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Enron Mail |
FYI
Things are tough all over. GP ---------------------- Forwarded by Greg Piper/Corp/Enron on 12/10/2000 10:01 PM --------------------------- From: Keith Couch on 12/10/2000 11:02 AM To: Hal Elrod/Corp/Enron@Enron, Brandon Wax/HOU/ECT@ECT, Greg Piper/Corp/Enron@Enron, John Cummings/HOU/ECT@ECT, Jeff Harbert/HOU/ECT@ECT cc: Subject: paperexchange CEO resigns PaperExchange CEO steps down December 08, 2000 01:35 PM PT by Adam Feuerstein Kent Dolby, president and CEO of PaperExchange, resigned unexpectedly Thursday, adding to the mounting turmoil at the independent Net marketplace for the pulp and paper industry. Dolby's resignation, for personal reasons, comes a little more than a month after the company laid off 14 percent of its workforce in a major retooling of its business plan. Dolby joined PaperExchange -- 83 percent owned by Internet Capital Group (ICGE) -- in December 1999. Bob Brenner, PaperExchange's current chief technology officer, is being promoted to the CEO post. Duane Desisto, currently CFO and chief operating officer, will become president. Company executives, including Dolby, were not available to discuss the management shifts, but the moves were confirmed by a company spokeswoman. Brenner's ascension may be linked to PaperExchange's decision to focus less on its online exchange for excess paper products, and concentrate instead on developing and selling Internet-based business applications for the pulp and paper industry. Dolby may also be a victim of the fickleness of the b-to-b sector. When he joined the company, independent Net markets were the poster children for successful b-to-b ventures. But in the ensuing months, industry-sponsored marketplaces -- ventures set up by big industry players -- have risen to the top, forcing indie Net markets onto the b-to-b endangered list. PaperExchange faces considerable competiton from ForestExpress, a marketplace sponsored by industry giants Weyerhaeuser (WY), International Paper (IP), Georgia-Pacific (GP), Mead (MEA), Boise Cascade and Willamette (WLL). ForestExpress may or may not grow into a successful b-to-b marketplace, but its very existence has dominated b-to-b activity in the pulp and paper industry, and has essentially frozen any progress PaperExchange was making. The pickle in which PaperExchange finds itself is also being viewed, by some, as an indictment of Internet Capital Group. In September, ICG boosted its stake in the company from 20 percent to 83 percent, in exchange for 4.8 million shares of ICG common stock. The deal came at a time when ForestExpress was showing signs of life and when indie Net markets in general were falling into disfavor and were being all but ignored by most venture capitalists. ICG's fortunes have tumbled lately because many of its b-to-b investments are not paying off for shareholders. Last month, the company announced plans to cut costs, reduce its investment spending and refocus efforts on 15 "developed" companies in its portfolio -- companies that have the best near-term shot at initial public offerings. PaperExchange was not named as one of those "developed" companies. An ICG spokeswoman defends the investment in PaperExchange, acknowledging the company needs to help in developing its business model further -- a role ICG is uniquely positioned to play. "We have accumulated a lot of knowledge about b-to-b that has helped us build some leading b-to-b businesses," said Michelle Strykowski. "Our investment in PaperExchange is an educated bet based on that proven experience." Adam Feuerstein covers e-commerce for UpsideToday. Reach him at adamf@upside.com. If you would like to submit a letter to the editor regarding this story, email online@upside.com
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