you have to make it. and if you want a successful business, all it takes is an idea, and now becomes the future where you grew a dream into a reality. the all new godaddy airo. put your business online in minutes with the power of ai. david: this is my kitchen table and also my filing system. over much of the past three

decades i have been an investor. the highest calling of mankind i've often thought was private equity. then i started interviewing. i watched your interview so i learned how to do an interview. i have learned from doing my interviews how leaders make it to the top. >> i asked him how much he wanted and he said 250 and i said fine. i did not negotiate with them and did no due diligence. david: and how they stay there. -- i would have -- i have something i would like to sell. and how they stay there. you don't feel inadequate being only the second wealthiest man in the world? is that right? one of the most successful business executives in the world over the past 10 years has been bill mcdermott. he took s.a.p. to record heights and is doing the same with service now. i had a chance to sit down with bill mcdermott in new york and had him describe to me how he came from very modest roots to the top of the corporate world and how he inspires his troops, inspires his customers, and loves his job. in october of 2019, you surprised the business world by

stepping down as the ceo of sap. a very large company whose value had more than doubled during your co-ceo position and ceo position. you took a position at a smaller, less known company, servicenow. usually when people leave a job they go to a bigger company. why did you go to a smaller company? bill: i saw the future and where it was going. first of all, i want to say i had a great run at s.a.p. and it was a pleasure taking them from $39 billion to $163 billion. really inspiring a lot of people and customers. it was a wonderful experience. after 17 years, i was ready to do something different. when i saw servicenow in the marketplace, i knew what it was and i knew what it could do and i knew with my background, i was a pretty good cultural fit for what servicenow needed to scale it. david: what does servicenow really do? tell me in simple english language. what do they actually do? bill: it is a very good

question, david. basically it drives productivity in work. think about tech today. every ceo you talk to is going to tell you i have to digitize to survive. 40% of the ceos say today if i do not digitize my operations, my company will no longer be viable in less than a decade. we were the i.t. backbone for companies all over the world. how did they manage assets, run their operations, secure their operations, all things digital having to do with i.t. that is how we started but the employee experience, hybrid work, all these concepts became so important. how do i hire people? how do i onboard them? train them? provide services on a mobile device? we do it. david: about two and half years ago when you took over your position as the ceo, chairman of servicenow, during that period

of time the technology world has had challenges, layoffs and other things. you have more than doubled the value of servicenow during this period of time. the revenues are more than doubled. operating earnings are up eight times. you have doubled the number of employee base. what was your secret sauce when everybody else else was going this way, you were going this way? bill: i give credit to the original founder because he had the idea and he built the platform. lots of people came into the company and expanded on that platform. but the original idea was to give people technology that truly enabled them to do things they could never have done before. so it is really a product centric engineering company at its soul. what i tried to bring to the company is continue to expand that. continue to build innovation into that platform, but at the same time build a truly global software market leader where

everybody understood the brand, the hungry and humble nature of how we focus on the customer, the customer is everything here, and ultimately the value we deliver. david: somebody watching this, should they say i should buy this guy's stock? or have you plateaued? you can't keep going the rate you have been i assume. bill: i think we are just getting warmed up. it is really interesting. very few software companies ever make it to a billion. even less make it to $5 billion. less than that make it to $10 billion. we will be the fastest enterprise software company to have ever gotten to one billion, 5 billion, and 10 billion organically. it has never been done before. the world we see is so bright because we are like 5% penetrated in the enterprises even that use our service now. so there are many that do not. i believe like net new brands,

net new logos that are not doing business with us should see your show and say i have to get in touch with that guy. the ones that are already doing business with us need to say he's talking about a completely different approach to digitizing my company. are we looking at them closely enough? if i have achieved that we are going places. david: sometimes people who run technology companies have a technology background. they are engineers. you have an mba from northwestern but you are not an engineer. does the technology jargon go past you or can you understand what the engineers are saying when they come up with a new product? bill: i have been around it for a while. while it is true i am not a coder, it is also true that i understand where the idea can fit into a customer's world. i will give you an example. with ai the expectation of ai is going to be the iphone moment. when the consumer begins using ai in the consumer world, they

