New CEO for Diligent

Board governance software company Diligent Board Member Services [NZX: DIL] has appointed a new chief executive, former McKinsey & Company partner Brian Stafford.

Mr Stafford takes over today from Alex Sodi, who will become chief product strategy officer and remain on the board.

Early March, the New York-based company announced profit rose 43% to $US8.59 million in the year to December 31, as sales climbed 28% to $US83.1 million.

It also revealed plans to launch a new product – Diligent Teams – in the third quarter of this year but its intention to double its spending to about $US14 million ahead of its new product saw Diligent’s stock downgraded by two brokers.

Mr Stafford led the McKinsey’s growth tech practice, primarily focused on software-as-a-service companies, ranging from early-stage to publicly traded enterprises. Before that, he was founder and chief executive of CarOrder, a division of Trilogy Software, based in Austin, Texas.

Diligent chairman David Liptak said Mr Sodi had built the business up through focusing on the product and customer experience but he can now concentrate on product strategy.  

“I am thrilled that we were able to recruit Brian away from McKinsey… We have put one of the world’s foremost experts in SaaS growth strategies in charge of maximising our revenue growth.”

Diligent’s 92,700 users include a third of the Fortune 1000 companies and about 75% of its revenue is generated in the US.

The company has had a turbulent couple of years, facing protracted issues with option grants, account restating, and management and board changes.

Last year it was told off by the NZ Markets Disciplinary Tribunal for failing to file three earnings reports on time as a result of its incorrect revenue recognition, which prompted the firm to restate accounts for the 2010 through 2013 financial years.

However, customer retentions are at 95% and new subscriptions remain strong, with sales forecast to rise to between $US97 million and $US99 million in 2015.

Shares in Diligent last traded at $5.40, and have advanced 2.7 percent so far this year.