A major benefit of maintaining autonomy is not being subject to another entityu2019s decisions and plans that may be counter to your success. My cautionary tale follows. It is a blow-by-blow account from my archives of contemporaneous notes and documents that illustrates how hubris combined with political motivations and ignorance by those with controlling interest in a company can destroy that companyu2019s current successes and potential while dragging it into the depths of depravity. Trigger warning: For many, this will be TL - especially for those disinterested in u201cancient historyu201d.A team of 4 from SAS Institute started Tangram Systems Corp in 1986. Subsequently, we raised $2.1M from a consortium of venture capitalists to build Arbiter, a VTAM subsystem capable of efficiently supporting very large numbers of PCs connected to IBM mainframes. The VCs had 51% voting control upon closing the A-series. This was acceptable to me and my team because we believed all decisions would be based upon sound, business-based rationale toward the financial success of the Company.We developed the product and entered beta test at several companies within a week of plan and under budget. References from the betas were very, very positive with 100% converting to paying Customers. This was a significant valuation-enhancing event. Our plan of record was to leverage it to close a B-series at a substantially higher per share price than the A-series. The use of funds from a B raise was to expand sales and support while launching a market benefits & brand awareness campaign. Since we had maintained a growing consulting business with IBM, USPS, Lotus Development Corp and EDS, we had more cash on hand than originally planned so the board, over my objections, decided to defer the planned raise.Even at the increased valuation we discussed with new leads, a majority of the VC consortium refused to allow the B-series raise. That raise would have required each current investor to add new money on a pro rata basis with the new investors. Two of the original investors had planned, but failed, to raise new funds so they couldnu2019t invest in a new round. The other VCs didnu2019t want them to be subjected to the pay-to-play provisions in the original deal. Besides, Tangram wasnu2019t under immediate threat of going out of business without the new money, so letu2019s kick that can down the road. Having given up voting control, we were hostage to the politics of our VC consortium.Their decision severely restricted our ability to market and sell Arbiter. Having said that, we achieved break-even cash flow several months after NPI. But maintaining and growing beyond monthly break-even was a significant, unsustainable balancing act without marketing programs and additional sales staff. I finally convinced the Board to revisit the interest in acquiring Tangram that Lotus had shown months earlier. Jim Manzi had floated the idea during a meeting in Cambridge, MA based upon his staffu2019s analysis of future cash flows to Tangram once Lotus began paying license fees and royalties for the use of Arbiter within their emergent mainframe product portfolio.I had a short list of potentially interested acquirers with whom we were either in discussions or had active projects. Without additional funding, we were severely limited in adding new co-development projects to the several in progress with Lotus. Even with DCA and Novell willing to pay non-recoverable engineering fees, we simply didnu2019t have the cash to hire, equip, train and deploy new developers. I was transparent about our situation with our partners.: adding projects meant multi-tasking existing staff to the detriment of current projects.DCA had active co-development projects, independent of Tangram, with Lotus and Novell. And, they talked. Therefore, my inquiry caused a flurry of discussions among them because all three shared interest in using aspects of Tangramu2019s intellectual properties. They decided that DCA was a better fit to acquire Tangram and was best positioned to address the collaborative projects that the others wanted to implement. As a result, I received a call from Howard Laffler of DCA wanting to discuss acquisition.Since I planned to stay with the purchasing entity, the VCs sidelined me from the direct negotiations. The VCs griped that they werenu2019t able to get a bidding war going among the three but finally reached agreement on a price. The price wasnu2019t a home run for the investors but the IRR was very good. The agreement included a no shop provision during DCAu2019s 30-day due diligence period. DCA began a formal, professional, inclusive process to evaluate u2024 well u2024 everything. They were excited about the