are going to expect the business leaders are bringing ai in to make their world better in the office environment. that is why this is the iphone moment for the enterprise. there is no doubt. so i know we have to be the market leader in ai which is why we started working on it. and the first acquisition i did was element ai, a company in montreal canada. we did that in 2020. we were working on it all 2019 as soon as i came in, but then 2020 we actually executed that. the reason for that was they had a gigantic group of researchers, data scientists and engineers exclusively working on nexgen ai and large language models. that is how can we teamed up with jensen and nvidia and started building them on the now platform. we saw what it could be. now that it is in the platform

we see the commercial sensation it will be for us but more importantly we see the productivity and the cost savings and revenue growth our customers will get from it. david: is ai going to reduce the amount of jobs people have now? bill: i do not believe so. i think if you look at the market today, we have a 17 year situation where it was 17 years ago when the job market was this type, where the openings -- tight, where the openings outpaced the opportunity for candidates to jump in those jobs because the candidates are not there. we really are capitalizing on technology to fill that void. for example, i talked to a ceo yesterday of a major financial services company who was interested in ai. he said i cannot get enough people to do what i need to have done. i said how many engineers do you have? he said 7000. what you need to do is ai enable them. now you can text a code, text to workflow automation or even text

to new application development. we can make your engineers 50% more productive than they are today. david: you have done a good job but why don't you do something more important like running a private equity firm with digital transformation? you could do very well financially. ever thought about that? if not, think about it. i will be happy to figure out a way to get you in the private equity world. bill: to work with you would be an honor so we must think about different ways i could help you. ♪

david: let's talk about your past. it was not preordained that you would be ceo of s.a.p. or the ceo of service now and at the top of the technology world. where did you grow up? bill: i grew up in amityville, long island. i was born in flushing, new york. grew up in amityville, long island. it's that long island grit. david: when you were growing up, were your parents professional workers? were they blue-collar workers?

bill: i come from a working-class family. my dad worked for con edison. he was a troubleshooter meaning you called him a spider. he went into the manholes and basically worked on those high-voltage lines to keep the electric on in new york city. a very dangerous job and he was great at it. david: is that a safe job? bill: no, it was not. very dangerous in fact. i admired my father. the image that stayed in my mind, he worked the midnight shift most of the time, midnight to 8:00. i could just see him in the driveway chiseling the ice off of his windshield knowing he was going into new york to get into those manholes like the spider inside of those cables. and that was to put food on the table and give us a very nice life. and i had a great life. david: but you always did some working. from what time did you begin working for money? bill: i think the first time was around 10 or 11 when i was delivering papers door-to-door in long island.

matter of fact, i remember that the paper was long island press. do not even think they are in -- i do not even think that they are in business anymore. but my mom cosigned for me because you had to buy the papers. then you got the money back when you collected it. so she put up the money for me, got me started. and i'll never forget what it took to be successful as a paperboy. the same things it takes to be successful today. i had to know my customer. i had to know how you wanted it. is it in your door? do you want it wrapped in plastic? do you get upset if i throw it? you know, there are all kinds of techniques. but why did i do it? because i wanted to be happy and i wanted them to give me a good tip. david: you wrote a book about your life and you talk about the fact that sometimes people did not pay you and you had to go and ask them to pay for two or three weeks. was that hard to do? bill: it was. because, you know, when i went there and i asked them for 10 bucks, and, you know, that's a lot of money for a paper, but i'm like, yeah, but you are in three weeks in the rears.

