Lacking Business Model, Phones, AllAdvantage “Still In Business”

The rumors of AllAdvantage’s death have been greatly exaggerated. At least, that’s according to Marty Pichinson.

Pichinson is a founder and principal at Sherwood Partners, a consultancy that specializes in crisis management for troubled firms, debt placement, and asset liquidation.

And according to him, pay-for-surf firm AllAdvantage is not out of business. Instead, the Haywood, Calif. company’s board of directors has retained his firm to “decide where to take the company to maximize it,” he said. “To proceed in a new area.”

Pichinson said the board wasn’t exactly clear on the specifics of that new area, but it would somehow relate to software.

“They felt very confident about working in software,” he said. “The process they had filled a niche, through software.”

AllAdvantage served banner ads in a window on the user’s desktop. While that window was open, and while the user was surfing the Web, AllAdvantage could track what users did and what ads they saw, rewarding them with money or sweepstakes entries.

Before its collapse, spokespeople from the firm suggested that it was getting into the ad-serving business for firms like Conducent, Radiant and EverAd, which make ad-sponsored applications (similarly to Qualcomm’s Eudora). While this could be the software business AllAdvantage is planning to move into, representatives from AllAdvantage conceded in November that it had yet to sign any deals with firms like these.

At any rate, it should be interesting to discover how AllAdvantage plans its escape from its current situation and plans to restart its business, since it seems to be selling off most of its business assets at the moment.

Up for auction at B2B auction house DoveBid are AllAdvantage’s Sun Microsystems, Windows NT and Linux servers, high-volume storage systems, Cisco switches, routers and firewalls, and “100’s” of Hewlett-Packard laptops and “various” desktops.

That’s in addition to 500 desk phones, a corporate voicemail server, 600 Herman Miller office workstations, “and more.” According to DoveBid, the auction is a “complete liquidation of a fully-equipped 80,000 sq. ft. e-commerce facility.”

At last count in November, the company had about 430 employees. That the firm is scrapping more phones and workstations than it ever had employees (in addition to the “complete liquidation” of its corporate headquarters) seems to suggest that a staff reduction program, of some sort, is at least planned by the auction date, Feb. 20.

However, Pichinson said AllAdvantage hadn’t cut any staff since its December layoffs of 150, and declined to speculate on the firm’s immediate plans.

Representatives from Conducent, Radiate, and EverAd did not immediately return requests for comment.

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