After 13 years as CEO of PTC, Jim Heppelmann will retire from the role. Replacing him will be Neil Barua, who had joined come to PTC from the ServiceMax acquisition at the start of this year.
Barua’s coronation, as it were, will happen at the annual stockholders meeting in February of next year.
"I'm immensely proud of all that PTC has accomplished during my 26 years with the company, including these last 13 as CEO,” said Jim Heppelmann. “PTC has become a premier digital transformation partner
"It's an honor to be named the next CEO of PTC, and I greatly appreciate the confidence the Board has placed in me,” says Barua in the press release. “PTC is a terrific company with great customers, talented employees, and the strongest product portfolio in our industry. The company has been performing exceptionally well, and we'll build on this success as we enter our next chapter. I look forward to working with Jim and our executive team during this transition and deepening my relationships with our customers, employees, partners, and shareholders."
ServiceMax was PTC’s biggest acquisition ever, but that its CEO, Barua, would be anything more than the head of the PTC’s SLM (service life management) division, comes as a complete surprise. Heppelmann, who himself had come to PTC on an acquisition (Windchill), had managed to keep the heads of acquired companies in subservient roles during his tenure as CEO.
Jim Heppelmann will move to the chairman of the board position, replacing Bob Schechter, chairman of board for the last eight years.
There was no hint of a ServiceMax takeover at PTC’s recent annual conference, LiveWorx, held in Boston in May. Heppelmann as much in control as ever, sharp as a tack, on top of every product, every acquisition. Introducing Barua to an audience of mostly Creo and Windchill users, was he not every bit the father to the son? Even if he had aspirations for the son to take the throne, wouldn't he have nurtured the youngster for a few years?
Playing back the tape, however, were there were some clues? They never shook hands. Heppelmann introduced Barua from a far-off corner of the stage, Barua elevated above him. Okay, we might be reading too much into that but the speed of the ascension has made heads jerk. This announcement comes only 7 months after PTC acquired ServiceMax. Could Barua as PTC CEO been the plan all along?
Who is Neil Barua?
Born of immigrant parents (from India), Neil Barua went on gain an education in finance and economics (bachelors at NYU) and joined Merrill Lynch upon graduation. A series of positions led to a private equity firm (SilverLake) that placed him at the head of ServiceMax. That Barua had no experience in the service industry or software did not seem to matter. Private equity firms typically invest in industries across the board, ruthlessly taking leadership. Theirs is a "buy to sell" approach that evokes fear in hearts of the CEOs of companies they are buying, according to Harvard Business Review. Entrenched CEOs may be viewed as a detriment as they are prone to regard puny double digit growht as satisfactory. A PE firm's goal is typically to expand the business in multiples and sell it for a huge return for their investors.
Barua ran ServiceMax for 4 years before selling it to PTC for $1.46 billion in January of this this year. SilverLake had paid $915 million, a respectable 12% annual yield (CAGR).
ServiceMax was once owned by GE Digital, but when GE fell on tough times, 90% of ServiceMax was sold to SilverLake. When SilverLake asked its executives who would like to replace Scott Berg as CEO of Service Max, Barua was first to raise his hand and say “Put me in, coach,” according to a interview published April 17, 2019 in diginomica, where he said he was “motivated by the challenge of taking ServiceMax through its next phase of after exiting GE Digital and scaling it further.”
The CAD world's first look at Barua at LiveWorx revealed an articulate individual who had quickly learned enough to speak to them on their own terms – and not afraid to share personal stories. He told of visiting a close relative on her deathbed but was encouraged to find her passing “to the next stage in her life” was eased by all the medical equipment around her, their service and maintenance ensured by ServiceMax. He credited ServiceMax for liberation of people from the menial task of manually filling out service records and forms, like his father who spent 3 hours doing this every evening, time that could have been spent teaching the younger Barua how to play soccer.
“I could have been a world-famous soccer star, instead of a software executive,” says Barua.
Barua will be relocating from near ServiceMax was based (Pleasanton, CA) to Boston and take an office in PTC’s Seaport district tower.