VeriFone, the big payments company that has more than half of the U.S. market for credit-card terminals, just ousted its CEO, Doug Bergeron.
It seemed sudden: The company announced that he was "stepping down" late Monday, with his departure effective Tuesday.
VeriFone's stock rose 6 percent today, following Bergeron's departure.
There's a host of possible reasons—disappointing results, ongoing shareholder lawsuits, and an admission of illegal business dealings with customers in Iran.
Bergeron has led VeriFone since 2001, when HP sold it to an investor group for $50 million, and took it public in 2005.
But lately Bergeron and VeriFone have struggled. Last year, VeriFone was worth $4 billion—and Bergeron dismissed upstart mobile-payments rival Square as an Internet flash in the pan.
Now Square has been valued at $3.25 billion, and VeriFone is worth less than two-thirds of that.
VeriFone attempted to take on Square's smartphone-attached credit-card reader with a knockoff product called Sail. It cancelled Sail late last year, with Bergeron declaring the mobile-payments business "unprofitable."
Square has pursued a very different business model than VeriFone's, emphasizing product development over sales.
In discussing VeriFone's recent revenue miss, Bergeron said the company hadn't invested enough in short-term hardware and software improvements.
American Banker reporter Sean Sposito got a copy of Bergeron's goodbye email. A VeriFone spokesperson verified its authenticity. Here's what Bergeron wrote:
From: Doug Bergeron.
Sent: Monday, March 11, 2013 04:20 PM
Subject: To All of You
I write to you today with thoughts that are full of emotion and filled with love for you and our company.
Late last week, the VeriFone board met, and together with my agreement decided that the time is right for new leadership of the Company. We have had our victories together as well as our stumbles. Recently, we disappointed our investors with some terrible results that I have largely blamed on our own issues. This was my responsibility and I accept the consequences.
I have been your CEO for almost 12 years and I have enjoyed every single day here. In 2001, we purchased the company from Hewlett Packard for $50 million dollars (which we mostly had to borrow) and today VeriFone's enterprise value is about $3 billion dollars. We had 800 employees and under $300 million in revenue in the first year. Today, our revenues are six times larger and we employ almost 5,000 people around the world. I am so very proud of this achievement. It was one of the most remarkable turnaround investments in a generation.
I actually do not recall much about life before VeriFone. I was CEO of VeriFone before I met my wife, and we now have 3 children together who have only known their father in this role. Those of you who know me best know that there is very little daylight between my personal identity and my role here. I will have to rediscover myself over the coming weeks and months, and I hope to discover some long lost talents.
I tried my best, always, to be an honorable leader and to make you proud of me and proud to work here. I know we created a special culture of entrepreneurship, risk taking, high expectations, and fun.
You will have an opportunity in the days ahead to be part of a new and rejuvenated company. We have many strong leaders who I'm sure will be asked to do even more. This is a great opportunity for all of you. The culture that we have created together is alive and well, and it will carry this company through this transition.
May God bless each of you and your families. I will always love you and I will always love VeriFone.
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