Barracuda Networks CEO resigns to 'pursue other avenues'
This story has been updated.
Dean Drako, chief executive officer of Campbell, Calif.-based security firm Barracuda Networks, is resigning to "pursue other avenues," the company announced Thursday morning.
Drako — who co-founded the company in 2003 and has served as CEO for nine years — will continue to serve on the board of directors. His resignation is effective July 18, although his next steps are unclear.
Barracuda has major expansion plans for its Ann Arbor office.
Melanie Maxwell | AnnArbor.com
Barracuda's current Ann Arbor office on Depot Street, which it plans to vacate this fall to move downtown.
Melanie Maxwell | AnnArbor.com
Barracuda is a privately owned firm that creates network security devices, provides email and web filtering products and phone system solutions, and monitors network attacks 24 hours a day, seven days a week. It has more than 1,000 employees globally and does not report sales figures.
It has an Ann Arbor office on Depot Street near downtown Ann Arbor where it employs 180 people.
According to a news release, Barracuda is conducting a search for a new CEO, and Board of Directors member Gordon Stitt, co-founder Michael Perone and CFO David Faugno are assuming the role on an interim basis under the newly formed Office of the CEO.
“We wish (Dean) well in his new venture, and are pleased he has agreed to remain on our board of directors as we continue to grow the company," Faugno said in a statement.
Drako, in a statement, said the company now has the “technology, user community, and growth ramp to be a thriving public company."
Fueled by growth in the information technology security industry, the company announced in June that it signed a lease for 45,000 square feet of office space in downtown Ann Arbor once occupied by bookstore chain Borders.
The space, located on Maynard Street behind the former Borders retail store, is located on three floors and partly underneath the public parking garage.
The deal was one of the largest commercial real estate leases in downtown Ann Arbor in recent years and could create up to 200 additional jobs if Barracuda meets its hiring goals.
Mary Catherine Petermann of Barracuda's press relations department said, via email, Drako's resignation will "absolutely not" affect the company's local expansion plans.
"We are very excited about our expansion as Ann Arbor has become a key center for us and continues to be so every day," she said. "In fact, we have started construction on the new space and are very much looking forward to moving in the new space."
Read more about Barracuda's local expansion plans.
Lizzy Alfs is a business reporter for AnnArbor.com. Reach her at 734-623-2584 or email her at lizzyalfs@annarbor.com. Follow her on Twitter at http://twitter.com/lizzyalfs.
Comments
LXIX
Thu, Jul 12, 2012 : 9:33 p.m.
Hey smoke blower, stick this one up the smokestack. A2news - july 18, 2011 -400 jobs Borders liquidateds 10,700 U.S. jobs lost, 400 in Ann Arbor A2news - June 30, 2012 -21 jobs maybe rehired The county dispatch has a staff of 17 and the city has a staff of 21. To fill out the department, the county has been hiring to fill out its ranks to 30 employees, including 10 part-time workers to take calls. Of the eight city dispatchers the county is hiring, two are part-time and six are full-time positions. All of the city employees were given the opportunity to apply for the county jobs A2news - May 21 2012 -12 jobs maybe not The City Council cut the number of FTEs in the fire department from 89 to 82 last year and tentatively planned to trim further to 77 this year. Lumm wants it back up to 88. AP - 2010 "Still, the damage Michigan and its economy have suffered over the past decade has been so deep that it will take years to recover", Fulton said. "If our forecast proves correct, the job decline that started in mid-2000 would bottom out in the summer quarter of 2011, with an aggregate job loss of 937,000 over that 11-year period, or about one in every five jobs that existed" in 2000, he said. UMnews - 2006 Michigan has lost 336,000 manufacturing jobs since 2000. 33,000 more by 2008. Yah smoke blower, what jobs?
a2xarob
Thu, Jul 12, 2012 : 4:37 p.m.
Which companies, specifically, are you referring to, Smoke Blower? Or was that just a vague rumor you heard?
Madeleine Borthwick
Thu, Jul 12, 2012 : 8:32 p.m.
yeah, smoke blower, which companies? or are you just Blowing Smoke....?
xmo
Thu, Jul 12, 2012 : 3:31 p.m.
Non News for Ann Arbor! With so many people being laid off since November of 2008, it is surprising that people VOLUNTARILY leave work?
Ed Kimball
Fri, Jul 13, 2012 : 12:17 p.m.
In my experience "resigning to 'pursue other avenues'" does NOT usually mean voluntarily. Voluntary resignations usually have a specific, identified plan for the future. Although it's possible that the resignation was voluntary, I think it more likely that the board decided that the company was outgrowing Drako's management skills.
Sparty
Fri, Jul 13, 2012 : 6:32 a.m.
