January 18, 2000
The May Report
by Ron May
The May Report: 1/18/2000: HA-LO buys starbelly; coolsavings files; Paragon,
Contact email@example.com/tmr about advertising, please. Also, please include
a phone number.
STOP!!! I want to get off this rollercoaster (or is it a merry-go-round?)
There is no time of catch one’s breath. Coolsavings filed on Friday, and I
have been going over their stuff. Now this. Starbelly is sold for $240MM!!
They had one person in the spring of last year.
I haver a lot more to send, but timing matters here.
Tonight’s AIP meeting is about marketing, and NetTraffic will present. It is
at 6:00 p.m. at 1 N. Franklin at the offices of Xpedior. Amy Brewer, did you
send out a notice on this? http://126.96.36.199/navevent.htm
Starbelly bought by HA-LO for $240MM
HA-LO (11, down 1-3/16 @ 11:12 am ET) announced it has signed a
definitive agreement to acquire Starbelly.com, Inc., the premier
internet business solution for custom-decorated merchandise. The
value of the transaction is $240 million. Under the terms of the
agreement, Starbelly.com shareholders will receive $19 million in
cash, with the balance in newly-issued shares of HA-LO common and
preferred stock. Closing of the transaction, subject to
shareholder approval, is expected in March 2000.
ColdFusion and Spectra are the fastest way to build and deliver scalable Web
applications that integrate browser, server and database technologies. From
e-commerce to business automation, from intranets to Internet, these tools
give you the power to develop and deploy advanced systems quickly and easily.
EnterAct Consulting has been hand selected as a premier development partner
with Allaire Corporation, the producer of ColdFusion and Spectra. Our
developers have extensive experience customizing site functionality using
ColdFusion and Spectra technology.
Please visit http://var.enteract.com to learn more about these products, the
ColdFusion Users Group, local ColdFusion and Spectra workshops, or to
purchase the software. Receive a 10% discount towards any Allaire
development product purchase made in December (please supply promo code
990812 when ordering to receive discount). Contact Scott Portugal at
312-588-2970 or firstname.lastname@example.org with any questions.
Coolsavings files its S-1 last Friday.
WASHINGTON, Jan 14 (Reuters) – CoolSavings.com Inc., a provider of
e-marketing services to advertisers like MCI WorldCom Inc. and J.C. Penney
Co. Inc. , filed on Friday to raise $57.5 million in an initial public
Terms of the initial stock sale such as the number of shares or their price
range were not disclosed in the company’s preliminary prospectus filed with
the Securities and Exchange Commission. Those details are expected in future
The company has applied to trade the shares on Nasdaq under the symbol
“CSAV.” The underwriters are Chase H&Q, Lehman Brothers and Thomas Weisel
Advertisers can deliver, target and track a large assortment of incentives to
promote products or services either online or offline, said the company,
whose Web site is http://www.coolsavings.com.
Chicago-based CoolSavings said it captures and stores detailed demographic
information of its members, and tracks shopping preferences and behavior.
As of the end of last year the company had more than five million registered
members representing nearly 3.9 million households. CoolSavings said it keeps
its members’ identities private.
It plans to use the net proceeds for general corporate purposes, including
working capital, capital expenditures and additional sales and marketing
Price per share: Unknown
Shares being offered: Up to $57.5 million of common stock
Shares to be outstanding: Unknown
Company location: Chicago, Ill.
Underwriter(s): Chase HQ, Lehman Brothers and Thomas Weisel Partners
Timing is everything, and in this case it is bad. Last week at the MEF
meeting, and then subsquently over the next day or two, I found out some
negative information about coolsavings.com for the first time. Number one,
they have had high staff turnover. Number two, my sources indicate that their
internal recruiters have quit, and a number of recruiting firms they have
been working with have not been paid their fees. Word is that several of
these firms may file suit against them for payment. Number three, the firm
went through quite a few PR firms, selecting one and then four months later,
getting another, and so forth. Two firms I know they used were EBS and
TechImage, both for short periods of time. Number four, word is that Steve
Golden, the CEO, does not have a high degree of respect for employees and is
“old school,” coming out of Salomon Smith Barney. Several people told me that
he is just very tough to deal with.
