Wednesday, November 02, 2011

Angie's List Losses Mount While Executives Pocket Millions

Everything that is wrong with American business today is epitomized by locally-based Angie's List. You have a company that always seems to get good buzz in the local media, and their founders are the darlings of the media who can do no wrong. The company has never made a dime in its 16 years of existence and its losses are piling up faster than the snow during a winter blizzard, but investors keep lining up to dump more money into the company. Governor Mitch Daniels and Mayor Greg Ballard gave their stamp of approval to it by announcing recently a $14 million economic development incentive package for a planned expansion of the company's downtown Indianapolis headquarters. The announcement came just one week before the company's executives announced that this great investment opportunity could be your's as it rolled out its plans for its initial public offering. Although it's never turned a profit, the latest filings with the SEC show its top two executives are receiving multi-million dollar compensation packages even as the company's losses are mounting at a record pace. The IBJ's Scott Olson has the numbers:

The provider of online consumer reviews reported Monday in its latest Securities and Exchange Commission filing that the company lost $43.2 million through the first nine months of 2011, pushing total losses since 2006 to $160.6 million.
Its loss through Sept. 30 represents a 59-percent increase from the same time frame last year, when losses totaled $27.2 million . . .
Its latest SEC filing does not provide a price at which company shares will be sold to raise the $75 million. No date has been set for the official offering, but the filing still indicates it will take place in 2011.
But it does give information on executive compensation. Angie’s List Chief Marketing Officer Angie Hicks earned a base salary in 2010 of $148,550, but her pay grew to nearly $4.2 million when including $3 million in stock awards and other compensation.
CEO and company co-founder Bill Oesterle earned a base salary of $254,995 last year and total compensation of $2 million when counting $1.4 million in stock awards and other compensation.
Aren't you just waiting with bated breath to learn whether the wise manager of your retirement fund will invest in Angie's List? Be sure and check out the comments section for Olson's story. Lots of good tidbits there.


Southsider said...

And probably a lot of $$$$ were political donations..

SW Lane said... the west of the business, along the north side of Washington St, there are a couple of small businesses, to include a small bookstore are being bought out by Angie's List for 200 spaces/parking lot.

How can they be hiring if they show such abysmal profits/bottom line?

Nick said...

Like the readers on the IBJ website said, in an age of Yelp and Google, why pay for Angie's List. I have never been disappointed with a business that got good reviews on Yelp. These people are clueless. I see her ads on Fox News and hear them on conservative talk shows. Hey Angie, it's not working!

Downtown Indy said...

And they spent big bucks on restoring an old fashioned diner car. A year has passed and I'm not sure it's ever served it's first customer!

Paul K. Ogden said...

I have to say, I have never understood the Angie's List business model.