Personnel File - November 2008: Internet Technology / Electronics
Chairman and CEO, Drake Software
Phil Drake vowed never to go into the tax business. His parents ran an accounting firm in Franklin, and he knew well the ravages of tax season. “I was what you would call a tax orphan,” he jokes. Never say never. These days he is chairman and CEO of a 500-employee software company that’s in the business of — you guessed it — taxes. Drake Enterprises Ltd., which does business as Drake Software, makes tax-preparation programs for small accounting firms.
Drake, 57, did try his best to get away from W-2s and April 15 deadlines. He earned a bachelor’s in math in 1973 from Davidson College and moved to Greenville County, S.C., where he taught the subject to high-schoolers. But three years later, his parents’ failing health brought him home to the family business.
At the time, the company had from two to six employees, depending on the season, and did its work by pencil and calculator. A computer enthusiast, Drake decided to buy an IBM machine for $22,000, a different beast from the PCs of today. “They were called ‘minis,’ which meant you could move them with a hand truck. You had to keep them in a room with air conditioning so they wouldn’t overheat.” He programmed the machine — which featured a four-inch diagonal screen — so staff could input some data on tax forms. The IBM salesman was so impressed by the program that he asked Drake to go on the road with him and sell it.
But it wasn’t until 1985, when the Internal Revenue Service began a pilot program to allow electronic filing, that sales picked up. By the early ’90s, the software was selling so well that Drake dropped its accounting services. These days, more than 20,000 tax preparers use his software. He won’t disclose revenue and says he has no plans to move. “The quality of life here is wonderful. I want to create a place where my employees’ kids can work.”