January 23, 2006 4:00 AM PST

PeopleSoft co-founder plans software return

HALF MOON BAY, Calif.--Oracle upstaged Dave Duffield once again.

The PeopleSoft co-founder was due to launch his new company last week at the AMR Research Strategy conference here, but at the last second, his handlers changed their minds. Good thing too, since most of the tech-focused media would have missed it: They were 25 miles north in San Francisco listening to Oracle executives trumpet their new business strategy--one that began a year ago with the $10 billion hostile takeover of PeopleSoft.

Duffield's last-ditch campaign to prevent the acquisition of PeopleSoft, the business software maker he founded in 1987, took a toll on himself and former vice chairman Aneel Bhusri, he told about 300 conference attendees.


David Duffield

"Aneel and I both went to therapy," Duffield said jokingly. Later, in an interview with CNET News.com, a much more somber-sounding Duffield recalled his last days at PeopleSoft. "It was very, very tough."

A builder of billion-dollar companies and palatial homes--and widely considered one of the Bay Area tech industry's most benevolent employers--Duffield is planning a comeback. He and Bhusri have founded Workday, which is designing a new business software technology and is now set to launch sometime in spring.

Duffield isn't saying what markets the company will go after, but industry insiders--some with close ties to him--are anticipating that Workday will begin by building software tools for managing human resources.

"I know that's one of his strengths," said Jeff Carr, an executive vice president of global sales and marketing at business software company Taleo and a former PeopleSoft executive. "If I was going to bet money, I would guess that he may be coming after that space. That's where he started at PeopleSoft."

Bruce Richardson, AMR Research's chief research officer, agreed.

""They are going to be like the early PeopleSoft," Richardson said. "It's going to be financials and human resources. They are going to do a lot of the back-office functions and try to build a new software model."

New start
That Duffield is worried about building anything surprises some in the software business. Richardson pointed out to the audience, after Duffield lamented losing PeopleSoft, that the former chief made roughly $600 million from the company.

"How many of you feel bad for Dave?" Richardson asked jokingly.

The 65-year-old Duffield appeared to be preparing for a life of leisure in recent months. In October, he submitted plans to construct a 72,000-square-foot house in Alamo, Calif. Had the home association there not opposed it, the structure would have been bigger than the White House or Hearst Castle. Last month, Duffield scaled back his plans by 70 percent and is now looking to construct a 21,461-square-foot building.

Sure, Duffield has plenty of money, but he said that getting rich never motivated him, not even in his younger days.

He said he enjoyed operating PeopleSoft after taking over from fired CEO Craig Conway in 2004. In total, PeopleSoft fended off Oracle's advances for more than 18 months. Duffield said that after he took control, PeopleSoft's share price was on the rise, morale was high and customers were excited again. But time ran out when PeopleSoft's board decided to accept Oracle's bid.

"I am very pleased with the job Aneel, myself and the management team did at PeopleSoft," Duffield said. "We almost pulled off a miracle. We were trying to get too expensive to remain independent, but Oracle just prevailed."

In keeping with his reputation as a commanding officer who doesn't forget his troops-- even in defeat--Duffield set up a fund to help PeopleSoft employees who were dismissed by Oracle. Of the 35 Workday employees, 25 worked for Duffield at PeopleSoft.

For that reason, he denied speculation that cropped up after he returned to PeopleSoft that he came back to help sell the company.

"There was never any thought in my mind about selling," he said. "I told my wife that the board wants me back and to go find a house that can accommodate our six kids. I had every intention of leading PeopleSoft, and I'd be doing that today."

Richardson said: "There's a certain goodwill aura that surrounds Dave. That's why even the most grizzled executive is going to make time for him when he wants to pitch his product. They are going to want to recapture his magic."

3 comments

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Good Luck Duff..
We are with you all the way.. Working on the Peoplesoft CRM has been an enjoyable experience. Hopefully you come out with another great product.
Posted by thedevilbegone (139 comments )
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Good Luck Duff..
You are the best in the world..go ahead.
Posted by fcoballe (1 comment )
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art the barber
Hi David,

I wanted to let you know that I really enjoyed having your mom as my 4th grade teacher @HHK.
She would read all the EB White stories to us after lunch. I also remember the hanging Cornell flag in the class room and the stories of Art the barber.
Posted by tencer07 (1 comment )
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