-- in the arrears. the technique was not only to get the $10 but hopefully get $12 so i would get a nice tip as well. and i kept very good records. it was not too automated. it was a little book with checkmarks and i was just showing them the facts. and if i show them the facts and you are just heart-to-heart with people they will respect you. david: later, as a teenager, you bought a delicatessen. how old were you when you bought a delicatessen? bill: i think we were about 16, 16 turning 17, something like that. david: where did you get the money to buy a delicatessen? bill: i did not have any. i was working three jobs. i was working at an italian restaurant, vip type italian restaurant, a supermarket, pound of amityville. always three jobs. whatever i could fit in. it was chaotic. one day i saw a help wanted sign in this deli and i traded in all those hours to go to the deli because the owner said i can give you all the hours you need. but i took my bowtie from the

restaurant, my white shirt, my tuxedo pants, and upgraded the delicatessen to how we would serve customers. as a kid. because i knew it worked at the restaurant. i am like, why wouldn't it work here? that led to a very good relationship because when he wanted to sell he could not have any buyers. because nobody wanted to buy it. it was son mark industries. the sunoco gas station owned the land and they would only give you a one-year lease. he wanted $25,000. everyone said why would i give you $25,000? they could take the lease away in an instant. i said, look. after no one else came to him, i will give you $5,000. he said $7,000 with interest. pay me back in a year. if you do not make the payment i automatically repossess the business. i said great. i still had the machine -- bill: where did you get that money? david: i didn't. it was a loan. from him. it was only a loan. if i did not pay him i would not have the business. but all the people that brought the beer, the cigarettes, the

potato chips, all the vendors basically said we will front you the first delivery on the arm. i said i do not want anything for free. i will always owe you the money. the day i sell or close you get your money back. meanwhile, you know how i got the money back? that was the early days of video games. i put asteroids and pac-man, some dinosaur game, my brother built them all. i learned this at the mall. i saw kids plunking quarters into these machines one after another. i said i will build a game room on the side of the store. we did that and i made more money splitting the quarters with the guy that actually owned the machines than i did slicing meat and making sandwiches. david: what did your parents say? you were supposed to be going to high school. did they say how about going to high school? bill: i am so blessed because my mom was the best. and people that i knew that were great friends of mine, they actually worked in a store when i was in school holding the place up and when i came out of school i got right behind the counter and worked until

midnight. david: you graduated high school. did you go to college? bill: i did. i went to dowling college in oakdale, long island, because i could do all my classes tuesday and thursday and be in store all the other days. david: when you graduated were you still owning the delicatessen? bill: yes, i was. at that time i made a decision. i got a job at xerox, which was a dream job. at that time i sold it. then we invested that money in a great beach house for my parents in myrtle beach, south carolina. david: your job at xerox was to be a salesman? you were selling what was a complicated product at the time. bill: at that time, it was copiers and electronic typewriters and printers and fact machines and all that. -- fax machines and all of that. david: you did that for 17 years. bill: i was at xerox for 17 years. i sold door-to-door for a couple years and then got promoted and ultimately became a division president and corporate officer in my mid-30's at xerox.

david: so one time maybe you thought at the beginning you could aspire to be the ceo of xerox. but you had an offer to leave. and why did you take the offer? bill: i did it because i stopped learning. at that time it was like, what else am i going to do? all i really want is the ceo job. there are steps left before i will get it. i started to think, it's not the right reason to stay. so gartner group offered me a job to be the president there. i was very excited about that. i felt that i.t., advice, and really meeting all the technology leaders of the world and advising them would get me sharpened up for anything. david: you took that job but you did not stay there that long. bill: i didn't. i missed the big technology stage. that is kind of what i really wanted to do. that is what i wanted to do, so so i went to siebel systems to run worldwide sales and operations for them in california. i learned the software industry at siebel. david: after that you took a

position as the head of s.a.p. americas. s.a.p. was a software company but what was its innovation that made s.a.p. such a strong company even at the beginning? bill: they call it erp, to break down erp, running financial systems for the biggest companies in the world, connecting that based on the industry, the supply chains. managing human resources, put that into one bucket and call it erp. and when i got hired by sap, they were a very fine company but in the americas they had missed 24 out of 25 quarters, so it was really the operation that was bringing down the whole company. so they had to fix that because they had five ceos in six years of sap america. david: you became the co-ceo of the entire company at one point and after five years of that he -- you became the sole ceo. bill: yes. i became the co-ceo in 2010. the sole ceo in 2014.

