Functional CEO Addicts
am sitting writing this on a flight, and the guy beside me has to be doing lines of coke in the bathroom. Three breaks in one hour. The people around me are also convinced, however, in case he has a mental disability, we aren’t prepared to say anything. Then again, if he’s doing blow, he might be very prone to having a temper. In any case he is certainly agitated and it looks like cocaine. This guy who reminds me of Ted.
I am often miffed when I see a certain CEO who is still functioning, albeit behind a faced of lies, coke and alcohol.
I first met this man in 1999 when he was a loudmouth shareholder in Starnet Communications (OTC:SNMM). He was incredibly vocal on the raging bull, the ihub of the day, and constantly was a general pain in the ass on conference calls. He was invited to visit the offices in 1999, and convinced the SNMM CEO at the time that he should join the management team. Needless to say, the CEO of SNMM at the time was a lame duck who had never really had a job before and was chosen because he had a law degree.
Ted started as on as one of the division presidents, and embedded himself into the management team based in Antigua. At first, he seemed to be pretty sharp. But it became clear early on that he had some serious substance abuse issues. Stories came back from the other ex-pat staff on the island about his partying and his general attitude towards other in believing he was the saviour of the company.
I first got to work with him on a trip to Oklahoma City where we closing a huge international deal. We arrived late in the day on separate flights. I arrived with our sportsbook marketing manager, Jake. Neither of our luggage’s arrived. Jake was pooched as he had nothing, but I always fly with an extra pair of socks, underwear and a plain white t-shirt in my carry-on case. The number of times it has saved me is one thing, but the feeling of new clothes on a long-haul flight or when one has a layover cannot be beaten.
Ted arrived later and we met with the ‘other side’ in the late afternoon. For all intents and purposes the deal was done, and we were negotiating the finer points. The meeting went well, and we adjourned.
One of our casino/sportsbook licensees, Mark, had made the drive in from Wichita and took the three of us out for a dinner at Ruth Chris steakhouse. We knew we had a 700am meeting the next morning to close the deal, so we took it easy and kept the drinking to a minimum. Except for Ted. I knew he was an alcoholic immediately by how quickly he kept chasing martinis with copious amounts of wine, immediately changing from Dr. Jekyll to Mr. Hyde. I called the for the dinner bill as quickly as possible and we were driven back to the hotel.
Ted wanted to have one drink in the lobby and so I joined him opting for a root beer. Being an airport hotel, it seemed only fittingly that a gaggle of stewardesses came into the bar. It was 11pm and I said my good night to Ted who insisted he was only going to stay for one more drink.
630am next day I woke, showered and arrived at the hotel conference room with ten minutes to spare. Sales thing I guess, always arrive early. Even if it was 50 feet from my hotel room door.
700am. Everyone is seated except for Ted.
715am. We start the meeting without Ted and move forward on all the points tabled the evening before.
725. Our clients are getting restless and asking where Ted is. I am running out of excuses.
730. I go to his room and start banging on his door
735. Door opens, and Ted looks like shit. I see a naked leg of a woman dangling from his bed. Did I mention Ted was married? The room smelled of booze and Ted of cocaine. I told him he was late and to get his shit together and get to the meeting.
745. On behalf of Ted’s division I signed the contract. Still no Ted.
755. We adjourn.
805. Ted shows up, completely hammered. I do my best to keep him away from the clients, but they know what’s going on. All is not lost, and they depart. The deal is intact.
I knew there was little point in berating Ted in that condition, nor was I going to report his conduct to head office. That sort of thing just isn’t done, and I convinced Jake of the same. We all flew out later that morning, and the next day incredibly Ted took all of the credit for the contract. Whatever. It was good for the company, so who is to care. Plus, everyone knew I did the deal.
I had hoped that this was a one-time event, but it proved to be the opposite. Less than six months later, the pattern was revisited in Las Vegas where I watched Ted smoke crystal meth and order hookers with a now deceased member of the company’s board of directors. I am not sure he even knew he was in a public space. He disappeared for days, and completely missed the conference. The last I saw of him he was chatting up a Russian hooker in Mandalay Bay. I flew out early. Again.
Did I mention he was married at the time?
By fortune our paths took separate routes, although I watched his new company with interested, even working with him as his first customer, and then his first outside investor. My career had pivoted, and I found myself as a VC, with his company being the first company that I funded and took public. To celebrate the financing team all went to the Cayman Islands and Ted was invited. He had recently received 500k in financing from me, and decided to pay himself back wages in the tune of 240k while giving his CFO another 180k. After a few outstanding bills, he was so broke that I had to pay for his flight down. The bowling alley in his house was more important, I guess.
In the Caymans he way out of control. Cocaine, hookers and booze non stop. I got so fed up with the situation I left the house we had rented and flew back to Costa Rica early. (I was living there at the time). I heard he mouthed of a Jamaican and landed in hospital two days after my departure.
In short time, he had blown up the deal by gifting his friend non 144 stock and blowing it out. This caused my shares to crash from $5.00 to 35 cents in a matter of weeks. Glad I knew he was capable of this and I shorted his company.
I worked for a while with him as my company was a signature partner in the processing business and I was a major shareholder in his company. I owned a payment processing company at the time.
Here’s a good one. I worked to close a deal with UPS that took me six months. Ted came on a call just as we were about to sign and said, “Great. I’ll FedEx the documents to you.” Let that sink in. He told the head of UPS ecommerce that he would FedEx something. We lost the deal.
In 2010, he was again destitute, and his company was done. The share price was now about 3 cents. I was out, and very happy with my investment.
In 2011, I had arranged a financing for his company and told him he needed to come to Costa Rica to meet the money guys. Naturally I had to pay for his flight and accommodation. There was no way he was staying at my house. He arrived around 3pm to Liberia International Airport and I drove him to Tamarindo where I lived. We had dinner with the financers and agreed to meet to negotiate the terms the next morning.
Fast forward to the morning. I am driving down to the meeting at 8am and I see Ted walking down the street wearing the same clothes as the night before. I stopped and said, hop in buddy. Let’s go to the meeting. He is so fucked up he doesn’t even recognize me. He didn’t make it back to the hotel and was still coked up. I took him to his hotel and we reconvened that evening. The finance guys were pissed off and I spent the day with them teaching them to surf to keep their minds positive. I still closed the deal. Also, I put Ted on the next flight home.
God only knows how many meetings he missed because of his coke issues. And God only knows how many angry texts and calls I received. In 2013, I put together a final deal for Ted. One would ask why? Simple. Finder’s fee.
I won’t get into specifics, but he managed to blow millions from that deal on a house in Hawaii, a house in Tahoe, and a whole lot of expensive restaurants. By 2015, he turtled his company and left thousands of shareholders holding the bag. The SEC is useless by the way. Ted issued a boat load of 144 stock, faked the registration and sold it through offshore accounts. What he did was criminal.
He currently has a criminal record and I think he did time. Not for fraud. In 2014 he was charged with:
CRIME 1:23152(A)MISDEMEANORDUI ALCOHOL
CRIME 2:14601.2(A)MISDEMEANORDRIV:SUSP/ETC LIC:DUI:VIO
CRIME 3:23152(B)DUI ALCOHOL/0.08 PERCENT
On November 17th 2016, he was arrested for DUI, possession of drugs, disobeying a court order and possession of a loaded firearm in his vehicle.
On June 14, 2009 he was arrested for:
14601.2(A) – Drive W/License Suspended For Drunk Driving
23152(A) – DUI Alcohol/Drugs
23152(B) – DUI Alcohol W/BAC > .08
His company website is still up. Lucky skunk or just skunk?