Today in New West news: Utah-based startup Domo turning heads with $2B valuation, Vertical Harvest opens in Jackson, WY; Alpha Natural Resources’ restructuring plan approved, and an update on Colstrip.
To say American Fork, Utah-based Domo has captured people’s attention is an understatement. The cloud software company, specializing in “business intelligence and analytics” has attracted not only attention, but also some major, major funding. According to Business Insider, citing a story from Venture Beat, the company has been hailed as an “insta-unicorn,” or a company valued at $1 billion or more right out of the gate.
But Business Insider says the company’s valuation may rest more on hype than reality—which doesn’t bode well for the “insta-unicorn.” From Business Insider:
Domo was founded in 2010 and, as of March, the company says that it has 1,000 paying customers and $100 million “in billings,” meaning revenue that has already been billed to customers. Those customers are served by 800 employees, it says.
That’s fast growth by any standard.
But former employees we talked to tell a different story. These insiders say that Domo is a very promising company, but it’s currently equal parts hype and reality. In particular:
• Its products are immature and expensive compared to competitors such as Tableau.
• The enterprise-sales team, the one that’s responsible for selling big contracts to big customers, didn’t do well in 2015 and quite a number of salespeople left.
• It’s a bit of an “Omniture club,” in that a lot of the top execs and best-regarded salespeople came from Omniture, the company CEO Josh James previously founded and sold to Adobe for over $1 billion in 2009. Domo acknowledges that about one-third of its exec team worked at Omniture, and says it’s “a great club to be a part of.”
• Employees have been pumped up about an eventual IPO. That’s the same for many startups. But because Domo has raised a lot of venture money, some question how much equity employees have versus how much has been sold off to investors.
Some former employees also commented on CEO/founder Josh James’ character, saying he’s a “nice guy” but as full of hype as Domo may be. One employee told Business Insider James is “the type that will overpromise and under-deliver a little bit. And people can see that with Domo, and that’s kind of the concern.”
Still, the fact a Utahan company is generating this much interest (and in some quarters, incredulity) shows just how far the region has come.
Up in Wyoming, we previously reported on the rise of Vertical Harvest, a state-of-the-art greenhouse over seven years in the making. Aimed at providing produce year0round to restaurants and local grocery stores (as well as employing people with various disabilities who may be barred from so-called “traditional” employment), Vertical Harvest was the dream of founders Penny McBride and Nona Yehia. I say dream because, according to Jackson Hole News & Guide, Vertical Harvest is up and running:
“Amazing,” “innovative” and “community” were three words constantly expressed Thursday at the grand opening of Jackson’s state-of-the-art greenhouse.
Local restaurants, farmers and artisans set up an impromptu market on West Simpson Avenue, with the entire Town Council, many of the county commissioners and Gov. Matt Mead in attendance.
“As we think about what this means, it is not just something that’s going to be great for this community, it’s going to be great for the state,” Mead said in public remarks. “It is a model of a public-private partnership, it’s a model of grit and determination. It is doing the right things for the right reason.
“Today I’m proud to say I’m from Jackson,” he said.
Vertical Harvest’s celebration reflected the excitement of many in the community about the long-awaited opening.
“This is amazing,” said Hadyn Peery, an associate financial advisor for J Singleton Financial. “It makes me believe in America and innovation.”
Peery toured the building and bought some tomatoes with his daughter.
“When you get on the top floor and you see how big those tomatoes are, it’s just incredible,” he said.
In addition to selling produce to individual residents and tourists, Vertical Harvest supplies many of Jackson’s local restaurants and markets.
The growing list of buyers includes the Snake River Grill, Cafe Genevieve, Jackson Whole Grocer and Cafe, Persephone Bakery, Aspens Market and Amangani.
