SugarCRM CEO Roberts replaced by board member

John Roberts on Wednesday resigned from his post as CEO of open-source CRM vendor SugarCRM, leaving board member Larry Augustin to assume the role of interim CEO while the company conducts a formal search for his replacement.

John Roberts

(Credit: SugarCRM)

Roberts, whose grounds for leaving the company and future plans remain undisclosed, has made a huge impact on the open-source world, innovating the "Open Core" business model and helping drive open-source applications into the enterprise.

SugarCRM, despite losing Roberts, will be in good hands with Larry Augustin, who, as founder and former CEO of VA Linux, sits on a number of open-source company boards, including Pentaho, Compiere, Appcelerator, and Medsphere. He understands how to run an open-source business and, importantly, what to look for in leadership. Augustin should be able to find a strong CEO to lead SugarCRM.

Augustin's near-term task is clear, as he outlines in his blog announcing the change in leadership:

Yesterday, I stepped into the role of interim CEO at the company. I have an immense amount of respect for the founding CEO, John Roberts...My goals for the next 30 days at SugarCRM are fairly simple: get to know the team, customers, and partners. I am looking forward to helping them to continue to execute and (taking) the company to the next level.

In other words, continue the solid work that Roberts started.

I first met Roberts at an SDForum event in 2004, at which time I thought that he was crazy for believing open source could succeed in applications. He and his SugarCRM team persisted in their Quixotic dream, building SugarCRM into a thriving company that brought in tens of millions of dollars in sales last year and has an eye on an IPO.

I couldn't reach Roberts for comment but hope that he spends a little of his downtime on cycling, one of his passions, before he leaps back into the open-source world. As Augustin notes of Roberts, "Few people have taken a company from concept to major growth the way John did at Sugar."

I agree. Roberts will be missed. Fortunately, his legacy should live on at SugarCRM, one of the pioneers of commercial open source.

Disclosure: I am an adviser to SugarCRM.

Follow me on Twitter @mjasay.

[arjenlentz]

Interesting time to jump...

[splendidcrm]

We spoke with John Roberts 3 years ago and he did not seem very open to us.

[vc_investor]

FWIW, I turned down SugarCRM at Series A because of Roberts. I thought he had way too much of a "open source is cool" religion and not enough grounding in the nuts and bolts of business-building. The idea of selling services was never a good model. This transition is clearly about the business not meeting expectations and I am sure that in large measure it is because of the freeware foundation of the business. Open source applications make no sense as a business model. This change is confirmation that the investors *finally* realize it. Too bad DFJ, Walden and NEA had to spend $50M to figure out the obvious.

[jlee888]

I wonder what this means for Jive

[jimmyjjjj]

This reporting is pathetic. Disclaimer aside, could you dislodge your nose, write objectively, and educate us about what _really_ happened? CEO's don't get fired so that someone else may "continue their good work". I'm surprised you didn't throw in a "..spend more time with his family" in there somewhere....

[Matt Asay]

The problem is that you expected it to be "reporting." It's a blog. Please learn the difference. IT's clearly labeled as a blog, my biases are clearly identified, and yet you clearly didn't catch on. Sorry to disappoint, but you got exactly what the blog purports to be.

[jimmyjjjj]

Matt - kudos for replying.

I dispute your claim that this page is "clearly" labeled as a blog. The website looks like an official cnet page and the title/crumb says "Home/News/The Open Road".

I appreciate your time and 'reporting' - and my criticism is meant to be constructive. Cheers,

-jimmy

[chowfun]

This is a terrible report. Clearly biased. Reading this report wasted 3 minutes of my life.

[Matt Asay]

If it makes you feel better, reading your comment only wasted 3 seconds of mine. Cheers!

[BrucePerens]

Uh, there does seem to be a lot missing here. If Roberts had left because of a family or medical reason, that would be clearly enunciated so that there would not be a perception of a problem in the company.

I think, Matt, that we need to at least entertain the possibility that their business model isn't working.

It's really hard to make Open Source as the main product of a company, and make money. That's why most Open Source is not made that way. And unfortunately the problem with "Open Core" is that you're back to competing as a proprietary company, rather than an Open Source one, again.

And Sugar suffered the usual problem of profit-center Open Source: it had its own community which wasn't really connected to anything else - and certainly wasn't connected with the non-profit-center Open Source community which produces most of Open Source.

But the bottom line is probably that the company missed sales goals for too long. Even if you're doing everything right, it's going to be hard to make them this year.

[kksf69]

John Roberts is a nice guy with a revolutionary ideas but anyone who has worked with SugarCRM has seriously wondered why it has taken the board so long to have John move on to "pursue other interests".

John ruled SugarCRM by irrational emotions and not the nuts and bolts of a business.

This approach worked fine when orders were coming in without any work ... not the case today.

Good Luck Larry. It will be interesting to see who else moves on to "pursue other interests".

[SugarInsider]

As far as I know sales goals have been reached or are close. Orders are coming in. Business is brisk in this bad economy. The business model of giving away the razor handle and selling the blade (giving away the Open Source version and selling Pro) is working.

I suspect they wanted a more seasoned CEO to take the company public. That's been the direction.