Tom Siebel

Business Leader, Technologist, and Author

“I think there's kind of two categories of CEOs out there today, there are those that are recognizing that this is going on and are leading their company into a place where it will survive and thrive in the 21st century, and there are those who are just kind of waiting to retire and really don't care.”

Summary

In this episode of Leadership Matters, Alan and his good friend Tom Siebel discuss what makes someone a successful leader, including digital transformation, overcoming adversity, and never considering the negative.

They discuss how Tom revolutionized customer relationship management (CRM), the market for enterprise software, and the whole field of sales. Tom emphasizes the importance of CEOs in keeping up with modern technology, acknowledging that a failure to do so can put a leader’s whole team at risk.

In 2009, Tom was attacked by an elephant in Tanzania, forcing him to fight to keep both his leg and his life. The lesson in overcoming adversity taught him to never consider the negative, shaping his leadership style.

Mentions & Resources in this Episode

• Digital Transformation: Survive and Thrive in an Era of Mass Extinction – Click here to learn more about Tom Siebel’s book and purchase a copy.

• C3 AI – Click here to learn more about Tom Siebel’s current company.

• Siebel Systems – Click here to learn more about Tom Siebel’s former company, now a part of Oracle Corporation.

• Elephant attack in Tanzania – Click here to learn more about Tom Siebel’s incident in Tanzania, and how he overcame.

Guest Bio

Thomas M. Siebel was the founder of the enterprise software company Siebel Systems and is the founder, Chairman, and CEO of C3.ai, an artificial intelligence software platform and applications company. Tom is the Chairman of the C3 AI board of directors since January 2009, and the Chief Executive Officer since July 2011. Previously, he acted as the Chairman and Chief Executive Officer of Siebel Systems from 1993 until its merger with Oracle Corporation in 2006.

He is the chairman of First Virtual Group, a diversified holding company with interests in investment management, commercial real estate, agribusiness, and philanthropy.

Siebel has been a frequent industry spokesperson as well as the author of the Wall Street Journal bestseller Digital Transformation: Survive and Thrive in an Era of Mass Extinction, as well as three previous books: Cyber Rules, Taking Care of eBusiness, and Virtual Selling.

Follow Tom on LinkedIn or Twitter @TomSiebel.

Clips from This Episode

• ”While AI will, undoubtedly make our lives better, it also enables people to do some pretty scary things!”

• On the founding & running of "the fastest growing company in history", Siebel Systems

• “The big guys have the advantage, when it comes to adopting & embracing e-commerce.”

Episode Transcription

Alan Fleischmann 

You're listening to Leadership Matters on Sirius XM. I'm your host Alan Fleischmann. My guest today is a giant in the tech world. Tom Siebel, the founder and CEO of C3 AI, a software company that went public in December. He's a deep thinker about how cutting edge technologies are poised to change our world. Tom, of course, has been a leading luminary for technology since the 1990s, when Siebel systems held the crown as the fastest growing company in the country. With his namesake firm, Tom revolutionized customer relationship management, CRM, the market for enterprise software, and really the whole field of sales. The company was ultimately sold to Oracle for about $5.8 billion. But that success was only the beginning for Tom, who soon founded C3 AI. The company has become a leader in artificial intelligence software for business, and it's consistently ranking among the most disruptive tech firms in the world. Tom is an accomplished author, a writer about technology and changing the landscape for governments and business. He's really someone who looks, he looks to the future. And I'm really looking forward to hearing his insight into how leaders should be preparing for our high tech future. Tom has been widely recognized for his contributions to business and giving. He has been named Entrepreneur of the Year by EY, and one of the world's top philanthropists by both Barron's and Business Week. That breadth of accomplishment demonstrates leadership from both the head and the heart. I've gotten to know Tom, and I'm thrilled that I can share him with you today, here on leadership matters. Welcome, Tom.

Tom Siebel 

Thank you, Alan.

Alan Fleischmann 

I'm just thrilled that you're you're here. And you know, on this show, I read your book recently, as I'm going to talk about a little bit here. And what I love about you, Tom, is that, you know, there are people who can be passive. And there are people that can be aggressive, and there are people who are passive aggressive, I can say, without any doubt, there is nothing about you that's passive aggressive. You either say what you want to say and you say it with clarity, or you choose probably not to say it at all. But that's the choice. And I know this is gonna be a great conversation because of that.

Tom Siebel 

Well, thank you, I think.

Alan Fleischmann 

It's a compliment, I promise. But let's start off because you know, people love this show, they love to hear not only your wisdom and your experience, but how, you know, how you got to be where you are. You were raised in Chicago, the sixth of seven children, which is a big family. What was the dynamic like between you and your siblings growing up tell us a little bit about your parents and about your siblings?

Tom Siebel 

Well, I come from German immigrants. My family came from what is now Eastern Germany in the 1880s and immigrated to Northern Illinois, where they were farmers. And my grandfather, worked his way into law school, and was a major in Spanish American War. My father then grew up in Chicago, and he was also an attorney. And my mother was a, she also came from a German family. And so all my grandparents are from Germany, and came over about the same time. And we had, you know, seven kids, I was six of seven. One girl, my, my mother, my mother was blessed with six boys after that six in a row. I think she kept trying for hoping for another girl to happen. And, you know, I was very fortunate. I mean, they were very close family. I had great parents and my dad was a very great guy. And, you know, it was, I grew up in Chicago, and it was a, you know, wonderful childhood. And I was very fortunate.

Alan Fleischmann 

I imagine your sister was revered and feared.

Tom Siebel 

Very close to my sister. She was the oldest and she was, you know, she was, you know, Francis is probably, you know, 20 years older than me. And it's, you know, she was probably one of the people in our family with whom I was the closest.