Here are the trivia questions I asked which were about coolsavings in last
Wednesday’s article. I had no idea they were going to file on Friday, so
don’t say I am just bringing up unpleasant news when they want good news.
6. What firm does the opposite of spend, has lost its recruiting staff and
has several headhunting firms ready to sue it?
7. How did this same firm go through a ton of PR firms as well? Hint: One of
the heads of this firm has the same first name as a famous rabbi.
The person I am referring to is the COO (I believe), Hillel Levin.
GREAT PLAINS DYNAMICS and eENTERPRISE BACKOFFICE SOLUTIONS
What do art.com, toysmart.com, n2toys.com and internetinvitations.com all
have in common? The award winning Great Plains eEnterprise BackOffice
solution powers each e-commerce site. Crestwood Associates has partnered with
Great Plains Software to deliver Great Plains Dynamics and eEnterprise — the
leading BackOffice ERP solutions for small and mid-market organizations
(Gartner Group, 1998 and 1999). Crestwood works with leading technology firms
to rapidly implement systems, train users and provide ongoing support.
Features available within the solutions include:
·e.Commerce (B2C) & e.Order (B2B) ·General Ledger, AR and AP
·Credit card processing/EFT transfer ·Sales Orders/Purchase Orders
·Human Resources and Payroll ·Inventory Control
·Manufacturing Control ·Service Management
For more information, please contact:
Brian McGuckin, Director of Business Development (847-359-8550 x12)
email@example.com and www.crestwoodassociates.com
Here is a very close paraphrasing of a note I got from a reader and obvious
insider at MBT/USWeb/cks. DR stands for Direct Report. What are you going to
do, Bob Bernard?
I corrected a couple of grammatical and spelling errors, but the words are
those of the reader. Bob Bernard, you told me you bought a good company, and
I know the Chicago office of USWeb is small fry when viewed in relation to
the size of the firm. But it is your headache now, buddy. I believe that it
was only doing $10MM or less in business when it was acquired by USWeb last
April, but having a cespool in your own back yard does not look good.
Paraphrased from a reader’s note:
Scott is having fun in Chicago.
Scott Spear is being audited after some very obvious accounting discrepancies
were discovered by the corporation. PWC is investigating how Scott accounted
for his two P & L s (his earnout P&L and the downtown P&L). Projects like
Simon Property Group and Cummins Engines which were landed by the downtown
office mysteriously appeared on Scott’s P&L. The cooked books are rumored to
be the reason the head of finance is leaving (he refuses to sign cooked
Massive turn-over is the direction of USWeb Chicago for the new millennium.
January will result in 10-20% turn-over. Considering the industry average is
29% annually Scott is on target to accomplish in two months what other
companies take a year to do. The confirmed turn-over for January is very
interesting since it is very heavy in senior management.
January departures prior to January 15:
Michael Maher – Manager / DR – Director of Operations and finance
Eric Collord – Partner / DR – Relationship Mgr for Walgreens acct.
Dan Ehrmann – Partner / DR – Relationship Mgr for travel and finance
Adam Kallish – Director / DR – Director of Creative
Mike Seiler – Partner / DR – Partner of Technology
Debra Wolcott – Account Director – Engagement Mgr. for Walgreens
Bob E. – Architect – Security Architect
Jeff S. – Consultant – Java Developer
The interesting fact is that 5 direct reports have left in a two week period.
Adam and Mike are transfering internally to other P & Ls. Rumor is that
Vince Kellen (Partner) has requested a transfer. Leaving Chris Dalton, Larry
Dana, John Christ, Paul Weinwuth, and Matt Shmeltz being left. The numbers
paint a serious leadership problem (5 left, 1 leaving and 5 remain).
Additional depertures are known but resignation letters have yet to be turned
in. Several Java developers are leaving to go work for Zepher in Schamburg.
The largest client in the region is Walgreens and the current team working on
Walgreens has only 3 to 5 of the same people from the previous team of 170
None of the departures are due to Whittman Hart. The meltdown is due to
Scott’s complete incompetence People are not willing to wait 4 months for WH
to fire Scott.
TOP SALES TALENT!!!