Wrong, the economy was losing 750,000 jobs a month for much of 2008 under Bush as the Dow lost half of its value.
smokeblwr
Thu, Jul 12, 2012 : 3:36 p.m.
I heard that the companies waited until the day after the election in 2008 to start laying people off.
mike umbolt
Thu, Jul 12, 2012 : 3:08 p.m.
It's just great to have Barracuda downtown. JOBS! Good work city and spark.
Ron Granger
Thu, Jul 12, 2012 : 2:05 p.m.
Drako has taken the company far, and should be congratulated for that. Not everyone knows when to move on. This may simply be a move to find a CEO suited to taking the company public. If so, I hope the employees have their stock options up to date. It is critical to have your options early, due to all the splits that typically occur as those private shares go public. It will be interesting to see what comes next. New CEOs often bring in their own teams, with their own vision and direction for the future.
Ron Granger
Thu, Jul 12, 2012 : 2:02 p.m.
Brad, not everyone fixates on droll bean counting in the ways you imagine. If the conversation did turn to Barracuda in Ann Arbor, it would probably be about growing this office from 1 to 200 employees, and then the plans to add a couple hundred more on a new tech campus in the heart of downtown. But if he is selling A2 on the golf course to his buddies, then it was money well spent. More likely, they are enjoying their time away from all things office related and talking about anything but that. As most healthy people do when they are away from work.
Brad
Thu, Jul 12, 2012 : 5:55 p.m.
Ron, you continue insinuate that if not for the move downtown that Barracuda wouldn't have added any jobs. I don't buy that. Not at all. They're already here, they've stated repeatedly that the talent that they seek is here and that they like it here, so to think that they would've left town without that one magical piece of downtown real esate seems pretty improbable. I would guess they would have found some other building and still added jobs and still paid taxes. It isn't an either-or thing as much as you'd like to present it that way. And I'm not just talking about the money the city is kicking in (you conveniently left out the parking subsidies). The state is also ponying up cash, and I pay those taxes as well. Remember just a short time ago they thought it was smart to throw money at the film industries to buy jobs, but have since decided that it probably isn't worth it.
mike umbolt
Thu, Jul 12, 2012 : 3:07 p.m.
Ron: You are right on about Barracuda, it is awesome to have them downtown. But, the city never gave parkland to the UM. Back in 1992 the UM gave the city 5 acres of land to put a new road on rather than on the planned route that would have taken out many old oak trees on natural land. In exchange the UM got a long term lease to some grass land below the hospital. They paved it for parking and they are still using it and paying the city parks dept. for it. At one point the city was going to partner with the UM on building a train station on the paved parking lot (80% federal $$) with a parking structure for UM. UM was going to pay the other 20%. But now that is off and the decision on where to put a new station, using federal $$ is up in the air again.
Ron Granger
Thu, Jul 12, 2012 : 2:40 p.m.
"Not beans - money. Taxpayer money. And Google "planned" (and promised) to have 1,000 jobs and has 300. Pardon me for being skeptical, but someone needs to take the side of reality in this thing." Then pardon the economy for tanking, instead of blaming google for modifying their A2 hiring plans accordingly. The tax incentives are contingent on the companies actually adding the employees. They get the incentives as the employees are added In this case, the $85K of tax abatement is pocket change compared to the $6 to $7 million they are spending on the new location, and the salaries of 200 new employees. Maybe you would prefer that it be another retail location instead, selling imported goods, and employing far fewer employees, mostly at minimum wage and without any disposible income to contribute to the community, all so the city can collect that $85K in taxes? What would it take for you to be happy about a company that has grown from 1 to 178 employees in A2 in just a few years, with plans to add 200 more? This pales in comparison to the city giving away our park land to the University of Michigan. It is like worrying about the shrubs while the city gives away the "forests" to the University.
Brad
Thu, Jul 12, 2012 : 2:20 p.m.
Not beans - money. Taxpayer money. And Google "planned" (and promised) to have 1,000 jobs and has 300. Pardon me for being skeptical, but someone needs to take the side of reality in this thing. Again, I am not anti-Barracuda in any way. I think it's great that they're here and providing some jobs to the community. I'm just not sold on the need to subsidize them at various levels to get them to move downtown and I'm also not sold on any widespread benefits created by them moving downtown (Bill Martin loves it, I'm sure). I know it's the popular Ann Arbor meme right now, but I'm still to be convinced that it's more than wishful thinking. I'm also trying to figue out how this "new tech campus" is going to grow there at the corner of Liberty and Maynard.
Brad
Thu, Jul 12, 2012 : 1:47 p.m.
Now isn't that interesting. He can hang out at the country club with his CEO buddies and tell them that his last official act was to get the state and city to cough up all sorts of things to get them to move eight blocks. Then they'll all laugh.