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CounterPath Now: A Film By Francis Ford Coppola
"Saigon, shit. I'm still only in Saigon. Every time I think I'm going to wake up back in the jungle. When I was home after my first tour, it was worse. I'd wake up and there'd be nothing... I hardly said a word to my wife until I said yes to a divorce. When I was here I wanted to be there. When I was there, all I could think of was getting back into the jungle. I've been here a week now. Waiting for a mission, getting softer. Every minute stay in this room I get weaker. And every minute Charlie squats in the bush he gets stronger. Each time I look around the walls move in a little tighter." Captain Willard (Apocolypse Now)
Captain Willard
Like the disturbed Captain Willard in Francis Ford Coppola's Apocalypse Now, I too live in anguish. He was destroyed emotionally in a senseless and disorganized war. I was destroyed economically by Donovan Jones of CounterPath. Willard may ruminate over the horrors of war. I ruminate over my loses under a disorganized and feckless leadership team. But today, I did something I may regret for months: I downloaded and reviewed CounterPath's annual results. As I read the report, I couldn't believe my eyes. It was worse that I expected, and the words of Colonel Kurtz echoed in my mind. "The Horror... The Horror..." Revenue declined to $11.081 million, proving again that Donovan Jones has failed. Jones struggles to close big deals, and probably never has. His fingerprints and failures are all over this report. Cash is down year-over-year to $2.159 million from $2.852 million one year ago. That's $700,000 more cash burned. Or about his annual compensation. Another cash raise cant be far off. According to the annual report: - Revenue declined $921,000 for the year ended April 30, 2015 - Software revenue declined to $6.031 million for the year, suggesting problems as customers purchase less of the product. - Sales to service providers, enterprises and channels partners all declined, suggesting problems in key segments. - International revenue from sales outside of North American declined 9%, suggesting CounterPath is struggling abroad and losing share in a growing global market - The company issued 25,000 shares for "advisory services." That's a lot of shares given the 1:10 share rollback that was recently completed. To whom? For what? - Employees purchased just 36,539 shares of stock under the Employee Share Purchase Plan. This low figure suggests few staff are buying stock, especially after accounting for purchases by BIG EARNER DONOVAN ZONES. - Management has increased the stock option plan by 200,000 shares. Wouldn't want Jones to go without. Load up boys!
Stuart Smalley Offers Donovan Jones Words of Advice
I’ve been thinking about Donovan Jones and his many struggles. As we rain down on him demanding change, perhaps we should instead take a step back and also offer support. Donovan is, after all, in a very challenging situation (that he created for himself). After ten long years at the CounterPath helm, the stock is down 80%-90%, sales are down from peak, old customers have built their own softphones and severed their relationships with CounterPath, international sales have collapsed. Furthermore, nobody who matters will meet with Donovan Jones. He is persona non grata.
So I contacted Stuart Smalley, a renowned but unlicensed counselor, and to see if he could help. As expected, when Stuart heard the details of the CounterPath’s history, including the endless stream of failures, the restarts, the lost customers, the missed opportunities, the changes in strategy, and the terrible stock price performance, he was concerned. Stuart at first reflected in silence, then furrowed his formidable brow, and prescribed the following daily affirmations for Donovan Jones and the CounterPath team. He suggested the company might perform better if only Donovan repeated them aloud two or three times per day, perhaps before the start of each team meeting. 
- I deserve my share of happiness. I refuse to beat myself up. I am an attractive person. I am fun to be with.
- I am good enough. I am smart enough. And dog-gone-it, people like me.
As an Impassioned Investor, it seems all we can do is ask Mr. Jones to follow the advice of this legendary counselor, and hope for better results next quarter.
Please Donovan – take a few quite moments each day and repeat the prescribed affirmations aloud. You definitely need them. Perhaps also have a sit down with your management team and say them aloud together. It just might help. At this point, you should be willing to try anything. Either that, or just quit and go away and give us a chance to recover our investments.
