CEO is latest casualty of Motricity shakeup
The Bellevue company and Ryan Wuerch mutually agreed to end his employment as CEO and a member of the company's board effective this past Saturday.
Seattle Times business reporter
Struggling mobile-data company Motricity has let go nearly its entire top management over the past three weeks — a shake-up capped Monday with a terse announcement that founder and Chief Executive Ryan Wuerch had been terminated.
Wuerch's departure, which the company described as mutually agreed-upon, leaves the Bellevue-based company, and interim CEO James Smith, with a host of challenges as it struggles to achieve profitability.
Since Aug. 5, the company has fired or announced the resignations of chief financial officer Allyn Hebner; chief development officer James Ryan; general counsel Richard Leigh; and Tyler Nelson, senior vice president for advertising, though Hebner, Leigh and Nelson remain with the company in a "transitional capacity."
Nelson had been CEO of Adenyo, a Canadian mobile-advertising company that Motricity bought earlier this year for $100 million.
A spokesman said the company would not comment further about Wuerch or any of the other departing executives.
Wuerch is barred from speaking about the circumstances of his departure by the terms of his severance agreement with Motricity, his spokesman said.
Under that agreement, Wuerch will receive $450,000, and 17,200 shares of restricted stock he owns will vest.
Options for 125,000 Motricity shares also will vest, but because the strike price of those options is $20.50 and Motricity shares closed Monday at $2.28, they are all but worthless.
In its announcement, Motricity said it had hired Korn/Ferry International to run the search for a permanent CEO, and that Smith was being considered along with "other external candidates."
Motricity, which markets its technology to wireless carriers for use in branded data services, went public in June 2010 at $10 a share.
Its share price soared last fall, peaking at $30.74, but has ratcheted down since.
The company has seen its core business in North America eroded by the rapid adoption of smartphones, which allow users to bypass carrier-specific data services of the sort Motricity supports.
Overseas markets, where smartphones have less penetration, have offset the North American declines somewhat.
However, Wuerch told analysts in an Aug. 9 conference call that the company has begun to encounter aggressive competition from larger rivals offering lower-cost products.
The day after Motricity reported second-quarter financial results that fell short of Wall Street expectations, its stock lost 59 percent of its value (though it's since recovered a bit).
Since then, eight separate law firms have either filed shareholder lawsuits against the company or announced plans to do so.
Motricity's most significant shareholder, however, is activist mega-investor Carl Icahn, who owns 14.6 percent of the outstanding shares (down from 19.1 percent immediately after last year's IPO).
Icahn's son Brett sits on Motricity's six-person board, as does Hunter Gary, who is married to the daughter of Icahn's wife.
Drew DeSilver: 206-464-3145 or firstname.lastname@example.org
The Morning Memo
The Morning Memo jump starts your day with weather, traffic and news
Career Center Blog
Dive into history in Now & Then