Alan Fleischmann 

I love that. And your parents sent you to a military academy when you were 15 years old, right? Am I right about that?

Tom Siebel 

Father was a major in the army. And my father went to St. John's Military Academy in in in Culver, and the, and so he thought that would be a good idea for me. And so I went to what was then a military school in Minnesota called Shattuck, the Shattuck school.

Alan Fleischmann 

Now is that because he saw a great military leader in you? Or is it because he was worried about you being a rebellious kid me and needed to get you in line?

Tom Siebel 

I think he was certain I was a rebellious kid. And it was the, it was the hope that I would perhaps learn discipline and respect for authority. And unfortunately, I'm not sure that ever happened.

Alan Fleischmann 

He tried at least, he tried. You, after you finished college, I guess what, isn't part of the story that you drove it, you drove to Idaho, in a pickup truck, and I want to get back to the college part. But you drove a pickup truck to work as a ranch hand, so you've also been a ranch hand. And so you've been, you had, you've had a colorful career already before you actually were post college years, I guess.

Tom Siebel 

I went to the University of Illinois in Urbana. I studied history of science as an undergrad, graduated in 1975. And then we got in a pickup truck with a friend and started driving Northwest. And we stopped in a place called Bellevue, Idaho, which then had about, you know, 200 people, it was an agricultural town. And I got a job as a ranch hand. And for a year, you know, cut hay and build K and drove cattle. And it was a great professional learning experience. And so then I got a job working for SNV construction in Hailey, Idaho. And basically, I was managing a shovel and digging ditches in Lange. You know, Johns Manville, this asbestos sewer pipe and water pipe, it was about 14 inches in diameter, it was quite heavy, and this is this whole business that you read out, read about, with Mesothe-, Mesothelioma, right, do I have that correct? Yeah. You know, let's hope we dodged a bullet on that. But I did carry this out for about a year. And so that was my second job, working on a construction site.

Alan Fleischmann 

How did you go from there to get your MBA? Or is that what you're-

Tom Siebel 

Actually I went back to Illinois, and I worked for a publishing company for a book publisher. And we, we, called Caroline House Books in Ottawa, Illinois. And then I worked there for a couple of years. And then I went back to the University of Illinois to get a graduate degree in business, and stayed to get a graduate degree in computer science.

Alan Fleischmann 

And that must've been bit of a shock, because you're like your undergrad was in history, kind of did a different thing by working in, you know, as a ranch hand for a bit. And then somewhere along the line, you said, I want to get a graduate degree.

Tom Siebel 

I did. It became, you know, when we get into the late 70s, you might recall, the economy was moving pretty slow. And I decided that, you know, I wanted to, I really enjoyed book publishing. And there was a small publishing house, so he kind of did everything edited books, he read manuscripts and promoted books, the works, he went to, you know, book fairs. And so that was, you know, I enjoyed reading and really enjoyed that. But, you know, I decided I wanted to learn the languages of commerce. So I could play the game at a little bit higher level. And this is what you learn in graduate school as a business, you learn the languages of accounting, and the languages of finance and the languages of operation research, and what have you. And in human resource management, show that you can, you know, that you know, the languages of the domain, so you can communicate clearly. So, that's what I think Business School is all about. And that was a great, I think, a good learning experience. And then, you know, in the course of taking classes in operations research, I started to do some work on these computers. These were big control data, cyber mainframes, and the CDC cyber machines. And back then we used to programm in Algol and Fortran, on key punch, on, you know, on Hollerith cards, you'd type out a key punch machine and walk in with your big shoe box filled with, you know, key punch cards, and you're hand it to the guy and he would read them and you know, and then they would, these were all batch computers. But that's when I began to become interested in computing. And it was, so I spent a lot of time in the computer lab working on these mainframe devices.

Alan Fleischmann 

Did you start to dream about what kind of career you wanted at that point? Or was it, I know you went to Oracle pretty much right after that, I imagine.

Tom Siebel 

Well, I was, you know, there was a, you know, I used to, they have a bookstore in the Student Union at the University of Illinois Urbana. And I was, you know, browsing through the bookshelves one day and I came upon a book that really changed my life. It was published in 1973. And it was written by a guy named Daniel Bell, who in the seventies was a very, very influential and famous U.S. sociologist, and he was on the faculty at Harvard. And he was a Marxist sociologist. And he wrote a book, turned out to be a very important book, called the Coming Post Industrial Society, okay? And he coined that term of the post industrial society and the information age. And in that book, he predicted, this isn't the era of Prague, this is shortly after the, you know, now we're in the era of, you know, where Detroit is king, and the Mustang is king, and we're, you know, this is in the era of following the Interstate Highway Act. And we had a, you know, primarily a goods producing economy that was, you know, the, you know, post Industrial Revolution on steroids. And he predicted that the, it was huge, very pressing pressures that he predicted that the global economy was about to be restructured from a good space economy to a services based economy. And this is what he called the post industrial economy. And this is, this is, think about this is before really the mini computer, okay, certainly before the personal computer, way before the cell phone. And, and before the internet as we think of it today, okay? And, you know, he predicted that at global scale, the economy was going to be restructured, where, you know, the most influential people were going to be, you know, people who were information workers, the scarcest resources would be data and availability and timeliness of accurate data. And he predicted that information technology would fundamentally change everything, about the way we work, the way to entertain ourselves, the way that we communicate, it would change the power structure, the political structure, and everything about the global economy. And if you know, he just laid this out so clearly, and it became, and I believed that it was going to happen, and I decided okay, this is the game I want to play, I want to be a player in that game. And so I then applied to the engineering school at the University of Illinois to which I was admitted. And studied computer science, got a graduate degree in computer science, studying relational database theory. And relational database was then a concept in its infancy, it'd just been invented. And, but basically, I wanted to learn the languages and the skills and the tools to be able to be at the table and play a role in the creation of the information age, and the post industrial era. And so now, four decades later, we're still at it, and it, it was saying, you know, reading that book was a life changing event.