acquisition as were the founding team and our employees.Unfortunately, during this period Ray Noorda told his board of directors about his plan to incorporate Novell Netware into the Arbiter platform once the DCA acquisition was completed. A representative of Safeguard Scientifics, a vulture capital firm sitting on Novellu2019s board, used this information inappropriately. They called Al Berkeley, at that time a GP at Alex Brown & Sons, and discussed Tangram. ABS was actually a licensee of Arbiter software and Berkeley was a major cheerleader for Tangram as the software solved some significant u201cmicro-to-mainframeu201d file transfer problems for them. Warren Musser, founder of Safeguard, believed that if the DCA-Tangram match was u201cgoodu201d then a Rabbit Software-Tangram deal would be even better u2024 for Safeguard.Rabbit Software was a failing publicly traded company controlled by Safeguard. Itu2019s addressable market couldnu2019t sustain a publicly traded Company so Safeguard kept them afloat. Like DCA, Rabbit was a micro-to-mainframe vendor but the companies marginally competed due to Rabbitu2019s limited product portfolio and market penetration. Neither Musser nor Berkeley performed any due diligence to understand the inadequacy of Rabbit to add value to Tangram from any u2024 sales channels, marketing, technology, corporate infrastructure u2024 from ANY u2024 perspective. Yet, they made the decision to try to break the no shop.Since Berkeley knew me well, he called me at home.Al: I hear rumors about Tangram and DCA. Whatu2019s going on?n really canu2019t say. Weu2019re in black out.n hear theyu2019re buying you. You know Alex Brown has done all of their public offerrings. All I have to do is call them but Iu2019d rather get it from you.nl had been very, very supportive of Tangram and me, personally so I relented. I confirmed the deal.nthe next week, I received daily calls from Al trying to reduce my support for the DCA acquisition. A sampling from my notes:Al: Why isnu2019t Tangram working with Rabbitu2019s SDLC adapter?necause none of our customers or prospects are asking for that support. Rabbit has zero market share where we're selling.nould you develop a driver for them anyways?nes, if theyu2019ll send one to me.n Since our sales activity had no overlap, Rabbit management saw no benefit working with us. Despite Al's repeated requests of them, they never sent an adapter. Turned out that Rabbit management was unaware of the Musser-Berkeley decision that Rabbit and Tangram should be combined.nid you know that Nordin (DCA's CEO) is reportedly very ill? That may change the way DCA acquires Tangram.nl, DCA's board has approved the deal and I'm working with Laffler, President of the division so I don't believe Nordin's health is an issue.n Berkeley was trying to find a way to diminish my enthusiasm for the DCA acquisition, Safeguard was striking a deal with the VC.On the day that the investors and DCA were to meet in Tangramu2019s offices to close the deal, none of the investors showed. I couldnu2019t reach any of them by phone. The DCA HR team had provided offer letters and employment agreements to each employee the previous day. We all sat around waiting. At the end of the day, DCA executives and their HR team packed up and left. Still no word from the VCs.The Tangram investors had agreed to not show up for the closing with DCA which was on the same day the u201cno shopu201d expired. Then, all the investors sold their shares to Safeguard supposedly after the expiration. I would hear later that the VCs were forced to pay DCA the money the VCs received from Safeguard in order to stave off a lawsuit for breaking the no shop.The next day Musser, Berkeley and others from Safeguard walked in to Tangramu2019s offices the next day and took control. Literally.The day before each Tangram employee knew precisely his/her role within the DCA-Tangram combination and had an employment contract from DCA, Musser and Berkeley walked in with an attorney and a chart.The chart was a graphic of Novellu2019s revenue from inception to IPO. Musser, after congratulating us on being Safeguardu2019s newest u201cpartneru201d, used the chart to take credit for Novellu2019s existence as well as its success going public. Other than u201cNothingu2019s changed, weu2019re your new partnersu201d Musser had zero to say about any business issue that the DCA-Tangram combination addressed.The attorney carried Board resolutions that replaced the existing Directors with Safeguard stooges; exacted a monthly fee for all the u201cservicesu201d that Safeguard provided their captive u201cpartnersu201d whether needed or not. I was told u201cDonu2019t worry that you canu2019t afford the Safeguard fees and