The Unica Story: Yuchun Lee’s Journey from MIT Blackjack Team to IBM Acquisition

8/30/10Follow @gthuang

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hundreds of mistakes. But we correct them quickly.”

In 2005, the company had some $40 million in the bank, Lee says, and was looking to go public. Technology had gotten to the point where Unica’s software could help companies track and optimize digital marketing campaigns, among other things. But the field also had become much more crowded. Companies with related products in online marketing and e-commerce included Aprimo, aQuantive, Art Technology Group, DoubleClick, Epiphany, Oracle, Onyx Software, and many other smaller players and startups.

Unica pushed forward with its IPO in 2005, netting $48 million, while racking up more than $60 million in product sales that year. By that time, the company had more than 250 employees and was continuing to grow. In 2006, Unica acquired Sane Solutions, a move that Lee calls “most pivotal,” as it solidified Unica’s position in Web analytics, as applied to understanding online customer behavior and digital marketing.

Then, in 2009, the company fell back to earth—along with the rest of the market. It was the worst of the four recessions the company had seen. “2009 was the only year in our history that we declined,” Lee says. “Customers stopped buying.”

But in 2010, Unica has come back, Lee says, with “record cash and record profit.” The company now has about 500 employees and more than 1,500 customers, ranging from small companies that sell eye-care products or class rings (including MIT’s brass rat) to giants like GE, American Express, Best Buy, eBay, ING, Monster, Starwood, US Cellular, and IBM.

Which brings us to the company’s future with its new owner. Lee couldn’t say very much about the IBM acquisition or the upcoming integration—always a tricky process for any company—since the deal won’t officially close until later this year. But he had some broader thoughts on the digital marketing sector, and on Unica’s and IBM’s roles in it.

“This market is at a pretty critical point in its evolution, where it really can be accelerated with the right set of investments,” Lee says. “IBM is in a really good position to shape the conversation in this market, to drive adoption in general…The next stage is pivotal.” He continues, “Marketing is undergoing a major transformation…through digital and social channels. The trend is very clear in our mind. The move is toward digital and toward [software suites and software-as-a-service] even for smaller companies.”

Asked about his own future, Lee says, “My plan is to stay on. I’m personally very excited.”

Reading between the lines, my gut feeling is that Lee knows when he’s playing with house money, and when it’s time to walk away from the blackjack table and cash out. Unica’s rebound from a tough year in 2009 seems like a pretty good time for an 18-year founder and executive to move on to the next stage of his career, at a big company like IBM.

Plus, I couldn’t help but notice the exact price of Unica’s acquisition: $21 a share.

Gregory T. Huang is Xconomy's Deputy Editor, National IT Editor, and the Editor of Xconomy Boston. You can e-mail him at gthuang@xconomy.com or call him at 617-252-7323. Follow @gthuang

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  • http://www.freshaddress.com Bill Kaplan

    Congratulations to Yuchun on building Unica into one of the industry’s leading marketing automation players, resulting in its attractive sale to IBM. It’s great to see him continue in the tradition of many of our former MIT Blackjack Team players, who parlayed their learnings and experiences with the team into successful business careers.

    Other notable players who successfully transitioned their careers from the blackjack tables to the software world include Chuck Whitmer and David Weise, who sold their company to Microsoft in the mid-80′s. While at Microsoft, David went on to create Windows 3.0, the product that Steve Ballmer said cemented Microsoft’s dominance in the PC world.

    Another MIT Blackjack Team graduate who deserves mention in this regard is Jon Hirschtick, the founder of Solidworks, a cad-cam company that he sold to Dassault for over $300 million in 1997.

    I’m sure that this is not the last we will hear of Yuchun and other MIT BJ Team graduates. Whoever knew you could learn so much from a simple game where all you need to do is count to 21?

  • Baltazar Morales

    Great news about this guy and his team. With perseverance, knowledge and acumen, he succeeded. Glad to hear he was a DEC person.
    More power to him.

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