There is an article in today's San Jose Mercury News about Kanwal Rekhi, the founder of Excelan and industry VC/guru returning to business to take the helm at Ensim (and presumably, "fix it".)

The focus of the article is on Kanwal's personal success and reputation - many have known him since his Excelan and Novell days, but the entertaining part is the 'stats' mentioned casually about Ensim, the company he is returning to lead.

According to the article Ensim has had $90 million in venture capital, has a burn rate of $1 million per month and has about $30 million left and "making minimal revenue".

"He blames the deficit on managers who let decided to let customers use the technology for free assuming they can charge later when the economy improves. You're training your customers to expect not to pay".

So --

1. $90 million to code a freaking control panel?

2. If you've been paying for Ensim, consider yourself a sucker as everyone else got it for free

3. In any case, be prepared for price increases and/or big changes in pricing no matter what - the free ride is over.

Could you provide a link to this article? I would like to read it. Thanks

http://www.siliconvalley.com/mld/siliconvalley/4679238.htm

2. If you've been paying for Ensim, consider yourself a sucker as everyone else got it for free

I heard that it was a big european ISP who was taking them for a ride on serverXchange, they had been 'testing' it for about 2 years and never paid a cent

But interesting stuff, $90m in VC, interesting to compare to plesk, their corporate profile says 600,000 domains worldwide are running under plesk, at 400 domains per server that's just 1500 plesk web panels, which doesn't seem a lot, or maybe I'm reading it wrong, even if each is a $799 version that's just $1.2m in revenue - so which smart guy at the VC gave ensim $90m

1. $90 million to code a freaking control panel

You bet! for $90 million it should sell hosting accounts by itself :)

I am guessing eveyone there is well paid :)

for $90 million i could make the best control panel ever... out of grass!

lol

Yes it does sound strange.............

don't 90 million sounds ridiculous ?

for what they ended up with as a product it certainly does.

for 90 million it should cook me my breakfast and fetch my slippers..

for 90 million that damn thing better mow my lawn...

for 90 million......

my wife is here..hang on....:erm:

90 million, perhaps u could get a better panel than ensim ?

There is no way that Ensim cost 90million,, im sure there are programmers on this board that could do a better job, in fact ive seen one or two free panels posted by people on this board that could easily compete with ensim,, they need to find some sucker company to sell for for 90million.. Ensim is not at all worth what they are currently charging.. 399,, i dont think its worth it.. its nice for 199, but i think the product is too hard to use and to behind in the market..

just my 2cents..

i guess they use 100 dollar bills to keep their offices warm :P :flamethr:

1) They went through $60 million, not $90. :)

2) They started as a pre-IPO company back in the .COM hay-day. They had the same frivolous spending habits just as the Harvard fools who flooded the Bay Area.

3) That $30 Million should last a long-time. I would hope they cut some fat (I know they did) and audit their books closer.

4) They did not just develop 1 CP. They have the SX product, Windows CP, they intergraded a lot of other advanced GUIs you guys don't even know about. Exchange server GUI for messaging and collaboration, Antivirus scanning at the box level, etc... [This stuff is too expensive for anyone to use around here (including us) - most anyway].

Of course even $60 million is a crap load for this type of end result. :D But in their defense, they didn't spend it just on Linux WP GUI. They have developed more and also had some expensive failures.

2) They started as a pre-IPO company back in the .COM hay-day. They had the same frivolous spending habits just as the Harvard fools who flooded the Bay Area.
but seems they didn't change their ways even after the dot bomb as they didn't raise $70m of that VC until jan 2001, whereas the dot bomb started early 2000

4) They did not just develop 1 CP. They have the SX product, Windows CP, they intergraded a lot of other advanced GUIs you guys don't even know about. Exchange server GUI for messaging and collaboration, Antivirus scanning at the box level, etc... [This stuff is too expensive for anyone to use around here (including us) - most anyway].
agh, secret stuff we don't know about

and also had some expensive failures
obviously 'very' expensive failures.

Of course even $60 million is a crap load for this type of end result.
understatement of the century.

