Momentum Performance closes?
01-15-2012, 06:05 PM
#1
Momentum Performance closes?
I didn't know where to post this and a search turned nothing up.
To all Momentum Performance Customers, Dealers, Partners and Enthusiasts:
By many measures, 2011 was an amazing year for Momentum Performance. The team strung together a number of victories including the release of our 350Z/G35 product line, the addition of over 400 new dealers to our network, a world-wide customer base, and the development of new product lines for the Mustang and BMW. In countless ways the Momentum team demonstrated their ability to push forward and achieve remarkable things. However, while all this was happening there was another challenge in the background that was not being met with the same success.
Momentum was founded with the goal of using technology and modern manufacturing, testing and procurement methods to bring exceptional products to the market at a fair price that all could afford (we were expecting to carve about 20% off the price of the Z/G product line in 2012). As such, there were significant upfront and ongoing costs associated with the effort, and it was critical that Momentum grow quickly to reach profitability while continuing to raise capital to meet the ongoing needs.
Coming into 2011, due to a strong business plan and an exceptional team of employees and partners in R&D, procurement, manufacturing, distribution, marketing, etc.; Momentum had been able to raise millions of dollars and did not foresee any difficulty in continuing to do so. However, unfortunately in March of 2011 a dispute began when Momentum’s investment group tried to renegotiate the terms of a note with a minority investor. Unfortunately, this dispute evolved into a serious lawsuit which all but eliminated any opportunity of raising needed capital. (Investing in startups is risky by nature, but startups with investor lawsuits are beyond the risk tolerance of almost all investors.)
There was never any denial of the investor’s financial claim—the company clearly owed the money but needed to renegotiate the terms. (And in a catch 22 situation, this need was only exacerbated by the ensuing lawsuit.) The issue instead (at least from the company’s point of view) was how can a compromise be structured that would allow the company to continue to raise capital, move forward and grow, and repay the investor’s debt over time.
Throughout 2011, I believed logic would win-out and eventually an acceptable solution would be found. I knew the only way the company could survive was to find a compromise and settle, and that if the company ceased operations virtually all value would instantly be destroyed for all stakeholders— including the investor pursuing the lawsuit. I believed strongly that the opportunity to gain something through compromise would eventually trump the emotion and certainty of losing everything through an ongoing lawsuit, and as recently as last month I believed we had found a resolution. Unfortunately I was wrong, and the sad fact is that after almost a year the dispute is still no closer to being resolved.
This has been a very disappointing and difficult time for the Momentum team who are all excellent people and fully invested their hearts and souls into the company, and I am extremely saddened to say that I now see no option but to close Momentum Performance since there is no way to continue without the needed funding. For those customers who have outstanding orders, please rest assured that we will continue to act with integrity and fully honor all current orders. We expect to ship all of these by the end of this week, and we will also do our best to make sure that any necessary tech support is available.
I want to thank all of the Momentum Performance team members and partners. Their unwavering dedication to excellence, integrity, and the overall customer experience throughout the past years has been inspiring to me and I believe also to the industry. Furthermore, I want to thank our business partners like Deatschwerks, Garrett, TiAL, UpRev, Vibrant Performance, as well as many others who have helped us grow faster and become better than we could have on our own. For any company considering hiring a past Momentum Performance team member or partnering with a past Momentum Performance partner, you will not regret it. These are all excellent people who will deliver.
Lastly, I want to thank all the Momentum Performance dealers, customers, and enthusiasts around the world. The ongoing and incredible support you have given our company and our mission has been overwhelming, and I am deeply sorry that I have let you down by not being able to resolve this matter in a favorable way. After nine months of trying to settle and maintain the value Momentum has built, it just doesn’t seem right that so much great work and so many great people should end in this illogical manner, but that is the sad and unfortunate reality we must face today.
Thank you again for your past support, and I wish everyone nothing but the best in the future. Push Forward.
George Taylor President/CEO
http://www.momentumperformance.com/P...ntumCloses.pdf
To all Momentum Performance Customers, Dealers, Partners and Enthusiasts:
By many measures, 2011 was an amazing year for Momentum Performance. The team strung together a number of victories including the release of our 350Z/G35 product line, the addition of over 400 new dealers to our network, a world-wide customer base, and the development of new product lines for the Mustang and BMW. In countless ways the Momentum team demonstrated their ability to push forward and achieve remarkable things. However, while all this was happening there was another challenge in the background that was not being met with the same success.
