Terminal Value Part 2

Tony hesitated. "Have you given the Mantric people any access to our files?"

Puzzled, Dylan shook his head. "No. Why would I do that? What's up?"

Tony sat down across from him and took a deep breath. "There are just so many people here, total strangers showing up, asking questions. It just feels odd."

Dylan looked at his friend for a moment in silence. "Tony, what's up?" he asked again.

"It's probably nothing, but several times over the past few weeks, since the Mantric group has been here, I've sensed that someone has been meddling with files. My major project is Hyperfn, and a few times I've felt like things in the files have been out of order, or someone has accessed them. I've waited to tell you, thinking it was just my imagination. Matt doesn't know anything about it, and I'm sure if you or Rob were doing anything, you'd let me know."

"Well, I certainly haven't had the time to do anything other than focus on the transition. Is there anything missing?"

"No, not that I can tell. It just doesn't feel right when I go into the file. This is a really important account, and I want to be sure nothing goes wrong. Do you think any of their techno-geeks could have hacked in?"

Dylan sat forward and thought about Tony's words. "I can't imagine why they would do that. Hyperfn and all of our other clients are becoming part of Mantric, and there will probably be a lot more people with access. I've confirmed with Art that you're the primary and Matt the secondary on that account, and he's agreed you two are the best ones to handle it because of your experience and your relations.h.i.+p with Joe Ferrano."

Tony sat back and nodded. "Yeah, you're probably right. I guess I'm just anxious about this whole thing. It's pretty important to all of us."

"Thanks for asking about this, Tony, but I really don't think we need to worry."

He smiled and left the room. Dylan sat back and wondered.

Chapter 5.

March 5, 8:30 a.m. New York It was an unusually warm day for early March in Manhattan. People were dressed more for spring than for winter, bringing a smile to Dylan's face as he walked through the maze of high-rise buildings.

Mantric's New York headquarters occupied five floors of a forty-six-story green gla.s.s skysc.r.a.per located in downtown Manhattan on West 19th Street, not far from the Hudson River. The company shared the building with an a.s.sortment of financial services and management consulting firms. With its modern design, sleek furnis.h.i.+ngs, and river views, it made MobiCelus's Boston office look like little more than the run-down factory it was.

Gossipy stories about the firm's beginnings were the talk of the technology world. CEO Art Williams had pitched Mantric's first deal to a major global insurance firm. Although everything Art described was essentially hypothetical, the insurance firm bit anyway, heady at the thought of the money to be made in the "clouds," so to speak, and in thirty days he had a.s.sembled a staff of nearly 500 low-cost Indian software engineers to launch the project. True to form, Williams also hired a publicist to play up the win and the enormous cost reductions the insurance firm would realize. It worked, and Mantric's phones rang off the hook.

Now, the firm had grown to some 10,000 employees around the world, including India and China. But the two-year-old company had a mixed reputation. Its innovative new client solutions, incorporating technologies such as cloud computing, made it a business media darling by leveraging low-cost labor to achieve huge savings for clients and equally huge profits for Mantric. But liberal politicians and the public media lambasted the firm for s.h.i.+pping thousands of U.S. jobs overseas and for incorporating itself in tax-friendly Bermuda. Nevertheless, its success was real and its IPO imminent.

Dylan stepped into the elevator. The doors closed behind him, and the voice sensor blinked in acknowledgement as he announced, "Twenty-fifth floor." He smiled, remembering his bewilderment the first time he rode this elevator. Had another pa.s.senger not entered directly behind him, it could have been embarra.s.sing as he searched for a way to make it rise.

The elevator glided smoothly up to the twenty-fifth floor, and when the doors opened, Dylan stepped into the reception area: a virtual shrine to the very latest technological marvels-from a 3-D high-definition screen that occupied nearly an entire wall to a voice-activated computer consisting of nothing more than a razor-thin flat HD panel.

