COMMENTARY -- I guess you can get back to your roots by moving further from home.
Joseph Galli cited personal reasons for vacating the presidency of Seattle-based Amazon.com (Nasdaq: AMZN) to take the CEO job at Horsham, Pa.-based VerticalNet (Nasdaq: VERT) last July. "My decision to leave Amazon really came about because I wanted to move back East, which is home," Galli said at the time. "I grew up in Pennsylvania and have family in Baltimore, so this works out perfectly."
We were supposed to believe his Amazon.com options being hopelessly underwater and B2C looking more passe than Run DMC had nothing to do with the shift to VerticalNet. Of course, there were plenty of skeptics, including me.
One angry reader who identified himself as "Ned Alton" blared at the time:
"You show complete ignorance when you make theoretical & hypothetical speculation with regards to Joe Galli's departure. Your poor attempt at humor towards downplaying the REAL reason he left Amazon and instead mocking the company show not only your lack of compassion, but your obvious ineptitude at understanding the broader picture. Having known Joe for nearly 15 years here in Baltimore, perhaps I can do your job for you by clearing up any wild rumors that seem to be disseminating from the likes of yourself!
"Joe DOES have a LOT of REAL personal issues in his life right now: he just got married, and his obligation to his former (and seriously ailing) wife is completely just, as well as the fact that he would like to be near his children in Philly.
"Now maybe, Sergio, you have similar issues out there with your family, but do us ALL a favor: in the future, don't use an individual's personal issues for your selfish reasons behind trying to slam his former company simply because you don't like them! SHAME ON YOU SIR!"
Ned didn't appreciate some not-so-serious speculation about Galli's Amazon.com departure. No doubt Ned was sincere in his umbrage.
But what are AMZN and VERT shareholders to make of Galli now that he's called another moving truck after less than half a year on the VerticalNet job? Consumer products maker Newell Rubbermaid (NYSE: NWL) -- about as traditional of a company as you can find these days -- is based in Freeport, Ill. Driving from Horsham, that's about 871 miles, or 32 percent of the distance back to Seattle.
Family proximity evidently lost its charms after five months, or at least after VerticalNet's stock price lost 90 percent of its value since Galli took over. In going to Newell, Galli gets to run a company whose stock has risen gradually the last three months: NWL shares bottomed out between 18 and 19 in October, and picked up more than 4 percent today following the CEO announcement.
Galli is going back to where he came from. He made his reputation at Black & Decker (NYSE: BDK), and Amazon.com hired him largely because of his experience with the back end of retail. "I especially look forward to returning to my roots in the consumer products industry," Galli said.
Newell Rubbermaid shareholders hope that Galli's business roots are stronger than his familial ones. Then again, they may hope otherwise if Galli's Newell performance parallels his VerticalNet record.
Galli fled the rapidly declining field of B2C last year to go where the real growth was supposed to be, business-to-business commerce. "One reason I'm so excited about this opportunity is that this is not a company that needs turning around," Galli said upon taking the VerticalNet helm. "The fact that this is a company with so much potential is very exhilarating."
So much potential that Galli decided to sell the NECX computers and electronics marketplace that generated more than of VerticalNet's revenue. Forget B2B exchanges, VerticalNet would be a software vendor.
VERT shares jumped briefly on that idea, but reality returned quickly. VerticalNet couldn't escape the gloom of the overall Internet sector, and its shares remain stuck near the world of penny stocks. B2B turned out to be no hotter than online retail.
Galli's enchantment with the Internet has disappeared entirely these days: he tells Reuters that he has no plans to compete with Newell Rubbermaid's existing retailers by directly selling products on online.
Black & Decker to Amazon.com to VerticalNet to Newell Rubbermaid makes four Galli companies in two years. Drifters must be in vogue these days. Or maybe Newell Rubbermaid's board was impressed by Galli's apparent willingness to chase whatever seems most lucrative at the moment.
Ned Alton would consider that an unfair and completely ignorant statement. Galli's friends wouldn't want you to think of him as someone who jumps from Hot Sector to Hot Sector.
He says he's just coming home. Again. 22GO
• 2HRS2GO: Personally, why leave Amazon?
• Amazon.com shares slide after COO bolts for VerticalNet>