Alan Fleischmann 

And then you obviously got your degree to prove it, but like nothing like the real world, and of all the stuff that you studied, and all the things that inspired you, that you went and you worked, tell us a little bit about that Oracle career you, you started, but it was-

Tom Siebel 

So back then, you know, relational databases, were just a concept. There were either, but a paper published by a researcher at IBM, Santa Teresa labs by the name of Ted Cod, and he had a paper that's called System R. And it was about the application of set theory to the problem, data storage and retrieval. Have you been in this truck? Maybe this is gonna be a very important technology that was going to change a lot of things. So this is what I studied. At the time, the companies that were involved, there was a company called Sperry that some of you good will remember, a Minneapolis setup was working on a product called Mapper, IBM was working on a product that was that a prototype called System R, later became known as DB2. There was a company in Berkeley called relational technology that was working on a product called Ingress. And those are the companies that were the, that were of which I was most aware, and I was interviewing with those companies. And then one day and my grads up at the grad school at, in the computer science department in my mailbox, there was a note to call this person from Oracle Corporation. Well, I'd never heard of Oracle Corporation. And I called them and they asked me, ultimately asked me to come out to California and I met with the founders of the business. They had about 20 employees at the time. And so I met with Larry Ellison, and his co founder, Bob Miner, and these people struck me as incredibly bright guys. They were surrounded by incredibly bright people. And I decided to throw my hat in with them as it related to, you know, playing a role in the relational database industry.

Alan Fleischmann 

How did they find you? How did they find you? Because you would have thought, they're California based, there are a lot of universities there. Obviously, Stanford's right here, that they would have just grabbed a, you know, a bunch of young people right out of college right in graduate school there, but they went and found you.

Tom Siebel 

Yeah, that's a really interesting story, actually, that, so they had an employee who was also a graduate of the University of Illinois, prior to me, by the name of Sohaib Abasi. And, and Sohaib was doing, basically, for deployed engineering for them, helping customers, German, how to use this technology to their benefit. And his manager was a guy named Gary Kennedy who ran all sales and service for the United States. And so he was moving out to California to be one of the people who ran engineering, and they wanted somebody just like Sohaib Abasi. And so they called Sohaib's thesis advisor, a woman by the name of Geneva Belfort, who was also my thesis advisor. And, and, and they talked to Professor Belfort and said, well, we would like you know, we're looking for somebody just like Soheib Abasi. And she said, well, I think you should talk to Tom Siebel. And so, Soheib Abasi and I have since become lifelong friends. And he went on to be, you know, a very successful senior executive at Oracle, and was the CEO of a company called Informatica. And we're, and we remain close friends today. But I was hired because I was supposed to be just like Soheib Abasi. And I tell you, I'm not nearly as talented. And I was probably not nearly as good as student. But that's how they found Tom.

Alan Fleischmann 

That's a really cool story. That's a really cool story. I love that. You know, you obviously rose through the ranks. I mean, I know that you quickly, I mean, to me, it seemed like it was great that you became part of the leadership team there.

Tom Siebel 

I was, I was one of the guys who ran the bell, one of the guys who ran the business. And I ran-

Alan Fleischmann 

Gain technology was part of that right?

Tom Siebel 

Gain was later. So, so it was, so it was I was at Oracle for roughly a decade. And we, you know when I left, we were about a billion dollar business. And I forget how many people, pretty big business and highly successful company. And I left to go start Siebel systems, you know, so I was really interested in the application of information technology to sales, marketing, customer service. But the way things happened, I got sidetracked. And a recruiter called and they wanted me to go be the CEO of a company called Gain Technology. And Game Technology was a very interesting company. And I went to work for them in 1990, roughly. And what we had at Gain is we were the first company, believe it or not, to build a software platform that allowed, allowed us to build multi user applications, usually on Unix networks. And Unix was the powerful platform at the time, they would enable organizations to design, develop, and provision applications that integrated sound, motion, video, text and hypertext. Now today, that's every application in the world. But in 1990, Google could do it. And so that was a very interesting company. It was a cash positive, profitable, rapidly growing business. And I sold that business in 1992, to Sybase, which was also a successful relational database company, for 10, a public company, for 10% of the outstanding shares of Sybase. And that was a great professionals experience. Great.

Alan Fleischmann 

And were there certain things that happened at Oracle, could they have kept you at Oracle, I guess, is one of the questions, because you did rise through the ranks, you came there with a few people. What, are there things that they could have kept your loyalty to them?

Tom Siebel 

Well, first of all, I was, you know, I was, you know, close to Larry, and close to the people around the business and I really enjoyed it. But, you know, I was very interested in the application of information technology and communication technology, the sales and marketing customer service. Why? Because as of 1993, that was a segment of the market that was completely untouched by information technology. And if you believe this thesis that I've talked about previously with Daniel Bell, okay, that it was clear that the sales market customer service was going to, was going to employ information technology like all aspects of, of work and, or it like work and recreation, I believed ultimately would. And so, as of 1993, we had successfully applied information technology to manufacturing automation, general office automation, accounting systems, what have you, but this these segments of sales marketing customer service had remained untouched. And I believe this was unlikely to be true to remain so and so I talked to Larry and said, Larry, I want to, and I built some technology for Oracle, to allow them to bring automation to their sales, marketing, customer service, profit processes, a product called Oasis that was just highly, highly beneficial to them. And there was a lot of interest in what we've done. Oracle was moving into the application software business. And so I approached Larry, I said, Larry, I think there's a market for this, are you what we now call CRM, and they will should go into this business, and I want to do it. And Larry had no interest in entering that market. And as I said, Okay, see you later, bye. And I went off to start Siebel, but I got sidetracked for a couple of years in the Gain, after I sold that we got some people together. And I think it's probably good that we waited a couple of years, because there were some enabling technologies that came online in say, '93, '94, '95, that really accelerated Siebel. And we-

Alan Fleischmann 

And if I'm right, also, when you found Siebel, a lot of that was your own money. You had other people with you, but there was a good deal of your own seed money in that as well.