Stenciled on the wall across from the reception desk were famous quotes from visionaries like Gordon Moore, the Intel cofounder who, back in 1965, stated his famous law that the number of transistors that could be placed on an integrated circuit or chip would double approximately every two years while the cost of a given amount of computing power would fall by 50 percent. At the time, Moore was thought to be crazy, but his prediction proved to be spot-on.

Silence ruled in the reception area, where thick carpets absorbed all sound, and the absence of human beings grabbed the visitor. Dylan walked over to a wall-sized screen displaying a rotating art collection, where an attractive female avatar appeared.

"Welcome, Mr. Johnson." A female voice spoke with a faint metallic ring. Soft music played in the background as she announced, "Mr. Williams will be with you momentarily."

Dylan found this "Big Brother" welcome somewhat disconcerting.

"While you are waiting," the avatar continued, "I will update you on how we are doing."

The avatar evaporated, replaced by a slowly spinning globe where the continents looked like integrated circuits. The globe began to pick up speed until it became a whirling blur that finally exploded to reveal the Mantric logo. The avatar's voice resumed, "In two short years, Mantric has grown faster than any other technology company in history." The logo pixelized into multicolored floating currencies that dribbled down into an enormous pile on the screen. "To date, our clients have saved over twenty billion dollars by entrusting their technologies to us."

"h.e.l.lo, Dylan," a deep baritone voice called from behind, and Dylan spun around to find Art Williams walking toward him with a beaming smile and outstretched hand. At five feet ten inches tall and with a round protruding belly, the fifty-one-year-old did not look the part of a successful CEO. Streaks of gray wandered through the disheveled brown hair that brushed lightly across his collar. He wore the attire of technology geeks twenty-five years his junior. In his dark gray mock turtleneck pullover, blue jeans, and Nike running shoes, n.o.body would confuse Art Williams with the cool young techies he apparently aspired to be. Dylan mused that the costume didn't work.

"Pretty impressive, huh?" Art remarked as he motioned toward the screen.

"Very," said Dylan, attempting to hide his continued discomfort at the "Big Brother" effect.

"Come," Art said, taking Dylan's shoulder. "The team is waiting for you."

They entered the conference room where the executive committee had a.s.sembled, as well as Frank Crowley, Mantric's master internal technologist, who would be handling the virtual worldwide meeting. Art directed Dylan to a seat at the middle of the table.

"Dylan, I think you've already met a few of these people, but let's go around the table and have everybody introduce themselves."

Christine Rohnmann, tall and slender, with short brown hair cut in severe layers, was dressed in an expensive, conservative pinstripe suit. She wore a small pearl choker and pearl and diamond earrings-her statement of wealth, cla.s.s, and control. After she had guided ProTechSure through the stages of going public, she earned her reputation as the female version of Attila the Hun and became Art's trusted first lieutenant. She was about to do the same at Mantric, cementing her role in the company.

"h.e.l.lo, Christine," Dylan said politely. "Good to see you again."

She nodded, did not look at him, and said nothing.

"h.e.l.lo, Dylan," said an Indian man who got up, walked over to him, and shook his hand. "I am Sandeep Nigam, Chief Technology Officer. It's a great pleasure to meet you. I admire the work you have been doing, and I'm very happy you are now part of our team."

"It's a pleasure to meet you. Tony Caruso speaks highly of you and your work." Dylan shook Sandeep's hand, wondering if he should have stood up as well. He observed that the wrinkled white b.u.t.ton-down s.h.i.+rt, faded jeans, and Nikes that Sandeep wore worked, in this case, just fine.

"I return the compliment. He is quite brilliant."

He sensed a lack of enthusiasm in Sandeep's words, but wondered if it was just the heavy accent. Dylan watched the soft-spoken twenty-nine-year-old Indian, with hair so black it was almost blue and dark eyes that hovered between sad and humorous, and wondered how misleading appearances might be. Something about Sandeep set an uncomfortable tone, but Dylan could not put his finger on it.

