The story is not over yet. There are lives yet to be ruined, consequences yet to be realized. More amazing hijinks are still to be revealed. But what has already happened, we can reveal. As I said, the story begins in 2006...
Beginnings
Early in the summer of 2006 my wife had found employment in a company offering digital distribution of movies and TV shows, over the internet, at high quality. No little You Tube type windows here, full screen DVD quality pictures over any decent broadband connection. That was, and still is, something of a novelty, and represents a technoloogy lead over the mainstream players, like Hulu and Jooost.At best, this is a real deal changer, a truly disruptive technology, which promises to change the way we view movies and television shows. Of course, technology leads are prone to closure with the passage of time, so time was, and still is, of the essence. I saw all this, and decided that this little company needed help, but I also realized that, with luck, and a lot of work, this company could become a great opportunity for my family, if we would make the commitment to give it our all. So, even though she stated that the company had little money, I asked my wife to get me a meeting with the CEO. And so she did.
At my meeting with "Gary," the CEO of "Real Good Networks," (which I will refer to as RGN from now on) Gary told me that they had nothing in the budget for a salary for me. Meanwhile he admitted that they could surely use my talents, shorthanded as they were, so I told him that, considering that he had offered to make my wife a partner, give her enough stock to make her a "principal of the company," the elements existed for us to make a deal that would satisfy both of us.
In the event, I offered to work there for no immediate compensation. I told him that all I wanted was for him to make the promises he made to my wife come true. I figured that, if the company became a success, any principal of the company would be sitting on many millions of dollars worth of stock. I agreed that I could await a salary until the day that they had enough money to start hiring staff. We also agreed that I would receive stock commensurate with my contribution, and additional stock commensurate with my results. On this he shook hands with me, which, in my world, is a done deal when dealing with a gentleman. Unfortunately, I had no idea at the time that Gary was no kind of gentleman. I did get him to repeat this promise to others, including the company's biggest shareholder, and recorded his voice repeating his promise.
Within two weeks a press release went out announcing my appointment as "Vice President of Corporate Communications." This was the first of many press releases that I participated in generating, all containing at least a morsel of truth, many entirely true, that we disseminated. This was on-the-job training, since I had no experience doing this kind of promotion, had never written a press release, and had never worked in any capacity for a public company.
Our target audience was the investing public, but with all our machinations, we never attracted more than two thousand people to buy the company's shares. With such a small circle to communicate with, many of them became, if not my friends, at least they became people toward whom I felt familiar, and warmly.
So long as I maintained my belief in what we were doing, I became a very effective Manager of Investor Relations, another title I was granted. It was easy. All I really had to do was respond to inquiries quickly and honestly, bearing in mind that we had to stick to a script of items that had already been revealed, and then other things that were not to be considered to be areas that would affect the value of the company's shares. Untrained as I was, my "training consisted of listening to Gary's calls, and then I would follow his lead as to which facts would be disclosable, and which facts to withhold. I never lied, but Gary taught me how to convey a lie by telling the truth. He also taught me to always answer the question I wished I had been asked, rather than answering the question actually asked. I could never quite do this as well as he could. But then I was never involved in selling the company's stock. That was Gary's job.
The stock players we dealt with, especially "Mr. Big" in New York, were always telling me what a great job I was doing, going so far as telling me that one half of the value of RGN's shares was due to my good work. That's pretty good, considering that I was never trained in this occupation, and knew very little about securities, or securities law.
"Mr. Big" was a guy in New York who had inherited a lot of money from his father, who had started Fedex or some such company, or at least that is what Gary told me. He owned a ton of our stock, and had a consulting contract with RGN giving him a piece of the gross revenues of RGN. We gave him stock and options and warrants and anything else he asked for, since he gave the company money when we needed it. He learned to dislike me before too long, since I could not be trusted, not being in on the scam and all. After all, whatever swindles were going on, and Gary could not help himself from bragging on them from time to time, I was never cut in. But they would buy up shares in the market, and then when the public did the same, they sold into this strength. I had thought that this was not entirely legal, but Gary assured me that it was all OK, and in any event it had nothing to do with me. And indeed it did not, since I never got a dime. I never lied to the public, and if I had doubts about something, I would reveal that as well.