Stuart was also nice enough to provide the following video demonstrating how Donovan Jones should proceed. Thanks Stuart! And Donovan – we hope this helps you get the company back on track.
The Punishment of Donovan Jones
In Greek Mythology Sisyphus was heir to the throne of Thessaly. But the crown went to his brother, Salmoneus, whom he loathed. Eventually, Sisyphus was appointed King of Corinth by Medea, a sorcerous, as reward for populating the city with people grown from mushrooms. Sisyphus, however, was not satisfied. To enhance his wealth and further aggrandize himself, he engaged in commerce and maritime commerce. Over time, as his tactics became more aggressive, he became known for his avaricious and deceitful behavior. As his depravity grew, Sisyphus eventually turned to murdering guests and travelers for both power and pleasure.
Sisyphus also maintained a grudge against his brother Salmoneus, and plotted to kill him. He developed a plan that involved seducing Salmoneus’ daughter, Tyro, and fathering her children, whom he planned to manipulate into his murderous plot. A devastated Tyro eventually learned of the treachery and slayed her own children to protect her father.
As a punishment for his actions, Zeus sentenced Sisyphus to endless toil, forcing him to roll a huge boulder up a steep hill each day, only to have it slip out of his hands and roll back down as he neared the top. 
The maddening nature of the punishment was assigned to Sisyphus because of his hubristic belief that his cleverness surpassed that of Zeus himself. In response, Zeus devised one the more frustrating punishments in all Greek mythology.
After watching Donovan’s seemingly endless struggle, I can’t help but wonder if Sir Terry is playing the role of Zeus by keeping Donovan Jones on task, rather than relieving him with a swap-out for a more accomplished CEO who is capable of pushing the big rock that is CounterPath to the summit. Is Sir Terry punishing Donovan Jones by leaving him flailing in the CEO seat? Or is he just punishing those of us who invested our hard earned dollars in CounterPath stock?
Let me know your thoughts
The I.I.
TheImpassionedInvestor@gmail.com
Shipwrecked — The Costa Concordia and CounterPath
Costa Concordia – In Port
Costa Concordia – Wrecked
On January 12, 2012, the Costa Concordia was wrecked off the coast of Isola del Giglio, Italy. Despite calm seas and a grounding just 500 meters from shore, Captain Frencesco Schettino failed to act quickly. Power was soon lost, the ship flooded through the 50 meter gash on the port side, and 32 lives were lost. In violation of international maritime law, the evacuation took over six hours, five more than the legal maximum. As Captain of the ship, Frenceso Schettino was later accused of multiple manslaughter, causing a maritime accident, abandoning ship with passengers still on board, and lack of cooperation with rescue operations. He was placed in temporary custody by the prosecutor of Grosseto, and released for house arrest on January 17, 2012. Schettino’s request to strike a plea bargain was denied, and by the time he had his first appearance in court he was left as the sole person accused of manslaughter. Schettino clamied the rocks were unmapped, and that his actions were heroic, and saved lives. However, on February 11, 2015, Judge Giovanni Puliatti sentenced Schettino to 16 years in prison. Many later critized the verdict, especially the families of the victims, saying it was too lenient.
As a long-term passenger on the CounterPath ship – I fear we too are approaching our very own metaphorical “unmapped rocks” in the ocean. The stock has declined to a paltry $0.45 from over $2 dollars just a few years ago. Revenue has declined, competitors have developed superior or alternative products, and new business models have prevailed. In this time – WhatsApp, was founded by Jan Koum, a Ukranian immigrant and welfare recipient. It was later sold for over $10 billion to Facebook. Not bad for a guy on Foodstamps.
Clearly, like Frencesco Schettino, CounterPath’s captain is unable to map a safe course, refuses to recognize his mistakes, and won’t take responsibility for his failed actions. Fortunately though, the ship is still afloat, albeit barely, and the board can still act. It’s time to find a new captain before the ship hits shore and sinks to the bottom of the sea, costing us all dearly. Replace Donovan Jones with fresh visionary leadership now.
