Gateway was on top of the mountain in South Dakota for awhile. Great brand, very nice computers. Then came their move to San Diego, the opening of their retail stores and the PC profit margins shrinking to nothing.
Bye bye Gateway
I recall when the CEO of my company, Lee Stein, invited Ted Waite to visit in San Diego. We were just planning to help him set up a means of selling his products over the internet (1996). Waite liked the city so much he decided to move his headquarters. I wonder how much that decision played into the decline and sell off of the company.
Ted Waite has been using Gateway stock (GTW) as his personal cash machine for years and years. Check out his stock sales just over the last two years; they've been relentless, netting him vast sums of cash while Gateway's regular shareholders were getting seriously hosed (and his sales before 2005 were much, much larger!):
I did some contracting for Gateway about 11 or 12 years ago, commuting from KC to North Sioux City, SD for a week at a time, then coming back home for 2 weeks, for about a year. While Gateway (It was still Gateway 2000 back then) was known for being cut-throat in its wages, it seemed to be a pretty fun place to work, and the people I met were pretty happy working there. A couple of things I remember were BBQ lunches on Fridays during the good weather, with dollar burgers or brats, and a DJ under a big inflatable cow. And Ted had sponsored a couple of race cars, and he'd occasionally have them brought to the factory, and tear around the parking lot in them! That was about the time that Ted rejected a buy-out offer from Compaq, well before Compaq and HP merged.
Mark
I wonder how much that decision played into the decline and sell off of the company.
Not much at all. What ruined Gateway was when Ted Waite stepped aside and brought in outside executives to run his company. He left to spend more time with his family. The company went south almost immediately.
Ted jumped back in to try to save his company, but it was too late.