You aren't one of the poor saps with their money being wasted by this firm are you UmBillyCord :)

but seems they didn't change their ways even after the dot bomb as they didn't raise $70m of that VC until jan 2001, whereas the dot bomb started early 2000

Raising $70 million doesn't happen in a month. They started the process months, if not years, before.

agh, secret stuff we don't know about

Many think that what lies within WHT is realitity. They do not see someone talking about other feature sets that someone has, then to them they do not exist. Look at H S P. People act like it just came out. Within the last two months the buzz went hive-loud. My point is that you will not see 1 thread or post on these other features that Ensim has. Nothing secret, no where stated so.

You aren't one of the poor saps with their money being wasted by this firm are you UmBillyCord

If you meaning of "poor sap" is someone who uses Ensim and has grown a very successful company that has been in the black since month one back in 1999, then call me a "poor sap". ;)

If your meaning of "poor sap" is someone who knows nothing of business and thinks $60 million is a lot for a corporation to blow through *and* that it was not common place back in the day, then no - I'm not a "poor sap". That is someone else I know. :)

In business, you must always have a back up. Ensim dies, we move to our back up. Simple as that. To dwell on would've of, could've, and should'ves in business is nothing more then wasted time.

PS - Ensim is not alone in their spending top dallars on CP/GUI development. Do Sun and Sphera ring a bell?

Also, this type of things happened throughout our industry. For example; companies who were in on the DC build race - lost out. Verio, Exodus, Genuity, etc.... Money was wasted. Those who fought lean and mean were the survivors. Plesk, cPanel, etc... are a sample in the CP market.

;

Raising $70 million doesn't happen in a month. They started the process months, if not years, before.
It's not the raising of the money I was referring to, but the spending of it, all after the dot bomb so no excuses about .com hay-day apply, they wasted the majority of the money well after the .com hay-day.

If you meaning of "poor sap" is someone who uses Ensim and has grown a very successful company that has been in the black since month one back in 1999, then call me a "poor sap".
I meant what I said, which wasn't anything to do with your business, although a nice self-promo, presuming of course that it is something special, which I doubt it is, as we are exactly the same, 1999 and in the black;) and I imagine many others are too.

If your meaning of "poor sap" is someone who knows nothing of business and thinks $60 million is a lot for a corporation to blow through *and* that it was not common place back in the day, then no - I'm not a "poor sap".
but it wasn't 'back then' it was during 2001 and 2002 they wasted the money, check the press release on their site, they didn't get the VC until jan 2001

Even their new 'top man' thinks it was wasted and who do you think will be the poor saps who will help give the VC's their $60m back? Well, you of course, Ensim customers. Their business model from now on will have a big chunk in every product sold to put some of that money back and build the worth of the company up to a point where the VC's can exit.

It's not the raising of the money I was referring to, but the spending of it, all after the dot bomb so no excuses about .com hay-day apply, they wasted the majority of the money well after the .com hay-day.

The more money you have, the more money you spend. Never said it was right. Never said it wasn't stupid. But that is what happens.

Guess what. News flash. Companies are still spending like crazy and going under.

I meant what I said, which wasn't anything to do with your business, although a nice self-promo, presuming of course that it is something special, which I doubt it is, as we are exactly the same, 1999 and in the black and I imagine many others are too.

People who know me around here, know I never promote. In fact I have not ever received a customer from here in the over two years I have been coming here.

Of course you are in the black. Of course you have been round since 1999. Of course *many* others are too. Heck you should have just changed it to 1996. I mean, who knows when you do not post your company. ;)

Even their new 'top man' thinks it was wasted and who do you think will be the poor saps who will help give the VC's their $60m back? Well, you of course, Ensim customers. Their business model from now on will have a big chunk in every product sold to put some of that money back and build the worth of the company up to a point where the VC's can exit.

I find it funny when someone who doesn't even use a product or service, decides to comment on it and tell the users of that product or service, "how" its going to be. If you have an opinion, great. But your post is telling us what is going to happen.

My pricing has come down. Oh, and some people run their business with the ability to quickly move and recover. It is called "worse-case senerio" planning. You should know that being you have been around since 1999.

If Ensim jacks up their rates, just what? I move. So while they are around, and I am getting great service and a great product, I will continue to use and defend them. Especially from someone who doesn't know anything more then what a news blip released.

<edit>
What CP do you use?

60million i would expect at the very least something along the lines of sphere or something..

