Update 30/3/15: Since writing this blog entry I've posted another, 'Barking up the
wrong tree?A reinterpretation of the Blipfoto/Polaroid tie-up' which should be read alongside this one. Thanks.
Someone -'Cameraman00' - (an untraceable fictive name) - commented on one of my previous blogs asking what my thesis and objectives were in writing these blogs as if I must have an 'agenda'.
But I don't. I'm not out to 'get' anyone nor I am trying to point the finger of blame. Rather I'm trying to understand what has gone on and what is going on. I've set up and run a small company with a very vocal user community, Cornwall Neighbourhoods for Change, and I'm genuinely interested in the dilemmas that small companies with active user communities face.
I'm also a Polaroid Blipfoto user and I care about what is going on and hope that the best (which seemed pretty exceptional to me) in the company, the infrastructure and the community can be carried forward - hopefully with the support and involvement of the users.
Aftermath and renewal
Late in the evening of March 25th 2015 Joe Tree, founder and and now ex-CEO and ex-Director of Blipfoto Ltd, posted a message from BlipCentral about the future of ... well of 'An Exciting Future'. It's in full at the end of the blog.
Whilst the message comes from Joe it is probable that it was agreed with, and possibly drafted by, the new owners or their representatives and agreed with the liquidator.
We don't actually know what Joe and Graham Maclachlan's positions in the new entity are yet and if these have been decided. When Joe and Graham were Directors and shareholders of Blipfoto
Ltd they had considerable influence on the direction of the company. Between them they had two votes in a Board of Directors of five where the Chair had no casting vote.
They also owned 12% of the company's shares (6.08% each) and were the biggest shareholders in the company by share numbers save for Scottish Enterprise (see this blog). Their fellow directors were local and represented the angel investors and
others who had invested in the company over the years.
As such Joe and Graham were in a position of authority and influence and deeply embedded in the supportive startup investor world of Edinburgh. That's not to say, of course, that they had everything or anything their own way with the Board and its observers.
Board decisions are, after all, taken by the Board and responsibility resides with all directors equally. And whilst having considerable sway as founders and senior managers they were a minority
on the Board. It's rather to say that things have changed.
The relatively transparent ownership and governance structure of Blipfoto Ltd disappeared with its liquidation. It is now owned by two US citizens (if my surmise below is correct) and it is
unclear what structure the company will have and where it will be registered. The other directors are gone and the investor and director ties with the Edinburgh startup world have been severed as
far as we know.
So when Joe speaks about the entity 'Polaroid Blipfoto' ater the liquidation he is speaking from a very different structural position than the one he occupied pre-liquidation. And the
company structure and ownership has changed beyond recognition.
If the new owners want to appoint Joe and Graham to a Board of Directors - if indeed there is or will be one - that is in their gift. They could make them first among equals. But until that is known it might be unwise to assume it is the case.
In this blog I try to tease as much meaning as I can out of the announcement about the new company's future. I had expected it to be followed by a press release - rather along the lines of the
one issued by Hilco Global through their
PR agents when news of a preferred bidder broke. But the absence of one might also mean something.
The new owners of the 'Polaroid Blipfoto platform' are named as Jeffrey Hecktman (later 'Jeff') and Bobby (Robert) Sager. It appears that even though these 'gentlemen' are linked in the sentence to their respective companies (Hilco Global and Gordon Brothers) it is they, rather than the companies that they are associated with, that now own Polarodi Blipfoto - aka 'the platform' - it is now in their 'hands'.
The original Hilco Global press release that announced the preferred bidders mentioned 'a group of investors' that 'included' Hecktman and Sager. This group now seems to have disappeared to leave just two owners as private individuals (And, hence, why there is no Hilco Global press release - because the assets of Polaroid Blipfoto are owned by individuals not companies).
The New Owners
It would be hard to dispute the phrase 'extremely successful' with regard to the new owners. Hilco Global and Gordon Brothers are big - not to say massive - companies operating in the
investors-in-distressed-debt sector. Having said that and at least with regard to Hilco Global I have found it difficult to find out anything about their financial dimensions or numbers of
employees. Here's a Bloomberg
profile of Hilco Trading , LLC, which apparently does business as 'Hilco Global' but there are no financials.
Here is a Bloomberg Executive Profile of Jeffrey Hecktman. He looks a very successful and very busy man. He also has a page on the Hilco Global website that lists his professional achievements and philanthropic activities.
