Ruby Randall's Short
Stint as President of
Yet another San Diego high-tech firm that intended to go public has decided to withdraw from a planned $75 million stock offering.
SkyDesk Inc., an Internet storage services company which formerly called itself @Backup, gave volatile market conditions as the reason for the decision announced June 30.
SkyDesk filed its S-1 application in March and retained Donaldson Lufkin & Jenrette as its investment banker. It was supposed to be trading on Nasdaq under the symbol DESK.
Despite the withdrawal, SkyDesk appears to be in a much better position than some other faltering Internet companies.
In May, the company attracted $10 million investment from both Qualcomm Inc. and Hikari Tsushin, a Japanese-based telecommunications firm. It has also added some 30 employees since the beginning of the year to bring the staff count to about 100, said spokeswoman Kate Blom.
Counting the latest round of $20 million, the company has thus far attracted $57 million in capital investment.
But no doubt, the firm's financial health and the harsher scrutiny for all high-techs persuaded the firm's management to hold off on the stock offering.
According to SkyDesk's S-1 filing, as of Dec. 31, it had an accumulated deficit of $21.5 million. Last year it lost $11 million; the year before last, the loss was $5.2 million.
Shareholders equity at the end of last year was minus $17.6 million.
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Management Exodus Continues: Yet another executive at CollegeClub.com said goodbye earlier this month. Ruby Randall, who was appointed president of the Internet firm last month, resigned from the position "to pursue other business opportunities," according to a company spokeswoman.
Randall's departure follows the resignations of CollegeClub's founder and CEO Michael Pousti and its chief operating officer, James DeBello, in June. DeBello left to take a job as CEO for ideaEdge Ventures, a local incubator company. Pousti, who owns 24 percent of the company's shares, remains on the firm's board of directors.
The management shakeup was apparently triggered by the withdrawal of an $85 million IPO last month. Founded in 1993, CollegeClub operates a Web site aimed at college students and claims to have 2.6 million registered users.
As of last month, CollegeClub had 250 employees, including 180 in San Diego.
Texas Comes To San Diego: Texas Instruments Inc., with more than $9 billion in revenues last year ranking among the top 200 U.S. corporations, announced it will purchase San Diego-based Dot Wireless, a 3-year-old company involved in developing third-generation wireless products.
Texas Instruments will pay a set stock price of $475 million for the local start-up, indicating the cutting-edge quality of research being conducted there.
"They (Dot Wireless) have tremendous technical expertise in 3G (third generation) wireless technology, and there's just not a whole lot of that out there. It's a very precious commodity," said Jamie Anderson, a TI spokesman in Dallas.
Dot Wireless spokesman Richard Sfeir would not disclose the range of stock options held by employees, but said an existing stock plan exists. Once the deal is completed by the end of September, a good number of Dot Wireless employees will be a lot richer, on paper at least.
Sfeir emphasized TI intends to keep the company intact and expand its operations as it converts to one of TI's worldwide wireless technology centers.
"This is a big win for San Diego. This is testimony to the fact this area is becoming known throughout the world as a hub for wireless technology and CDMA in particular," Sfeir said.
The Dot Wireless purchase was the fourth for TI this year. TI also has purchased Alantro Communications in Santa Rosa, with about 50 employees, for $300 million. Dot Wireless has 75 employees, putting the price tag at $6.3 million per employee.
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Qualcomm Stock Battered: San Diego's best-known stock, which rose by some 2,700 percent last year, was hammered over the last few weeks by news reports about chip set sales and future licensing agreements in South Korea.
Last month Qualcomm disclosed it expects lower order levels for its fourth quarter of this year. Not long after that, a Reuters news report stated several South Korean telecommunications carriers intend to select a technology that uses code division multiple access (CDMA) but a different type than one being offered by Qualcomm.
The company didn't officially react to the report, although some analysts said the report shouldn't have any impact since Qualcomm collects royalties on the licensing no matter which type of CDMA is chosen.
Still, QCOM lost more than $5 on July 7, and continued to drop early this week, ending at close to $55 as of July 10, or some $12 off its price in early June, and more than $100 off its price at the beginning of the year.
In other key news released by the company that may have affected its stock, it announced the layoff of 200 employees. The staff reductions had nothing to do with the South Korean news, and are "part of an ongoing evaluation to match the skill sets of our employees against the business needs of the company and are an effort to ensure the company remains competitive," said spokeswoman Diana Baldwin.
Leap Purchases Take Leap: Qualcomm spinoff Leap Wireless International said it will triple its purchase of Lucent Technologies' wireless infrastructure equipment to about $900 million.
The increased purchases will go toward the implementation of wireless service through Leap's Cricket subsidiary. Currently, Leap's Cricket service, which allows customers a single flat rate for all local calls, is offered in Chattanooga and Nashville, Tenn. The company has rights to purchase licenses in four other cities, and is looking to expand its market.
Leap stock rose $7 on the news, climbing to $54 on July 6, but is off its high earlier this year of $77.
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First Round's A Charm: Entropia Inc., a San Diego firm that bills itself as "creator of the world's most powerful Internet-scale computing service," said it has raised $7 million in first-round funding, including $6 million equity stake from venture capital firm Mission Ventures and $1 million equipment loan from Silicon Valley Bank.
The company said it will use the funding for corporate expansion and ongoing development of the second generation of its Internet computing services.
Brentech, a San Diego designer and integrator of computer networks, said it signed a year agreement with Peter David Inc., a Rancho Bernardo sports memorabilia company.
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