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Bigwigs out of Procket?

Will the Tony Li rumors ever end? Apparently not. Word in Silicon Valley is that the world's most famous routing software engineer is winding down his day-to-day engineering role and looking for a quiet way to slip out the back door of closely watched startup Procket Networks Inc., even though Li was recently named to the board of directors at the company (see Li Named to Procket's Board).

But wait -- there's more! Two other reliable Silicon Valley sources say that Mark Showalter, vice president of marketing at Procket, is also leaving the company. Showalter, a former top executive and a founder at CoSine Communications Inc. (Nasdaq: COSN), joined Procket back in July 2001 (see Procket Bulks Up).

Spokespeople from Procket deny that either Li or Showalter is leaving. "Ah, the ever persistent rumors," says Suzanne Panoplos, spokeswoman for the company. "Mark and Tony are both still with the company."

Li also denies the rumors. "That rumor is patently false," he wrote in an email to Light Reading today, "I'm still exceedingly busy and have numerous responsibilities."

Whether or not the rumors are true, there's no doubt that fundamental changes are underway at Procket. In the last few months the company has shed four of its board members and added two new members, Li and Daniel J. Warmenhoven, CEO of Network Appliance Inc. (Nasdaq: NTAP). Two venture capitalists -- Atiq Raza of Raza Foundries and Irwin Federman of U.S. Venture Partners -- both have stepped down, along with Jorge del Calvo, a partner with the law firm Pillsbury Winthrop. In addition, Sharad Mehrotra, a founder and former chairman of the board, also stepped down from the board. Mehrotra would not comment on why he left the company. Despite his title of "chairman emeritus," Mehrotra says that he has no association with the company any longer.

In the case of Li, the logic accompanying the rumors does make sense. If Li were leaving, as has been rumored for some time (see Is Procket Heading Toward the Edge?), giving him a board seat prior to his departure would be an elegant way for the company to wind down the relationship, without losing a lot of credibility. It also provides convenient cover from a PR standpoint.

Some of Li's former co-workers say this is unlikely. "I have no visibility into this and I have no way to know myself," says Mehrotra. "But my understanding is that Tony is committed to the company."

But the recent high-level board changes, along with persistent mumblings among the Silicon Valley elite, have left many skeptical of Procket's party line.

"It's never a good sign when you see the board getting smaller and more insiders taking up seats," says an equities analyst who didn't want to be named. "VCs don't quit boards for fun. Generally, there is more to it."

The company's current list of board members includes

  • Randall J. Kruep, president and CEO of Procket Networks
  • Tony Li, founder and chief scientist of Procket Networks
  • Daniel J. Warmenhoven, CEO of Network Appliance
  • Richard Lowenthal, founder of Lightera and former vice president of engineering at Stratacom
  • William Lynch, founder and CTO of Procket Networks
  • Stuart Phillips, general partner with U.S. Venture Partners
  • Geoff Yang, general partner with Redpoint Ventures.


— Marguerite Reardon, Senior Editor, Light Reading
http://www.lightreading.com
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Tony Li 12/5/2012 | 2:14:42 AM
re: Bigwigs out of Procket?
Today is March 15, 2004.

For the record, effective immediately, I am no longer employed by Procket.

Regards,
Tony

p.s. Beware the ides of March!
Scott Raynovich 12/5/2012 | 2:14:33 AM
re: Bigwigs out of Procket? Tony... do you have a new email address where we could reach you? e-mail to [email protected] if you do.

--Scott
mrinovato 12/5/2012 | 2:12:42 AM
re: Bigwigs out of Procket? Tony, I understand that you are no longer at Procket. Our senior executives, including Henry Samueli and Ford Tamer, would like to talk with you regarding opportunities with Broadcom. I would appreciate a call or an email with your contact information so that we can contact you to discuss. Thanks.

Mark Rinovato
Staffing Manager, Sourcing
Broadcom
949-926-5059
[email protected]
reoptic 12/4/2012 | 10:38:37 PM
re: Bigwigs out of Procket? Heard they had removed/demoted their VP of engineering. Also that their ASICs were dead not just once but twice. Also heard that they pulled out of core routing conference because of directional shift, as in they aren't building one since their ASICs don't work.

Of course, these are just rumours and we hear that every day in the Valley.
daytonabeach 12/4/2012 | 10:38:36 PM
re: Bigwigs out of Procket? this is a good move by the company. wprd on the street is that atiq is a worthless vc. he is very inexperiences as a vc and is very divisive on company boards. he has been kicked out of lot of boards because of his divisive behavior and incompetence as a company builder. he is more interested in flipping companies for a quick buck. none of his companies have ever produced a dollar in revenues or earnings. no wonder raza foundries is on its last leg which is good for the market.
KPSmells 12/4/2012 | 10:38:36 PM
re: Bigwigs out of Procket? It is good to see this guy leave. Beware of this lawyer. He has been involved in lots of dirty deals full of conflict of interests. This guy represents, VC firms, VC partners, Founders, Executives and the companies themselves, all at the same time. It is a matter of time when someone takes him to court and gets him barred from practising law.
short_the_stock 12/4/2012 | 10:38:35 PM
re: Bigwigs out of Procket? Yeah, rumor also has it the SUN batch is being replaced because they defaulted on their original promise to build Cisco (one of their original VCs) a network processor, but instead tried to go for the homerun by building the entire systems themselves (which in turn competes head to head with Cisco)... Blood and heads rolling everywhere.
skeptic 12/4/2012 | 10:38:35 PM
re: Bigwigs out of Procket? Yeah, rumor also has it the SUN batch is being replaced because they defaulted on their original promise to build Cisco (one of their original VCs) a network processor, but instead tried to go for the homerun by building the entire systems themselves (which in turn competes head to head with Cisco)... Blood and heads rolling everywhere.
----------------------
None of this sounds right. The story I heard
is that the SUN batch wanted to do a different
product than what procket ended up doing but
got redirected by various VCs toward procket
and their plans.

Things worked ok during the duration of the
chip design cycle, but at the end all the chips
came back dead. One of their bad decisions
was supposedly using lots of contractors to
do the chips.

And so with dead hardware, they had to reposition
the company and a whole bunch of people left
(or were pushed out) on the hardware side. It
appears that the split in the company went all
the way up to the board level.

This is all based on rumor of course. And anyone
with a better story is of course welcome to
correct me or just say I've got it wrong.
willywilson 12/4/2012 | 10:38:35 PM
re: Bigwigs out of Procket? It is a matter of time when someone takes him to court and gets him barred from practising law.

-------------------------------

Oh you naive and foolish idealist. Only blue-collar thieves get punished.
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