Across the room away from the doorway, Ivan Venko, Mantric's Chief Security Officer, stood in absolute contrast to Sandeep. Ivan, pale and matchstick thin, was dressed totally in black-black suit, black turtleneck sweater, black shoes highly polished enough to reflect things in close proximity. In this digital world, he was responsible for keeping all Mantric's data secure. His pockmarked face, slicked-back hair, and constant scowl gave him a mysterious and unpleasant air. A headset curled around his left ear and extended halfway along his jaw. He had been trained as a security specialist in Prague, which in those days meant working for the Slovak Intelligence Service, or SIS: an organization accused of kidnapping, torture, and most infamously the a.s.sa.s.sination of Robert Remia, a key figure in the trial against the SIS for the kidnapping of the president's son. Rumor had it that, following the break-up of Czechoslovakia in 1993, Ivan had fled the new republic to avoid retribution from the now-free Slovaks. Ivan made no attempt to move forward to meet Dylan, but remained away from the group, his dark eyes quickly glancing around the room in search of any problems.

One person remained at the table, and before she could speak, Art stepped in and introduced her. "Dylan, I'd like you to meet Stephanie Mathers, our Chief People Officer." At forty-one, Stephanie stood out like a sore thumb. She was short and overweight, and her hair was bleached several shades too light; the jacket of her business suit was one size too small and pulled tight over her ample chest.

"Welcome to Mantric," she said, shoving her hand toward Dylan with a bit too much enthusiasm. "I'd love to tell you all about the really special culture we have created here. We're all really, really looking forward to working with you and your staff. And if there is anything I can do-"

"Okay then," Art interrupted abruptly, cutting off the conversation. "Frank, let's get things started."

Since Mantric employees were scattered across three continents, the meeting was conducted over an encrypted virtual private network, or VPN, eliminating the possibility of access by any outsider.

Frank adjusted Art's chair to make sure Art was in view of the mini-cam perched on the table. Art sat down in front of his laptop, and the minor adjustment to his chair gave him the appearance of being taller than he was. He gave the nod to begin.

"h.e.l.lo everyone," Art said. "You all know why we're gathered here today, but I want to make it official. I am very happy to let you know the initial registration with the SEC has occurred, and we now expect to go public with our IPO the week of May second. I have no doubt we will absolutely be the hottest offering in our sector."

Cheers resounded throughout the room and through the monitors.

"I don't need to remind you that, given our stock option plan, each of you watching or listening to me today have a-well, let's just say you all have a strong incentive to hear the details of our offering." Knowing chuckles erupted. "So here they are. We've filed to offer three million shares of common stock, and we expect the initial offering price to be between ten and twelve dollars per share."

With a click of the mouse, the room lights dimmed, and the plasma screen hanging on the wall behind Art, as well as on everyone's displays all over the globe, sprang to life. The program started with a slowly spinning Mantric logo, and soft strains of music floated in the background as animated images began to appear on the screen.

"Joining us today is Dylan Johnson, the former head of MobiCelus and now Senior Vice President of our mobile division. As you know, given the migration of computing to mobile devices, the acquisition of his company is a crucial element of how our offering will be viewed on Wall Street. Not to mention the addition of their revenues!" Art paused and smiled at Dylan. "Thanks to Dylan and his team, many of whom are watching this, we now have the capabilities we need to be the clear leader in the world market.

"We generated eighty-three million dollars in revenues in the second half of our first year of operations, a 670 percent increase over the first half." A chart appeared with a revenue curve shooting upward quarter by quarter, literally blowing the roof off the chart at the end. "As you know, we were projecting revenues for the next quarter of ninety-four million dollars, about a forty percent increase over last quarter. More importantly, we've become profitable a full quarter earlier than we expected. But, with the addition of MobiCelus, I think we can now hit 100 million dollars next quarter." The incline of the curve increased even more.

Dylan leaned forward and studied the chart. Would they really be able to add that much revenue that quickly? He made a silent note to himself to check these figures with Rich. Quickly, the chart dissolved, and the spinning logo returned.

