Last week at this time it was popular to pile on Onlive's CEO to say "he fired everyone and stole the company!".
No one asked why he did it. The common thread was "he was greedy!"
That really pisses me off. We come to find out a week later that the company was days away from total insolvency and that structuring an ABC to deal with $40 million of debt was the only way to keep anyone's jobs. It's a brutally painful place to be.
Sometimes people do awful things for simple and awful reasons. But I believe that's rare. I believe some people are forced to do awful things that they would never otherwise do given the option. I think in this case people didn't want to know, or perhaps didn't care to know why it happened. They just wanted to blame someone.
I fear the media's growing lack of interest in the why.
The unanswered question is how much he profited from the move of selling the company. If firing all of the old people, devaluing their stock to $0, and reforming the company netted him a $1M bonus, then he is still a greedy bastard and donating a few thousand dollars to a fund doesn't change that. When something similar happened at my previous company, the people in charge got a large cash award as part of the acquisition while a bunch of employees lost their jobs and had their stock devalued to $0 so it is plausible that the same thing happened here. At another company I was at, the CEO laid off a large portion of the company for budget reasons but also paid us 2 weeks of salary out of his personal account in addition to our normal severance pay.
$50k split between all the people who made this decision is a trivial amount of money compared to their salaries and bonuses.
What if he did NOT profit? What if he lost millions of his own personal net worth? Would you consider him the opposite of a bastard?
There are very few instances where a company takes a complete header like this and the CEO gets paid handsomely. And how can you compare being in $40 million of cash debt and putting the company to ABC against selling a company in an acquisition?
> Sometimes people do awful things for simple and awful reasons. But I believe that's rare. I believe some people are forced to do awful things that they would never otherwise do given the option. I think in this case people didn't want to know, or perhaps didn't care to know why it happened. They just wanted to blame someone.
This is the essence of many of the problems in our lives.
When somebody does something awful, usually there is a reason other than that they are a 'bad person', there are complex reasons, maybe wrong reasons, but there are reasons why they did what they did, and is important to understand those reasons before criticizing.
Some times an awful thing is the best you can do, because the alternatives are even worse. Those decisions are the most difficult and painful to make, and rarely anyone appreciates it.
My deepest apologies Zizee. I'll think a lot longer before commenting next time. I'll be sure to keep your annoyances in mind. Thanks so much for your insight.
Seriously man. "THIS" (read: your grievances) are beyond first world problems. Pick your battles. Stop making annoy-enemies for stupid reasons. Go do something productive. I thought the guy was insightful, so I said it in my own way. Go do something productive.
HN and other sites have an 'I agree' button. Should that prove insufficient for expressing your enthusiasm for someone's comment, you can always find a grammatically correct way of saying "I agree", ranging from "I cannot more emphatically state my heartfelt support for your point of view!" to "FUCK YEAH!". "This." has always just seemed like a meme for the terminally grammar deficient.
Wow. What is wrong with "you people". Hacker News has turned into a really bad episode of the Player Hater's Ball. I used the word "THIS". As much as I actually like the term, how exactly does that make one "terminally grammar deficient"? Good to know that we can forget about the middle east for a while and focus on problems with THIS. Just let it go, man.
Life will be SO much easier for you if you just let shit that really doesn't matter go.
Read it, react. If you REALLY can't control that reaction and THIS just REALLY grinds your gears... go ahead and comment. I don't want your next aneurysm on my conscience. Maybe think about controlling what annoys you a bit. They have really good articles online for this kind of stuff -- lots of people are dealing with it. You are not alone. YOU ARE NOT ALONE.
that's stand up. At WebTV, at acquisition, he gave the staff a considerable amount of his stock in gratitude to sweeten their take - so I honestly don't think he has made the moves he did out of a desire to screw the staff but to save 50% instead of having to fire 100%.
The link shows is a community fundraiser for COBRA donations to the laid off staff. It shows a bit over $55,000 in donations which came from a list of dozens and dozens of people, 52 right now. Stephen G. Perlman, the CEO is in fact in the list of donors, but it doesn't say how much each person donated. There is no indicator anywhere here that he himself donated almost everything there. Does the OP have another source where he mentions having donated $50k personally?
Seems like an attempt to get over some of the extremely bad press to me. While it's good for the ex-employees, it was still a really crappy thing to do in the first place.
He seems to have done something that we very, very rarely see in corporate america, which is show genuine leadership. I'm wondering, keidian, what you believe you would have done that would have been less "really crappy." Genuinely interested.
Honestly? Doing a mass layoff will suck regardless, but doing it by shutting down the company and making a brand new one immediately rubs me the wrong way. While no one likes to be laid off, I think people would have been able to at least hold their head high about the work they had been doing rather than the stigma of being remembered as working at OnLive before AND being out of a job.
Side note: Wonder just how low my karma will sink after this post and my original one lol. Seems like people don't agree with me, which is fine :)
The shutting down/new company business is essentially a convoluted form of bankruptcy[0] that allowed them to keep the lights on; out of context it looks bad but it could have been much worse.
I don't know the full situation, but if each of those who were laid off owned part of the company it seems a little unfair for the majority shareholder to be able to sell the company to himself, leaving everyone else with nothing. What should have happened is that the company should go up for auction and the proceeds split by percentage owned.
They didn't own stock in the company. They had stock options which were cancelled. Which is just as well maybe since they would have also owned a piece of the debt.