expenses, weu2019ll loan you the money to pay us.u201d Tangram had just gone from a marginally cash flow positive company to one deeply in the hole but Musser was into u201cgood news, glad-handingu201d, not operational detail so none of his people would allow discussion about the reality of what they had done.In the following week(s),all collaboration with DCA and Novell ended.Safeguard resigned from Novellu2019s board - it was rumored that Noorda was so enraged by their ethical breech he kicked Safeguard off the board. Regardless, Safeguard went from being disliked by Noorda to vehemently abhorred.The uproar from DCA against Alex Brownu2019s meddling was so intense that Berkeley decided to take a leave of absence to become u2024 wait for it u2024 CEO of Rabbit Software. During this period, ABS analysts with whom I was friendly kept trying to distance ABS from Berkeleyu2019s actions but Al was an ABS GP after all u2026.Lotus was so shocked by the turn of events that all projects, except the completion of their data center which we had designed and were managing build-out as general contractors, were placed on hold. Manzi wanted to understand how he could trust Tangramu2019s financial viability and ability to support Lotus moving forward under Safeguardu2019s control.Manziu2019s answer had to wait until Musser accepted a new budget for Tangram. The DCA-Tangram budget was useless because it leveraged DCAu2019s channels, existing marketing teams, volume discounts based upon existing ad placements; it also included hiring to support NRE-based projects with Lotus and Novell u2024 none of which would occur as planned, if at all. Berkeley, who still was with ABS, vetted my work and kept saying u201cwe donu2019t want to scare Uncle Pete with big numbers u2026u201d!?!! It was obvious that their ONLY consideration was how much to pay the VCs for their controlling interest.The backlash against Alex Brown and Berkeley as well as the loss of our co-development partners u2024 not of my making u2024 made me suspect to the Safeguard team. I will admit that I provided to DCA photocopies of my copious notes from Bekeleyu2019s daily calls trying to undermine my support for the acquisition. All of my actions, from protesting against a Rabbit-Tangram merger (i.e., no one could pra business rationale) to pushing against other harmful-to-Tangram decisions by ignorant Safeguard personnel, were to maintain and grow the value of Safeguardu2019s and the employeesu2024 (including my) shares.The political climate within Safeguard between pro- and anti- Rabbit-Tangram merger advocates was professionally cordial in front of Pete but toxic, nevertheless. Berkeley became CEO of Rabbit. Suprisingly, he had no u201cofficialu201d business capacity with Tangram other than the demand for Tangram to support Rabbitu2019s products despite there being no (thatu2019s a big ZERO) demand from customers.Evidently, Musser was put off by the lack of celebration and enthusiasm from Tangram. Actually, thatu2019s false. Musser was put off by the total antipathy toward this takeover by everyone, except our Controller, at Tangram.So instead of Berkeley having a seat at Tangram, Musser appointed a Safeguard Senior VP to u201cmanageu201d us. Berkeley continued his nightly calls to me for updates about what was going on at Tangram and I gave him an earful. Despite his non-official capacity, it was apparent that he was trying to gain insights toward countering the SVPu2019s influence with Musser.The SVP, being very important and too busy for business detail, appointed his minion, an ivy league MBA named Chard, who was keen to demonstrate his importance and mastery of our business u2024 no input from us required. Our 1st meeting presaged his impact on the Company.We had agreed to meet at 9 am but I was on a very positive sales call with a major prospect so was 10u201315 minutes late as I entered the conference room. Chard was annoyed that I prioritized a sales call over his meeting. We were interrupted by my admin who stepped in to hand me a coffee. Chard told her, u201ctwo creams and a sugaru201d as she was leaving. She turned around and said u201ccoffee isnu2019t in my job descriptionu201d and turned to leave. u201cBut you brought hisu201d, pointing to me. u201cMichael normally gets his own about now but came straight here after the sales call. I brought his coffee out of respect for his time, not because he expected it.u201d She walked out. Chardu2019s face was flushed a brilliant red u2024 u201cWelcome to Tangram,u201d I chuckled. u201cDo you know where the break room is?u201dChard demanded to participate in every meeting and u201cimportantu201d conversations with prospects, staff etc. A hallway u201cpick-up sessionu201d with