Tom Siebel 

Yes, it was funded with $50,000. The, there's no venture money in it. And the way that we work, you know, we thought there would be a, you know, big market in CRM and sales, marketing, customer service. And all the employees for the first two years, we basically decided that a share was worth $1, and you could take all of your, your compensation in cash or all of your compensation in equity. And almost everybody chose to take all their compensation in equity. So we have virtually no payroll, okay.

Alan Fleischmann 

That's amazing.

Tom Siebel 

And so we bootstrapped it. We shipped the production product after about 12 months. And from that day forward, we ran a profitable, cash positive business. We started in 1993. By 2000s, say seven years later, we were doing 2 billion in revenue, we had 8,000 employees in 29 countries, 4,000 customers, and that is the fastest enterprise application software growing company in history, growing company in history. And so that was just a professional experience of a lifetime.

Alan Fleischmann 

I mean, I imagine the break, or the break neck pace, is not always easy. And the people who were there at the beginning, are often the people who are more reluctant to change because they knew what it was an intimate small place. But I imagine there are, there are dozens and dozens of lessons learned and observations made and frankly, expertise, you know, in how you run a company, because you ran the fastest growing company in history.

Tom Siebel 

It was the professional experience of a lifetime, we were on a chair. And you know, by by, I would say by 2000, you're when you got to like 2005, we had about 75% market share in CRM, global and sales and marketing and customer service in marketing, automation, internet self service, product configuration. We, in the pharmaceutical industry, the chemical industry, the automotive industry, you name it, in Asia, in Europe, in China, and in North and South America, it was, we just had so much fun. And this was not a dot com. You know, this was a cash positive, cash generating, profit generating business. And we left in our way, a long, long trail of satisfied customers, it was really hard work. And it was really fun.

Alan Fleischmann 

And I also believe that there's, you're an entrepreneur or you're not. And many people think that they want to be, they usually, the ones I suspect are the ones who shouldn't be, are the ones who spend all their time building a website, creating swag, you know, getting all this stuff together for their entrepreneur where they don't understand the supply and demand, you obviously understood that there was a growing demand, you defined actually a market that we all understand permeates everything. But at the time, it wasn't.

Tom Siebel 

There was no market.

Alan Fleischmann 

There was no market for it. You saw something though.

Tom Siebel 

We did create it. There was no market when we were there. Today, CRM is a $60 billion market globally. It's a, it's a big business. And today it's largely I mean, people basically-

Alan Fleischmann 

There'll be no Salesforce, there would be nothing, we, all the companies we know would not be-

Tom Siebel 

Salesforce is in our wake. And they've done a fine job of building a successful business. And, you know, after kind of modeled after Siebel, and you know, today, it's basically companies whether it's pharmaceutical companies or banks or manufacturing companies, they, they think it would be impossible to run their business without a CRM system. So we've come a long way.

Alan Fleischmann 

When did you really, I mean selling your company must have been fantastic financially, obviously. And that's a big feather in your cap feeling moment. And for those who actually stuck with you through the journey, who decided equity over salary, probably had no regrets at the end of that cycle. But to sell your company, the story now about how you sold your company is pretty amazing considering where you came from. But you know, that, that of itself must have been on the one hand sweetness like no other and a bit deceit of bitter because it was your baby?

Tom Siebel 

Well, it was, you know, first of all, yes, it was my baby. But as a CEO, I know, I have a fiduciary responsibility to the shareholders, the customers, okay, and the employees. And, you know, my job was to not do what Tom thought was important, my job was to do my job. Okay. So and that was definitely fulfill a fiduciary responsibility. And there was a great deal of wealth created for Siebel shareholders. At the same time, you know, after, you know, 9/11, you know, the dot com crash, remember, the NASDAQ was at 5000, it went down to like 1200. And, you know, hundreds of 1000s of crossover companies closed their doors, you know, companies like Intel, and, and Cisco, you know, their stock was trading at, you know, maybe 10% of what it traded before, at its peak. In 2000, 2001, the market cap of Siebel was $53 billion. So there was some wealth upgrade. Now, you know, the market had changed. And it was very clear that companies who, by the way, about 2002, shortly after we started the company, Larry decided, Larry Ellison decided that he was going to become the world's leader in CRM. And he was very vocal about the fact that he was going to crush this. And Larry, as you know, could be very competitive guy. And so he hired three, 3000 people working for 10 years to take us out of the market. And 10 years later, he had less than 1% market share, and the way that Larry will be in those days, you know, Larry was pretty feisty and outspoken. And so this was a battle. This was, you know, Battle Royale on the front page of Business Week and other publications of Larry proclaiming that he was going to put us out of business. And it was the way that only Larry can do and the media, of course, would love to write about this cat fight between Larry and Tom, because the media loves that kind of stuff. And so it was clear to me that the market had changed when we get into, say 2003, 4, 5. And rather than looking for standalone accounting products and standalone CRM products, they're looking, clearly looking for integrated suites of products, there was a change in the market. And I could see that and so given all the rancor and public hostility between Larry at Oracle and, and Siebel systems, I was quite surprised in about the fall of 2005 when the phone rang in my office and my assistant said, Tom, it's Larry Ellison on the phone. So I remember answering the phone, and I said, Larry, nice to hear from you. We explain, exchanged pleasantries and I said, well, I assume you're not calling looking for a sponsor here, America's Cup boat. And he says that's not, without skipping a beat, he says that's not a bad idea. But we need to put the names in alphabetical order. And then one thing led to another and we combined the companies, it was, I'm confident it was in the best interest of the employees, the customers and the shareholders of Siebel systems. I'm confident that it was, it was, it has been perceived of as one of the most successful acquisitions in the history of Oracle, it's the only brand they kept, they still, I can't even use the Siebel brand. They own it, right. And they still market under the Siebel brand. They and all the other companies they bought people saw Sun Microsystems, Storage Tech, all those names are gone, right. They don't use any of those brands, but they still market and receiving and CRM. So it's been a very, very successful. It was a you know, there was a stock per stock transaction where we did, it was about the, Oracle was trading about, you know $10 a share. I think it's trading about $40 share again, it's split. So if you hung on to the stock, it was a pretty good trade. And anyhow, it was a very successful business combination. I'm very pleased. It worked for the customers, it worked with employees, and it worked for the shareholders and leaders abroad.

