Ed has been imposed on his new company by the VC backers without the involvement of the directors, founders and management. Ed's brief is to prepare the company for an IPO. His diary, which recently came my way, reports Ed's early struggles as he tries to fit into his new environment.
'It's important to get the company thinking IPO", writes Ed in his diary, 'so I call a Town Hall meeting at our HQ to be videoed for transmission to our other sites.'
'My talk to the employees emphasises that we must concentrate on making the company as financially attractive as possible. That's to be done by cutting costs, looking for better margins and new markets, working together across internal company boundaries and generally raising our game.'
'The talk seems to go well. They listen in silence. Encouraged by the reception, and this may have been a mistake, I ask for questions.'
'There are a few questions about the technical nature of IPOs and then a thick Gaelic accent cuts across the meeting room.'
"So hoo much will yer be takin' fer y'self from this IPO?"
I recognised the Scottish engineer I had met in the canteen early on in my tenure as CEO.
"That depends on the number of share options I have and the price of the issue", I tell him.
"Hoo many share options d'yer have noo?"
"It's in the company literature", I tell him.
"But we don' read tha' shit. Canna ye tell us the number of shares ye have? Or be tha' so many you canna coont them?"
Well it's about five hundred thousand," I tell him.
"And wha' be the share price you're looking at fer this IPO?"
Well it's uncertain this far out", I tell him, "stock market conditions are volatile. They could be different in a year's time. The semiconductor market may also have changed by then."
"Let's be assuming conditions dinna change. Hoo much?"
"About $20 a share."
"So ye'll be making ten million dollars fer eet teen months wairk - plus your salary", says the Scotsman.
I say nothing. The Scotsman mutters something. People laugh. The board and senior management look uneasy. The meeting breaks up.
The board get together after the meeting. "I want that bastard sacked", I tell them.
"You can't," replied one of the company co-founders, "he pretty much single-handedly invented our analogue design methodology. Without him our new product programme will be compromised. And without that - no IPO."
Shit. Oh well, only 368 days to go to the IPO and I'm out of here with a wicked wodge of wonga.
Hello,
Working at NXP, I look forward for this vidéo conference !
It is indeed the last line towards IPO. Bloody ever losing
money businesses are now out (good luck Trident).
Next target is to open R&D center in China, the place to be apparently.
2 or 3 years to go and bye bye KKR. At last !
Not sure they get their money back. I will not shed a tear for that.
Thanks Fresher and good luck. I can only hope that after what KKR has done to NXP, no other company management in Europe will ever do a deal with KKR (or any other private equity company) again. Trouble is there are always greedy managements who will sell out their employees to enrich themselves.