Pulvermedia rumors

Several sites have noted the rumor post by Marc Robins speaking of Pulvermedia layoffs and going so far as to say that Pulvermedia may be closing its doors.

Jim Courtney cites a press release as verification that “Jeff had sold most, if not all, of his interest in PulverMedia.” That press release talks about an $11 million dollar “investment” in Pulvermedia by Technology Investment Capital Corp. (TICC) back in June 2007, in the form of “secured notes with warrants.” The press release provides no clue as to the valuation basis of Pulvermedia and therefore the percent stake the $11 million represents, so it’s not clear that it represents “most, if not all” of Jeff’s interest. It also does not tell how the notes are “secured”.

Typically, an investment is just that, an investment, and not an acquisition. In an investment, the investing firm typically doesn’t assume operational roles in the company they’re investing in (although they may take a board seat). However, given that the investment was over six months ago, the deal could have terms that permit the investors to assume control if certain (usually bad) conditions are met.

Whether that is happening or not, I don’t know. I agree with Andy that, if true, it’s sad news indeed, and I offer Jeff my public support.