After unsuccessfully trying to find a buyer for several months, LucidEra has turned itself over to a workout firm to sell off the patents and whatever else has value at the once-promising on-demand business intelligence (BI) vendor. We understand that CEO Robert Reid and the company’s board members have left LucidEra, replaced by Diablo Management Group. DMG, which got the mandate last week, has sole fiduciary control at LucidEra. A scrap sale, if it occurs, is likely within the next two months or so.
It’s a stunning fall for LucidEra, which was arguably the most visible startup in the market. Certainly, cofounder and former CEO Ken Rudin was one of the loudest – if not the loudest – evangelist for on-demand BI. (Rudin served as CEO until last July, when he assumed the role of chief marketing officer and turned the company over to Reid.) The company had raised some $23m from Crosslink Capital, Benchmark Capital and Matrix Partners over two rounds. We would note that if DMG does manage to sell LucidEra, the startups’ creditors will be first in line for payment, with any remaining funds then available to investors. LucidEra doesn’t have many creditor claims, but there are some.
In many ways, what initially allowed LucidEra to get going ultimately proved to be its undoing. From the beginning, the vendor tied its fate to Salesforce.com, specifically offering a pipeline reporting and analytics feature for the on-demand CRM vendor. That essentially made LucidEra an after-market add-on for Salesforce.com customers, which limited its market and always prompted questions about why Salesforce.com wouldn’t just offer that technology. It also got us wondering in a report two months ago why Salesforce.com wouldn’t just acquire LucidEra. That may still happen. If it does, however, Salesforce.com will be picking up just a fraction of what LucidEra had been when they last discussed a deal. And it will be paying just a fraction of the price, as well.