Metro-Optix Drafts New CEO
Orr was president and CEO of Pliant Systems (formerly BroadBand Technologies), a company selling DSL access gear, from April 1997 to July 2001. In 1999 the company was restructured, shedding its BroadBand Technologies name and product strategy. Pliant filed for Chapter 11 in May 2001 and, after mPhase Technologies (OTC: XDSL) refused to acquire the company, it closed late in 2001.
Orr replaces Arun Bellary, who will become Metro-Optix's executive chairman and will return to California to spend more time with his family.
"My experience at Pliant was a stressful one, as we tried to raise money and retire the company's debt," says Orr. "What I learned is that you can have a lot of things going your way -- technology, development, customers -- but how the company is financed and what its balance sheet looks like end up being as important as a company's technical advantage."
Prior to Pliant, Orr was the president and CEO of Alcatel Network Systems. He came to Alcatel Network Systems when Alcatel merged with Rockwell International's Transmission Systems Division, where Orr was a vice president and general manager. (Orr's replacement at Alcatel was Krish Prabhu, now a Morgenthaler Ventures partner and Westwave Communications board member.)
Orr says he wasn't brought in to restructure or sell the company. "I've been brought in to help the company grow," he says. Orr says the company has enough momentum with big and small carriers that it will soon start ramping up in size and revenues to go from a 275-person startup to a much larger company.
"We haven't had any major cutbacks or anything, and that's because of our customer traction and because we're moving ahead," says Bellary.
"They have the opportunity to scale the business, and that's why Dave Orr was such an attraction," says David Britts, general partner with J.P. Morgan & Co., a Metro-Optix investor. "He's done this all before."
Metro-Optix hasn't announced any marquee customers, but it does -- like many other equipment vendors -- have some equipment in trials at large carriers (see Qwest Tests Metro-Optix and Metro-Optix Lures WorldCom, Genuity). Orr's job will be to help the company get from tryouts to signed contracts.
Orr's starting salary at BroadBand Technologies in 1997 was $350,000 a year, according to SEC filings. He also got a $4 million signing bonus when he joined BroadBand, which Pliant recently paid him upon his departure. There's no telling what he's making at Metro-Optix, but he probably didn't come cheap. It's safe to assume that Metro-Optix wouldn't spend so much of its funding on executive compensation unless it knew something big was on the way.
"[Orr] did his own due diligence and he voted with his feet," says Britts.
Metro-Optix has raised about $136 million since the company's founding in December 1999. Bellary says there's enough remaining to last the company through the rest of 2002.
Orr says Metro-Optix's growth now will be "a matter of timing relative to the capex situation improving." He adds that so far the company has invested in all the right things -- Osmine certification, for one -- to be in a good position when carriers begin to spend more freely (see Report: Multiservice Is In).
— Phil Harvey, Senior Editor, Light Reading