HR Technology Column in the World is Rudy Karsan?

Founders who sell their companies rarely stay around long after being acquired. Co-founder and CEO of the former Kenexa Rudy Karsan sold his company to IBM more than two years ago. But now that the combined IBM Kenexa Talent Management Suite is out the door, he's left to continue trying to save the world.

Monday, December 8, 2014
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In case you hadn't noticed, there are only one or two standard drills when an HCM software or services company gets acquired by a larger organization.

After everybody praises the synergies of the deal to the skies, the founders most often leave after meeting whatever the deal required to receive the full purchase price. Sometimes that's the moment the deal closes. Less frequently, these founders stay to start a new career at the acquiring company.

When SuccessFactors acquired Jobs2Web, its brilliant founder Doug Berg stayed for 15 months and is now, unfortunately, out of our industry.

Paul Sparta, co-founder and CEO of  Plateau, stayed with SuccessFactors for 11 months after it acquired his firm, leaving after SAP bought SuccessFactors. He went back to racing cars, running or serving on Boards of Directors and (happily) commenting frequently on the LinkedIn Group (click at the bottom to join).

On the other hand, Peter Howes, founder and CEO of analytics pioneer Inform (I prefer the original name InfoHRm) in Australia, has stayed with SAP/SuccessFactors for nearly five years since the acquisition, along with almost every member of his team.

Tim Clifford, founder and CEO of the former Workscape, hitched his wagon to ADP after his firm was acquired, climbed the corporate ladder high enough to become Co-President of National Accounts for ADP (one of the top five jobs there) and then left some months ago to look at other CEO opportunities.

Knowledge Infusion co-founders Jason Averbook and Heidi Spirgi recently left Appirio. Jason-as natural a marketer as he is a presenter and thought-leader-very loudly (but thoughtfully) announced his new job as CEO of The Marcus Buckingham Company. On the LinkedIn Group, where else?

At the new company, Jason will have software to develop and sell-true performance management (not "review")-in addition to keynote speeches, research, leadership training and consulting. His former Knowledge Infusion partner Heidi is wisely moving out of his shadow and striking out on her own.

My guess is that not one of these entrepreneurs has to work after their buyout, but they all need and like to work or they wouldn't have started their companies in the first place! If you've never experienced the pleasure of working at a job that calls on everything you're good at (and as few of the things you're bad at as possible), keep looking.

Then there's my old friend Rudy Karsan, co-founder and CEO of Kenexa, acquired by IBM more than two years ago.

Rudy knows all about acquiring companies. Kenexa itself was comprised of more than 30 acquisitions, and he was very clever at that game. Years ago, I was startled to see his company carrying about eight EVPs. "Oh, those are all former owners, continuing to work with us or sticking around to make sure their stock is eventually worth something," Rudy said at the time. Amazing, when most (as detailed above) generally don't.

About 20 months ago, I asked how long he would stick around IBM. "I have no contractual obligation to IBM. Just a handshake, so it really depends on what I get to do," he told me.

He then detailed two very big ideas, which characteristically might make money while also improving people's lives everywhere. All the details are in this previous column. What makes Rudy special-and worthy of two columns in two years-is that he has the most highly developed social conscience of any business leader I know: He really wants to save-or at least improve-the world.

Well, despite my hopes that IBM was the one company forward-thinking enough to act on Rudy's ideas, it didn't work out. Rudy became the GM of the Smarter Workforce group, which got the new IBM Kenexa Talent Management Suite out the door. So it was sort of like his old job.

"They didn't need me for that," Rudy says. "So I told them I wanted to leave in mid-July, and then IBM very graciously allowed me four or five weeks travelling around the world to say 'good-bye' to everyone I worked with, and I left at the end of August." Very quietly.

After looking at some Fortune 500 CEO jobs, he characteristically struck out again on his own, creating Karlani Capital, funded with a substantial part of his proceeds from the Kenexa sale and those of his former CFO Don Volk's. The name is a combination of Rudy's last name and his wife's maiden name.

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Karlani is structured not as a venture capital nor a private equity firm, but as an "operating company." That means in addition to investing $100,000 to $2 million,usually at an early stage and maybe more later, the principals will get actively involved in operating the portfolio company. Karlani already has 13 of them.

Karlani is practicing philanthropy Silicon Valley style: doing well by doing good. "Whenever I started a business just to make money, I always lost money," Rudy says. Many of his investments are in typical tech start-ups, while others like Green Spirit Farm are developing indoor vertical farming.

Rudy calls another, harri, "the LinkedIn for restaurant workers," who are rarely members of that larger network and never find jobs on it, as they can on this one.

"We have lots of deal flow," Rudy says, "and as the chief screener I'm looking for a bunch of smart 20-somethings [to hire] to share the load." Karlani has a fairly whimsical website for a money company, where Rudy's title is listed as "Grand Poobah" and Don Volk's as "Silent Assassin," so the right people should come knocking.

Rudy is interested in potential HR technology investments but has a non-compete to consider with IBM.

Personally, he's downsizing. Moving from his large but hardly mansion-sized suburban house to a three-bedroom condo in downtown Philadelphia, across the street from Karlani's office.

"And decluttering, too," he says, "since there's no room for all our stuff in it." But there is a terrace attached to the 45th-floor apartment for his telescope! Whatever happened to no higher than William Penn's hat? An older Philadelphia, I guess.So that's where in the world you will find Rudy Karsan, still trying to make it better, his way.

HR Technology Columnist Bill Kutik is co-chair emeritus of the 18th Annual HR Technology ® Conference & Exposition, returning to Las Vegas, Oct. 18-21, 2015. You can comment on this column at the Conference LinkedIn Group, which doesn't require prior or future conference attendance to join. Listen to The Bill Kutik Radio Show ® for his provocative interviews with HR thought-leaders. He can be reached at

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