Dancing with the Giants
Ed Colligan
VP Marketing, U.S. Robotics
Who was Palm computing?
- Small venture-backed software company
- Founded January 1992
- Specialists in software for handhelds
- Introduced Graffiti September '94
- Acquired by USR September '95
- Introduced Pilot March '96
What Giants?
- Casio, Sharp & Tandy
- Hewlett Packard
- Motorola, Compaq & Ericsson
- IBM, Phillips, Sony, Microsoft
- Finally U.S. Robotics
Rules of Engagement
- Get perceived major issues out on the table early. They'll negotiate you to death.
- Never let them dictate the timing. Your going to do it with or without them!
- Set hard deadlines and don't be afraid to walk away.
- Always have a second credible option! It makes you a better negotiator.
- Have faith in yourself. Don't get desperate and do a bad deal.
The USR Deal
- We wanted a modem; they made us an offer we couldn't refuse.
- How did we get to $48 million?
- Previous round at $30 million
- 2 times projected revenues
- couldn't take less than $5/share
- why USR
- autonomy
- communications technology
- entrepreneurial behavior
The Results
Benefits
- investment enabled faster growth
- great execution brought autonomy
- purchasing, manufacturing expertise
- brand awareness aided market entry
Pitfalls
- Success has a thousand feathers
- Sucked into corporate much
- Loss of total control
- Who Knew We Could Get $700 Million!