Meant to link several days ago to Bill Hobb's timely post on Al Gore's upcoming IPO for Current Media---which seeks to raise $100 million from would be investors.
In that post, Bill also links to a recent News Week article on Gore's wheelings and dealings which the writer considers a bad deal for investors. Author Ron Grover writes,
"In the financial election of his life, Al Gore is betting that investors will vote with their dollars for him and his big idea. CurrentTV's parent company, Current Media, hopes to raise $100 million in a public offering it filed on Jan. 28.
Some of the money will go to pay off lenders, who include a couple of Democratic Party biggies that joined the onetime Veep to launch a new style of citizen-journalism. Of course the IPO will also help make Gore, who sits on the board of Apple (AAPL) and is a senior adviser to Google (GOOG), a sizable bundle of cash.
"Something about this deal just doesn't sit right with me. Gore isn't just taking piles of cash. According to the filing Gore, who is listed as executive chairman, and his CEO partner, lawyer-turned-entrepreneur Joel Hyatt, each loaned the company $1 million to get it started. They'll get that back in the IPO. But the two guys also collect hefty salaries for a company that hasn't shown a profit in three years—taking down $491,677 apiece last year in cash, plus bonuses of $550,000 each for, in Gore's case, helping get the company new affiliate agreements, broadening exiting agreements, and putting together a management team. The two currently receive $600,000 a year in salary and are eligible for additional bonuses, according to the IPO filing.
"By comparison, at the time of the Google IPO in 2004, its two founders were each taking home a total of $356,556 in salary and bonuses, while sitting on top of a company that had earned nearly $106 million the year before."
I can just see it now, Al Gore, the next titan of a Google-style company. He pays himself lavishly while his company has yet to turn a profit. Well, he deserves to be paid well. He's Al Gore, after all.
All I can say is run, don't walk away and hold on to your check book for dear life. It sounds more like Enron than Google to me.
Anyway, you may need your money later---if Al has his way---to buy carbon offsets to take your family out for a Mexican dinner.
Beautifully written, Webutante. What a scofflaw!
ReplyDeleteJim [Taggart] boasted that this had been the most prosperous six months in Taggart history. Listed as profit, on the glossy pages of his report to the stockholders, was the money he had not earned – the subsidies for empty trains; and the money he did not own – the sums that should have gone to pay the interest and the retirement of Taggart bonds, the debt which, by the will of Wesley Mouch, he had been permitted not to pay...
ReplyDelete"You have always considered money-making as such an important virtue," Jim had said to [Dagny] with an odd half-smile. "Well, it seems to me that I'm better at it than you are." (p.333)
BUT, But but he's aLgORE! That alone is woth half a mill. Well that and the need for his own "carbon offsets" for the manse energy bills that daddy built in Tennessee and he got when daddy assumed room temperature.
ReplyDeleteThat's success. Isn't it?