• 2005 Navagate Software founded in New York City– 30 Java developers.
  • 2006 Software Development Center, Minsk, Belarus – 120 Java developers and implementers. Agility version 1.0 tested and released. Major sales were made to New York Life (12,000 sales and marketing personnel). New York Life required integrating 17 large back-end systems—mammoth task. $6MM deal. HSBC Hong Kong Wealth Management contracts for 1000 user test. They called us from 20,000 km away, remarkable that our accomplishments travelled that far, that fast. We scrambled to set up a remote implementation team. We could not rely on outside services firms. The lead time would have been too great.
  • 2007 Navagate Software Development Center Opened in Chennai, India — 40 developers. NY Life and HSBC work continues 20,000 km apart—120 services engineers.
  • 2008 January – HSBC and New York Life approve licenses and full implementation. January – Mutual of Omaha signed a 3,000-unit license for their entire sales staff based on NY Life approval. These “proofs” were needed for $10MM planned capital raise for growth.
  • February – Bear Stearns fails in Mortgage Securities Crisis — Venture capital funding market shuts as tech investors get cold feet. Sequoia Venture Capital, one of the top 5 venture firms, circulated a now-famous letter. “This will be a deep recession. We are not investing in new portfolio deals. And our current portfolio firms will be making appropriate spending cuts to get through this storm.”
  • September—Lehman Brothers Bank collapses—Venture capital window shuts tighter. 2009
  • August—A boutique New Jersey based Broker-Dealer (The Banker) says they can raise a $3M “bridge” loan and repay it or convert it into a $15MM equity raise. They said the raise of the $3MM loan would take 2 months, and they would do a simultaneous start on the bigger round to take out the initial bridge investors. Our pre-money valuation was set at $25MM. The total market capitalization in this sector was $250 Billion. We had big upside given our disruptive performance, an incredibly impressive client list and charging 50% less than the big players.
  • September– HSBC jumps to 2000 units in Greater Hong Kong. They love it. 2010 April—The NJ Broker Dealer raises only $400K for the bridge after 7 months, not $3MM in 2 months. This Is A Disaster. Lies and incompetence reign. The Broker Dealer forces me to sign a guarantee with a financial statement. Pinned against a wall, I filed a false financial statement. If the full round was raised, it would not be an issue. If the full round was not raised, it could be an issue if I did not sell the code to HSBC. In either case, the real issue was the $25MM valuation. Someone could raise it or I could sell all rights to the code. That is what should have made the $3MM bridge note a non-issue. The value was there. If you have a house worth $25MM, a $3MM home equity loan would be insignificant. The guarantee meant little and even with it, the Banker could not get the deal done.
  • November– HSBC extends Agility to 10,000 users in all their Asia operations. They indicate an interest in extending to all 30,000 users globally. This is an incredible endorsement. HSBC is the world’s largest bank!! 2011
  • January to December– $2.5MM dribbles in from the Broker Dealer. It is insufficient to clean up balance sheet and prepare for full raise. The promise was 2 months, and it needed to happen over a few months not 24 months. Navagate gave the Bankers world class, fully installed clients in a massive market and they gave Navagate company killing delays.
  • October—Navagate sets us a 40-person software development center in Shuhai, China, a 40-minute ferry from Hong Kong, to service HSBC. 2012 The lack of performance and lies from the Broker Dealer forced Navagate to find an alternative. HSBC wanted to go to 30,000 units and buy the code rather than rent indefinitely. This would be a bad business move (lower total payments over time) but it would allow Navagate to repay the bridge loan instead of going ahead with the full $15MM round. Because many of the dribbled-in bridge notes were now at the end of their term, some investors filed default notices. This is another example of theBroker Dealer’s incompetence. You have to control your syndicate or bad things happen. They did not control their group. This compromised Navagate’s ability to negotiate with HSBC. Instead of $3MM per year rental, HSBC wants to buy their code for $3MM! It took 11 months, but I was able to get $5.7MM from
  • HSBC. The HSBC negotiating team later admitted they were surprised at my resolve, but it was necessary. This allowed me to pay down the bridge loan.