and what i can tell you is it actually a very nice design. a lot of people knocked the co-ceo model, but in our case, i had a great partner, a great friend of mine still to this day. we had a great orientation around our partnership. we talked every day. jim was kind of like mr. inside in terms of representing development, especially in germany where we have very large engineering, and i was the guy on the front lines moving the number and working with the worldwide operations. david: as you were working at sap, you are the ceo, things are going well, the company is in good shape. what motivated you really to do something else? i mean, most people at the top, when things are going well, they kind of stay at the top. bill: i think i get the 17 year itch. you know? david: 17 years at xerox, 17 years at s.a.p. bill: exactly. i think after 17 years, i feel like i need to do something else.

those were two of my greatest experiences. and i need a change. and i really did want to take service now because i saw what it could be and i did want to make it the best. and i felt like my skill set and where they were and what they needed was a good match. david: so you will be here until 2036, in other words? bill: i don't know, especially with you and private equity in my future. [laughter] david: so you are obviously a very good salesman. what is the secret to being a good salesman? bill: you can get anything you want in this life if you help enough other people get what they want. ♪

david: why has technology been -- you've already -- always been a good salesman so what is the secret to being a good salesman?

bill: you can get anything you want in this life if you help enough other people get what they want. i care about what you want and what you need. when you understand that i can compose solutions for -- thanks to the great team that i work with. if i say something to you and make a promise, no matter what you will get that promise kept. i never break my word and that is what is about. david: in your business career what has been the best advice that you have received? bill: the best advice i have a -- i have received is in the long run play the long game. most people grossly overestimate what they can do in the short run and underestimate what they can do in the long run. i have always tried to take a long view and not be so focused on just the here and now. today i will have a complete day in new york city. i will meet some of the biggest ceo business cards in the world, but i'm constantly thinking,

what do we have to look like five years from now, maybe even 10 years from now to keep up with having ideas that they don't even know they need to know about but we need to know where we need to take them? we have to invent the future we want. we can't wait for someone else to do it and try to copy them. it's already too late. so constantly trying to see around those corners, long view. david: what's the worst business advice you ever got? bill: go for the money. don't go for the money. and i would say, like any career choice you make, any deal you do, it is not about the money. the money is nice to have but it is much better to do things that are sustainable. so when you take a job, do it because you are loving on that culture and you believe it is a match with your personal dna and who you really are. when you are doing a commercial agreement, yeah, the transaction

is nice and you want to win it and you want to accomplish things. but that relationship is so much more important because that is sustainable and it is long-term. david: so your ambition is to grow the company and maybe do something else later on after you are happy with what you have done here. any aspiration to go into government or public service? bill: i would love to. i do think there is a place to give back and to serve and i think public service needs executives that have experience, especially global experience, where they have actually physically been to all these places around the world that -- and have a sense of culture and the dynamism of humans, no matter where they are located and how to really do the right thing, not just the convenient thing. it would be an honor to someday do that up the road. it's way up the road but i would not rule it out. david: in 2015, you were walking down the steps of your brother's house and you fell down and

glass fell in your eye or went into your eye. can you describe what happened and how you have dealt with that? bill: it was a rough night. because i had a giant water glass, very thick, slipped on the stairs and met a concrete foundation and glass and my face, and the glass actually went through my eye and cut it in half. and, you know, dealing with that was a pretty traumatic experience to say the least. but i'm so blessed to be here. and i think i have a greater appreciation for everything. and i have also learned that vision is not just about what you see. but it is how you make other people feel and how you feel by making other people feel good. david: you had about 11 surgeries to save your eye and ultimately they could not. bill: that is correct. i lost that battle but i think i won a bigger war.

david: incredible story. congratulations. you started with virtually nothing and built up a great reputation in so many different industries so thank you. i wish i had bought your stock when you came here. i can still buy stock in the future i guess. bill: it is not too late, david. ♪

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val: this, this is a basketball that was autographed by the first dream team, they played in barcelona. clyde drexler, scottie pippen, i assume that's magic, michael, ad