We are looking for top sales talent to continue Denmac’s aggressive growth!
You will drive business by identifying, qualifying and closing
opportunities using your consultative selling style.
Denmac Systems is a network consulting and integration firm. We design,
optimize and secure the networking infrastructure for our client’s
e-business environments. We deliver guaranteed results through our
project-focused approach, IMPACT methodology and proven technical expertise.
A highly motivated, success driven professional will be rewarded with an
aggressive uncapped compensation plan!
For more information please contact:
650 Academy Drive
Northbrook, IL 60062
Here are two notes from another reader who reports on what is going on at
Paragon Solutions. This is bad news for JB Pritzker, Ellen Carnahan and Bill
Weaver. Michael Willis and Bill Lederer were quoted by Barbara Rose in the
Crain’s article about me, and they are GONE. Could having been interviewed
for that article be the curse of death?
Notes from a reader, dated January 17th.
MR. MICHAEL WILLIS, WHO JOINED PARAGON SOLUTIONS LESS THAN A YEAR AGO,
RESIGNED SUDDENLY LAST WEEK UNDER PRESSURE FROM PARAGON’S BOARD.
PARAGON WILL BE PURSUING AN IPO OVER THE NEXT FEW MONTHS ACCORDING TO TAI
PHAM, PARAGON’S CEO.
· Effective immediately, Michael Willis has resigned as President and Chief
· Effective at the Board meeting this past Monday, Kenneth D. Rardin has
become Chairman of the Board;
· Effective today, Tom Underwood has joined Paragon as its new President and
Chief Operating Officer.
PARAGON HAS LOST ALMOST EVERY KEY EXECUTIVE IN THE PAST YEAR, INCLUDING MARY
HEALY, FORMERLY OF SUN MICROSYSTEMS, JIM O’KEEFE, FORMERLY OF SAP, FRANK
SCARPELLI, FORMERLY OF MCI SYSTEMHOUSE AND THE HUNTER RESOURCE GROUP, STEWART
BRUNO OF DELOITTE & TOUCHE, KEN SLAPIKA OF SWISS BANK/WARBURG DILLON REED,
I-HUNG LI OF LUCENT TECHNOLOGY, MAURICE D’SOUZA OF MOTOROLA AND LUCENT, AND
TOM VEAR OF THE CBOT WHO IS ALSO A PRIVATE INVESTOR.
From the same person, a bit of explanation for the current chaos.
Several of Paragon’s employees were the victims of a Mr. Ralph “Tres” Rogers,
the recent former Director of Business Development, Paragon Solutions, a
convicted felon who swindled the employees and some clients out of over
$200,000.00. Mr. Rogers was brought on by Mr. Tai Pham and Mark Dendinger,
SVP of Business Development, who knowingly hired this man with a tainted
past. They received a warning letter from Mr. Rogers previous employer,
which was obviously ignored.
Paragon’s India operation has been losing over $100,000 per month for the
last year plus…suffers from lack of focus and direction. Paragon, did
however, recently expand its facility in Vietnam. Perhaps with the help of
the Government? Hmm. Don’t know.
Mesirow is scrambling to save their investment in Paragon. The Chairman and
new Pres/COO were hand picked by the Mesirow people.
Paragon’s entire strategy into the Web Based Learning niche was crafted by
Mr. Michael Willis.
Mr. Pham is a former technologist from Lucent who came to this country in the
1980′s after the war. He will need a miracle to salvage this one, although
he has been called the “Teflon Man.” He did manage to build a million dollar
home in Glencoe. Give him some credit…er, ugh, somebody already did, I
Epicor Software (formerly Platinum Software) Delivers Front to Back Office
* Are you looking for sales force automation?
* Is e-commerce a part of your business strategy?
* Do you know the ROI of your Marketing Campaigns?
* Is your accounting system integrated with your sales and customer support
* Is your IT department bogged down maintaining multiple databases?
If you answered yes to any of these questions, contact us today for an
executive overview of Epicor’s customer centric ERP applications. Mention The
May Report to have a FREE multi-media CD-ROM sent FedEx to your office.
Tom Feeley extension 5005# firstname.lastname@example.org
John Geraci extension 5004# email@example.com