So, you believe they should have just gone bankrupt, liquidated, and left everyone out of a job? I'm trying to parse your response to see what you would have done, and it seems that the part that upsets you is the "shutting down the company and making a brand new one immediately" - I'm wondering whether you would have preferred just shutting everything down? From my reading, it appears they were out of cash.
Putting the firm on sale earlier and saving the jobs or negotiating a decent severance package would be my idea of leadership. This is charity - worthy as far as it goes, but reactive rather than being out in front of the company's problem.
Why do you have doubts about this guy being "genuine?" I've seen executives in similar positions (close to liquidation, or at liquidation) - and almost without exception, all they thought about was themselves. The one exception I know of was when Jim Barksdale reached into his own pockets to help out the employees who lost their jobs at Webvan.
Letting the company run dry and not telling anyone until paychecks bounce would have been even worse. It doesn't seem like anyone made a clean getaway from this at all (Perlman himself isn't even taking salary from "OnLive2").
That's noble, but only valuable if you have FU money to start. Otherwise, there will be a little drag in the back of your mind saying "should I be doing this?" at a point when you want the leader in and committed 100%.
Do you have any idea how many different things Perlman is involved in? If he had put every last cent into on-live our future would be worse off. Google the work he is doing in the wireless networking space(DIDO). Your iPhone 7 is probably going to run it.
Hopefully this entire episode straightens itself out - I was worried that Perlman was not the man I judged him out to be from a far (talks/papers/history/work). It seriously undermined my confidence in my ability to judge the character of the people around me (I'm still doubtful of course - but this shook me a little bit more than usual).
Looks like a bit of poor cash flow management - mixed with some unfortunate acquisition manoeuvres lead OnLive to this rather nasty juncture (Sony's Gaiki acquisition - inability to monetize - inability to sign up profitably - too much scale too fast).
OnLive is still a great idea - and as John Carmack has stated (paraphrased):
> "Cloud gaming is a technical inevitability. It will happen within the next 5 years."
And someone is still going to make a lot of money. I'm still betting it'll be Perlman and his team.
The only reason to believe he was a bad person, or not the person you thought he was, was a completely made-up and unsubstantiated hit article by Tech Crunch designed as link bait. Before that article, it was just another matter of a poorly performing business plan that needed to be addressed.
How many months of medical coverage through health insurance can you buy in the US for 55'000 USD?
In the case of my own health insurance outside the US, I could pay the premiums for about 11 years.
As a sidenote, living in a country where health insurance is mandatory and not linked to having a job, I am always shocked that Americans loss job and health insurance if they get fired. Isn't the getting fired bad enough, especially in today's economy?
It really really depends. If you're young and healthy you can buy many years of health insurance for $55,000. If you have cancer in remission, on the other hand, you probably can't buy health insurance on the open market for any price. Many other people are somewhere in between those two extremes.
On the plus side, it looks like the employees here are eligible for COBRA, which lets you buy into your previous employee health plan for up to 18 months. That at least gives you a semi-fixed group rate that doesn't depend on preexisting conditions. The regulated health insurance exchanges that should be opening by January 1, 2014 under the new healthcare reform will also (if all goes well) make things much better, albeit still much more complex and bureaucratic than necessary (living in Denmark now and contemplating moving back to the U.S., I'm not looking forward to the huge increase in healthcare complexity).
That is one of the problems in the US right now. Unless you or your spouse works at a business that gives good health care benefits, buying it yourself is prohibitively expensive.
The Affordable Healthcare Act (Obamacare) is trying to remedy this by creating the insurance exchanges and making everyone buy insurance. That should all be setup sometime in 2013 I think.
Until then, I'm staying in Germany where health care is actually affordable for self-employed people.
It is only prohibitively expensive if you have a pre-existing condition. I have an excellent PPO for which I pay $200 a month, has a $1,000 deductible, and $20 copays. I'm in my mid-thirties and was a smoker for 18 years. If I had lied about my smoking, it would've been $150. My fiancee, her policy is $240 a month for the same. Now, if we had children? Yes, covering the children would be quite a bit more - as they tend to use more healthcare than we do.
One problem is that, under current law, you tend to only get those rates until you get sick. Insurance companies aren't allowed to actually jack up your rates if you get sick, but they tend to do so in tranches: every N years they'll discontinue one insurance program and institute a new one. Healthy people can apply for the new one with lower rates, but people with preexisting conditions will be denied a transfer to the new program. The old program will then enter a death spiral where only people who have e.g. cancer or diabetes are stuck there, because once you're seriously ill you can't go anywhere else (at least as an individual purchaser). Then the rates start being jacked up each year to account for the now-less-healthy pool. (This pattern is called the "closed block" problem, and some states have been attempting to add new regulations to restrict it.)
And of course if you had a childhood condition (beat childhood cancer, congenital heart defect, etc.) you can never buy in in the first place.
No one asked why he did it. The common thread was "he was greedy!"
That really pisses me off. We come to find out a week later that the company was days away from total insolvency and that structuring an ABC to deal with $40 million of debt was the only way to keep anyone's jobs. It's a brutally painful place to be.
Sometimes people do awful things for simple and awful reasons. But I believe that's rare. I believe some people are forced to do awful things that they would never otherwise do given the option. I think in this case people didn't want to know, or perhaps didn't care to know why it happened. They just wanted to blame someone.
I fear the media's growing lack of interest in the why.