Interview: Roy Rafalco (Part 2)

Posted March 1 1999

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A Conversation With
Topspeed Corporation's New CEO

On December 28, 1998, Topspeed announced the appointment of Roy Rafalco, Topspeed's President and Chief Operating Officer since 1993, to the position of Chief Executive Officer. Rafalco succeeds Bruce Barrington, Topspeed's founder, who will remain Chairman of the Board. Click here for the full press release.

This is part 2 of a two-part interview. Click here to read Part 1.

Clarion Magazine: How are you positioning Clarion in the marketplace?

Roy Rafalco: It's critical, because you and I both know, once people start using tools, they attach themselves to those tools. It's not easy to change. It's a learning curve, and it's even worse if you're not MS or IBM, and you're some Clarion Software or Topspeed Corporation that you never heard of before. That's why the word of mouth is essential. Right now our marketing department is gathering all sorts of case studies and success stories, so that when we do promote and call on people, we have a success story. People need to hear about other companies that have successfully used Clarion.

We used to hear about the push to sell Clarion in the corporate shops. Is that less of a focus now?

We were attracted to corporations for a couple of reasons. One was the lack of price sensitivity. Secondly, corporates were willing to talk about the tool once they had purchased it. If we could sell into a corporation, chances are they were going to pass the word about Clarion on to others. There's no competition between corporate developers about which tool they used. But the corporate market, which is really client server, is a mature marketplace. And when corporations make such an investment in the tool, the decision-maker's not going to say oh, you remember all those millions of dollars I spent on PowerBuilder? I'm going to spend a couple of thousand dollars on Clarion and do the same thing. It doesn't work very well.

All along our goal has been the same.We want to sell to programmers who can benefit from our technology, whether it's a small shop or a large shop. Now, we will be targeting and continuing to want to target programmers where the cost of selling the tool is reasonable given our produce price. Since, we don't charge royalties or runtimes, we receive only one price, and that's it. We may not ever hear from the customer again, unless they want to upgrade. Due the cost of selling the tool, it makes no sense to knock on the door with one or two programmers in that organization.

So if not corporate shops, what's the market?

One area that we're thinking about carefully is the trend in the marketplace is to outsource IT. We believe IT consulting firms are less married to their tools. IT consulting firms have more programmers who may not be committed to a particular tool. And that's why there's some significance in the press release you might have seen on UTA, where they've decided to train their programmers on Clarion. They're a government consulting firm. UTA's interest in Claron is significant when you consider that their client is very conservative.

We still want to sell to programmers, and we don't care whether they're small independents or they're large corporates. Eventually, we will better identify specific markets where our tool will provide an unique solution, and our cost of sale will be reasonable.

What about creating a version of Clarion for Linux? Is that something you're keeping an eye on?

Oh absolutely. We've certainly learned our lesson when it came to getting to Windows late and getting to Client/server late. Being there first means a lot. So we're constantly thinking about that, and meetings go on every week, where we're talking two, three, four, five, ten years out. What is the latest technolgoy wave, and do we grab that wave or don't we grab that wave? We had a painful lesson back in '93 when PDAs were the big thing. You remember the Pen Developer add-on to Clarion 3. I think we may have sold two of those. Because we have limited resources, we have to be careful where we devote our development resources

We all at TopSpeed have worked too hard to throw things away because we went in the wrong product direction. We have retained the Gartner Group as analysts for us. They provide consulting and services in terms of where they see the direction of technology going, and the marketplace. We consult with them regularly. Yesterday Bruce brought to me the fact that Infoworld estimated there was 12 million Linux boxes out there.

As we come to the right business decision, we also have to decide who we can link up with strategically to make it happen. Because you can't do everything by yourself, we have to constantly think about matching ourselves with a partner.

Will there be an IPO any time soon?

We don't want to go public until we think we can really maximize the initial stock offering. And we believe that that will take several years of consistent growth and we have to be at a certain revenue target. It could be as early as two years from now.

Are you thinking at all about the Open Source movement? Would you consider opening up the Clarion language?

Not really. We've been reading about open source, and it depends on your viewpoint. We've seen some things take place that look more like gestures than anything else, but on the Clarion side, we really don't see a need. Our plans are to continue advancing what we call the art of automated programming to whatever platform, using whatever language. At the same time, I would never say never to anything, but we are not ready to open up the Clarion language at this time.

How about generating Java or C++ code?

Given our technology and the fact that you don't have to hand code as much, the language used ends up being irrelevant. I can't necessarily tell you which direction we're going to go in terms of supporting other languages, However, we're in the long term business of providing automated programming tools.We'll look at all of the opportunities for how we can leverage our automation technology in order to grow the company and the technology so that programmers can be more productive.

