Jim Whitehurst left IBM to get another shot at being a CEO, he tells Barron’s

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Jim Whitehurst, who led Raleigh-based Red Hat for 12 years, left IBM because he wants a shot at being a CEO again.

Last week, Whitehurst surprised many by announcing that he would step down from his role of president at IBM — a position he took on after IBM bought Red Hat for $34 billion in 2019. The position officially made him the No. 2 at IBM, behind CEO Arvind Krishna, and tasked him with making sure Red Hat merged smoothly into IBM.

IBM did not give a reason for the departure, which was announced on July 2, and declined to comment other than to say Whitehurst would remain an adviser to Krishna for some time.

In an interview with the magazine Barron’s, Whitehurst said he decided to step down because he wants to lead another company.

He noted that he and Krishna, 59, are too close in age — Whitehurst is 54 — for a likely transfer of power to happen anytime soon.

Whitehurst has not yet responded to an interview request from The News & Observer.

In the interview with Barron’s, Whitehurst said the decision was tough — “I spent 12 years building Red Hat. It’s my baby” — but said he felt “really good about the Red Hat integration.”

As the second-highest employee at IBM, Whitehurst had a large compensation package that he will be stepping away from. Whitehurst’s salary at IBM was $1.2 million, according to filings with the U.S. Securities and Exchange Commission. In addition, he had been awarded IBM stock worth more than $18 million.

IBM was also giving Whitehurst retention payments worth up to $6 million to stay at the company, conditioned on his achieving certain goals. The payments were to be paid out over three years on the anniversary of the Red Hat deal with IBM officially closing. That anniversary is in July, and Whitehurst was given a $2 million retention payment last year.

Whitehurst plans to continue in the advisory role for a couple of months and take some time to travel before deciding his next career move, he told Barron’s. Additionally, public records show that Whitehurst and his wife sold their Durham home last month for more than $2.1 million.

He added that he wouldn’t rule out potential moves into private equity or venture capital. Whitehurst also has an advisory role with the private equity firm Silver Lake that he started earlier this year.

Whitehurst will bring a varied background to his next company. Prior to growing Red Hat into a software company with more than 12,000 employees and billions of dollars in revenue, he was the chief operating officer at Delta Air Lines in Atlanta.

He helped guide Delta through a Chapter 11 reorganization before joining Red Hat in 2007, when he replaced Matthew Szulik as CEO.

In an email, Szulik told The N&O this week that Whitehurst has been incredibly successful since joining Red Hat.

“Few remember Jim was a Delta Airlines guy with no tech industry experience at the time of his hire,” Szulik said in an email. “Jim’s success is unquestionable — evident by the fantastic growth in (Red Hat’s) stock price, industry success and lucrative ... sale to IBM.

“Since Jim’s hiring, Red Hat shareholders have been rewarded handsomely.”

In January, Oliver Schabenberger left his job as the No. 2 at another of the Triangle’s most influential tech companies.

Schabenberger, who was considered the heir apparent to CEO Jim Goodnight at SAS Institute, left his role as chief technology officer and chief operating officer to join a the growing startup SingleStore.

This story was produced with financial support from a coalition of partners led by Innovate Raleigh as part of an independent journalism fellowship program. The N&O maintains full editorial control of the work. Learn more; go to bit.ly/newsinnovate.