Shipwreck video below —
And I added this one just because of the great footage:
Shareholder dilution (the CounterPath way)
Pollution isn’t solved by dilution. The original contaminant remains in every respect after the mixing, it’s just less concentrated. This fact is known to chemists everywhere and utilized by industrialists worldwide. Just visit a large factory anywhere in Asia and watch the concentrated and toxic effluent pour into the local river untreated. Meanwhile, just a few kilometers downstream, you are sure to find the locals bathing in the water, completely unawares about what is happening just upstream and the implications for their long-term health. It’s a disturbing sight.
Dilution Explained
Today I was shocked to learn that Donovan Jones – and apparently Terry Matthews and the rest of CounterPath’s board – subscribe to the dilution school of thought when dealing CounterPath’s very own in-house pollutant: poor management that hasn’t delivered strong results despite ten years at the helm.
CounterPath just reported a quarter that can only be classified as an epic failure. Yet, rather than correct problems into the executive suite – Terry Matthews topped up the balance sheet with $1.5 million in additional capital and left current management in place. A shocking and development.
I’ve churned on this for a while, and can’t see the logic of diluting shareholders without appointing new leadership, even if only to give us a bit of hope in exchange for the punishment we must bear. Now I wonder if Terry Matthews plans to keep diluting shareholders in an attempt to keep CounterPath afloat under the same business plan, or will they change course?
Let me know your thoughts!
The I.I.
CounterPath Reports Epic Failure
Today, after taking a few weeks break to get the gang settled back in class, I logged on and checked up on my portfolio. Whilst I was generally pleased with what I saw – there was one clear disaster in the mix. CounterPath’s stock remains the biggest loser and still sits at under $0.50. Shocking.
I then dug into the details a bit. But I wish I didn’t. It turns out that Jones had just delivered the worst quarter in memory. Revenue declined to a paltry $2.3 million. Shocking. Operating income remained deeply negative. Upsetting. Cash was down to just over $2 million. Worrisome.
So – Congratulations to Mr. Donovan Jones and team. You just delivered a quarter that can only be called an EPIC FAILURE. Nobody expected it could get this bad, this fast. But YOU DID IT !!! Way to Go TEAM EPIC FAILURE !!!
CounterPath Surprised the Market – Delivers Train Wreck Quarter
Counting at CounterPath
As I reflect on this long journey, I wonder if can anyone can COUNT up all the EVPs and VPs of Sales who have cycled through CounterPath over the last five years? They come in like lions, with high hopes and hoopla. But then they all leave like lambs, broken shells of their former selves, after months. But if I’m struggling with the numbers, it’s probably because I’m not good with figures. Or perhaps, after so many years, I’m just tired. The count, on the other hand, never tires. He would attack this task with alacrity. So, rather than bore you with a list, I’ll just step aside and leave the counting to the great master:
Donovan Jones as “The Count” of CounterPath
“You know that I am called the Count Because I really love to count I could sit and count all day Sometimes I get carried away
I count slowly, slowly, slowly getting faster Once I’ve started counting it’s really hard to stop Faster, faster. It is so exciting! I could count forever, count until I drop
1! 2! 3! 4! 1-2-3-4, 1-2-3-4, another SALES VP out the Door !!! 1-2, i love counting whatever the ammount haha! 1-2-3-4, heyyayayay heyayayay that’s the sound of the count
I count the spiders on the wall… I count the cobwebs in the hall… I count the candles on the shelf… When I’m alone, I count myself!
I count slowly, slowly, slowly getting faster Once I’ve started counting it’s really hard to stop Faster, faster. It is so exciting! I could count forever, count until I drop”
1! 2! 3! 4! – Another Sales VP OUT THE DOOR !!! 1-2-3-4, 1-2-3-4, 1,2 I love counting whatever the ammount! 1-2-3-4 heyayayay heayayay 1-2-3-4 That’s the song of the Count!
See Video Below – “Counting UP” All The Sales VPs Fired Over the Last Ten Years
See video below – “Counting Up” Sales VPs Fired over the Last Few Years
The Impassioned Investor 