If we were to do another language, Clarion wouldn't go anywhere. We still believe in the Clarion language and we still think it's a good language. When I was in London in August, I was amazed to hear so many London developers taking the side of the Clarion language. Way back when we merged it was Clarion what?

It's also their Clarion language now.

And it's showing. It's a good environment and it's one of the things I really like about Topspeed and the people, and the London guys are just fantastic to work with. They could be so much different, based on other engineers I've worked with.

It seems like there's a lot of loyalty and stability there.

In 1997 I was in London and some of the original JPI people came in to see me. It was the fifth anniversary of the merger. And I thought Oh God, it's five years, how do they really feel about the company. However The London developers said it was the best decision we've ever made. They love what they do, and hope that the company will continues on like it has been.

What do you see as Topspeed's biggest opportunity?

From a technical viewpoint, there is no limitation as to what the London developers can do. I sleep well every night knowing that the London Development Centre exists with its tremendous talent. So that itself is an opportunity. Very few companies have that kind of talent. I think the biggest opportunity is that we haven't told anyone about Clarion. If we start telling people about Clarion and being focused with our sales and marketing programs, I just think there's an incredible opportunity for the company as a whole. I'm just amazed at what we're able to do and no one's ever heard of us. I was just blown away when I saw this posting that we were second at DBMS. I just think if we come up with the right sales and marketing approach and start this ball rolling down the hill, then we will have an expanding the number of customers. When we increase our install base, our financial resources increase. With increased financial resources, we can enhance the technology even more, and it just goes on and on and on.

As I was coming up on my fifth anniversary at the end of 1996,I made a new year's resolution. I've been here five years. This company's going to go, if I gotta kick it, I gotta shove it, I gotta whatever, but I'm going to be less patient now. I'm a very patient person, very methodical., Over the years some of my staff have criticized me because I'm too patient. I should've made some moves quicker, whether it's regarding personnel or whatever. And so, I've got my staff working based on this resolution. I've told them they've got eight quarters. In eight quarters, we're going public, and we deserve it! I mean I'm not going to sit here and drive the car off the cliff, but this is our time to shine. Remember Internet Connect? A couple of years ago I was over in London and I was sitting down with the guys. At the time, we were pushing internet connect to be mastered. Gavin Halliday was giving a demonstration of a very rough alpha and showing what it could do.

I was sitting there with my mouth wide open in amazement. I turned to Gavin and asked him how he created such amazing technology.

And Gavin looked at me quite matter of factly and said, "Well Roy, it's magic."

And all I said was "OK, Gavin, I guess you've decided I'm not technical enough to understand. Just pretend it's magic, right?" And he said "Yeah, it's just magic." 

Your press release says that your appointment confirms what you were already doing. Did Bruce just sort of look around and say, well, he's acting like a CEO, I guess we better promote him? How has your role changed?

Bruce doesn't necessarily turns over his favourite thing to anybody, and Bruce is very cautious. Over a period of time he's gradually given me more responsibility. He came to the conclusion that now basically I was running the business, and it was time for me to come from behind the curtain. And quite frankly it wasn't my idea and I didn't ask for this, because it's been really comfortable to stay behind the scenes. I can hide out back there and make things happen, and not necessarily deal with all of the political things that result from being in the limelight.

As things are getting better at TopSpeed and we're breaking all records, I turn to the old folks here (they're not that old, but have been with the company), and I say you know, we're going to miss those old days, because a crisis brings people closer together towards a common goal better than anything else.

It's also probably true to some extent of the programmers. If it really got big, one of the things that we could lose would be that close familiarity.

Customers tell me that they don't want us to grow big, because they know they can get me on the phone. Also, they know they can send an email, and Bruce may respond to it. They don't want those days to come to an end. The tool doesn't cost them too much. They like that kind of premiere access to TopSpeed. In addition, their competitors do not knows about Clarion. so they can go in and undercut their competitors' bids.

Perhaps some of the lack of growth of the product is because of that resistance to change within the Clarion programming community.

My plan is to continue to make it that personal touch, even though it's going to be hard, and it's going to get harder and harder. But that's a value that our customers like. And we'll strive to keep it as close as we can.

Clarion wouldn't be where it is today without its customers. And those customers are a different kind of customers. They're the customers who pay for their upgrades every year and kept us in business. They're the customers like Team TopSpeed who are just giving of their time to the nth degree to help everybody, and to help the company. Really the success here is all based on the customer. That's our greatest asset.

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