a sales person that might draw in a support tech and move to a white board became me being insubordinate because I didnu2019t call Chard away from his interviewing staff to participate. He pointedly told me that Safeguard would manage the withering Lotus relationship. They did. It died.With Chardu2019s meddling in general; the new and rapidly growing rumor mill among Tangram-Rabbit-Safeguard employees; and his u201cinterviewingu201d Tangram employees with questions like u201cIf founder insert name here leaves, who should replace him?u201d, the Company was in complete disarray. As I tried to redirect Tangramu2019s focus back to selling, Berkeley decided I needed to hire a VP of Sales so he sent me the resume of a totally unqualified person. The only rationale he gave me was that Darwin Deason highly recommended her. u201cUh, Al u2024 if Deason recommends her so highly, why did she leave his employ seven months ago? and, why hasnu2019t she found work since?u201d No answer. Uncle Al simply ignored such questions. I had her resume, so do it.I interviewed her; called the references she provided; and talked to other people who had worked with her. The independent references were quite insightful. When asked why their uniformly critical and derogatory reviews were the opposite of the enthusiastically positive reviews from the references I was provided by the candidate, I was told that the four individuals provided quid pro quo complementary references for one another. Besides having no experience with system software sales, this candidate was a disaster waiting to be hired.When I called Berkeley to report my findings I learned that heu2019d told Pete she was the best candidate u2024 after all Deasonu2019s made big bucks so his recommendation is solid u2024 so Pete had drafted an offer letter as Tangramu2019s Chairman. WTF? Berkeley explained that she had another offer in the mill and unless she received an offer immediately sheu2019d take it. Wait, Al u2024 u201cin the millu201d isnu2019t the same as u201coffer in handu201d. Never mind, it was clear by now that once Peteu2019s supplicants told him anything, they never admitted error.My response to this was to resign as CEO to become Tangramu2019s VP, Marketing and Support. I discussed the transition with Berkeley before drafting the letter. Why act like Iu2019m in charge when Safeguardu2019s people are running roughshod over the company?Safeguardu2019s response was to hire an ex-Informatics sales executive who I knew well to be a profane, abusive manager. In one meeting with highly-technical influencers considering licensing Arbiter, Seyler interrupted my presentation about how data flowed from a PC over a specific IBM SNA configuration to be written on mainframe DASD by saying u201cwhat Campu2019s telling you is weu2019re plumbing. Arbiter moves shit from your PCs to the mainframe u2026u201d.After a few weeks of this, our new CEO called me to his (my old) office one morning and Chard joined him. Seyler explained that heu2019d replaced a founder as CEO at his previous employer. Over time, the founder regained good standing with his investors and Seyler lost his job. He wasnu2019t going to allow that to happen at Tangram so I was fired. Neither he nor Chard had read the employment agreements that the other founders and I signed with Safeguard to keep us from leaving after their takeover.Safeguard was surprised. At first Safeguard denied that Iu2019d been fired. After realizing that Chard & Seyler had announced my termination to employees, Safeguardu2019s focus was on keeping me from receiving my accelerated options for termination without cause. Finally, Berkeley brokered a deal whereby Iu2019d join Rabbit Software as VP, Marketing and Sales for the remaining six months of my vesting period and that would count toward my Tangram vesting period. My time with Rabbit is yet another story although Iu2019ll say that, based upon my positive impact there, I was verbally offered a position at Safeguard. How could I say u201cnou201d u2024 simply u2024 without a snarl u2024 without epithet. I couldnu2019t.When Seyleru2019s employment contract with Tangram expired, he left the Company. Safeguard found a new CEO who decided to take the company in another direction. Seven years after taking control of Tangram (1995), the original Musser-Berkeley vision finally prevailed: Tangram was merged into then long-standing penny stock, technically-bankrupt Rabbit Software. A new name, Tangram Enterprise Solutions emerged whereupon Safeguard and its favored executives continued to feed off the public markets as the company limped along on the OTCBB until it was acquired in 2024 for a measly $10M in stock and debt assumption by OPSWARE.What a waste.