On my checklist for a slamming at the moment is super-hyped cloud play Snowflake (SNOW).
So I used to be driving home final evening and heard Snowflake’s CEO Frank Slootman — a mega gazillionaire who loves crusing yachts however can also be a grasp at building tech businesses — doing an interview with a YF competitor. On with him is somebody I by no means heard of earlier than, Sridhar Ramaswamy, who was being described because the incoming CEO of Snowflake.
My first response was, “Wait — how did I miss this tonight, and why was I paying a lot consideration to Salesforce’s earnings?”
I slammed the brakes on my new automobile and pulled off from the busy freeway to look at the interview (sure, for actual), the place I discovered two smiling execs yucking it up with the host. The host recommended Slootman signaled strongly to him in a not-so-distant previous dialog that he was going to step down.
Memo to Frank and to all the Snowflake board: You did a horrible job signaling this was coming in any kind. And now the common investor (who does not have access to Frank Slootman) is left holding the bag on a super-hyped tech inventory — shares are crashing greater than 23% as of this writing.
The Street was usually shocked right here.
“Snowflake shocked buyers on various fronts final evening: its tremendously profitable CEO is retiring efficient instantly after he stated he wasn’t going wherever simply 7 months in the past,” Guggenheim analyst John Difuci wrote in a consumer observe.
Stifel analyst Brad Reback additionally referred to as Slootman’s exit a “shock.”
Bottom line: CEOs have a accountability to sign when they could not need the highest job, both as a result of they’re burned out, need to play golf, or are eager on shopping for one other yacht. And it is the board’s job to make sure this course of is dealt with first-rate, from exterior communications to inner communications.
If it is not dealt with proper, you might get Slootmanned, excuse me, and expertise a pointy inventory sell-off due to a shock shift within the C-suite.
