity, if we played the long game."

The chief exec cited Salesforce and Google as early inspirations for Mimecast because of the way they changed the game from the previously "fashionable" client-server technology.

Bauer admired Salesforce's use of multi-tenancy to build software that could deliver solutions to thousands of companies from a single platform.

Google's transparency about its architecture, and how different it looked to that of client-server computing, also served as inspiration to Mimecast's founders.

Building a legacy

The South African native CEO looks to his fellow countryman and former president Nelson Mandela, whose story of never giving up and always working to be better serves as a source of reflection to him.

"His is a tremendous story of contribution and transformation," said Bauer. "[Our story] is a very humble and modest parallel to that; the craft of building a company over an enduring period that will go through many different phases - some of which may seem potentially hopeless.

"I don't want to aggrandise that to what Mandela did, but it is powerful to realise that other people have done things much harder than we have and succeeded."

One such obstacle for the UK-based Mimecast came three years ago, when it chose to list on the US stock exchange rather than its London counterpart. The move caused controversy at the time, but a few years down the line, does Bauer regret not going local?

"Three years on, it was the right decision," he said. "For us, so much of our potential customer base is in the US and we were already looking for the opportunity to raise our profile over there.

"I was already based in the US and had proximity to the banks and shareholders, so logistically it was easier for us to do it there than perhaps if the CFO and CEO had been based in the UK and trying to do a US IPO."

He admits that he never harboured ambitions of doing an IPO with a tech company, admitting that he previously thought people who made such a move were "strange".

"Now that I am here, I understand it is part of entrepreneurial culture. The movement of stocks is of great public interest; it's a proxy of all sorts of things," he said.

"Public companies here are either celebrated or beaten up more vigorously than in other markets, but it has worked well for us."

Mimecast continues to be headquartered in the UK, which is its second-largest revenue contributor after the US. Bauer revealed that the company is moving to a larger space next year, which will allow it to further grow its operations here.

Mindcast

In its most recent financial year, the company reported revenues of $261.9m (£208.5m) for its year ending 31 March 2018.

Bauer has headed Mimecast since its inception 15 years ago, and has formulated a culture of learning that he hopes his younger employees will remember as they progress through their careers.

"We have a lot of young people who don't have a point of comparison from working at another company, but I want them to be mindful of it now and when they reflect on it that Mimecast was the place that they did their best work, their best team work and their greatest learning. I really push that because it makes for a meaningful experience," he said.

"People often think that learning happens when you are in a classroom, but I have found that my greatest learning has come when you don't feel like you are progressing, you don't feel like you are learning and you feel like nothing is working.

"Then you look back once you've pulled through and realise how much you have actually learned."

Over the years, he admits that heading a large company can have its down days, especially when he is the face of the organisation. Bauer said on those days he employs a certain mindset to help him get over this attitude.

"It's such a rich experience, from coaching an up-and-coming employee, to sitting with the team to problem-solve a challenge, to working on product design, to investor calls," he said.

"On the reverse of that, though, I've had days where I've turned up and barely been able to get myself out of the car because I've been so despondent about things.

"However, [as CEO] I have to be conscious of what I telegraph [to the company] on how I am feeling or looking because it is probably the most influential homing beacon for people in the company.

"I've found that your brain and attitude follows what your body does. Pick your head up, smile and you might find yourself driving home at the end of the day thinking you have the most interesting job in the world."