At its highest peak, RGN shares sold for over twenty cents. That's a lot of money in Pinkyland, so called because our stock was listed on the "Pink Sheets," a place for penny stocks to grow up and become real public companies. It is also a place where people like Gary take a company like RGN and get the public to fund their operations, and of course the very large salaries of Gary and his family. He has other Pinkies to his credit, and none of these companies have ever made a profit, as far as I know. In fact, Gary started RGN in order to keep his other companies afloat.
Today RGN shares trade at less than three cents.
There could still be a chance, even a good chance, for RGN to succeed, but it can not succeed with Gary involved in operations, in my humble opinion. He is obsessed with stock transactions, selling stock at half the bid, printing money. He has no idea how to run a company, not the foggiest clue. I am not sure he even wants the company to be successful. He wants to sell stock. He also likes being CEO. He likes making decisions. Unfortunately, he makes them without bothering to find out the basis upon which the decisions need to be made.
What he knows is how to play with people's feelings, and manipulate them to do his bidding. That is no way to run a company, because it makes people all fearful, wondering when the next shoe will drop. He just LOVES to ask people if they "Have a minute?" and lead them into his office, leaving them to wonder what will happen this time. Will the master tell them they were good, or will he tell them that they were bad? Will they be punished or rewarded?
This kind of management absolutely chills initiative, since any action taken out of personal initiative is likely to be met with disapproval. Thus, many fine people are either working at half their capacity, or they quickly join the large and growing list of "RGN survivors." Like me.
Spoiler
Anyway, that's it for chapter one. I hate to tease, so before I leave you, I will hand you the ending, or, at least the state of things today. After I became disabused of the truth of the things I was required to say, my job performance deteriorated. Also, my feelings about Gary and what he was doing, or not doing, became known to a lot of people, including Gary himself.At a certain point he could take it no longer, so he embarked on a crusade to make people believe things about me, most of which were not true. The amazing thing is, the truth would have been enough! I hated him, I told people that I did, and a CEO of a family-run company needs no more reason to fire someone. He has surely fired quite a few for much less. But that is not Gary's way, especially since so many of the shareholders really liked me. They knew that I would not BS them, and would tell them what was going on, or tell them that I could not comment.
So he launched his manipulation plan, to get others to do his dirty work. He made his new COO believe that I was doing nothing, that they would do fine without me, and there was no need to replace me. He undermined whatever work I tried to do in the marketing area, and then would point to the fact that marketing was not moving forward. For what it's worth, two months after my termination, there is still zero movement in the marketing area, except for initiatives that I started. Soon he will need someone else to blame. But Gary never looks too far ahead, he just likes to "kick the can down the road a bit." Sometimes I think that he never looks past the next pay day.
So they gave me a letter announcing my termination, without notice or severance pay. They also refused to pay me my accrued expenses. They will not even make a bounced pay check good. They even are denying me my unemployment benefits. They know that I will not sue them, since my wife still works there, and owns some stock.
If that stock never amounts to anything, we will have wasted two years of our lives.
Of course they never made her a partner, and of course never gave her anything remotely close to the amount of stock they promised, but she still had a big title for a few months, and a reasonable salary. When they demoted her, they insisted that she continue to call herself by her old title, telling her to continue to use her old business cards. Her salary is low for her, but high for them - at any rate we are not ready for her to lose that job just yet. And I continue to try to help the company succeed, behind the scenes. But I also have a need to get this story off my chest. This is just for me. Nobody will ever read it. Right?
Copyright Michael Gersh 2008 All rights reserved.