Momentum was founded with the goal of using technology and modern manufacturing, testing and procurement methods to bring exceptional products to the market at a fair price that all could afford (we were expecting to carve about 20% off the price of the Z/G product line in 2012). As such, there were significant upfront and ongoing costs associated with the effort, and it was critical that Momentum grow quickly to reach profitability while continuing to raise capital to meet the ongoing needs.
Coming into 2011, due to a strong business plan and an exceptional team of employees and partners in R&D, procurement, manufacturing, distribution, marketing, etc.; Momentum had been able to raise millions of dollars and did not foresee any difficulty in continuing to do so. However, unfortunately in March of 2011 a dispute began when Momentum’s investment group tried to renegotiate the terms of a note with a minority investor. Unfortunately, this dispute evolved into a serious lawsuit which all but eliminated any opportunity of raising needed capital. (Investing in startups is risky by nature, but startups with investor lawsuits are beyond the risk tolerance of almost all investors.)
There was never any denial of the investor’s financial claim—the company clearly owed the money but needed to renegotiate the terms. (And in a catch 22 situation, this need was only exacerbated by the ensuing lawsuit.) The issue instead (at least from the company’s point of view) was how can a compromise be structured that would allow the company to continue to raise capital, move forward and grow, and repay the investor’s debt over time.
Throughout 2011, I believed logic would win-out and eventually an acceptable solution would be found. I knew the only way the company could survive was to find a compromise and settle, and that if the company ceased operations virtually all value would instantly be destroyed for all stakeholders— including the investor pursuing the lawsuit. I believed strongly that the opportunity to gain something through compromise would eventually trump the emotion and certainty of losing everything through an ongoing lawsuit, and as recently as last month I believed we had found a resolution. Unfortunately I was wrong, and the sad fact is that after almost a year the dispute is still no closer to being resolved.
This has been a very disappointing and difficult time for the Momentum team who are all excellent people and fully invested their hearts and souls into the company, and I am extremely saddened to say that I now see no option but to close Momentum Performance since there is no way to continue without the needed funding. For those customers who have outstanding orders, please rest assured that we will continue to act with integrity and fully honor all current orders. We expect to ship all of these by the end of this week, and we will also do our best to make sure that any necessary tech support is available.
I want to thank all of the Momentum Performance team members and partners. Their unwavering dedication to excellence, integrity, and the overall customer experience throughout the past years has been inspiring to me and I believe also to the industry. Furthermore, I want to thank our business partners like Deatschwerks, Garrett, TiAL, UpRev, Vibrant Performance, as well as many others who have helped us grow faster and become better than we could have on our own. For any company considering hiring a past Momentum Performance team member or partnering with a past Momentum Performance partner, you will not regret it. These are all excellent people who will deliver.
Lastly, I want to thank all the Momentum Performance dealers, customers, and enthusiasts around the world. The ongoing and incredible support you have given our company and our mission has been overwhelming, and I am deeply sorry that I have let you down by not being able to resolve this matter in a favorable way. After nine months of trying to settle and maintain the value Momentum has built, it just doesn’t seem right that so much great work and so many great people should end in this illogical manner, but that is the sad and unfortunate reality we must face today.
Thank you again for your past support, and I wish everyone nothing but the best in the future. Push Forward.
George Taylor President/CEO
http://www.momentumperformance.com/P...ntumCloses.pdf
Last edited by ocdz; 01-15-2012 at 06:08 PM. Reason: added link
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01-15-2012, 07:18 PM
#11
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That sucks, I really liked how their company stood out to the actual customer, they put what seemed to be alot of true R&D into their products and showed it off as so. The video's they put out were top notch.
Glad I got their exhaust while I could.
Glad I got their exhaust while I could.
01-15-2012, 07:39 PM
#17
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really sucks if its true.
its obvious they were doing quite well.. sucks the other investors pulled out on them as well.
its obvious they were doing quite well.. sucks the other investors pulled out on them as well.
Last edited by Barnabas; 01-15-2012 at 07:40 PM.
01-15-2012, 08:53 PM
#20
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The good thing is R&D is mostly conceptual. Like stated earlier, if it is true, they could always start up again as a small business, with most of the R&D already sunk into the "Momentum" brand. They just have to keep whatever research they've already done.