Armin,
A short reply to your recent post.
First of all, DSSI won't be able to put out a monthly release regarding its field tests' status. They usualy don't know themselves how long a trial will take, and whether a customer will decide to use their product. Only if there is an RFP (Request For Proposal), we can tell who is running against them and after a decision who won. In Venezuela Comverge beat Schlumberger who was also in the short list.
You shouldn't expect updates on field tests, besides if DSSI says it expects a deal by a certain date and doesn't get the deal, it could get suid - and we don't want that.
As for calling me impatient and not knowledgable, you're way off the mark. If you are not aware, I still own shares of DSSI, so I must be patient after all, otherwise I would have sold my stock. As for not being knowledgable, well you obviously don't know what you're talking about. I know the company and its ubsidiaries as well as or better than most of the people involved with the stock. I know Comverge better than anybody, and I've met with the company several times.
I definitely understand that this business isn't like the internet and things will move much slower. Utilities are huge mamoths, and they don't change the way they do business so quickly. Unlike several people on this thread, I never said Comverge will have revenues of tens of millions so fast. Some said they expect Comverge to sell more than 100K units this year and over 200K next year, both are unrealistic. However, Comverge has a good chance of becoming a major player in this very promissing industry.
You have nothing against senior management, well that just shows that you probably don't know the company that well. Senior management (i.e. Morgenstern) has been doing quite a lousy job this past year, but still gets HUGE salaries. An example :
Comverge is a start-up company, and like every start-up it needs money for R&D and even more money for marketing once they have a product ready for sale. Comverge needs to raise money in order to increase its marketing efforts and its visibility, if it wants to be a major player it must do this now. The Ceo of the Israeli division is a one man marketing team running all around the world - that's not how you take a company to the next level (this Ceo is doing a great job, when one considers the resources he has).
Comverge was about to raise money via a private offering with a very nice valuation. However, something went wrong - the Venezuela deal was delayed (not management's fault, which did all the right things). Without that first full scale deal, Comverge couldn't get the nice valuation, but it still needed money - this was two months ago.
There is a rule in VC - you take money, whenever you can, not when you want and not always at the terms you prefer. The start-up must keep forward movement, you can't take a time out, and wait for a better financing deal.
Comverge should have tried to raise less money (at lower valuation) and keep moving forward. However, Morgenstern wanted the better deal with the higher valuation. Once the Venezuela thing wasn't happening a decision had to be taken, but Morgenstern called "time-out". I respect Morgenstern, and he obviously knows a good asset when he sees one (he bought Tower and the Lucent division for peanuts), but the guy obviously doesn't know how to run a start-up and how VC works.
He messed up on PHD, no matter how you look at it. The company was sold for 3 x sales, that's a joke for a software comany, not alone a start-up with great potential. When he did sell PHD, that was the best deal he could get, but 6-12 months earlier was the rout of the problem. He decided to move by himself, not raise money or sign strategic partners (while the help-desk sector was consolidating). Better decision making, would have meant a lot more money for DSSI shareholders. We barely covered our investment with PHD, and that was a company with award winning products in an exploding business.
I feel much better knowing that Mr. Shmuel Fogel(CEO of DSI) is involved with Comverge (he wasn't involved in PHD). Mr. Fogel has a lot of VC experience, as the #1 guy at MOFET. I hope he will be making the strategic decisions and not Morgenstern.
Morgenstern gets more than $400,000 a year, plus two company cars and we gave him financing to buy a house in Israel. With all this money, he can't afford to buy a single share ? The man is in his 60's, he doesn't need to support his kids (educated guess), so he probably has the cash to buy shares.
Morgenstern runs a holding company, and even though he's an active chairman in Tower, he doesn't do a lot for the day to day operation. Tower has a great management team !!! Comverge has a great team as well both in Israel and in the US (still need more marketing efforts), DSI is also being run from Israel. I don't understand what Morgenstern does, which is worth $400,000 a year.
I'd rather have new blood at the top (maybe Mr. Fogel), and keep Morgenstern as an advisor - for future acquisitions, as that's what he knows best, finding bargains. The company needs someone younger who will work his ass off and move things a lot faster. It seems as if we're exactly where we were 6 months ago.
Armin, remember, we're on the same side. I still own shares, and I still think the stock is a bargain (it has a break-up value of at least $8 per share, maybe we'll get an offer...). I just want the management to work harder for its shareholders. There are no analysts following DSSI, so nobody is putting pressure on them to perform. If shareholders won't demand performance from the company, things will not move anywhere, as there is no pressure to perform.
Omer
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