With regard to Bobby Sager you might want to take a look at this Daily Telegraph article titled, 'Bobby Sager the not-so-secret-millionaire.' It's surprising. He also
has a page on the Gordon Brothers website.
He is a very wealthy man - but to say how wealthy would be, he says, 'so boring'. (So bore us, I say). Sager says, “I have enough,” he says, “so that I can spend the rest of my life engaged in giving away money. Especially the way I do it.”
But note, that giving is philanthropic. Not commercial.
He's a committed “eyeball-to-eyeball and hands-on” (his phrase) philanthropist through the Sager Family Travelling Foundation at Team Sager. He's also a friend of Sting, who gave him a Harley Davidson motorbike that sits in his home which has a fully plumbed in guest bathroom from a Boeing 747 and a chunk of meteorite for which he paid in the region of $50,000. His apartment is huge and made from twelve apartments knocked together - he made the neighbours offers they couldn't refuse, apparently, as they came up for sale.
He was also the Chair of Polaroid (at least in 2011) and 'and was instrumental in bringing in Lady Gaga as the company’s hands-on Creative Director.'
With regard to philanthropy he wants his money to work hard. He says,
“I’m an entrepreneur, so I’m looking for opportunity, I’m looking for huge return on investment, both for my money and my time." (My emphasis).
I wonder how hard he wants his Blipfoto/Polaroid Blipfoto dollars to work and how many of those dollars he and Jeff Hecktman are planning to invest (see 'future sustainability' below) ?
Sager's story is not a quite rags-to-riches biopic but it would certainly qualify as emblematic of the 'American Dream' narrative. And its made its way onto TV (see below).
For another perspective on the sector in which Sager made all that money that he so bored to talk about see this Financial Times article from 2011 where the 'colourful' former president of 'liquidator' Gordon Brothers, Bobby Sager, "regaled guests with tales of his good work in 'messed-up places'" at the charity fundraising dinner held for London’s Norwood charity by 'investors in distressed debt'.
The very detailed article is titled, 'Vultures circle Europe’s debt mountain' and gives an assessment of the investors-in-distressed-debt sector, which is made up largely of hedge funds
and private equity firms, and their activities in Europe.
I also came across in my searches a blog entry here on the Gawker that claims to be reproduce a hacked email from Mr Sager to Bouthaina Shaaban, a senior media adviser to President Assad of Syria in 2011.
I had no idea if the email was true or not but this report in the Boston Globe titled, Sager defends support of Syrian dictator, suggests it, or something like it, was.
Here's a video of Bobby Sager in Khayelitsha township, outside Cape Town, talking about indestructible soccer balls his Sager Family Travelling Foundation were giving away (For Khayelitsha see my site's history of those townships and conditions in them).
The South Africa TimesLive website reported Sager's Cape Town visit with his indestructible footballs
in World Cup year under the headline, 'American do-gooder puts a stop to breaking of balls'.
So yes these guys are successful, very successful, and one of them spends more time giving away money than making it. Although he is still a Director of Gordon Brothers , the 'liquidator', as the
FT puts it (above).
Maybe they really do share 'our' (I don't know who this 'our' is) 'collective' passion and enthusiasm for the 'Blipfoto' 'platform'.
It's very possible they were both involved in the discussions around the Blipfoto Ltd/Polaroid tie-up and what's not be be enthusiastic about? Aren't we all passionate about the platform?
'And they are as eager as I am [not 'we are'] to see it continue to grow and expand.' Again, what's not to like?
And to be honest, they both look kind of busy for photo-journaling, but I could see blipping from the Sager Family Travelling Foundation from 'messed up' places around the world could be fun and informative (see for example the lovely Blipfoto journal, WellsforZoe).
The message from the 'platform' continues with Joe Tree expressing relief that business leaders have been found found that share 'his vision for Blipfoto' (again without the 'Polaroid') . He expresses his confidence that the new owners have the 'creativity and resources to support a long term plan for the platform.'
There's that 'platform' word again. Was that always part of the Blipfoto lexicon? First time I came across it was in a Polaroid press release about Polaroid becoming a 'licensing platform' in 2014.
And you can see why there is 'confidence' with the new owners because Blipfoto Polaroid had direct corporate and possibly personal links with them during the development of the 'Blipfoto' vision under its 'Polaroid Blipfoto' guise.
