Most young companies that enjoy early and rapid success have growing
pains, and Silverbonde Lotions was no exception. By then a multibillion
dollar enterprise with a Board of Directors and profit expectations from
shareholders, the Board had grown a bit impatient with what they perceived
as young Max’s lackadaisical approach to his CEO role. They rightly
perceived that Max was more interested in formulating and developing
additional products than he was in the day to day activities of running
Silverbonde Lotions. However, they underestimated Max’s ability to
multitask. Especially now, with the support of Honey, Max was beginning
to contemplate the possibility of other world changing products that his
polymer chemist skills could create. Nevertheless, the Board wanted a
“professional manager”, and they wanted it now! They insisted that he
bring in a CEO who could make sure the company was run the way a
multibillion dollar enterprise was supposed to be run.
A nationwide and international search ensued, with Silverbonde Lotions
looking for the individual who could both harness Max’s entrepreneurial
genius and deal with the business aspects that the Board demanded. The
first four of the five finalists for the job were either taken aback at the
challenge, or felt that they wouldn’t lower themselves to take direction from
young Max. The last finalist was a man named John Scuddy, who at time
was the CEO of a large consumer goods company that made among other
things, packaged snacks and soft drinks. The onsite visit to Silverbonde
Lotions went well from Max’s perspective. He felt that he could work with
John. John’s meeting with the Chairman of the Board went equally well.
They had their man! When the day ended, Max was to accompany John
back to the airport in the company limousine. On the way to the airport,
John was unusually quiet. Max told John that everyone was happy with
how things went and that they would be preparing an offer. John was
silent. Max asked what was wrong. John said he was unsure whether he
should make the move. Max was shocked. Silverbonde Lotions was
already nearly as large as John’s current company, and had unlimited
growth potential. Max struggled for a minute or so for what to say. After
all, if they couldn’t convince John to join Silverbonde Lotions, they would
have to start their search all over again. Finally, Max said to John "Do you
want to spend the rest of your life selling flavored water or do you want to
moisturize the world?" Those were the magic words! John saw the
potential of Silverbonde Lotions versus his current company and told Max
“You know, you’re right. We can moisturize the world together! I’ll await
your offer!” Silverbonde Lotions indeed had their man!!
Flash forward two years:
Silverbonde Lotions is experiencing phenomenal success and Max has
been recognized worldwide for his polymer chemist skills. The success of
the company, however, has led the Board and CEO John Scuddy to think
that they no longer needed Max at the helm. Instead of correctly
recognizing her as Max’s muse, they mistakenly believed Honey to be a
negative influence on Max. Besides, John and the Board were the ones
who had marketed Silverbonde Lotions worldwide. The product was what
was important, not Max. What did they need Max for now? There was only
one problem … Max still owned 49 percent of the company shares which
would allow him to partner with any other institutional shareholder to take
full control of the company if the Board moved to oust him. So instead,
John and the Board decided to make an effort to buy Max out. A meeting
was held. John and the Board Chair offered Max a price substantially
above the current value of the shares. Since Silverbonde Lotions initial
success, Max had always lived a comfortable life, but it had been far from
lavish. This buyout would make Max one of the 5 wealthiest in the world at
the ripe old age of 32. How could he refuse! Wait … there was a catch.
Max would have to relinquish the patent on his groundbreaking formula for
Silverbonde Lotion and also sign a non-compete agreement to never
attempt to make or market a skin care product that would compete with
Silverbonde Lotion. John and the Board felt this deal would at last get Max
and Honey out of the way. On the other hand, Max felt that the deal would
at last free him to create the other products that his current duties with
Silverbonde Lotions had prevented him from working on. And with Honey
at his side, he knew they would be unstoppable! The deal was done!! Max
and Honey were billionaires!
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