From JobLoft (Dragons’ Den) to Teamsave – Chris Nguyen

Canadians first “met” Chris Nguyen on CBC Dragons’ Den when he and three others young guys pitched JobLoft (see my previous articles about Chris). So it is interesting to watch Chris again on The Globe and Mail (video) today, talking about Teamsave.com (a “fast follower” in the crowded field of Groupon-want-to-be).

Dragons’ Den – JobLoft’s blog about their deal breakup

Dec 9th, 2010 Update: From JobLoft (Dragons’ Den) to Teamsave – Chris Nguyen

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I’ve already commented on JobLoft’s deal getting away so I will now focus on only a few key and important points in the JobLoft’s blog entry (Dec 9th, 2010 update: thanks to Tuzo, here is Wayback Machine’s archive of JobLoft’s blog entry that was “deleted”). And I quote from JobLoft’s blog directly here,

• “What we need to address first is that what was shown on TV was just a glimpse of what happened in that boardroom on a wonderful Halloween morning. Of course, it was edited for TV, and producers have a magical way making things look and feel a certain way for television.”
  • [K: Are there any reasons for CBC to deliberately twist the JobLoft story to favour the Dragons? Seems to me it is good TV either way already. As far as I know, Stu has a background in Fifth Estate and Tracie has a background in Venture. In my humble opinion, there are just too much journalistic integrity in them to really distort the story one way or another. I wander if JobLoft has a full audio and video recording of what happened that Halloween morning to support their views? If they don't have the tapes, has a request been made to CBC to help clarify the events that morning? Full video of the meeting may be required for analysis to be fair to all parties involved.]
• “We are fortunate to have him [Dr. James Norrie] as a mentor and we are willing to stand up for the best interests of the company.”
  • [K: Did JobLoft truly want the deal to go through? Why were nothing done or said by the founders to stop Dr. Norrie's personal insults of the Dragons? Why create such a negative environment right at the beginning of things?]
• ‘For the record, Chris Nguyen, CEO of JobLoft says, “I learned a lot about business when I was at Ryerson…but nothing prepared me for the harsh lessons about what can happen when things go so wrong, so fast. [K: emphasis mine] The coolest thing about it though, is that in retrospect I wouldn’t change a thing about what happened and learning is always a good thing. As we complete the search for appropriate investment partners in the coming weeks, I think the shareholders have realized that we are better off with this outcome than the alternative of a fractious board fighting about the right strategy for our company. I would never take an investment offer again without making sure everyone was aligned on the company strategy. No regrets, no hard feelings and my partners and I, and even our company advisors, all wish the Dragons well and hope they can say the same about us…”’
  • [K: Learning is of course a good thing. But I was deeply disappointed to read that, "... in retrospect I wouldn’t change a thing about what happened ...". Chris didn't have the basic graciousness to apologize for the personal insults by Dr. Norrie ( who is a director of the company) against the Dragons and Jim.
  • K: Did the JobLoft founders support Dr. Norrie's view of the deal being under-valued? The problem was that Dr. Norrie's attack was partly predicated on $200,000 being too little money. And given Dr. Norrie's view of the fairness of the amount, supporting Dr. Norrie's view fully has the same tone and appearance of backing out of a deal simply because of the agreed upon amount of money weren't "good enough".
  • K: May be JobLoft can get more investment dollars elsewhere. May be money really trumps "a deal is a deal" and integrity in our world where Donald Trump was treated as model businessman and source of wisdom. I just hope there is more than just money in life. I may be wrong. (smile)]

Here is a philosophy that I call “front page story test” which I learned from Warren Buffett after reading Roger Lowenstein’s Buffett: The Making of An American Capitalist about ten years ago. I will quote Warren Buffett to Salomon Brothers employees (I think it is Salomon) here, [K: emphasis mine]

“I want employees to ask themselves whether they are willing to have any contemplated act appear on the front page of their local paper the next day, be read by their spouses, children, and friends … If they follow this test, they will not fear my other message to them: Lose money for my firm and I will be understanding; lose a shred of reputation for the firm, and I will be ruthless.“

Now, the JobLoft founders and Dr. Norrie have put themselves in the center of attention on national TV. I am deeply sadden that based on limited clips that I’ve seen and the above Jobloft blog entry, I truly wonder if the four JobLoft entrepreneurs and Dr. Norrie have unwisely traded off part of their reputation for a potential better deal for JobLoft (i.e. more money and other benefits). Is it worthwhile? Your comments are much welcomed here.