Home Director closes its doors for good
LIVERMORE, Calif.--After a number of efforts to recharge its failing business, including selling off its installation arm, Home Director ceased operations in late April due to its negative cash position and its inability to raise or borrow additional funds.
The company--a supplier of home networking products that went public in April 2003--struggled to find a place in the market since it was spun off of IBM in 1999 and lived through a number of reorganizations and management teams. In mid-March, the company announced its most recent restructuring and the sale of its Digital Interiors subsidiary, the company's home networking installation business, to 180 Connect, an installer and integrator of home wiring and electrical systems, for $350,000.
Digital Interiors, which was sold so the company could focus on supplying products according to Home Director's former Vice President of Marketing Tom Wilky, and was the largest revenue generator for the organization.
Michael Liddle, chief executive officer of Home Director, said the demise of the company came down to not being able to raise enough capital to keep going.
"We had a reasonable business and new products ready to go to market in the first quarter," Liddle said. "But we also had a significant cash crunch because of reduced revenues and a lower cash balance. It just happened at a time in the market when it was too difficult to raise additional capital."
Liddle, who joined the company in January 2004, said available cash was a constant problem. A private placement worth $5 million the company secured in late 2003 was already spent when Liddle joined.
"Virtually all the money was gone and we had to go out and immediately raise another $5 million," he said.
But Liddle said there were other reasons for the company's failure including inventory problems, reduced revenues and a lower cash balance.
For more on this story, see the June issue of Security Systems News.