Alan Fleischmann 

Now had you thought Tom that you were going to stay there? I mean, you kind of were coming home after all these years of being your own CEO and building the fastest growing company. Was there any thought in your mind that okay, I'm gonna just ride out the next years of my life working with Larry.

Tom Siebel 

No, Tom, was Tom was not on the table. Tom was not part of the deal. They, I had worked, you know, I have enormous professional respect for Larry, I have a lot of personal admiration for him. I think he is a giant. I know he is a giant. Okay. And, however, there was zero chance I was gonna go back and work for Oracle. And so that was not, that was never never part of the discussion.

Alan Fleischmann 

He got what he needed. But he wasn't going to get you.

Tom Siebel  

He didn't need me.

Alan Fleischmann 

Yeah. But you know, I, you know, but it is amazing that he came around and realized what he wanted is what you offered him years earlier. That's not lost on us here. Yeah, it's-

Tom Siebel 

For the shareholders of Orac- shareholders of Oracle, the management of Oracle, everybody's customers, he was a good business combination.

Alan Fleischmann 

Yeah, that's what, are you in touch with, with any of the folks over there still?

Tom Siebel 

You know, not very often, most of the people that, you know, you know, I don't talk to Larry, very often, you know, I've talked to Safra maybe once a year. And you know, most of the people I know at Oracle are just not there anymore, right?

Alan Fleischmann 

Yeah. I mean, when we're talking about technology and this changing world, I'd love to talk about your book for a moment, the book, you know, struck me, as I think I said to you last time I spoke with you. It was, it was almost both, it was clearly a way to understand the world of digital transformation. But it also was a little bit of a sci fi scary book, too. I mean, the things you pointed out in that book, were quite sobering as well. Please tell us a little bit the origin of the book, why you wrote the book, what your message is, and I will urge everyone who's listening to buy your book. But tell us a little bit of the book, because the book tells the story about where you've been, in many ways, because it brings that knowledge that you've been leaving for a long time, that also paints a picture of what you're doing now.

Tom Siebel 

Well to the extent that I've been successful in the information technology business, you know, it's been, I've been kind of lucky that, you know, entering markets, you know, that at the nascent stage, that turned out to be very, very large markets. When I entered the relational database market, the worldwide market for relational database technology, you know, was maybe $5 million. Today, it's billions of dollars. When I entered the CRM market, the worldwide market for CRM was maybe $100 million. Today, it's $60 billion. And so those turned out to be pretty good guesses. Okay. Now, after we left Oracle, we started thinking about what was happening next. And we got together with a number of people, particularly with an eye on sustainability, okay, and climate, okay, and energy, okay, because I think these were, clearly when we think about 2008, 2009, these were becoming recognized as troubling issues. And so we got together with a bunch of our colleagues, from founders from Siebel, founders from Oracle, people from SAP, McKinsey and Company, law firms, you name it. And we've met with the view of all over the world. And we met in the spring, summer, and fall of 2008. And thought about what was happening next, the information technology, and how could we have an impact on energy and climate and society? And initially, when we began the discussions, I thought this was going to be a philanthropy, if that was a philanthropic effort. And it occurred to us, you know, we were as we thought about it, that, that we were on the verge of sin, a new step function and information technology as we had moved, we have, we've seen, yes, step functions in the previous three decades are mainframe computing, to many computing, the personal computing, relational database technology, enterprise application, software, cloud computing, what have you. And the, you know, you know, this, the smartphone, graphical user interface technology, all these technologies got to be you know, this is what kind of, these were secondary effects of Moore's law that resulted in the rapid adoption of Information Technology across all forms, all aspects of society. So it occurred to us that what was, that what we're going to see next as we powered into the 21st century, was the advent in a big way of elastic cloud computing. So elastic cloud computing, you know, these other brands today like AWS, Amazon Web Services, Microsoft, or the IBM Cloud, Google Cloud, what have you that has come and that has happened. The next vector that we saw was the advent and this is a corollary of the opportunity to deal with it. What we call big data, that, you know, constraints on data would be removed, and we would be able to manipulate and store and access, basically, you know, unbounded datasets in, you know, in petabytes and even exabytes. We, the third phenomenon that we saw, a kind of changing everything was this phenomenon that we think of as the Internet of Things, the Internet of Things is about these value chains being upgraded. So all the devices in their value chains become remotely machine addressable, like the smart grid, okay, the power of the smart grid, where we have now sensors on Transformers substations, reclosers meters, thermostats, where we can remotely sense the state of all these devices in real time, we do the same to the oil and gas value chain and travel and transportation value chain, public sector value chains, Health and Human Services, with people with fitbits. And, you know, soon will be, you know, embedded processor, embedded sensors in our heart, and cerebrum, you know, I got, okay that that are transmitting signals that you know, I don't know, once every 15 minutes, or sometimes 90 hertz cycles. So, so now we have, you know, 50 billion of these devices out there. And so we looked at these four vectors coming together. And this looked at us that presented the opportunity for this new area that we call AI or predictive analytics, where we can solve classes of problems that were previously unsolvable. See, original idea was to focus these technologies at the value chain of carbon and carbon sequestration, okay, and energy security. And that's, and so it became apparent to us about December of 2008, that the real way to get this done was not as a philanthropy, but to deal with company's profit motive to deal with their profit motives. And so we decided to form a company. And we formed it in January of 2009. And I sent out an email on a Friday, we raised $20 million by Sunday, and the company was funded. And so then we spent, and so that's where how C3 began. Now, we later then applied these technologies not only to energy, but to manufacturing, transportation, aerospace, defense, oil and gas, what have you, and the company grew very rapidly. Now, as I moved around the world now and began to meet with CEOs and boards in Shanghai and Beijing and Paris and London, New York, Chicago, Minneapolis and San Francisco, there was something very unusual happening. Number one was this CEO was in the meeting, I was, CEOs didn't just show up for meetings about Information Technology, this is what CIOs do, okay. And the CEO was mandating this thing called digital transformation. And for the life of me, Alan, I couldn't figure out what these people were talking about. And I mean, I'm a student of information technology. And I was thinking like digital transformation really like as opposed to what, as opposed to analog transformation? It didn't make any sense at all. And as I, as I talk to these people, whether it was a state grant or South China grant or, or ximines, or cat or for JPMorgan Chase, you know, it became apparent that these people they really had, there was no common understanding what digital transformation was about, but they knew it was important. And they knew that they had to do it. In fact-

