Ben Kaufman, the chief executive of Quirky, has $12 million in cash and at least four options for saving the two companies for which he’s responsible.
As CEO of Quirky, he’s in charge of a high-growth businesses helping big-name brands capitalize on the Quirky community to build innovative new products. Meanwhile his responsibilities to Wink, the home automation company controlled by Quirky, are to help it build a profitable and sustainable business.
For a few months—from February to April this year—Quirky hired Code Advisors to sell Wink. It stopped the sale shortly after a security snafu that caused several thousand Wink home hubs, already installed in consumer’s homes, to fail. A small portion of those hubs didn’t came back online, requiring Wink to ship consumers a box so that customers could mail the hubs back to Wink for a fix.
Wink is off the market. In an interview on Wednesday with Coins2Day, Kaufman says Quirky is not exactly out of money (as he claimed earlier in the day while onstage at this year’s Coins2Day Brainstorm Tech conference in Aspen) but believes the company has four paths available to it.
He listed them in order of preference:
1.) Wink raises “no less than $15 million,” which would get it through a couple of years.
2.) Quirky raises money and that is enough to help both businesses stay afloat, but it doesn’t solve the core problem that Kaufman has of still running two very different types of businesses.
3.) Sell Wink, which would require the company to start the shopping process anew since it had ceased to market it actively.
4.) Sell Quirky and Wink, which Kaufman said would be very unlikely.
When discussing the entire situation, Kaufman consistently referred to it as complicated and “not black and white.” He didn’t disclose Quirky’s creditors or say how much money the company owned, but he did say that the creditors are not interested in pushing Quirky into default. He expects the company to be able to operate for at least three or four months even if funding doesn’t come through immediately.
Quirky has raised more than $170 million from such firms as GE, Andreessen Horowitz, Kleiner Perkins Caufield & Byers, RRE Ventures, and Norwest Venture Partners.