Tom O’Neill, President and CEO, The Nerdery
In January, Tom O’Neill officially became the chief nerd in a land of 500 nerds, replacing Mike Derheim who cofounded the company in 2003 with partners (Sierra) Mike Schmidt and (Bravo) Luke Bucklin.
O’Neill has been there since the early days. He joined as a programmer shortly after inception and championed the culture from the start, through those formative years, and into the growth phase as he rose through the ranks. From the bottom to the top — we sit down with this vet to hear about the next chapter of this Minnesota tech staple.
When did you originally join The Nerdery and what capacity?
I joined what was then called Sierra Bravo as a programmer in September of 2004 for a specific project. They convinced me to leave another full time job to go full time with them, and I even took a paycut!? They had only been in business for about a year, but it was clear that it was something that would be fun and exciting, it was a small team with a grand vision at the time.
Where did you go from there?
I loved working at Sierra Bravo so much that I just assumed an informal recruiting role by going out and championing the company. Soon after that, I convinced the founders — Mike Derheim, Mike Schmidt, the late Luke Bucklin — to let me officially take over the recruiting aspect of the business. I was also the Software Development Manager and Sales Support Enginner at the time. I mean, as an entrepreneurial company going all out we just whatever that was called for at the time.
Over time, my efforts and success was rewarded as the company started growing. I climbed the ranks from Software Development Manager to VP of Software Development in August 2008 with about 75 nerds on my team. That was a really big deal for me, when I think I started cutting my teeth as an executive leader under the mentorship of the founders.
Then came Chicago, where my original tour of duty was supposed to be two years, staring in 2010, but it was actually only about 11 months. Shortly after we setup shop there, Luke passed away in October of 2010, which obviously changed everything. When Mike Derheim moved into the CEO role, I came back to Minnesota to backfill his operations role here under the title of Chief Operating Officer, with sales, software development and marketing reporting to me.
In 2013, Mike Derheim made me President of The Nerdery, which is where I was sitting for the past two years.
Speaking of Chicago…how are The Nerdery’s other offices doing?
Great! Chicago has about 60 employees, Kansas City has about 50 employees, and Phoenix has about 10. We also have about 30 full time nerds in our work from home program that aren’t in any given office.
What is the division of labor among your locations?
We have support with finance and HR here in Minneapolis, but both the sales and production is a similar strategy and model serving their local markets. Arizona is kind of a Southwest outpost right now as we look at how to better go to market in that region.
You were at the forefront of some layoffs last year too, care to talk about that?
The Nerdery has evolved and grown up quite a bit…we’re much more of a custom software development company now vs. website design company then. As technology changes, our service offering has adapted, so have the skillsets required. As we’ve made this shift, it has impacted our business and our nerds. We lost some good ones in that process, but I spent a lot of time placing and recommending them, and we’ve even hired some back since.
Looking at some financial records of the company…~$60m in revenue 2014, up from ~$52m in 2013; how did 2015 end up?
We’re planning for double digit growth in 2015 and 2016. It’s too early too give you a specific revenue number for 2015, but I know we grew it again — although not at the same levels we did in 2012 – 2013 where we went from about $38m to $52m.
How many customers do you have presently?
We’re working on about 400 active projects from about 150-200 active clients. The work we’re doing these days is much larger than before in terms of average project size and scope.
Is The Nerdery going to launch any products down the road?
No, we’re 100% in the pro services model and while we’re standing up products with partners, we do not plan to build and sell our own products in the future.
Why did Mike Derheim step down as the CEO?
In 2013, when I became President, Mike also formed an advisory board. We found some very savvy people who have given us input on how to sieze the opportunity to continue growing. As part of that process, Mike wanted to really empower others so he gave me a shot to see what I could do, which has been working.
He also wants to take more time and energy to put into Prime Digital Academy, among other new ventures.
How would you say your leadership style differs from Mike’s?
I think that I’ve always been a bit more excitable and outgoing than most people around me. Our vision is to be the best place in the world for nerds to work, which preceeds me. That culture transcends dogs in the office and beers in the fridge, it’s about smart and passionate people growing and learning professionally in the end.
What does the future look like under CEO Tom O’Neill?
We’re building some really cool stuff in the areas of machine learning, enterprise mobile, and life sciences – so ahead of its time that it will be years before it hits the market.
Traditional IT spend is declining and a lot of that is rolling up into SaaS and similiar services. We’re like the glue in terms of integration, API, configuration and micro services.
The world is longing for something new and different, beyond the big 4 technical consulting companies…
Are you aspiring to someday displace such multi-billion dollar companies?
There’s some crazy in me, but i don’t know if there’s billions of it? As long as we aim to be the best place in the world for nerds to work, I’m not stopping.
Do you see The Nerdery becoming publicly traded, or boosted by private equity?
I don’t see a scenario by which that helps us reach our goals, the tradeoffs are not enticing.
Is there anything else that you would like to add?
Thanks for the conversation!