by alec on October 31, 2006
Michael Geist’s column in the paper this morning highlights how government is attempting to re-introduce internet surveillance legislation by splitting opposition from privacy advocates and civil society advocates. His blog entry covers the same ground as the paper, so if you can’t read the Toronto Star, or Ottawa Citizen, you can read his point of view online.
He quotes from a Department of Justice Memorandum:
A Department of Justice memorandum candidly notes that “current privacy laws may not be sufficient to protect Canadians’ personal information,” acknowledging that “federal privacy legislation is not responsive to new technologies, including the Internet, biometrics, data matching and data mining, video and infrared surveillance, the decoding of the human genome, the need for protection of genetic information and the ability to store and manipulate large personal data banks.” Officials are open to reform, stating that “as the privacy and personal information of citizens and businesses is increasingly vulnerable in the online environment, substantive measures to protect personal information need to be considered.” Potential solutions apparently considered by the Department of Justice include the establishment of a new Task Force on online privacy.
His conclusion is to call for the Department of Justice to work with privacy advocates, rather than seeking to diminish their influence.Â
by alec on October 31, 2006
Last week Cisco bought Orative for $31 million, and it barely raised an eyebrow. Russell Shaw wants to know why! He rightly points out that Orative has some very cool features, and it’s a nice addition to Cisco’s bag of tricks.
So why did so many not comment?
From the publicly available data (and I will caveat this that there may be something I don’t know about here), for entrepreneurs, this looks like a sad story. The company raised a $6 million A round in 2003, and a $12 million B round in 2004. That means that the company was probably valued at $12 million in 2003, and in the neighborhood of $30 million in 2004. It looks like Orative sold for not much more than it was valued at 30 months ago.
For the employees, this is a possible scenario: the investors likely owned participating preferred shares, which means that they get to take their $18 million out first, leaving $13 million behind. Again, I’m speculating, but it’s likely the investors own 65% of the company, the employee stock option pool is another 20% and the founders stake is the remaining 15%. So the investors got another $8.45 million, all the employees split another $2.6 million, and the founders, after 5 years, receive a little under $2 million.
Not exactly a roaring success. The VC’s earned 46% in 5 years, which is about the rate that mutual funds pay.  The average employee probably earned a down-payment on a house. And the founders made the equivalent of 5 years of salary at a larger organization.
Orative’s key capability was pushing Cisco PBX features to RIM handsets. Orative, with a single strong partner in Cisco was a bit of a one trick pony. RIM’s acquisition of Ascendant earlier this year probably forced some soul searching at Orative.  RIM, via Ascendent, will be pushing Orative-like features to every PBX manufacturer. The writing was on the wall.
And that kids, is a lesson on why it pays to have a broad partnering strategy.Â
