Why I quit the company I founded
Dr Louis Somoni, founder of Harltons Ltd stepped down as the Chief Executive Officer of his own company three years ago.
Earlier this week the former CEO penned an open resignation letter as a director of the company which he termed as a ‘Private Equity Fund choked gem’.
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He claimed the current model of the company was not working and was full of loopholes since he secured PE funds from an investment company.
Dr Somoni also advised entrepreneurs seeking investors to do due diligence and check on the track record and fruits of their investors before accepting their investment or signing up with them as partners.
He documented the rot, fraud and financial malpractice at Haltons Pharmacy brought on by the investors that forced him to resign.
Before he signed on with the investors, he had explained to them that he would need at least Sh1 million to ensure that the model he had planned for the company could be realized; to which they responded that all would be well as “they were in this together.”
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“The board started getting frustrated with me that I was not spending the money fast enough. On my part I was confident of my pace; we were innovating, creating and executing things that were life and industry changing,” says Dr Somoni.
By the time he decided to quit following frustrations from the board members, the company was doing well with nearly half of the stores were at their prime, over USD 1 million in the bank, a loyal and motivated workforce, and suppliers that had their backs. Things started to go awry when they hired a new CEO.
“We got a new CEO referred to us by networks from one of the key board members. The new CEO brought his team and together with the adhoc operations board committee (that met weekly without fail to approve and dismantle the vision) ran the company down,” says Dr Somoni.
According to Dr Somoni, the new CEO poached employees from the preferred suppliers and formed new companies with them to double and triple true costs of service delivery among other issues.
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“I have suppliers till this day are yet to recover from this selfish acts and some yet to be paid their dues for work done while I was still CEO. While the CEO went to build apartments and operate local drinking dens with the siphoned money that the board is not willing to pursue,” claimed Somoni in the letter he penned three years after he quit.
He says the employees faced sexual assault and pressure from the CEO, those who spoke up were either fired or given hard duties.
As the resources started to dwindle from the mismanagement staff stated being layed off to balance the books. The CEO then started hiring unqualified individuals to balance the books outside of the protocols and standards.
“As a Director and founder, I gave ‘the investor’ my trust and goodwill 110 per cent, this was trampled on and even still being trampled on…. As I look back, I am ashamed for my naiveness (the track record of mismanagement, bareness and fruitlessness had been there all along) but really disappointed & ashamed for my lack of due diligence (I was extremely star struck). Truly, all that glitters is not gold. I partnered with the wrong individuals – I had no congruence of values and beliefs with them,” says Dr Somoni.
He urged PEs out there who care for better than mediocrity to look into how they structure their programmes. ”The time of ‘smokes and mirrors’ or quick fattening a company like a cow for the slaughter house or for sale to an “unsuspecting” buyer is over… At least in Healthcare that time is over, we are now aware how the game is played and are awake”
– we will not let our professions to be used for money laundering, lowering of patient care & safety standards, lowering of Human Resources for Health Standards. The ground is even now. We want nothing short of a mix of tangible local impact (economic, training, patient & treatment standards, governance, quality of life of patients, and technology) or else, take the money elsewhere!
He went on to advise entrepreneurs that they do not need money or to go to school for a Ph. D or masters to gain integrity – just a mentor/coach who has demonstrated fruitfulness to keep you accountable as you confront self, submission to a higher authority.