CRM Vendor Onyx Earnings Disappoint, CEO to Step Down

Onyx Software CEO Brent Frei announced Monday that he will step down from his position after disappointing preliminary fourth-quarter earnings.

Onyx Software Corp. CEO Brent Frei announced Monday that he will step down from his position on the same day that the mid-market customer relationship management software company announced disappointing preliminary fourth-quarter earnings.

Frei founded Bellevue, Wash.-based Onyx in February 1994 after architecting an internal CRM system at Microsoft Corp., where he was a computer programmer and systems analyst. He has led the company ever since.

In an e-mail sent to reporters, Frei did not give any reason for his stepping down, only that a search for a new CEO has begun and he would "transition" out of the role once a new candidate was found.

"Im proud of the technology leadership and customer-focused corporate culture weve created, and I believe the time is right to turn over the reigns to a CEO with a strong sales/distribution background who can take Onyx to new heights over the next decade," Frei said in the e-mail message.

In addition, Frei noted that Onyxs fourth quarter revenues would come in around $13 million with a GAAP operating loss of about $1.3 million. He said consulting and license revenues came in lower than the company had anticipated.

"While Im clearly disappointed with our Q4 revenues, I remain optimistic about our business and the potential for growth in 2004," Frei said.

He said he would remain actively involved in running Onyx during the search for his successor.

"Although weve started the search, you should know that I am still very passionate about this business and the opportunities that lie ahead. Im continuing to drive the team in focusing on our customers, products and growing our embedded CRM business as well as the rest of our distribution channels," Frei said.

Frei, who for now plans to remain Onyxs chairman, said in a follow-up e-mail that his future role at Onyx would be up to the new CEO.

"I still have tons of passion for Onyx and what we do here," he said. "I would be happy to stay for another 10 years. Time will tell how that may or may not play out with the new CEOs plans."

Frei said his successor as CEO could be in place as soon as the second quarter.

"Im very bullish on bringing in a CEO with lots of Sales DNA to complement our awesome technology and customer satisfaction strengths," he said.