People who know me around here, know I never promote
So if it wasn't self-promotion what was it for? It had nothing to do with the post or you were trying to tell me "hey I've been around for years and I know what I'm talking about, so I must be right" don't think so somehow. Does it hurt so much to think someone else can have been around for as long as you? I don't put the company name for a reason, but I will pm you if you want to take the risk of being wrong? Of course if I do then I expect you to post to rectify this:
Of course you are in the black. Of course you have been round since 1999. Of course *many* others are too. Heck you should have just changed it to 1996. I mean, who knows when you do not post your company.
I find it funny when someone who doesn't even use a product or service, decides to comment on it and tell the users of that product or service, "how" its going to be. If you have an opinion, great. But your post is telling us what is going to happen
Laugh away, it's like saying you can only comment on smoking being bad for your health if you smoke. You don't need to be an Ensim customer to be qualified to comment on them, how ridiculous is that, in fact as your comments have shown an actual customer sometimes cannot comment impartialy about a situation.

It seems you take it all too personal, I'm sure it's easier for you to start trying to personally attack me rather than stick to the actual thread, I mean whats this What CP do you use? got to do with a post about ensim blowing $60M?

The facts are quite straightforward, if a company blows $60m in VC and has little to show for it, then the VC (as in this case) make some changes at the top, because they want to see an exit strategy that gets them their money back or at least some of it. To do this customers pay more, it's just simple business nothing too difficult.

So if it wasn't self-promotion what was it for?

Do you know what self-promotion is??? Sorry, but I don't see my business name around here anywhere. So what am I promoting? Get it?

Does it hurt so much to think someone else can have been around for as long as you?

I am sure you think 1999 is a long time. Maybe you like patting yourself on the back, but to me 1999 isn't that long. Better then most, but still not old. I am not naive enough to think 1999 is being around a "long-time". So I have no idea what the hell this came from. You made a stupid post about people using Ensim being "poor saps". I pointed out... well, I am sure you can read what I replied.


Laugh away, it's like saying you can only comment on smoking being bad for your health if you smoke.

No, it isn't like this at all. You don't have to jump off a bridge to know it will hurt. But you need to jump to truly experience what it feels like. You read one news release, then act like you know what is going on at Ensim. Did you ever think they could be correcting things and moving forward? Does it have to be certain death? Get my point?

Also, I find things like your post in another thread to be related to this:

http://webhostingtalk.com/showthread.php?threadid=94393

Your comment:

I've not used the ensim transfer but I don't think it will transfer datbases

You have no idea. Just a complete guess. Sorry if you feel you are being attacked. But unless you have more insight or actaul experience, calling people "poor saps" for using a product or service you do not use certainly will not win you any friends around here.

got to do with a post about ensim blowing $60M?

Well, since people who use Ensim are poor saps, I just wanted to know what CPs people other then "poor saps" use.

but I will pm you if you want to take the risk of being wrong? Of course if I do then I expect you to post to rectify this:

.... waiting on a PM....

I love flame wars...but who were you quoting UmBillyCord :confused:

I am sure you think 1999 is a long time. Maybe you like patting yourself on the back, but to me 1999 isn't that long. Better then most, but still not old. I am not naive enough to think 1999 is being around a "long-time". So I have no idea what the hell this came from. You made a stupid post about people using Ensim being "poor saps". I pointed out... well, I am sure you can read what I replied.

You were the one quoting 1999 as your setup time not me, you are the one who quoted it as something special not me, you made the stupid post, read the thread UmBillyCord if you have forgotten this - I pointed out that it is nothing special to you - so if you are still wondering where the hell it came from ask yourself.

As I asked you earlier what the hell it had to do with this thread and now you are asking me! Get your facts right UmBillyCord, as I don't think 1999 is long but you mentioned it as some kind of quote to make your comments have more meaning!

I never posted people using ensim are poor saps, I said the invetors were, and anyone who purchases ensim in the future must do so realising they are paying for the mistakes made by previous ensim managers.

No, it isn't like this at all. You don't have to jump off a bridge to know it will hurt. But you need to jump to truly experience what it feels like. You read one news release, then act like you know what is going on at Ensim. Did you ever think they could be correcting things and moving forward? Does it have to be certain death? Get my point?

