Original URL: http://www.theregister.co.uk/2006/05/30/segway_ipo/
Segway confuses investors with 'liquidity event' vow
IPO or trail of tears?
Prepare yourselves for a second round of Segway hype. The company behind "IT" is eyeing an IPO.
Despite much slower than expected sales, Segway Inc thinks it might have a play in the public markets. The company's CEO, James Norrod, has started a media blitz, trying to convince potential investors that Segway sales are growing at a steady rate and that the company could make an attractive long-term bet. The IPO chatter that's sure to extend over the next couple of years will haunt many of you out there so very tired of the Segway "buzz".
Norrod, who stepped in as Segway's CEO last year, has already mastered the vague diction required of a public company's chief.
"(The investors) thought it was the right time to bring me in to really lead this company through this crucial period and to a liquidity event," Norrod told the AP.
We take liquidity event to mean an IPO and not the pool of tears investors have shed over Segway's most unspectacular sales.
Back in the glory days, the likes of Amazon's Jeff Bezos and Apple's Steve Jobs celebrated the Segway as some type of miracle. The device could travel faster than a speeding turtle and change entire city designs in a single scoot. Humble inventor Dean Kamen vowed that "IT" would "be to the car what the car was to the horse and buggy".
These days, however, Kamen is literally drinking his own urine, and Segway Inc is pitching its scooter as a niche play. Law enforcement groups like the device, as do those concerned about gas prices.
"That (high price of gas) has been a driver, a real driver of our business (in Europe)," Norrod told the AP.
Of course, self-respect and bicycles have had a devastating impact on sales.
The AP notes that venture capital firm and Segway investor Kleiner Perkins Caufield & Byers (KPCB) once expected scooter sales to reach the $1bn per year mark. At $5,000 a pop, it would take 200,000 units to reach that revenue goal.
(Rather comically, the AP claims that KPCB is "best known for its early investment in Google". And here we thought the likes of Intel, Sun Microsystems, Genentech, Amazon.com and EA impressive.)
Segway doesn't release sales figures, and shipments are thought to be just a fraction of KPCB's ambitious dream.
The Segway has been such a poor seller that a cottage industry has sprung up around the scooter, poking fun at Segway culture. A new mockumentary, in fact, has just come out in which a couple of yuppies trek across the US on a Segway. We profiled the stunt in 2004.
Segway has already burned through three CEOs and a host of other executives, but we're pretty sure this Norrod chap knows what he's talking about. Like it or not, lazy cops and high oil prices guarantee a successful IPO bid for Segway. Read all about it here. ®