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von mir an dieser stelle hauptsaechlich wegen ueberschrift gepostet. cheers, guuruh The second coming of Divine Interventures By Lawrence Aragon, Julie Landry Red Herring, February 20, 2001 Twist Andrew "Flip" Filipowski`s arm all you want. He still won`t cry uncle. Mr. Filipowski, CEO and chairman of troubled Divine Interventures (Nasdaq: DVIN), has been written off by Wall Street. But, ever the salesman, he made a case this past week for why his Internet holding company will not only survive but prosper. He says he expects Divine to start posting an operating profit by mid-2002. Mr. Filipowski has made a lot of missteps, for which some will never forgive him, but for the first time since he started hyping Divine, he actually has a game plan that makes sense. Given his track record, the odds that he can pull off the plan are slim; however, it would be a mistake to say that Divine has failed -- yet. "Relative to where Divine was positioned before, I`m optimistic about their new direction," says the skeptical Dave Wright, a vice president and incubator expert at market researcher The Aberdeen Group. "But their recent executive track record casts a shadow on their ability to execute." Mr. Wright gives Divine "a little less than 50 percent" odds of succeeding, but it should be noted that his previous odds were a big fat zero. The central piece of Divine`s comeback strategy is its planned purchase of enterprise software company SageMaker for $16.5 million. The plan is to merge SageMaker and Divine, creating an enterprise software holding company called Divine Incorporated. Divine Interventures will be a separate but wholly owned subsidiary that will continue to support its portfolio companies. It will make few if any new investments, Mr. Filipowski says. The big difference between what Divine will do now versus what it did previously is its focus on so-called infrastructure software -- software that underlies or enables online business. The other key difference, the company says, is that each of its portfolio companies is unlikely to be publicly traded on its own. Divine`s portfolio currently includes about 20 software companies. "They`re a collection of wholly owned subsidiaries, with one common face to the customer," Mr. Filipowski says. INCUBATORS AREN`T DEAD Mr. Filipowski denies that Divine has abandoned its fundamental business model as an "Internet Zaibatsu" or that the premise for Internet holding companies has failed. "I`m sure that many will interpret it that way," he says. "But we`re still a holding company, and we`re still following the same theme. People can interpret [the change] as capitulation, but as long as they try to appreciate what we`re trying to do as a software company it becomes irrelevant." For Divine to have failed in its original mission, it would have had to "write off everything we did and start from scratch," he says. "Then that would be a capitulation." Divine has no plans to sell or close any of its 20-plus portfolio companies. However, it will stop funding companies in sectors that lay outside its core business, such as Internet marketplaces National Transportation Exchange, Farms.com, Neoforma.com, and FuelQuest. "If they ask [for more funding], we`d definitely say no," Mr. Filipowski says. (He believes the companies will be successful without more money from Divine.) The company also has no plans to sell other assets, like intellectual property, although it has listed Goose Island (the Chicago locale where it planned to build its sprawling headquarters). It paid about $8 million for the land. Divine itself isn`t for sale either, Mr. Filipowski says. "It`s not being shopped or marketed, and we haven`t hired investment bankers," he says. "But at $40 a share, I don`t know how fast I could say `yes.`" Divine`s stock price closed at $1.81 on Friday. How Divine fell to such depths can be largely explained by external market forces, Mr. Filipowski says. The company got into the "econet" game much later than its troubled brethren CMGI (Nasdaq: CMGI) and Internet Capital Group (Nasdaq: ICGE). After delaying its IPO several times and booting its conservative lead underwriter, Divine went public after the IPO bubble had burst, raising about $150 million less than it had planned. Its stock never traded above $13. The implosion of Divine is a rare failure for Mr. Filipowski, who struck it rich with the founding and eventual sale of Platinum Technology International to Computer Associates (NYSE: CA). That big-bang software success is exactly why some observers -- including Flip himself -- paint Divine`s latest turn as a smart move, a return to the territory he knows best. The story`s a little more complex than Mr. Filipowski spins it, though. The company has been through a lot in just two years. It raised more than $600 million in venture capital, went public, laid off 4 percent of his core staff (29 employees, mostly in partner development), and finally announced its focus on software. WE`VE GOT A PLAN Through every plot twist, Mr. Filipowski has insisted that his latest move was what he`d planned all along. He first laid out his grand plan to us in August 1999. The goal, he said then, was to build a network of companies that would provide funding, marketing, Web design services, recruiting, and even office space to Net startups and spin-offs from brick-and-mortar companies in the Midwest. The emphasis on brick-and-mortar spin-offs was based on his theory that such companies "are incapable of maximizing value or successfully creating an Internet business." To date, Divine Interventures has not done a single bricks-to-clicks deal. Six months later, he posed for the cover of Red Herring magazine, looking like a devilish puppeteer, as four CEOs dangled from strings he clutched in his hands. He was the poster boy for what Red Herring dubbed econets. "We want to create a structure where $1 invested in one of our companies travels around and makes 50 stops with the network before leaving our doors," said Mr. Filipowski of his planned empire. "It`s entirely possible the few winners who get this right could be among the top 25 of the Fortune 500." Three months later, Mr. Filipowski was feverishly trying to take his company public. Investors like Microsoft (Nasdaq: MSFT) and Level 3 Communications (Nasdaq: LVLT) were breathing down his neck, since their $220 million-plus funding was contingent on an IPO by the end of July. Divine`s IPO prospectus admitted a focus on Internet companies and summed up its troubles: "Our management has not previously actively managed, operated, or promoted Internet companies, and if they cannot do so effectively, our business strategy will fail," said a filing with the U.S. Securities and Exchange Commission. Divine shares finally stumbled onto the public market on July 12, but raised only $128 million of a planned $300 million. Its stock hit an all-time low of $1 on January 8. In November of 2000, Divine swore off its initial plan of incubation and planned to acquire and roll up undervalued companies. "This is the phase where what you do as a holding company is accumulate the babies that are being thrown out with the bathwater, where the public has departed from the liquidity equation," Mr. Filipowski told us at the time. Of Divine`s 43 board members, 8 left during the third quarter of 2000, at least one of them over fundamental flaws in the business model. Since the first of the year, at least 17 inside shareholders have sold their shares at less than $2 per share, according to First Call/Thomson Financial, effectively washing their hands of involvement with the company`s poor stock. Despite all the problems he`s been through, however, Mr. Filipowski says he has no regrets. "Do I regret the price of the stock? Yes. Do I feel bad and responsible? Of course I do. Do I intend to work my ass off? Yes.... There`s a certain amount of pride involved in it, or even ego. I hate to lose." Discuss the fate of incubators in the Insider`s Guide to Incubators discussion forum, or check out forums, video, and events at the Discussions home page. |
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| aus der Diskussion: | INTERNET CAPITAL GROUP - es geht los ? |
| Autor (Datum des Eintrages): | guuruh (20.02.01 17:20:06) |
| Beitrag: | 93 von 17,989 (ID:2945845) |
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