Meant to link several days ago to Bill Hobb's timely post on Al Gore's upcoming IPO for Current Media---which seeks to raise $100 million from would be investors.
In that post, Bill also links to a recent News Week article on Gore's wheelings and dealings which the writer considers a bad deal for investors. Author Ron Grover writes,
"In the financial election of his life, Al Gore is betting that investors will vote with their dollars for him and his big idea. CurrentTV's parent company, Current Media, hopes to raise $100 million in a public offering it filed on Jan. 28.
Some of the money will go to pay off lenders, who include a couple of Democratic Party biggies that joined the onetime Veep to launch a new style of citizen-journalism. Of course the IPO will also help make Gore, who sits on the board of Apple (AAPL) and is a senior adviser to Google (GOOG), a sizable bundle of cash.
"Something about this deal just doesn't sit right with me. Gore isn't just taking piles of cash. According to the filing Gore, who is listed as executive chairman, and his CEO partner, lawyer-turned-entrepreneur Joel Hyatt, each loaned the company $1 million to get it started. They'll get that back in the IPO. But the two guys also collect hefty salaries for a company that hasn't shown a profit in three years—taking down $491,677 apiece last year in cash, plus bonuses of $550,000 each for, in Gore's case, helping get the company new affiliate agreements, broadening exiting agreements, and putting together a management team. The two currently receive $600,000 a year in salary and are eligible for additional bonuses, according to the IPO filing.
"By comparison, at the time of the Google IPO in 2004, its two founders were each taking home a total of $356,556 in salary and bonuses, while sitting on top of a company that had earned nearly $106 million the year before."
I can just see it now, Al Gore, the next titan of a Google-style company. He pays himself lavishly while his company has yet to turn a profit. Well, he deserves to be paid well. He's Al Gore, after all.
All I can say is run, don't walk away and hold on to your check book for dear life. It sounds more like Enron than Google to me.
Anyway, you may need your money later---if Al has his way---to buy carbon offsets to take your family out for a Mexican dinner.