Keeping with Wyoming, according to the Billings Gazette, a federal bankruptcy court has approved a restructuring plan for Alpha Natural Resources, overriding objections from the U.S. Trustee who said Alpha’s plan was too vague and did not shore up the company’s reclamation responsibilities. From the Gazette:
The government was joined by a series of environmental groups, the United Mine Workers and an insurance company who objected to Alpha’s outline.
But U.S. Bankruptcy Judge Kevin R. Huennekens ultimately sided with the company, which argued the objections amounted to concerns over its restructuring plan and not the disclosure statement itself.
An Alpha spokesman declined to comment.
Environmentalists said there were encouraged by an amended disclosure statement filed prior to the start of the hearing. Alpha’s original outline provided little details on how it intended to deal with $411 million in self-bonds, or unsecured reclamation costs, in Wyoming.
Under the company’s plans, Alpha’s mines would be split between core and non-core assets. Its two Wyoming mines, Belle Ayr and Eagle Butte, were designated as core assets and would be controlled by a new company run by Alpha’s senior lenders.
In its Wednesday filing, the company proposed a plan for resolving its outstanding reclamation obligations in five eastern states. Although Wyoming is not party to that agreement, Alpha said it anticipated the new company would replace its self-bonding obligations with secured financing like surety bonds and permitted collateral.
“It seems positive, but it is still tentative in terms of what’s going to happen,” said Shannon Anderson, a lawyer at the Powder River Basin Resource Council, a landowners group that has pushed for an end to self-bonding. “This last version provides a lot more certainty of what is going to happen, and what expectations we as a public can expect of this company.”
The Gazette further reports creditors will be able to vote on Alpha’s plan from now until June 29, with a confirmation hearing scheduled for July 7.
Finally, up in Montana, we’ve been following developments around Colstrip, the coal-firing electricity plant that supports a titular town and supplies power to the Pacific Northwest. Increasingly, the debate over Colstrip is making the plant into a symbol: for some, a symbol of the state’s heritage that must be preserved; for others, a symbol of obsolescence, an obstacle to the state’s future. And as far as the future of Colstrip, change is coming whether people want it or not.
According to the Missoulian, Talen Energy (which owns a share of the plant and operates the entire facility) has given the plant two years’ notice, which means the plant will need to find a new operator by May 2018, if not sooner:
“This decision is part of Talen Energy’s overall strategy to conclude our business operations in the state,” said Todd Martin, Talen spokesman. “Talen Energy will continue to work with all of the Colstrip stakeholders to create the best possible outcome for employees, customers and the community as we facilitate the successful transition to the new operator.”
Talen was obligated by contract to give two years’ notice to the owners of Units 3 and 4 to assure enough time to find a new operator. The shareholders of those units are Washington utilities Avista Corp., and Puget Sound Energy; Oregon utilities Portland General Electric and PacifiCorp; and NorthWestern Energy, a South Dakota company that is Montana’s largest gas and electric utility.
Ownership of Colstrip Units 1 and 2 is evenly split between Talen and Puget Sound Energy. The new operator will run those units also, Martin said.
The new operator won’t be NorthWestern Energy. In an earlier meeting with Puget Sound Energy, Talen and Montana Gov. Steve Bullock, NorthWestern said it wasn’t interested. NorthWestern’s position hasn’t changed, said Butch Larcombe, company spokesman.
“Talen, and formerly PPL Montana, have performed as operator for the past decade,” Larcombe said. “However, no owner is required to serve as the operator. The owners will get together soon to discuss Talen’s decision and develop a plan for operating the facility in an efficient, cost-effective manner.”
Various reps and state legislators have said Talen’s decision doesn’t change too much for Colstrip’s near future, as companies like PacifiCorp and Avista Corp. have said they will continue to use the plant. But with the Pacific Northwest planning to essentially shut out coal, and the ever-present issue of the federal Clean Power Plan (which is currently held up in court due to a lawsuit but still inspiring companies to implement emission cuts and transitional strategies), Colstrip may not be able to coast for much longer on heritage.