Code42 is a darling of the Minneapolis tech scene: The secure data-storage company is growing at a fast clip, has revenue estimated in the tens of millions, attracts considerable investment and frequently makes lists like Forbes’ “most promising” companies. So the press was swift when even whiffs of something awry popped up.
A triple whammy of issues struck earlier in the spring and summer. First, the company pulled out of Ackerberg Group’s MoZaic East project in Uptown. Intended to be custom-built for Code42 to move into from their current Northeast Minneapolis digs, the developer was left scrambling to redesign the space for several smaller tenants.
The company said it wasn’t a sign of financial stress or that it would be picking up and leaving town.
“We’re extremely committed to our role as a leader in the growing Twin Cities technology scene,” CFO Jason Bristow said in an email. He added that Code42 has been experiencing high revenue and added over 10,000 new customers in 2014. The company decided not to move, he says, to instead “focus on investing in resources at our current location to continue to meet demand.”
Then came two big shakeups. In early June, Code42 quietly replaced co-founder and CEO Matthew Dornquast with cofounder Mitch Coopet. Later the same week, the company said COO Brian Bell was leaving for personal reasons.
By mid-July, Joe Payne, a veteran of high-growth software companies, was named CEO of Code42. He is a former CEO of Eloqua, a Toronto-based company, where he led a successful IPO and subsequent sale to Oracle. He will commute from Washington, D.C.
Pulling out of the real estate project and replacing two C-level positions have certainly created a buzz. Speculation has run the gamut, from a company struggling to continue its spectacular growth to one preparing itself for sale to a tech giant.
Code42, for its part, has remained tight-lipped about it all. Coopet said in an interview with Tech.MN that Dornquast stepped down so the company could find a CEO that “can scale [sales] past a billion dollars.”