No I don't get your point, no one is saying, including me, that it is certain death, no has said they are not putting things right, what has been said is they wasted $60m and to put this right there current and future customers will pay for this, you don't need to have bought an Ensim panel to know this, just a bit of common sense.

I'll give the rest of your post the respect it deserves, which is none.

Well, this is now truly wasting my time. Here, mr. short-term memory:

Originally posted by time-to-go

You aren't one of the poor saps with their money being wasted by this firm are you UmBillyCord

and


Originally posted by time-to-go
Even their new 'top man' thinks it was wasted and who do you think will be the poor saps who will help give the VC's their $60m back? Well, you of course, Ensim customers. Their business model from now on will have a big chunk in every product sold to put some of that money back and build the worth of the company up to a point where the VC's can exit.

As stated before. Calling people who use a product or service you do not, "poor saps", is ignorant. I find it offensive, especially when you have not one bit of knowledge or experience over this simple news release.

Feel free to carry on with this......

You aren't one of the poor saps with their money being wasted by this firm are you UmBillyCord

Yes, I was asking if you were one of the investors, in other words is part of the $60m yours? As you seem to want to defend something even ensim are not defending.

As for the other comment it is true, where else is the money going to come from to allow the VC's to get their money back, but from customers, so it is obvious the wasted money will inflate future product prices and so you will pay more if you are a customer, you are right I find that offensive. Unlike you I am not going to start quoting why i think this or what experience I have to do this, but if you want it let me know, but you'll probably ignore that as you have before.

So instead of personally attacking me and saying that just by "being a customer I would know" more prove it, you are obviously so close to ensim management thinking by buying a few panels, where are they going to recoup the $60m if not by hiking prices? The money is spent, so cutting future costs won't bring it back - I would imagine they will have to over-price.

but I will pm you if you want to take the risk of being wrong? Of course if I do then I expect you to post to rectify this:

Still awaiting a response for you to rectify your earlier comments but I imagine you'll skip over that as you don't seem like the sort of person who likes admitting to being wrong. You brought the subject up, you accused me of lying, which I wasn't, but you now seem very quiet on this. Just like you seem to like attributing me with bringing this up!

Still awaiting a response for you to rectify your earlier comments but I imagine you'll skip over that as you don't seem like the sort of person who likes admitting to being wrong.

--------------------------------------
ATTENTION WHT. ATTENTION.

For what it is worth.... Time-to-go has a company founded in Dec of 1999. He has over 1000 customers! I can't name the company as I have a PM NDA, but it was important for him to be validated.

Carry on....
--------------------------------------

OK, hope you can sleep better. This poor sap is moving on until the next time he is called a poor sap.

I think it is only you who that was important to ;)

Uncle Kanwal Rekhi (Indian)
:D

Fellas, this has turned into little more than a pissing contest at this point. If you two feel like going at it, then by all means, do so over PM. But please leave the rest of the members on this forum out of it.

Threads like this do little more than reduce the integrity of WHT as a valuable and credible support forum for the Web Hosting industry (which it definately is).

Thanks for your consideration in this matter,

Originally posted by Nevidia
Fellas, this has turned into little more than a pissing contest at this point. If you two feel like going at it, then by all means, do so over PM. But please leave the rest of the members on this forum out of it.

Threads like this do little more than reduce the integrity of WHT as a valuable and credible support forum for the Web Hosting industry (which it definately is).

Thanks for your consideration in this matter,

Bryan Jaskolka, CEO
Nevidia | Internet Solutions
http://www.nevidia.com

Hello Byran,

Did you know that you are free to not read anything here? You are also free not to post? I appreciate you view on what you think WHT is. I am sure you have learned a lot over the last month. However post like these will happen - on any forum. So if you plan on enjoying yourself around here, just ignore it and move on. You will see this again. Chances are you will see it from me.

Also, please read the rules, particularly this one:

Signatures must be setup in your profile and not manually added to your messages. Participants may not use a "signature" with plan descriptions or any pricing information at the end of Forum messages. Signatures must be kept to a maximum of four lines.

Thanks for your consideration in this matter.

Hi Everyone..

Youre not going to beleive this..but Ensim plowed through 90 million dollars...!!!!

