One On One With Bill Coleman, CEO, BEA Systems
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SUSIE GHARIB: BEA Systems (NASDAQ:BEAS) bills itself as the e-commerce
transactions company. It provides the infrastructure for businesses to do
business on the Internet. Its Chairman and CEO is Bill Coleman. He founded
the company in 1995 along with two colleagues. It's partly owned by the
venture capital firm Warburg Pincus. BEA went public almost two years ago,
selling at $6 a share. Since then, BEA has shot up to $105 and the company
is planning a 2 for 1 stock split. Now it's trying to position itself as
the global leader in the business to business e-commerce market. In
tonight's prime movers segment, Donald van de Mark asks Coleman if he's
worried about creating overly high expectations for BEA on the Street.
BILL COLEMAN, CHAIRMAN & CEO, BEA SYSTEMS: I think we've been pretty
conservative about building up expectations. We have been conservative in
giving our forecast and where we're going revenue-wise, where we're going
predictions-wise and we've always exceeded those. A year ago we gave an
expectation that we would grow in the low 40 percent and we actually grew
over 60 percent. So we've tried to do that. I think the expectation is
around the market and it's around seeing the rapid growth in our customer
base, just phenomenal growth in our customer base. You know, we're not even
predicting a major growth in our new business areas this year as far as our
economic models. But we're investing in making that happen. So I think it's
important to give a positive but real attitude of where the market is going
and then build it out.
DONALD VAN DE MARK, MYPRIMETIME.COM: One of the best investment ideas of
the past 18 months has been to invest in companies that are building the
infrastructure for the Internet and the world of e-commerce. Now, you're
perfectly positioned to see a lot of what's going on. So what types of
companies should people be looking at when they're looking for investments
in this world or what specific partners, for instance, or companies that
you know about that you might recommend?
COLEMAN: Well, I really see all sorts of consolidation growth happening.
There's a whole new area of application service providers and I think we're
going to see a huge amount of growth and even consolidation of telephone
service providers there that are going to offer a whole new value
proposition beyond the telephone systems to applications, aps on tap, as
Hewlett-Packard likes to call it. Now, above that, when you talk about the
core competencies of businesses, we're really looking at things like
trading exchanges that are coming about. Companies like Ariba (NASDAQ:ARBA)
pioneered that and Chemdex (NASDAQ:CMDX) is doing it in vertical markets, that
allow you not just to trade and learn about new chemicals but do real time
dialogue with the inventors of these things so you can speed up the
production of medicines.
VAN DE MARK: Let me ask you a question about managing the future. It's
great because everything is being turned upside down or everything is brand
new, but how do you then stay ahead of something that is moving so rapidly
and changing so dramatically?
COLEMAN: Well, I call that the Cisco (NASDAQ:CSCO) model and it's about realizing
that technology is moving too fast to build new technology. You try to
build it, you're going to be one of the 100 people that try to build a PDA
before Palm Pilot.
VAN DE MARK: So you're going to acquire it?
COLEMAN: You have to acquire first move or advantage and then you have to
give it the scale to get there.
VAN DE MARK: So you're going to be buying companies?
COLEMAN: You have to in the new areas and then you build on that advantage
and you compound that advantage. A hundred years ago, every industry that
formed the Industrial Revolution of the 20th century was formed by
acquisition.
VAN DE MARK: It's not easy to actually fold companies into yours. Cisco has
been very good at it but most companies are not.
COLEMAN: Druker's view is that for the first time 50 years of AT&T's life
their only core competency was acquisitions. That's been what we built BEA
on and when you are acquiring new technology, you're not acquiring
technology. You're acquiring the people. You're acquiring that stroke of
genius and that dedication, drive and passion that made it happen. You have
to assimilate that into your culture.
VAN DE MARK: Congratulations on the progress so far and good luck in the
future.
COLEMAN: Thanks. It's been a lot of fun.
Nightly Business Report transcripts are available on-line post-broadcast.
The program is transcribed by
FDCH. Updates may be posted at a later date.
The views of our guests and commentators are their own and do not
necessarily represent the views of Community Television Foundation of South
Florida, Inc. Nightly Business Report, or WPBT.
Information presented on Nightly Business Report is not and should not be
considered as investment advice.
?2000 Community Television Foundation of South Florida, Inc.
News Alert from Nightly Business Report via Quote.com
Topic: (NASDAQ:CMDX), (NASDAQ:BEAS), (NASDAQ:CSCO) Cisco Systems, Inc., (NASDAQ:ARBA)
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