07 May 2019
How Sonja Hoel Perkins Saved John McAfee from an Especially Bad DealTopics:
As a young analyst, early in her career, Sonja Hoel Perkins (MBA 1993) had a nose for deals, according to the book Alpha Girls: The Women Upstarts Who Took on Silicon Valley’s Male Culture and Made the Deals of a Lifetime, by Julian Guthrie, an excerpt of which appears in Wired.
In 1989, before attending Harvard Business School, Hoel Perkins landed a job on the ground floor of the venture capital firm TA Associates in Boston. There she impressed management with her computer skills—all self-taught—and her knack for finding prospects for investment. Around that time, she saw an ad in PC Magazine about a company that was trying to sell its software. On a hunch, Hoel Perkins cold-called the company, saying she had money to invest, and landed the founder’s car phone number. When she caught him on the phone, John McAfee was about to sell his company to Symantec for $20 million.
So she laid out an alternative deal: “We’ll value your company at $20 million, and you keep half. You sell half the company for the same valuation, hold on to the upside, and still get money up front.”
McAfee said, “I’d love that. I hadn’t even thought of it.”
It was a gutsy move. Hoel, as a $28,000-a-year analyst, didn’t have the authority to offer $20, much less $20 million. She quickly called Jeff Chambers, a managing director who had been with TA Associates for almost two decades and had opened the firm’s Silicon Valley office. She left him a voicemail, saying, “Jeff, you have to look at this business. Its forecasted revenue growth rate is more than 90 percent, and its pre-tax margins run between 80 and 90 percent of sales. The problem is that John is seriously considering selling McAfee to Symantec.”
That didn’t happen, according to Guthrie’s telling. McAfee went public the next year and raised $42 million, and grew from there. For her part, Hoel Perkins joined Menlo Ventures in 1994 and became the youngest general partner in the firm’s history. Since then she has founded the Perkins Fund, as well as Project Glimmer and the investing group Broadway Angels. She invests broadly in information technology; Worth Magazine ranked her among the 100 most powerful people in finance.
Photo by Stacey Estrella
Class of MBA 1993, Section G