“The Diligent Story—My Most Recent IPO”
THE VISION AND PUSH necessary to take a company public is a huge job. And, with Diligent, besides founding the company, the role I played was getting it over the line to a successful IPO.
But you can’t get it over the line unless everything else about the company is performing like clockwork in the background — which means having a spectacular management team back at headquarters running the company and making sure sales are being made, services are being delivered, and clients are happy:
1) We had a powerful creative and marketing group who built and maintained Diligent’s global brand. This was (and remains) a critical component in successfully signing up the boards of many of the largest corporations in the world (including our first Fortune 500 client as early as 2003). It was also critical to our success in having global stock exchanges, such as the London Stock Exchange, competing for our listing.
2) We had a global legal team ensuring we did everything correctly for the IPO, and that we met all the due diligence and corporate governance requirements pre-IPO, IPO, and post-IPO.
3) And, while all of that was going on, a fabulous team of IT people, software developers, and administrators were performing in the background making sure everything was running smoothly so I could go out and interview exchanges, recruit directors, and secure pre-IPO money. This made it possible for me to represent Diligent at an investment banking level without worrying about the day-to-day operations of the company.
So, while I was essentially out of the office for nearly a year doing what I had to do with the lawyers and investors, the company didn’t miss a beat.
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I want to publicly thank and acknowledge the outstanding Diligent senior management team that was in place at the time of the public offering that made the Diligent IPO, and its ongoing success, possible. The members of my team (with their respective job titles and descriptions at the time we went public in 2007) that I want to thank include:
• Alex Sodi, Executive Director and President— one of our earliest senior employees who joined Kiri and me in 1998. He managed the development of Diligent Boardbooks and was responsible for maintaining the pivotal relationship with Diligent’s foundation client, SunAmerica Funds — and who did a superb job taking over CEO responsibilities and leading the company when I stepped down. In my view, Alex is doing a great job as CEO of the company today.
• Sharon Daniels, Executive Director and Chief Marketing Officer — an original founding partner of Diligent, responsible for creating and maintaining the Diligent global brand and market position. Sharon is now Executive Director and Chief Marketing Officer of Arria NLG.
• Bob Craig, Chief Development Officer — an original founding partner of Diligent, developed the original Boardbooks interface and headed the product development and special projects group. Bob is now Executive Director and Chief Development Officer of Arria NLG.
• Kiri Borg, Co-founder of Diligent and its predecessor, Manhattan Creative Partners (MCP)—Kiri won and managed the seven figure software development contract that put MCP into the database-driven software business. Over the ten year period prior to the company's transformation into Diligent, Kiri recruited and developed many of Diligent's top executives, including its current CEO. Kiri also implemented many of the systems and controls pivotal to future public company operational stability. Her extensive New York city corporate experience and Fortune 500 background helped build a well-managed company pre-IPO, enabling it to smoothly transition into the public company realm.
• Marc Daniels, Chief Operating Officer — responsible for the superb sales force that presented and sold Diligent Boardbooks to potential clients.
• Simon Small, Managing Director, Europe — responsible for launching Diligent’s board portal throughout the UK, Europe, Africa and the Middle East. Simon is now Executive Director and President of Arria NLG.
• Don Meisner, Chief Financial Officer: USA — responsible for the U.S. accounting, forecasting, budgeting and financial reporting.
• Kevin Lawler, Chief Financial Officer: New Zealand — responsible for the New Zealand accounting, forecasting, budgeting and financial reporting — played a huge role in getting the company’s finances in order and working with the auditors in preparation for the IPO.
• Tricia Burke, Vice President, IT — managed the complex global IT and hosting operations critical to the success of Diligent.
• Al Percival, Vice President, Software Services — responsible for the top-notch software development team in New Zealand.
• Bryan Zwahlen, Vice President, Support — managed the global support of Diligent Boardbooks working directly with the directors and general counsels of clients worldwide to support the Diligent Boardbooks application.
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I would also like to thank these major outside contributors:
• Dan Kiley, Original Partner and first Chairman of Diligent Partners, LLC — I am indebted to my friend, Dan Kiley. It was Dan and his incredible enthusiasm that first encouraged my brother, Gerald, and I to take on the USA in 1987. It was Dan who focused our fledgling Manhattan-based strategic consulting business on the U.S. financial service industry. It was Dan who first introduced us to David Liptak in the 1990s when David was President of West Broadway Partners, and David became one of our earliest financial services consulting clients. It was Dan who introduced us to his friend, Peter Harbeck, President of SunAmerica (the client relationship that gave birth to Diligent Boardbooks). And, it was Dan who gave our company its name — Diligent — which is entirely appropriate since Dan would have to be one of the most diligent financial advisors I’ve ever met. Most importantly, Dan has stood by us through all our ups and downs, and is the personification of the word friend.
