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Andreessen's Loudcloud stake rises

Regulatory filings show Chairman Marc Andreessen's share of his company jumping to 14 percent in 2001, as Loudcloud swaps a growth strategy for one that conserves cash.

Loudcloud Chairman Marc Andreessen's stake in his company jumped to 14 percent in 2001 compared with 12 percent a year ago, according to regulatory filings.

As of May 10, 2002, Andreessen owned 10,649,950 shares, up from 9,110,899 on May 11, 2001, according to Loudcloud's proxy statement filed Friday with the Securities and Exchange Commission. Loudcloud, which targets large corporate customers, provides Web infrastructure and related services.

The proxy didn't reveal how much Andreessen is paid, but the company did say it granted its chairman an option to buy 1 million shares at a price of $3.68.

Andreessen played a seminal role in the dot-com IPO boom in 1995, when as a 24-year-old wunderkind, he helped take Netscape Communications public. But the second time around for Andreessen, as he edged past 30, has been a little harder, with the weak economy forcing Loudcloud to swap a growth strategy for one that conserves cash.

Nevertheless, Andreessen's portfolio got a little relief Friday as shares jumped 20 cents, or 14 percent, to $1.61 in early trading. The company said that it was comfortable with analysts' earnings and revenue targets for the first quarter, ended April 30, and for the second quarter. According to a First Call consensus estimate of three analysts, Loudcloud is expected to lose 50 cents a share in the first quarter and 46 cents a share in the second.

The company also said it will burn about $18 million to $20 million in the second quarter, lower than previously expected. Loudcloud ended fiscal 2001 with $116 million in cash and equivalents.

Andreessen has been acquiring foundering Loudcloud shares throughout the year, buying a 438,000 block of shares last fall and purchasing 1 million shares on the open market last June. But despite his purchases of Loudcloud shares, the stock continues to trade well below its March 2001 IPO price of $6. In between Loudcloud's last two proxy statements, shares have fallen 69 percent. Shares closed Thursday at $1.41.

CEO Ben Horowitz also increased his stake in the company, to 5.9 percent in 2002 from 5.5 percent in 2001. Other executives and directors had roughly the same number of Loudcloud shares from a year ago. Among large shareholders, Benchmark Capital, a venture capital firm, cut its stake in Loudcloud to 10.4 percent as of May 10, 2002, from 13.2 percent. Amerindo Investment Advisors' stake in the company increased to 7.9 percent in 2002, up from 5.6 percent a year ago.

Aside from the share-shuffling, Loudcloud also disclosed pay packages for its top executives. Horowitz had a salary of $250,000 with a bonus of $50,000 for the 2002 fiscal year ending Jan. 31. That was up from a salary of $210,000 and no bonus for fiscal 2001.

The compensation committee called Horowitz's performance "outstanding" and said he shows "highly effective leadership."

Shellye Archambeau, chief marketing officer, had a salary of $245,578 with a bonus of $218,400 after joining the company in March 2001. James T. Dimitriou, executive vice president of customer operations, drew a 2002 salary of $400,000 without a bonus, compared with a pay package totaling $325,000 a year ago. Roderick Sherwood, chief financial officer, had a 2002 pay package of $369,491, up from $344,872 the year before.

As for stock options, Horowitz and Archambeau were granted more than 1 million. Dimitriou received more than 700,000 stock options, and Sherwood got more than 350,000. The strike prices for the grants ranged from $6 to $1.46.