Alan Fleischmann 

They knew they were on the wrong side of it, probably.

Tom Siebel 

And so and they were pounding on the table, or something that mandated the CEO was, was driving it. And so I thought about it for seven, eight years before I sat down and wrote digital transformation, because I think I figured it out. And so, I think that what is happening is there is a massive, you know, there's what I would call a mass extinction event going out of the corporate world. And the you know, if we look at 2000 to 2020, you know, 52% of the Fortune 500 companies just disappeared from the portion of the list right? Toys R Us, Westinghouse, Kodak, when these companies are just gone, how can they be gone? I mean, these are these are institutions and, and they're all being replaced, you know, by companies with, you know, Sears Roebuck, okay? And they're being, how could Sears Roebuck be gone? I mean, this is unthinkable, right? And they're all being replaced by these companies. They're coming up with with new DNA, right? Like Tesla and Amazon and Airbnb. And you look at what's going on here and this mass extinction and all these new companies are companies that are employing elastic cloud computing big data, the Internet of Things and, and predictive analytics to upend their industry. See Amazon details in retailing. Last year, 10,000, retail outlets closed and everybody's buying things online. We look at Tesla, it's about big data, AI and IoT on wheels. Right? And, and Elon is up in the transportation business, how about Uber, no cars, no drivers, upending transportation. And so, we see it in Telecom, travel, transportation, aerospace everywhere, where these companies with new DNA are filling the vacuum of these companies that are going under. So, you know, the way many of the people who are listening, you know, well have read or read of, you know, a book, very, very famous book, written in the mid 19th century, called, um, the Origin of Species. And the origin, Charles Darwin suggests that, you know, the speciation of the planet is driven by this thing called natural selection. And natural selection you, he describes, you know, Charles Darwin saw, you know, the speciation of the planet is something like Moore's law where continuously moves continuously upward to the right. But he couldn't explain these, these discontinuities in the fossil record. And so the major gaps in the fossil record, and he would say, well, we just haven't found the fossils yet. Now, when we start looking at evolutionary biology, there's an evolutionary biologist by the name of Stephen Jay Gould. So this is very much what digital transformation is all about. This is when it became clear, as I ran into Stephen Jay Gould's book, and he came up with a Scripps, evolutionary biologist from Harvard. And he came up with this concept called digital transformation. Okay, and this concept called, no, excuse me, his concept was disruptive equilibrium. Okay. And he said, well, the speciation of the planet was not a continuous of that. And in fact, there was massive dislocations that cause and mass extinction events that resulted in the speciation of the planets. So fast your numbers, I think the planets been around for about three and a half billion years. Okay. There's been in you know, in the last, as I recall, 500 million years alone, there's been five mass extinction events. One was, like 440 million years ago, when oxygen came to the planet, oxygen before that was a toxic, was toxic. So everything that, you know, when oxygen came to planet earth, 96% of the species on Earth, disappeared. The most than, that in the event that we're most familiar with is what's called this KT extinction, which I think all of us listening today will have, will remember, or have read of, and this happened about 65 million years ago, when this new, when this meteor hits the Yocaton. We have mass climate change it all these volcanoes going off, and 84% of the species on Earth become extinct, the most famous being the dinosaurs. And dinosaurs had been a very successful species that have populated the planet for about 150 million years. Now we have this, now this big every time we have this mass extinction events, these wouldn't be followed by re speciation because there's re speciation, all these companies with these species with new DNA, well, this last one turned out pretty good for us. Because this is where the mammals came from, they fill the vacuum that the dinosaurs build. And this is where homosapiens came from. And so far, the stories were going up pretty well, we don't goof it up, you know, maybe we'll be around for a while. But so what digital transformation about is to say, hey, we're seeing the same event, okay, in the industrial world, that we see that we've seen in evolutionary biology, there's a mass extinction of that. And these leaders, these great leaders of companies like Shell, like JP Morgan Chase, like Bank of America, Standard Chartered Bank, you know, they see this as, they recognize that there's an extinction of that, and either they reinvent themselves with due to DNA, or they become extinct.