It's unclear in the announcement whether the new entity will be 'Blipfoto' or 'Polaroid Blipfoto': both are used in the text. But my guess is that it will be called, 'Polaroid Blipfoto', and that the licensing agreement will be renewed in one form or another. The website and apps are all now designed around the Polaroid Colour Spectrum and Border and the branding is embedded everywhere.
It would also be pretty strange for the owners to back away from Polaroid when they have such strong corporate links with it even if they are investing as individuals.
(Although the 2014 shift in the ownership of Polaroid with a 65% controlling share now owned by Minnesota's Pohlad family investment
group might be something that needs to be factored in. But probably not.)
New Roles and Clean Sheets
I'm glad that Joe and Graham are being asked to 'play an active role' in the company. The 'boundaries [that there will be] to work within' could be difficult or not. When you have been founders, senior managers, directors, owners and the original users all rolled into one a reduced role could be difficult. But there could be share deals or other emoluments to lessen the bitterness of the pill.
The platform's priority 'always will be future sustainability' we are told but we don't really know what that means - does that mean revenue break-even, capital-growth oriented, profit-making? Or something more to do with the future of the planet?
Starting with a 'clean sheet' is an interesting phrase and again what to make of it?
A clean balance sheet, for sure, because the company was liquidated and creditors payed off as far as the liquidator could achieve this.
I do wonder about the money Scottish Enterprise put in - £430,000 - (see previous blog). It seems a lot but that's the risk-taking model of economic development often used by state-agencies and you win some and lose others. And all is not necessarily lost - there's still the platform, the management and the community.
But if I were a bone fide reporter I'd be asking Scottish Enterprise for a statement. (It's funny there has been no news in the media about the announcement. Maybe there were just not enough
facts in it to build a story.)
I'm relieved the community will be 'well represented' as work begins on future plans for 'the platform/company' but disappointed that the way that the community will be represented is not detailed and that all that 'scurrying around' is going to take place first.
How and who will represent the community? And when?
It would be interesting to know what the new owners think about that. As far as I can tell they have largely worked in private companies that don't report to or consult with 'communities' and
have little public transparency. It would be nice to get a steer from them because the mood music coming from them will have an important influence on whoever is actually running the show from
Edinburgh or wherever.
And in the meantime the 'community', disparate and unknowlable as it is from within (we don't even know the user numbers in the community let alone the demographics and growth trends), might think about representing itself? You know, given that there is a 'clean sheet' and all that? (See my sign up here).
That phrase 'putting resources back in place that were lost at the beginning of March' makes you think. What would those 'resources' have been? The Blipfoto Team maybe? I wonder if rehires are in
prospect - it sounded a fun place to work. But again I've not seen any news on this.
The New Dawn
The last two paragraphs are a corker. Talk about alchemy. What was a pretty catastrophic liquidation (for the staff team, the investors and the customers of Blipfoto Ltd.) has now given birth to
an 'exciting transition' that has ' a bright future' and 'many wonderful new ideas in store'. Sort of - bang - crash - rebirth - and all in less than a month.
We can all toddle off now and 'rest assured' even if things in the 'very near term' might be a little bit unresponsive.
To be fair, what else can you say but I find this a strange statement. So full of unknowns and glowing optimism for the future. But then, as I said at the outset, maybe the announcement is more
the new owners speaking than the old.
And maybe as more becomes known that optimism will show itself to be well founded and the tensions between the drive towards the Polaroid brand and its demographic and the different layers and
segments of the Blipfoto community will be ironed out and we can all get on with what we came to Blipfoto or Polaroid Blipfoto to do. Blipping.
I think this will be my last blog on Blipfoto for a while. As of today the series has had 3,245 page views and the feedback I've received has been overwhelmingly positive. Thanks for taking the time to read the blogs and thanks particularly for your feedback, views and information about the Blipfoto story. I do go back and put in updates as better information becomes available.
I'd also like to thank Ian Stevenson at Salient Point, the high tech start-up service in Edinburgh, for helping me understand the inner workings of the startup world. He's also stopped
me making a fool of myself on a number of occasions for which I am most grateful. Anywhere else I've overstepped the mark into foolishness is entirely my own responsibility.
To access previous blogs go here and scroll through. Thanks again.
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