the company, he replied by e-mail: “I am always tempted to be very cynical and say things like, ‘I learned to trust no one!’ But after much internal deliberation I have come to believe that my mistakes were the basic lack of common sense brought about by youth and enthusiasm and the lack of a strong business mentor. As an engineer who was seeing his idea grow into a business I became very focused on the nuts and bolts of engineering development and manufacturing. But common sense should have told me that as an entrepreneur I also needed to focus on the biz side. I should have never signed docs without clearly reading them but my ‘enthusiasm’ was elsewhere at the time.”
What was a sad story for Borrego came to an equitable conclusion, however. He says the prospective buyers viewed his unhappy departure as what the lawyers described as “a dangling liability” that jeopardized their acquisition. “In the end,” he says, “I ended up being in a good negotiating position for the deal.”
Borrego says a new CEO persuaded him to return in 2006, a move that made the company a more attractive acquisition for Apollo Management. “To come back and want to make [the company] successful wasn’t really a hard decision,” Borrego says.
As Networkfleet continues its rapid growth, Borrego maintains that plenty of innovation remains to be done in several areas:
—Companies that operate larger fleets are coming under increasing pressure to become “greener.” Under a pilot program with California environmental agencies, Networkfleet is using diagnostic data to continuously monitor vehicle emissions—fulfilling the same requirements as the state’s biannual smog test (and making such tests unnecessary for those vehicles).
—Automakers are now making Vehicle Identification Numbers, or VINs, available electronically on the vehicle LAN, and establishing a unique ID number for each vehicle built. As the data available in vehicles becomes “richer,” Networkfleet is developing more products and services, such as pay-as-you-go insurance and driver safety programs.
—As GPS and cellular technology improves in robustness and efficiency, Networkfleet can expand its capabilities, providing fleet managers with data that enables them to more precisely determine fuel usage and total miles driven for each vehicle.
As for the future of Networkfleet, Borrego sees a looming period of consolidation following the economic shakeout of the past year. “It’s a typical new technology cycle,” he says. “A lot of new players have emerged in the space over the past 10 years. What’s going to happen is that a couple of giants are going to rise from these consolidations”—and he view Networkfleet as one of them.