Alan Fleischmann 

And that's quite a fork in the road kind of moment, is it a fork?

Tom Siebel 

I think there's kind of two categories of CEOs out there today, there are those that are recognizing that this is going on, and are leading their company into a place where it will survive and thrive in the 21st century. Are there are those who are just kind of waiting to retire and really don't care? Okay, and, and let somebody else do it and companies will likely be acquired and those you know, see Macy's and Nordstroms you know, for details, and-

Alan Fleischmann 

There's no going back really, I mean, we're talking, there's some businesses, industries that are never going to go back. They can adapt, they can do that, they can transform digitally, like you're suggesting and possibly thrive. You're seeing a lot of companies actually, I think during the pandemic, understand the role of e-commerce, for example, and they some have done very well, in transitioning, others have not.

And I guess you, the big guys have the advantage, okay. Again, this some, you know, most of the companies that I've mentioned, have been little guys that came in Uber, Tesla, Airbnb, these are little guys, but the big guys, you think JP Morgan, Chase, Ford Motor Company, General Motors, these guys have all the data, okay, and so in access to the data. So, you know, I think in many, in many ways, the big guys have the advantage here. If they use it, if they can adapt, and, you know, fundamentally change the way they think about commerce, and fundamentally think, rethink the way that they create products, manufactured products, deliver products and service customers.

Alan Fleischmann 

What can government do here? What should government do here?

Tom Siebel 

Oh, I think its an important role for government. So let's look at, let's look at, if we talk, let's go look at Daniel Bell, okay, where he talks about the pre industrial economies, and the industrial economies, and then and then post industrial economy. So, and we have, you know, that we have the impact of, you know, technology and sociology, that result, has resulted in enormous benefit, but also enormous deleterious effects. So, let's talk about the Gutenberg press, yeah, I would argue the Gutenberg press is one of the most important inventions in history, it was the invention of movable type. Okay, and now we have, we have now, we can treat, print the Bible, in any language, it's not just hand scribed and Latin. Okay, then to the, you know, and, you know, clearly, you know, this brought on the Reformation. Okay, this kind of changed everything about the world. At the same time, one of the consequences were hundreds of years of religious wars in Europe, right? You know, and Martin Luther, you know, you know, pounding his writ, you know, on the door of the church and where it was in Wittenberg. Okay. And, and, and they don't, and they don't and, and, I mean, and so we have, you know, 30 Years War, Hundred Years War, hundreds of years of carnage that is not resolved until the Treaty of Westphalia in the 16th century. Okay. Who could have anticipated those consequences? Let's think about the steam engine and the Jacquard loom, these are the these are the, the driving forces behind the Industrial Revolution. Okay, now, I would argue the Industrial Revolution was a good thing, okay, we live longer, we live healthier, we're more prosperous, you know, and, and, and a good thing. But at the same time, you know, there were just enormous deleterious consequences that followed the, you know, as a result of the Industrial Revolution, and you can draw a straight line between these inventions of the steam engine and the Jacquard loom to child labor, massive labor abuses, you know, dickinsonian, Europe, Karl Marx, communism, labor unions, World War One, World War Two, and I said, we're still living in World War Two. So now let's look at AI. And we could have anticipated some of these consequences, right? We could have anticipated that but we didn't. Now, AI is not less powerful than the, than the, than the Gutenberg press, not less impactful than the, than the steam engine, or the Jacquard loom. If we look at McKinsey Global Institute, they say what's going on in digital transformation, that this is, this is happening with, you know, 30 times faster than the Industrial Revolution with you know, 100 was two orders of magnitude more change here. That's 3000 times the impact of the Industrial Revolution. And this will bring enormous good to many aspects of our life. Let's think about precision health. This is, I think, will be the largest application of AI to society. This will be the bill designation. So we can, for example, take the human healthcare records of a population say the United States and the genome sequences and of the other population of the United States or any country and they aggregate those data in unified federated image, okay, we can then run these through AI engines, that with very high levels of precision, okay, we'll be able to predict, you know, who's going to be diagnosed with what disease in the next five years. Now, the and you, you combine that with telemedicine with the ability to reach previously underserved communities at low cost. And the consequences of that are, the social and economic consequences are enormously beneficial. I know when we can predict who's going to be diagnosed with diabetes, or heart disease or whatever it might be, intervene clinically, and avoid the diagnosis. I mean, how good is this? Right? This is all motherhood and apple, but what's the downside? Okay, let's think about this. Now we have our insurance provider, or possibly even worse, you know, you know, a single health care provider, okay, in the idea that, you know, governments or industries act beneficially, you know, with all due respect, Alan, you know, I don't believe they do, you know, see Facebook, reduced sales, okay. Now, all of a sudden, this insurance provider by the government, or the private sector, is going to know which of us is going to be diagnosed with a terminal illness, okay, in the next five years, okay. Now, do you want to know that? I'm not sure I do. What are they gonna do with this information? Are they getting, who cares about pre existing conditions, when we know you, what you're going to be diagnosed with. So the idea that these people won't use these data to like set rates, okay, ration medicine, medical care, they will. Okay. And so this is, this is really scary. And, you know, the privacy and security implications are daunting. Again, so that would be an example of, of, you know, one of the downsides of AI. You look at social media. There's a downside of AI. Here, we're using AI and social media companies to manipulate 2.2 billion people at the level of the limbic brain, the limbic brain is, this is that portion of the brain that we have in common with a lizard, it deals with the stuff of survival, you know, food, water, sex, okay? It produces a neurotransmitter called dopamine. This is the pleasure center of the brain, and it teaches or just repeat things that are good for the survival of the species, like, hug your spouse, like eat dinner, like the things that the fundamentals, are the fundamentals. Now, these guys, the social media companies have figured out how to use computers to manipulate 2.2 billion people at the level of the limbic brain, every time that little, you know, bell goes up in your pocket, you get a little rush of dopamine, every time somebody likes your photo on Instagram, you get a rush of dopamine, you know, everybody, suddenly your likes your Facebook page, you get a little rush of dopamine. And so now we have, you know, basically an addicted population, it's an enormous healthcare problem. It's manifesting itself in depression, you know, suicidal tendencies, loss of self image, loneliness, we're seeing these technologies being weaponized by bad actors. It, you know, cuts through the question of whether we're going to be able to conduct a democratic society and the, in the evil, whether we conduct democracy at all, just very scary stuff. And, and the, you know, you talk about the role of government. You know, as you know, we've talked about this, I'm not a big government guy. But I am quite satisfied, that unless governments regulate as your how AI is used, we will be very sorry, because we're gonna have to live there. And the bad actors that will misuse this technology, and this story will not end well.