• Ken Carroll, The First Outside Investor in and second Chairman of Diligent Partners, LLC — After our consulting team helped Ken brand and position his company, Instrumentation Engineering, as a global player — he was able to sell it to Flextronics for $300 million. Ken then became Diligent Partners’ first major investor and its Chairman. It would be difficult to overstate the importance of Ken’s role in our success.
• David Liptak, Current Chairman of Diligent Board Member Services, Inc. — It would also be difficult to overstate the importance of David’s role in our success. Many people do not realize that David was one of our first consulting clients when we initially started our consulting business in Manhattan in the 1990s. It was David who introduced us to Alex Sodi, who became one of our earliest senior employees. And it was David who recently became an investor and the Chairman of DBMS, Inc., and who (along with Diligent’s astute board of directors) helped guide the company through the 2008 Global Market Crash to profitability.
• Tom Makeig, Legal Counsel to Diligent — an amazingly skilled legal mind who led the Diligent IPO legal and accounting team to the successful listing of Diligent on the New Zealand stock exchange. Without Tom’s knowledge of and expertise with global legal and accounting structures, Diligent would not exist. I am forever grateful for Tom’s ability to look at what’s best for all the sides in a deal, and to bring them harmoniously together. Tom is now General Counsel of Arria NLG.
And last, but certainly not least, I’d like to thank my brother:
• Gerald Henry, Strategic Consultant to myself and Diligent Partners, LLC (the majority shareholder of Diligent Board Member Services, LLC which was the precursor to the public company) from the inception of Diligent Partners, LLC through to the IPO of DBMS, Inc. — consulted on the development of Diligent’s global brand, its sales and marketing structure, and its SaaS business model. As an early adopter of (and a firm believer in the future of) tablet computing, Gerald also consulted on the technology growth path that included both online and stand-alone versions of the software. Gerald is now a Strategic Consultant to Arria NLG.
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My apologies to anyone I may have missed — my thanks go out to everyone who contributed and who continue to contribute so diligently.
Diligent Boardbooks is a registered trademark of Diligent Board Member Services, Inc.
As described in the 2003 Diligent Partners, LLC corporate brochure pictured above, Diligent Boardbooks® was created by the inhouse skills of Diligent Partners, LLC, a global consulting group which had previously focused on providing its global client base with both advanced software development services and leading-edge product, brand and marketing systems. It was also this team that took Diligent Board Member Services, Inc. public in 2007.
Diligent Board Member Services, Inc. has been a stellar performer on the New Zealand Stock Exchange. Despite an initial slide, its stock price has risen over 260% for investors since going public in December 2007. (Source: NZX Diligent Price History, 19 Apr 2010 to 19 Apr 2012)
After Brian left Diligent (a year after the IPO), the superb management team he left behind in the company, guided by the excellent leadership of Alex Sodi, did an outstanding job of nurturing and growing the business — making it one of the stars on the New Zealand Stock Exchange. And of special note, this performance took place during the deepest recession since the Great Depression. This chart shows Diligent’s Cumulative Sales by quarter since 2007, the year the company went public. This is indicative of the type of growth pattern a successfully run Software-as-a-Service (SaaS) company can produce. (Source: Q1 2012 Diligent Quarterly Report)
This 2003 Diligent Partners, LLC corporate brochure presented the partnership’s vision for the Diligent digital boardroom. The Diligent Boardbooks Board Portal was introduced in 2001. And, at the point this brochure was created in 2003, we had just 3 clients. However, by Dec. 31, 2007 we had 74 clients, of which 12 were ranked in the Fortune 500. That our startup software company had the global brand presence to have the boards of some of the most powerful companies in the world host their most sensitive corporate data on our servers is a testament to the power of the Diligent Partners, LLC team responsible for creating the product, the company and the global brand.
Diligent is now the world’s #1 Board Portal — and, as of March 31, 2012, serves 1,231 clients, 1,800 boards and 33,000 users worldwide.