The animated chart flipped over, revealing a NASDAQ listing of companies on the other side. Mantric was on it, with the trading symbol MNTR, and rose off the page into large type. "You know, I'm not a greedy man," Art said, "but I think by the time we go public we'll be the hottest offering in our sector." The listing turned into a stock chart, with a starburst signifying an initial offering price of ten dollars a share, then rising up to twenty dollars, then forty dollars, and then it burst through the roof of the chart again. "And within three or four months, based on comparable valuations we've looked at, I expect our stock will be trading at about sixty dollars." Everyone applauded again.

"We are now officially in our quiet period. No one, and I mean no one, is to discuss our stock offering or our firm's performance with any outsider. Not to a reporter, not to an a.n.a.lyst, not to an investor, not to your mother. If that happens, the SEC will prohibit us from going public. I want to remind all of you that we must concentrate on our clients and our projects. I know this is an exciting time for us, but the worst thing we can do right now is take our eye off the ball.

"So the next step is to prepare for the road show, which will be the last ten days of April. The management team will be visiting investors in London, Los Angeles, San Francisco, Chicago, Dallas, Boston, and New York."

Dylan smiled at the mention of the road show. As the head of the mobile division, he would play an important role in Mantric's show as perhaps the world's most renowned expert on the future of mobile computing technologies. He had already started working on his presentation.

As Art began a discussion of the history of the company, Dylan felt a light buzz against his chest. He retrieved his cell phone and flipped it open to see Tony's signature response on the screen. A short text message darted across the screen, reading: "something odd, need 2 talk 2U." Then the message ended. Dylan's mind raced through what could be important enough for Tony to send such a cryptic message during this event. He snapped the phone shut and returned his attention to the meeting.

"This is only the beginning. Everyone knows the future lies in constantly developing and capitalizing on emerging technologies to achieve enormous compet.i.tive advantage-"

Art's voice droned on and on in the distance, while Dylan's mind returned to Tony's mysterious message. Dylan tucked the message into the back of his mind as Art completed the virtual meeting. Dylan pushed away from the desk and slid out of the chair. He wanted to talk to Rich about the numbers Art had rattled off, and then he had to find Tony.

"Good meeting, Art," he said and rose.

Art did not respond but wafted a casual wave through the air as he walked toward Ivan. Dylan watched as Ivan held out his cell phone toward Art. Art looked at the face of the phone, then looked back at Ivan, and just raised his eyebrows and pursed his lips as if contemplating some deep thought. Simultaneously he and Ivan slowly raised their eyes toward Dylan. Art smiled and waved again.

March 5, 2:00 p.m. Boston The meeting ended at 11:15 that morning, and Dylan grabbed a cab to the airport. He'd called Tony but, as always, got his voice-mail. Dylan was anxious to get back to Boston and pursue his questions with both Tony and Rich. The twelve-thirty p.m. shuttle touched down just sixty minutes later, and by two o'clock, Dylan had settled in at his desk and dialed Rich's extension through the computer keypad. The screen opened, and Dylan saw Rich with his right side turned to the screen, his attention drawn to another computer on the credenza at the side of his desk. Dylan chuckled at Rich's ability to mult.i.task with such focus.

Rich turned and smiled when he saw Dylan. "Oh, hi, Dylan. Meeting over? I only caught part of it."

"Yeah. Listen, Rich. Just a quick question. Did you hear Art's announcement about the revenue levels once Mantric goes public? Now, I'm not a financial wizard like you are, but did the numbers he announced sound solid to you?"

Rich waited for a few seconds before answering. "Well, I thought that part of the speech, which by the way I found terribly boring, was a wee bit of a stretch, but that's what Art does well, isn't it?"

Dylan chuckled. Only a number cruncher would find the meeting boring. "Yes," he said. "It is his strong point."

"Why do you ask?" Rich asked.

"Well, like you said, I thought that was a bit of stretch as well. Could you just do a cursory glance at the numbers?"

Rich leaned in toward the webcam. "You think there is something fishy about the numbers?"