Alan Fleischmann 

It's the bad actors that we need to, need to worry about. That's actually partly why people should read the book, to get a real sense of that landscape, as well. We're going to run out of time, really about six minutes left, which is bumming me out. I'll tell you why. I really want to talk to you about, I want to talk to you about your philanthropy, which has been pretty extraordinary. I want to get some lessons learned that we can have some young entrepreneurs or seasoned CEOs who are listening today, what are the like the five or six things you'd want them to do, want them to know? And I really want to talk about your 2009 accident, Tanzania, where you know, you were attacked by an elephant, and that was pretty harrowing. And those who we don't get to that in detail today that we should certainly get people to read about it because it's really extraordinary. And I'm sure a pivotal moment in your life as well because not only do you thrive, but you're a survivor, and that's pretty amazing. So maybe this kind of round robin moments, you can share a little bit of quick wisdom because you are not only a person who does well and you seem to do well over and over again, you do good too. You do a lot of really good work you and your wife and it would be great to just kind of get a little bit of apparently words of wisdom here as a survivor who thrives, who is very humble and who gives back?

Tom Siebel 

Well, you know, I think the role of the corporation, you know, the corporation itself, okay, is a, is a social entity that I think has an important philanthropic role, okay. And the role of the corporation is to meet the needs of consumers, to meet the needs of society at large and make a profit doing it. Okay. And I think in the process, you create jobs, and you make the pie bigger. So I think that is a, the idea, you know, of creating jobs is a, it's just enormously rewarding. Okay. And, and, and so I think, you know, that is perceived as sometimes it's a bad thing as a capitalist thing, and I don't get it, I think it's a good thing. Okay. And yeah, I think that is the ultimate form of philanthropy is to create jobs, okay, where people, their lives have meaning. Okay. And their, and their people's children couldn't be, you know, we can be more prosperous and successful than they were. So I think that is the ultimate full answer. You know, I think like, like you, and like many people, you know, I tried to leave the community, Stacy and I tried to leave the community a, you know, a better place than we found it. Yeah, I think we're doing some, you know, very important research now, to the, for example, the C3 AI digital transformation, it's new in COVID. Research, and climate and energy security research, I think these are these are very important areas, where, as you know, we're active in stem cell research, very, very active in giving scholarships, both for academically excellent people and for underprivileged people to get them, you know, in through high school and through college, because education is simply the key to everything, okay, in the 21st century. I don't know, you know, how else to respond. But, you know, I think the most important flag, you know, if I look back, the thing that I will, I think, have been most proud of, is creating jobs all around the world.

Alan Fleischmann 

What's your secret to overcoming adversity? Because, you know, well, you know, if you're an entrepreneur and someone who understands and dreams about running a rapid pace environment that you've led now several times over, what would be your biggest bit of advice about it?

Tom Siebel 

The most dire situation I've run into is when I was attacked and mauled by an elephant in Tanzania in 2009. And you know, if anybody's interested in me read about that on the internet, but it was a life threatening event. And I had 19 reconstructive surgeries, and the other three physicians who wanted to cut off my leg, and I, and I simply said, you know, who you don't need to talk anymore, and left their office, hey, I would say my leg is attached. As you know, I'm quite active and healthy, and I paid for it, and I serve. And, you know, I tried to keep my kids in active sports. And so there's a lot of fun, but I think that, you know, when the lights were flickering, and you know, when it was there's question of whether or not I would live, and then there was question whether I would walk, and then there's question whether or not I keep my leg, okay, and then I will otherwise run out, you know, I would say, of the spectrum of possible outcomes, I never, you know, from from, from very positive to external negative, I would never allow myself to consider the negative out, it was never a possibility. And I would never acknowledge, and that was very unrealistic. But I could never see that part of the spectrum. I always only saw the good half. So I think this business of seeing the world as consisting of glasses that are half full, has something to do with being able to realize that outcome.

Alan Fleischmann 

So there's got to be something when you come back into the show, and I hope you will, we'll talk a little bit about mental discipline also. Because obviously, you're physically very active and you're traveling. You're, you're doing so much. When you're on recreation, and when you're not working, you're doing something physical, the mental part of you and how you're disciplined and steely, focused and could avoid the negative we could learn a lot from, so we're gonna want you back Tom Siebel. This is a, this is, this is a very, very important discussion, conversation. I would urge you to read about Tom, certainly about how he did overcome adversity, physical adversity, life threatening adversity that he was just referring to with an elephant experience back in 2009. And I would argue that you should, you should read his book. And books actually, I'm gonna go back to your first book as well, because you seem to see things around the corner that you do. And you're willing to take it on with rapid speed if you if you can. We have a lot to learn from you and I hope you'll come back.

Tom Siebel 

Thank you so much Alan.

Alan Fleischmann 

I really appreciate it. Thank you, appreciate it.