Tuesday, Jul 8, 2008
Critical Path has faced stock drops and layoffs, but CEO Doug Hickey won't be lumped in with the losers.
Aug 14, 2000 | Doug Hickey's office at Critical Path sits right in the middle of the main floor so that anyone can drop by. The messaging company's CEO wouldn't have it any other way; he has always liked being at the center of things.
In 1989, when the Albany, N.Y., native got "the California bug," that meant working for Metropolitan Fiber Systems, a company that "sold Net applications and connectivity before we even knew what to call it," Hickey says. And later that meant becoming CEO of GlobalCenter, the Web-hosting firm, which he sold in January 1998 (and which hosts Salon).
He says he joined Critical Path in October 1998 because its core business of outsourced e-mail looked like a foolproof foundation for success. "I saw a huge opportunity," Hickey says. "When you look at the whole messaging marketplace, when you look at the ability to touch every Internet user -- I don't know if there's too many other plays out there like that."
Still, like many Internet companies these days, Critical Path has had its troubles. Its idea of moving messaging to the Web hasn't proved as compelling to consumers as many analysts thought it would. There have been layoffs at the 850-person San Francisco company, and the stock has dropped from a high of $100 to about $60. None of this, though, seems to trouble Hickey.
I read a few weeks ago that Critical Path laid off over 100 people. What happened?
If you've followed the company, you'll see that in 1999 we acquired a series of technology companies, and now that we've integrated all those companies into Critical Path, we have made an adjustment in head count. We cut out about 125 people, but we continue to grow the business very, very aggressively. If you look at our revenue numbers, in '98 we did less than $1 million in revenue; in '99, we did about $16 million in revenue. Analysts' estimates for this year are about $145 million, so the company is growing at an extraordinary rate.
"Adjustment in head count" -- that's an interesting way to put it. But where did this "adjustment" come from?
It came out of general administration, a small piece out of operations, a small piece out of sales and marketing. What we've really been able to do is put the right people for the right jobs doing the right things. That's different from some other companies. When they make an acquisition they, right out of the gate, make head count adjustments. We really wanted the right people in the right jobs. We had multiple people with one chair, if you will.
We put together packages for people based on their tenure with the company, so from that perspective we absolutely took care of people. We also pointed people in the direction of other opportunities. The third part is that because Critical Path is a company that's pretty well-regarded in all the areas where we made adjustments, we think great people will find great opportunities. We were helpful -- but the market itself has been very helpful.
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