Gosh does anyone else know about this...?... :eek2:

Originally posted by time-to-go
where are they going to recoup the $60m if not by hiking prices? The money is spent, so cutting future costs won't bring it back - I would imagine they will have to over-price.
That's a pretty simplistic view of how to turn a company around. You're saying cutting future costs won't increase revenue?

P.S. Only in web hosting since 2000. My apologies in advance :D

You're saying cutting future costs won't increase revenue?

Yes that's right, cutting future costs will just put the companys revenue back to where it should have been. So if they cut costs today to something realistic, from today forward they will make an ordinary profit level, what they need to do is make an 'exceptional' profit level to recoup earlier losses/over spending.

From a VC's stand-point they invest in a company to make high yield in the short and sometimes medium term (high risk investing), part of the VC's deal is always an exit strategy. In other words a way for them to get out with their initial investment plus profit. One thing VC's don't do is hang around for years on low yield. They would invest the money in shares if that's what they were about. They look to invest, wait a few years and hope for a flotation or takeover/merger to release their equity.

What's important to a VC is the value of the equity they own in the business. In essence Ensim have just a third of the VC investment left and they have to use that to increase the value of the company in a much shorter timescale - so a much harder job if just cutting costs.

The downside is that because VC's know their invetments are high risk they will pull the plug rather than waiting years to see a return. They mitigate their risk by having a broad portfolio and they don't expect every investment to win for them.

As it's already almost 2 years since receiving the bulk of their VC Ensim is already into meduim term (when you think most VC fund life spans are usually only 10 years - that's for the total fund not individual investments) to get a good return for the VC. As an example, if they planned on using the $90m over a 3 year period they now just have $30m and one year to achieve the same results. The key is that ensims flagship product 'serverXchange' was developed before the majority of the VC was raised, so it would be easy to assume the spending of the $60m VC has not contributed to the value of the company, just spent on running expenses, spending on running expenses does not bring a return/increase share value, whereas the development of new products for the money may have.

I guess I hadn't looked at it from the VC's point of view. Some good points you raise there :)

It will be interesting to see just how this pans out...

I guess Ensim is developed by some indian programmers, some directories are named after their names, which are Indian...

Well, Ensim's Webppliance isn't a lousy product, others, umm i havn't used.

For an indian product it sure cost ALOT! For that amount they should have had NASA on the project:)

Whatever time-to-go just said makes since all though it hurts my head to think about it:eek:

And by cost alot i mean the amount of money theyve spent with development, etc...

But the product itself is still overpriced for what it provides and considering the competitors out there with far more attractive pricing with a better features list and less hassle.

my 2cents.

Well.. alot of VCs had also been burnt, know that it's normal and move on. In fact, the rules of the games are that VCs get burnt usually more often than not. But it's that 1-2 successes that changes the game for them. i.e 90% of their deals can go sour, but just having 10% make it will be good enough to earn spectacular returns.

VCs typically will look at return to profitability which consist of cost cutting plus revenue generation. VCs a lot of time are more obsessed with the former as you are spending their money. Not that they aren't about the revenues... but the funny thing is they are more worried about costs.

But then again. 30 million is plenty to turn around a company on. I know a lot of people who can do that.

The exit does not come from your revenues... it will never be enough. It has to come from an extraordinary event like merger, sale of shares, listing of company and so on. So as long as you can make it profitable or/and create some valuable IP, you can still make some returns for the VC easily.

Originally posted by silversurfer
Well.. alot of VCs had also been burnt, know that it's normal and move on. In fact, the rules of the games are that VCs get burnt usually more often than not. But it's that 1-2 successes that changes the game for them. i.e 90% of their deals can go sour, but just having 10% make it will be good enough to earn spectacular returns.

VCs typically will look at return to profitability which consist of cost cutting plus revenue generation. VCs a lot of time are more obsessed with the former as you are spending their money. Not that they aren't about the revenues... but the funny thing is they are more worried about costs.

But then again. 30 million is plenty to turn around a company on. I know a lot of people who can do that.

The exit does not come from your revenues... it will never be enough. It has to come from an extraordinary event like merger, sale of shares, listing of company and so on. So as long as you can make it profitable or/and create some valuable IP, you can still make some returns for the VC easily.

Some people do not understand this. Good post.

Also 30 million is a 'hell' of a lot of money. Especially now that they have someone aware of past spending habits.