Time to jump in and confuse the issue a bit. Please don't jump to conclusions about my motives, but my take on Zeev's analysis is that he's pretty much on target. Goes to show that these threads make strange bedfellows.
The busted play with CCI is an indicator of playing around. With only the smallest bit of DD all the controversy surrounding CCI's president Daryl Piercy as outlined in the DD report on the GeoCities site could have been uncovered long in advance of the unwinding of the agreement a few months ago. Additional information about Mr. Piercy's character was also readily available on the Internet long before the deal was done.
While the CCI concept is the core of the marketing plan, it appears that decisions were made at the very top in a vacuum. Further to that a team was hired, and promoted to shareholders, to fulfill the concept and right away the new president was essentially dismissed because of strong opinions against the hiring of an inept web designer, Hastings. Best information places the decision to dismiss and the decision to hire Hastings as Mr. Gordon's exclusively and probably hampered the execution of the plan for a minimum of 6 to 8 months. Certainly not a reason for an option reward. Total revenues for the past 4 or 5 years is laughable. Mr. Gordon has lots of ideas and has delivered no execution. While “playing around” is a strong characterization it is more fitting than anything is that smacks of good planning.
The comp agreement, while for a 5 year period, lacks any sensitivity to the failures of the past, and/or current revenue history of the company. It also comes uncomfortably close to the line with regards to the potential of a shareholder action. May have even crossed it. If Mr. Gordon is so confident that the latest marketing plan will be such a success, as many here are, myself included, let him stand down on his comp UNTIL certain benchmarks of performance are reached. Common Sense.
To use his control of the board to muscle his way up to the pay trough BEFORE these bench marks are attained is an indicator that will be of grave concern for not only current and prospective shareholders but also for any legitimate source of capital, something for which Mr. Gordon has demonstrated limited aptitude. His personal subsistence at the expense of the public shareholder appears to have little limit. During my unannounced visit to St Pete last December, while I did not meet Mr. Gordon, I'd like to believe that he's a substantially different person than the mosaic created by this public document.
Mr. Gordon's history appears to be one of living off the public shareholders money with the rationalization that he's working on a great money making opportunity. He's failed at everything that he's been involved with in the recent 8 to 10 years. His brightest moment must have been when he was informed that George Soros, or GS people, thought enough of what he was doing to throw 10 or 20 million dollars at another plan back in the Phoenix days. That came to an abrupt halt when George didn't get performance. Phoenix went bust and the only winner appears to be Mr. Soros. You don't “play around” with George's money. It appears that Mr. Gordon lives very well and way above the means of a proven failure and George doesn't reward failure. Neither should the shareholders of a public corporation.
He failed at Phoenix and probably prepared TSIG as a back door exit strategy in advance of getting the boot. Tenacity or survival? Maybe a bit of both. Over the ensuing few years he bankrupted TSIG. Not formally, but balance sheets don't lie. A second failure. When all looked bleak in February 1998, rumor has it that CCI came along quite by chance. Mr. Gordon hired another new TSIG team. We don't even want to talk about the last “new TSIG team.” This new team was given the responsibility to get CCI airborne. Mr. Gordon as best as can be determined and as delicately can be described interfered with critical and material decisions. (Hastings) This new team quickly became the next old team. TSIG is now working with a 3rd new team. The CCI concept is still taking shape. Fully a year in incubation. Playing around so to speak. Very little solid planning when analyzed from a distance.
Mr. Gordon has a resilience that's to be admired. Even if it's only driven by a sense of personal survival. However, here's where we separate the players from the planners. Mr. Gordon appears to have lived more by his wits than by careful planning on behalf of the public shareholder. In checking around you will find that Mr. Gordon has a history as a licensed stockbroker and as such has more than a passing knowledge of market mechanics. I tend to believe that this history coupled with the speculative investment nature of his companies left too many opportunities for abuse of the public shareholder. Can this all be forgiven? Will history be repeated?
The Future;
The plan is powerful. Seductively powerful. So simple and not capital intensive to execute. Never will happen as fast as we investors would like but we should be close to there by now.
James Guild's credentials are Sterling. Rob Newten has a strong financial background and should do well in the mix. Keith Wine has an impressive track record with call centers. It appears that the newest team is the strongest and the least liable to be dominated by Mr. Gordon.
I've saved Mr. Hwang for special note. With the introduction of Mr. Hwang upon the scene, things probably have the best chance of coming together quickly. According to Mr. Hwang's press and past success's he is a planner and a doer. Not only that but a preeminent authority in the core business that has now transfixed TSIG's business plan.
The hiring of, and more importantly the willingness to be hired, of Golin Harris has all the earmarks of a major shift of mindset by Mr. Gordon. However, you'll notice the GH office that's working the account is not in Chicago, their headquarters. It's in SF, right down the line from John Hwang. If you add 2 & 2, I believe that you'll quickly deduce that Mr. Hwang was probably the driving force behind the hiring of GH.
This joined at the hip trio of talents and services poised to enter the E-Commerce sector is unique. They will be the first. As such, and if they can execute, they have a potential that in my opinion easily overwhelms the past history of Mr. Gordon.. There are too many good and highly credentialed people, not the least of which is Golin Harris, to allow any market improprieties or bad decisions to go unchecked for very long. There's just too much at stake. I also believe that Mr. Gordon is fully aware of the size of the brass ring, and is far too smart to repeat the mistakes of the past and to miss this opportunity.
Bottom line, my money remains on Mr. Gordon. The past is the past. He's seen more than his fair share of adversity. He's a tenacious big thinker, that doesn't quit. Just hope he has the presence of mind to modify his personal comp pay out timing to be more in line with his achievements. A public announcement of that would go a long way in the eyes of all concerned.
I sincerely believe that TSIG has an opportunity unlike anything in the market at this moment.
Sword.Com
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