Microport Buyout ( was: Microport Status )

[John DeArmond]

In article <237 at egsner.UUCP> eric at egsner.UUCP (Eric Schnoebelen) writes:
>
>In article <310 at feedme.UUCP> doug at feedme.UUCP (Doug Salot) writes:
>-
>-In article <96729 at sun.Eng.Sun.COM> plocher at sun.COM (John Plocher) writes:
>->	I tried to obtain the legal rights to Microport's driver source
>->	before I left, but because of SEC regulations about insider trading
>->	I would have had to pay "full asset value" for them, and I didn't
>->	have the ~$250K that it would have taken. :-(
>-
>-I might be willing to contribute a few $K and some engineering resources
>-if someone were to negotiate a Microport buyout and form a limited
>-partnership.  A global support network comprised of Microport users,
>-anyone?

WEll, it's fun to speculate about this but let's look at Microport 
as businessmen.   Microport went bankrupt; ie, failed.  Failure always
has a cause.  Let's list some possible faults with Microport.

*  Pretty much standard Unix - little value added, crowded market.
*  Fairly buggy
*  Poor tech support (fixable but reputation would remain)
*  very poor attitude toward user support (same as above)

Of these, the problem with reputation is the worst.  Considering that one
can buy a source license for PC-type unix from AT&T for about $80,000 (as
of last fall when I checked), the only other assets Microport would have
to offer would be its customer base and its good will.   As of late, the
customer base has been shrinking and the good will is approaching zero.
You'd be better off just to buy a license from at&t and start over.

Now lets look at the financing.  There are several ways to raise money,
among them

*  venture capital
*  bank loans 
*  sba loans.
*  Pocket loans (you dig into your pockets... :-)

Lets look at each...  Venture capital is out.  These guys want to talk
at least a million bux, better yet 10 million and must be able to anticipate
a 10 times return on investment in 3 to 5 years.  (this is experience talking)
This operation would do good to be profitable in 5 years, much less saleable
for 10X investment.  Besides, these guys want all the equity.

Bank loans?   Not a chance.  They don't want to loan you money until you are
successful enough not to need it (no :-)

SBA?  If you are not a minority and/or are not opening a corner grocery store,
forget it.  SBA has a large bias against technology.

Pocket loans?  Well that's about all that's left and is what has been
discussed in this group.  The problem is though, that if you could 
raise enough money from friends and such to buy Microport out of bankrupcy,
you would be much better off buying a source license and starting over.
Use the money to grow the new company rather than paying off creditors.

The only way I could see this work is if the court does a Chapter 7.  Then
the assets perhaps could be picked up for a song.  You'd still have the
problem of re-negotiating the license with AT&T.  



>
-- 
John De Armond, WD4OQC                     | Manual? ... What manual ?!? 
Sales Technologies, Inc.    Atlanta, GA    | This is Unix, My son, You 
...!gatech!stiatl!john                     | just GOTTA Know!!!