Yocam Resigns, Fuller Brought On Board
In a surprise announcement that may have seemed like a corporate April Fools joke, Inprise Corp. (<A HREF="http://www.inprise.com/">www.inprise.com</A>) announced on April 1 the resignations of chairman and CEO Delbert W. Yocam and vice president and chief financial officer Kathleen Fisher.
In a surprise announcement that may have seemed like a corporate April Fools joke, Inprise Corp. (www.inprise.com) announced on April 1 the resignations of chairman and CEO Delbert W. Yocam and vice president and chief financial officer Kathleen Fisher. About two weeks later the company announced the appointment of Dale Fuller as interim president and CEO of the company and warned Wall Street of expected lower earnings for the first quarter 1999.
Fuller, 40, served as president and CEO of WhoWhere Inc. (www.whowhere.lycos.com) before it was acquired by Lycos Inc. (www.lycos.com). The Inprise board of directors has said that it requested Yocam's resignation because of philosophical differences regarding the company's growth strategy. One area the board may have been referring to is the recent split of the company into two divisions: Inprise, which focuses on enterprise-scale applications development and applications servers, and Borland.com, which focuses on Web and e-commerce tools.
The board is evaluating the potential benefits, or lack thereof, of that move as part of a comprehensive strategic review. It has hired leading investment banking firm Hambrecht & Quist to help with the diagnosis. The company expects to report a first quarter loss of about $0.54 to $0.56 a share, including one-time charges of $0.33 to $0.35 a share for restructuring and severance costs. Analysts had expected the company to break even.
Inprise, formerly named Borland until April 1998 when the company changed its name to Inprise, brought Yocam to the company in December 1996 after stints at Apple Computer Inc. and Tektronix Inc. (www.tek.com). The former Borland had a history painted in red. It posted a net loss of almost $13.5 million in the first quarter 1998; the net loss was $44.5 million for the same period a year before.
As Inprise, the company has been in more reasonable shape. For the year ended Dec. 31, 1998, the company recorded net income of $8.3 million, as opposed to a net loss of $48.4 million the year before. Fighting increasing competition from Microsoft Corp. and other development vendors, the company's position was never expected to be an easy one.
As of press time, Inprise was still searching for a new CFO. The company did not specify why Fisher resigned, but it is believed she was Yocam's right hand and departed accordingly. Fisher joined the company as CFO in May 1997 after working at software companies AST Research Inc. and Western Digital Corp.
"It's a real surprise. [Yocam’s resignation] may stem from Del's inability to increase the valuation of the company and increase the move toward the enterprise sector," says Dave Kelly, vice president of application strategies for the Hurwitz Group Inc. (www.hurwitz.com).
Before the company announced Fuller's appointment, Kelly had said it was important the company replace Yocam with a strong, prominent executive or risk a major loss in sales.
But Leo Singh, president of the consulting group InThink Corp. (www.inthink.com) and president of the Arizona Delphi Users Group (AzDUG, www.azdug.org), says the shake-up will not matter. Singh says the mindset of developers at Inprise and those who've used Inprise's products has always been focused on the products, not on the people pushing them. According to Singh, in the past when Inprise was between CEOs, it still managed to roll out products on time. The next version of Delphi is due to ship in July and Singh expects it, too, will come out on time.
Some, such as Hurwitz's Kelly, feel Inprise is vulnerable and could be eaten by bigger players, such as Sun Microsystems Inc. or Oracle Corp.
Singh, once again, disagrees. "One piece that the analysts don't realize is the mentality of the customers and the independent developers. They have an independent streak," Singh explains. "They'll survive independently. They don't have to merge with someone else."
Singh says it's this independent streak that has enticed leading developers to work for Inprise and create successful products, which in turn attracts more developers. He admitted, however, that it is difficult in the corporate environment to keep using Inprise products when the IT administrator's boss opens up the Wall Street Journal and finds that Inprise's CEO has resigned. Singh says those IT people who've stood up to their bosses before to begin using Inprise products will do it again to continue using them.