Featured in The Wall Street Transcript’s Best CEO Interviews of 2015
Kevin B. Thompson, President & CEO of SolarWinds Inc. (SWI), interviewed with TWST for the Business Services and Application Software report. Since the interview, SWI‘s stock price has increased approximately 18%, from $49.7 to $58.51 currently.
In this interview, Thompson discussed some of the central parts to SWI‘s strategy:
Our network management business, which is a set of about 12 products, is still the majority of our revenue. But our systems management business is growing very quickly and growing at a slightly higher percentage rate. We don’t have one product or one set of products that are the lion’s share of our business. Network management, because that’s where we started back in 1998, is still the largest single piece of our business, but the rest of the product suite is delivering a meaningful amount of revenue today.
We’ve actually got a very unique revenue model — always have — in that about 70% of our revenue is recurring. Not because we don’t sell software licenses; in fact, we do. We sell licenses to most of our products, but we’ve always had a very high maintenance component, meaning we never maximized the value of our licenses. Instead, we maximized the value of the maintenance. We sell maintenance at a list price without regard to what you pay for the license in the first year. And so we’ve always had a much heavier recurring component to our revenue stream than any other license-model company.
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