"Good Lord, no!" Dylan responded quickly. "I just wanted to be sure, and you're the person I trust to do that research best."

Rich sat back. "Oh! Okay. I'll check into it and let you know what I find out, but I think he was just doing a little exaggerating to jazz the meeting-not that it worked for me." He mumbled the last comments half to himself, half to Dylan.

Dylan chuckled. "I'm just curious, but don't put a priority on it-just when you have a few minutes."

"Yeah, like that will happen anytime soon." Rich responded. "But I'll check the numbers for you."

They both clicked off the call at the same time. Dylan wasn't sure if he would understand the numbers, or what he was going to do with that information, especially if the numbers were exaggerated. He just had a nagging itch he couldn't scratch, and he needed to satisfy his curiosity. His fingers returned to the keyboard, and he deftly dialed Tony's number, which rolled into voice-mail again.

"Tony, don't you ever answer your phone? You sent me an odd little message. Want to talk about it? Call me."

"Dylan." The soft voice filled the quiet room. Dylan turned to see Heather standing in the doorway.

"Hi!"

Heather walked into the room and sat on the sofa. Dylan couldn't help but admire her slender legs as she crossed them. She looked out the window, then back toward Dylan. She noticed him looking at her legs, and her green eyes bored into his. "So," she said with a sly grin. "How do you think the meeting went?"

Dylan turned beet-red. "I think there may have been some exaggerations, although minor, but they were probably made to 'jazz' the audience." He could not believe he had just stolen a comment from Rich.

Heather laughed. "Yeah, I'd agree." She leaned forward and licked her lips. "But it is exciting, isn't it?"

A noise from the doorway caught their attention, and they both turned to see Rob standing at the door.

"Not interrupting anything, am I?" he asked in a peevish tone.

"Not at all," Heather interjected.

Dylan sensed a lowering of the emotional temperature in the room and wondered if it was reality or just wishful thinking on his part. Rob entered and threw himself into the chair across from Dylan. "We were just discussing the meeting," Dylan said.

"Yeah, I'll bet that was the most boring meeting you've ever attended." Rob did not address either person directly.

"Yeah, well, maybe for you, but not for the new people who haven't been in on this thing from the very beginning. Others might find it a bit more interesting." Heather responded. The chill deepened.

"Whoa," he answered, throwing his hands up. "I didn't mean anything by it!"

Dylan watched their reactions with interest. "Well, anyway," he said in a vain attempt to warm the room. "We should be preparing for the offering and making sure we have everything in place that we need to handle on our end. We also need to make sure Hyperfn is brought online without a hitch."

"Hey!"

All three turned at the sound of the nasal voice at the doorway. Dylan asked, with the sort of exasperation one friend displays to another, "Don't you return your calls anymore?"

"Did I ever?" asked Tony, grinning. He stepped into the room and looked at Heather and Rob.

Heather rose first and walked to the doorway, then turned. "Looks like you guys have something to talk about, and I have work to do. Ciao!"

"Hey, wait a minute! How about lunch?" Rob jumped up and dashed out the door after Heather, who had disappeared down the hallway.

Dylan remained quiet for a moment, gathering his thoughts. "So-what was that mysterious message you sent me while I was in the meeting? You said there was something odd going on and you wanted to talk about it."

Tony stared out the window, then moved his chair closer to Dylan. He looked around to be sure no one else was there to hear him. "Listen, I don't usually pat myself on the back, but I'm pretty confident I know what I'm doing when it comes to technology."

Dylan raised his eyebrows high on his forehead and gave his friend a lopsided grin. "Yeah, I think I could agree with you on both those things!"

Tony glanced around again. "When the newest technology comes out, I'm always on top of it. I like to think my knowledge gives me an edge. Like, I'm virtually always around, even if you don't know it. I'm a teeny tiny software script in your electronic life." He pointed to Dylan's pocket where he kept his cell phone. "I see you, but you don't see me. But, when you need me, voila! I magically appear."