Avast CEO Vince Steckler Retiring; Incoming CEO Ondrej Vlcek Hailed As 'Secret Sauce'

Avast CEO Vince Steckler told investors he plans to retire from the security software maker effective June 30, handing the CEO post to his top lieutenant -- Consumer Business President Ondrej Vlcek.

"It wasn't an easy decision," said Steckler of his plan to step aside."It's been an incredible journey at Avast!"

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Steckler, who will also give up his position on the board of directors, said that he has "partnered" and worked closely with Vlcek to grow the business from under $20 million to more than $800 million. "It has been a terrific ride," he said.

Vlcek has been "training" to be CEO for many years as part of an informal succession plan of sorts, said Steckler. "Sometimes Ondrej has been kind of hidden, but Ondrej has been kind of the secret sauce for the company," said Steckler.

The announcement of Steckler's departure came as the Czech Republic-based company posted its first annual results since going public nearly a year ago reporting adjusted revenue growth of 9.5 percent to $811.5 million for the year ended Dec. 31, 2018. The adjusted revenue of $811.5 million was below the average analyst estimates of $819.2 million.

Avast shares closed down $10.15 pence or three percent to $297.80 pence.

Avast reported EBITDA (earnings before interest, depreciation and amortization) growth of 6.7 percent to $444.7 million. The company's adjusted EBITDA margin was up 33 basis points for the full year to 54.1 percent.

For the year ahead, Avast said it expects high single digit growth in adjusted revenue and stable EBITDA margin percentage.

"The business is in great health," said Steckler. "We had a really good year. We have got a nice solid outlook. We have got a great management team."

The 60-year-old Steckler is widely credited with transforming Avast into a cybersecurity powerhouse pioneering what is referred to as a "freemium" model - giving away a basic security product and upselling and cross-selling consumers into a full security portfolio.

The 41-year-old Vlcek, meanwhile, who has a degree in mathematics from Czech Technical University in Prague, started his career as a developer for Avast in 1995. He led the team that developed one of the first antivirus programs for Windows, and was promoted to CTO in 2007.

Working side by side with Steckler, Vlcek then was promoted to chief operating officer overseeing day to day operations. After Avast's $1.3 billion blockbuster acquisition of AVG three years ago, Vlcek took over the combined desktop and PC security business for the company.

Last year, Vlcek was named president of the entire consumer business for Avast. "Now the natural step is for him to take over the entire company," said Steckler. "He has been running somewhere between 80-90 percent of the business for many, many years and he is well-ready to take over."

Vlcek, who takes the CEO job July 1, was unanimously elected and appointed by the company's board of directors.

Michael Goldstein, CEO of LAN Infotech, a Fort Lauderdale, Fla., solution provider, credited Avast with doing a a good job of winning customers in a crowded security market. "Their success shows that freemium model with an upgrade to premium security products works," he said.

That said, Goldstein, said Vlcek must make sure to embrace channel partners as the company expands beyond the consumer market into small medium business (SMBs).

"Most SMBs who are upgrading from the free Avast software are going to be reaching out and transacting with trusted security advisors like us," said Goldstein. "It's critical that Avast has a strong channel program and presence with partners like us."

Steckler, who will remain available in an advisory capacity to the company for a full year after his retirement, said he is looking forward to spending more time with his family.

Noting that his decision to retire was "probably a surprise to everyone" except his family, Steckler said that over the last decade he has only spent about 20 percent of his time with his family. "I need to change that for the future," he said.