Blackbaud CEO Mike Gianoni looks to accelerate Charleston software firm's growth
After reporting to his new job at Blackbaud in January, Mike Gianoni went through the corporate orientation program with about a dozen other hires.
At a glance
Michael P. Gianoni
Job: CEO, president of Blackbaud, which has about 2,700 employees worldwide.
Last position: Executive vice president and president of the financial institutions group at Fiserv Inc.
Previous employers: CheckFree Corp. and DST Systems, among others.
Education: Associate degree in electrical engineering from Waterbury State Technical College; bachelor's degree with a business concentration from Charter Oak State College; master's degree in business administration from the University of New Haven.
Residence: Sullivan's Island
Notable quote: "We'll continue to grow the business here. The headquarters is here, and we want to remain being an important part of this community."
His presence wouldn't be at all remarkable except for the fact that Gianoni wasn't some fresh-faced entry-level recruit. He was the software company's incoming president and chief executive officer. He wasn't even required to attend the two-hour indoctrination.
Following the money
Blackbaud plans to spend an extra $16.5 million in 2014 to increase sales and improve other areas of its business. It's said the one-time move will be "a nominal drag" on its 2014 profits.
Here's where the money will go:
Accelerating revenue growth: $8 million. Includes beefing up the sales staff.
Improving operating efficiencies. $5 million. Includes moving all sales teams to the same sales IT platform. "It's pouring a common foundation for the future growth of the company," CEO Mike Gianoni said.
Identifying winners, losers: $2.5 million. Blackbaud said it wants to ensure it's investing in the "highest growth, most profitable and strategic" products and services. Some underperformers could be eliminated.
Transition: $1 million. To support the shift to a business model based on recurring subscriptions to cloud-based products rather than sales of physical software.
"I just wanted to see it and see how it works in introducing the company to new folks," Gianoni said.
The easy-going Connecticut native and 30-year software executive was plucked from an international search that took much of last year to become the fourth CEO to run Blackbaud, the largest publicly traded company based in the region and one of the biggest technology employers in South Carolina.
He started at the firm's Daniel Island headquarters on Jan. 13. He also became a director of the Nasdaq-listed company, which describes itself as the world's top seller of software products and services to nonprofit groups large and small.
The changeover in the corner office at Blackbaud coincides with the rebound in the giving industry, which took a hit after the 2008 financial crisis.
"The market is doing well, and we're pretty well-postioned in the market," Gianoni said in an interview last month.
But the 53-year-old wasn't hired to be a custodial CEO. He's stepping in as Blackbaud prepares to invest about $17 million this year to help carry out the board's marching orders.
"I think the mandate is, 'How do we accelerate growth?' " he said. "The mandate is grow revenue faster, and I think we can."
Gianoni is taking the reins of a business that by most accounts is in solid shape but at a turning point. It cracked the half-billion-dollar threshold in sales last year at $503 million, a gain of about 13 percent from 2012. Profits for the year increased nearly fourfold to $30.5 million.
"Nothing's broken," Gianoni said. "There's a lot of upside in the business."
The most fertile ground is in the online field. The company jumped into that rapidly evolving business in a big way through its $275 million purchase of Austin, Texas-based rival Convio in 2012.
While the online market is still small - donations to nonprofit groups from the Web account for just 6 percent of the total - it's expanding at a 13 percent annual clip, far faster than the old-fashioned money-raising techniques that Blackbaud has mined since its launch in 1982.
"We're positioned well on the traditional side, and we're positioned well on the online side," Gianoni said.
Also, Blackbaud is "going pretty deep in mobile and payments" by seeking ways to make it easier for customers to solicit and collect donations through smartphones and other portable devices at fundraising events.
"The market wants that," he said. "The market wants solutions on iPhones and iPads that are conducted in the field in a more automated way. It's in line with where other consumer behavior is going."
At the same time, Blackbaud continues its shift from selling physical software that must be installed, upgraded and maintained to offering annual subscriptions for online products housed in remote data centers.
Through the ranks
The new CEO doesn't hail from a high-tech hotbed. Home is Bristol, Conn.
Through the ranks
"Right down the street from ESPN, which is pretty cool," he said.
His father owned a machine shop, where the younger Gianoni worked during high school and college. It was that old-world industry that helped introduce him to the power of technology when computer-aided design tools crept into the family business.
"The precursor to robotics," he said.
Gianoni studied electrical engineering and business in college. After graduation, he went to work at a Boston company that designed software for the mutual-fund industry. He never looked back.
"I started off in engineering and went into systems integration and product management," he said.
Successive stints in sales and management followed. He earned an MBA along the way.
"I worked in each of the departments that make up a technology business on the operating and marketing side." he said.
Melanie Mathos, Blackbaud's senior public relations manager, said the new boss' jack-of-all-trades background "really resonated" with the rank-and-file tech employees at his first "all-hands meeting" in Charleston.
Gianoni didn't dispute that.
"I've had the benefit over 30 years of sort of living in the shoes of most of the jobs in the company," he added.
'A real match'
Gianoni was in top management at his two last employers for nearly eight years, starting with CheckFree Corp., a pioneer in the electronic money transfer business. He stayed after the firm was sold in 2007 to Wisconsin-based Fiserv, a huge maker of software that banks and credit unions use to power their online and mobile transactions.
'A real match'
Gianoni rose to become a group president based in Jersey City, N.J. His division was about twice as large as Blackbaud based on revenue.
"Fiserv is a big company," Gianoni said.
That it isn't a household name is partly by design. Its software is "branded" not to Fiserv but to the banks and credit unions it works with, similar to the way Blackbaud operates.
"It's just that the client base is quite different," Gianoni said. "At the underlying level, the types of technologies we use and the types of applications we have are a lot of what I'm used to."
Gianoni said he wasn't itching to leave Fiserv or to move from north Jersey to South Carolina.
"I had a great job," he said.
Then, an executive headhunter contacted him about the Blackbaud opening last year, after longtime CEO Marc Chardon announced he was stepping down after about eight years at the helm.
"I got a phone call and got in the mix," Gianoni said. "I started to learn about the company, about the market and about the opportunity. I thought, man, this is a real match."
CheckFree founder Pete Kight has been following Blackbaud's business for years. He said Gianoni is well-suited for his new role.
"I just know it's a great fit," Kight said during a trip to Australia last week. "It's a company with a fundamental strategy and execution tactics that are similar to CheckFree and the division that Mike ran."
Kight, who's now managing partner at the Comvest Group, vineyard owner and Fiserv board member, said his former executive vice president isn't a top-down leader.
"He'll make sure what they have is a team that leads Blackbaud," he said. "It won't be Mike as CEO using his ego. He will make sure he has a team ... that works well together."
Kight, who sold CheckFree to Fiserv for $4.4 billion, wasn't surprised to learn that Gianoni sat through the two-hour employee orientation after joining Blackbaud.
"That's classic Mike," he said. "He doesn't run on ego."
Contact John McDermott at 937-5572.