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October 12, 1999 12:20 PM PDT
CrossWorlds founder to leave CEO position
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Fred Amoroso, a former executive with IBM and PriceWaterhouse, will assume the positions of president and chief executive, the company said. Garnett will become chairman of the board of directors.
CrossWorlds declined to comment beyond its announcement of Garnett's change in title.
CrossWorlds offers software that lets different applications work together and share information across a business's information technology (IT) apparatus, or between diverse businesses. The business software integration business has been brisk in recent years, but analysts say CrossWorlds has had limited success in capitalizing on the opportunity.
"It has been a visionary company," said John Mann, analyst with the Patricia Seybold Group. "But their implementation hasn't been as good as they hoped it would have been."
Sources close to CrossWorlds said the company expects to have $20 million in revenue this year, up from $8 million in 1998. The company has not yet turned a profit.
Amoroso was general manager of Asia Pacific Global Services at IBM and before that managed the company's Worldwide Insurance Business Unit. Executive search firm Heidrick & Struggles recruited Amoroso for CrossWorlds.
"Fred possesses tremendous operating skills and broad experience in highly competitive global technology markets," Garnett said in a statement. "We believe Fred is an exceptional choice to lead our efforts in the global business integration market. I welcome him to the team."
Mann suggested that CrossWorlds has lagged behind some competitors--which include Active Software, Vitria, and IBM--because it has tried to pull together a package of integrations to run across entire IT systems.
"They thought they'd sell packaged integrations, and the real world needs more flexibility," Mann said. "The trouble is that no two customers are alike, so it's more difficult to do a package-based system, where you have to tailor individual solutions. Then you're selling a service rather than a product."
Most of CrossWorlds' closest competitors sell individual tools rather than comprehensive packages, Mann said.
Garnett earned notoriety for appearing in print advertisements for the company wearing a low-cut black evening dress. The advertisements, which mentioned the company's name in inconspicuous type, sparked criticism that Garnett was trivializing her role as the company's chief executive.
CrossWorlds this month raised $25 million in a mezzanine-level funding round. Investors included Soros Private Equity Partners. Among those increasing their existing investments were SAP and Venrock Associates. The company is expected to go public soon.
In October 1998 CrossWorlds laid off 20 people, just less than ten percent of its workforce at the time. The company now has 220 employees. Subsequently, CrossWorlds went through a series of executive departures, among them the company's chief financial officer. In March the company named Mark Kent to that post.
