Episode
Tyler Technologies: Big Fish, Small Pond
- Podcast
- Preferred Shares Podcast
- Published
- Dec 23, 2024
- Duration seconds
- 3273
- Processing state
not_requested
Actions
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Summary
Welcome to Episode 16 of the Preferred Shares Podcast. In this episode, Douglas Ott walks us through the origin story of Tyler Technologies to the present day. In this episode Introduction to Tyler Technologies [0:00-1:40] Tyler Technologies is described as a “big fish in a small pond,” focusing on software solutions for municipalities and state/local governments. The market is around $24 billion in total revenue, which is too small for larger tech companies but provides a good opportunity for Tyler. Tyler's competition is typically small, private, unscaled players. Early History as an Industrial Conglomerate [1:40-3:30] Tyler’s history began in the late 1960s with Joseph McKinney, who formed a venture capital business. McKinney formed Saturn Industries, acquiring several small businesses, then acquired Tyler Pipe in 1968, changing the company name to Tyler Corporation. Over two decades, Tyler acquired various businesses including a trucking company, an explosives company, a specialty chemicals company, and an electronics distributor. By 1987, Tyler reached $1 billion in revenues. Divestment of Holdings [3:30-4:30] In the late 1980s, McKinney started selling Tyler’s holdings, distributing over $400 million to shareholders by the mid-1990s. By 1995, none of the former companies remained at Tyler Corporation, leaving a cash shell holding company. Downturn and New Acquisitions [4:30-5:30] McKinney acquired Forest City Auto Parts and Institutional Financing, which were different from Tyler’s B2B industrial focus. These acquisitions performed poorly, leading to a $52 million write-down and McKinney’s departure by the end of 1996. New Leadership and Strategic Shift [5:30-6:30] Bruce Wilkinson was hired, aiming to return Tyler to its industrial roots. Louis Waters acquired a…