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BestCalls
Mark Coker wants to poke holes in the walls around corporate conference calls
By Jeff Kearns
To the uninitiated, eavesdropping on a corporate conference call might seem like an incredibly dreary affair. Someone from the public relations department starts off by reading a prepared statement, and introduces the company brass on the line. Then the executives get on and give their update, and after that, some analysts, or maybe reporters, pepper them with tough questions about PE ratios and P&L statements. And everything's in that tinny speakerphone voice.
But to people like Mark Coker, it's a kind of promised land, where stockholders are privy to the most valuable information, and no-nonsense Wall Street analysts can fire off questions that make CFOs of Fortune 500 companies squirm in their seats like nervous school kids as they struggle to explain why one set of numbers isn't what it should have been.
Often, though, these calls are off limits, kept under seal by corporate gatekeepers who don't want proprietary information leaking out to the masses before the press release goes out to the Wall Street Journal.
That's where Coker comes in.
In March he launched the new website www.bestcalls.com, which tracks conference calls out of his Los Gatos public relations firm. With the launch, Coker has made it his business to knock down those conference-call walls by tracking the minority of public companies that do offer access to their calls, and by turning the ones that don't into the target of his own personal jihad.
The site already logs more than 20,000 page views per day, from users who get the phone numbers and access codes so they can dial into conference calls by phone, or stream live or archived calls straight to their computer desktop.
BestCalls also boasts tens of thousands of subscribers to its free email notification service, which Coker points to as evidence that there's pent-up demand for conference-call information that's just now being tapped.
His "cause" is also getting noticed. Business Week devoted an editorial to the topic, urging: "It's time for all public companies to spill the beans in cyberspace. Internet calls won't end private conversations between Wall Street and public companies. But they'll sure improve the information shareholders need."
Barron's, The New York Times and several other major dailies across the country have also picked up on the nascent movement. Even the SEC has taken notice, with one commissioner saying publicly that opening up conference calls might be a good way to cure a little-known ailment called "selective disclosure."
That's the term regulators apply to releasing material information that may or may not affect a company's stock price and influence buy/sell decisions. But just what information counts as material is in the eye of the beholder.
If company officers know about a problem that might cause their stock to tank, it might be tempting to sit on that information for a few days, maybe sell the stock or put off a purchase, before word gets out to industry analyists and the media.
Conference calls, however, when they are closed, are breeding grounds for sensitive information, while open calls, which anyone might hear, would give individual investors access to that inside information--days before they might pick up the paper in the driveway in the morning and find out their stock tanked overnight.
That's why Coker wants the calls open.
"Whenever it goes to only a few individuals, that's illegal, and selective disclosure is rampant in conference calls," he says. "I want to change the way corporate America communicates with investors."
Photograph by George Sakkestad
Six of the company's nine staff members are (back) Jim Azevedo and Stephanie Steenbergen, (middle) Doug Coker and Mark Coker and (front) Corey Oiesen and Maile Spinola.
Coker, 34, expects to have nearly 40,000 registered members signed up with BestCalls by this week, up from under 30,000 a month ago. Credit the rush to earnings season, the quarterly reporting period when companies release their numbers from the previous quarter. Along with the flurry of activity on Wall Street, it's also a busy time for individual investors, who sometimes have to struggle to keep up with what's happening behind the scenes.
According to the company's newsletter, 92 percent of users are individual investors, but almost 1,000 are Wall Street analysts.
Give the credit to Dovetail Public Relations, the company Coker founded five years after leaving another PR firm in Palo Alto. BestCalls, in a sense, is both Dovetail's main client and the PR company itself. Although it is a separate company, Dovetail employees are also BestCalls employees.
Accordingly, the company didn't stumble into the spotlight: Two employees have the BestCalls account, and treat it like any other client. When the site launched, Dovetail sent press releases to the 250 biggest daily papers in the country, along with all the major financial publications, like Forbes, Fortune and Barron's.
And Coker isn't the only Coker on staff. His younger sister, Keri Coker, became employee No. 1 five years ago, when Mark lured her away from her career as a social worker in Santa Cruz to become the small company's human resources department. Coker's dad, Charles Coker, a former IBM engineer, is the engineer working on the company's new site, bestcareers.com.
Coker left IBM after 13 years to start Coker Electronics, which employs only one person (Charlie Coker), and is operated out of that employee's house in Gilroy.
In college, Mark Coker worked for his dad's company, where he got his first experience with PR promoting its software.
"I think he caught the entrepeneurial bug working for me," Charlie Coker says. "He's got a lot of entrepeneurial talents that are best expressed in Silicon Valley. He's fulfilling a need in the marketplace, and that's one of the definitions of success."
Doug Coker, a 20-year-old computer science major at UC-Santa Cruz, designed and built the complex BestCalls site. Doug Coker built the site in a way that lets him or Mark take care of all the housekeeping without employing a team of 10 webmasters to do it.
Ask Mark Coker what's so special, and he spins his laptop around and logs onto the site. With a few clicks, he has access to the entire subscriber database ("We don't sell anything to anyone," he says) and all the statistics associated with it.
Doug Coker says he shares the same ambitions as Mark, hoping that the site--and the 18-hour days he's been putting into it, doing the jobs usually reserved for three or four employees--will open up the hidden world of information that's not available to individual investors.
""I'm a big fan of the level playing field," he says. "There's something that bothers me about a system that can take advantage of people who aren't as well informed as other people."
From those statistics, Coker created the BestCalls 50, a list of the 50 most-watched conference calls on the site. Something of a Top 40 for the conference-call world, it was picked up last week in the Industry Standard, a respected high-tech trade magazine.
Except for brief stints in Berkeley, where he was born and went to college, Mark Coker has lived most of his life in Los Gatos. His home on Oka Road is just down the street from the house where he grew up, and the Dovetail office is next to Happy Hound on Los Gatos Boulevard.
Coker started his investing career while he was still a student at Los Gatos High School, with his dad's Charles Schwab account, and got his own when he was 18.
Now, Coker is still investing, but instead of just having a Schwab account, he's got bigger ideas. "I want to do for conference calls what Charles Schwab did for investing," he says. "There are 10 million people who use the net for investing."
Not only did Coker's dad get him started as an investor, he also started him with his first high-tech job, when he started working at IBM's Almaden facility during college, working on the clean-room production lines for hard-disc platters.
Coker also held a series of odd jobs and started other businesses before he went into PR. "I've been an entrepeneur since I was a kid," he says. His first source of income was his chickens. He started selling eggs door-to-door when he was 4.
He's also raised white pigeons for weddings, grown mistletoe, stalked shoplifters as a loss-prevention specialist at a supermarket, and worked as a driver for a medical delivery service.
Coker, who graduated with a marketing degree from UC-Berkeley in 1988, worked for a high-tech marketing firm before starting his own PR business.
With no clients and just $3,000 in the bank, Coker rented a small office on Lark Avenue and started his own agency, something that, until then, he'd only dreamed about.
For a few different reasons, Coker called it Dovetail. There's the furniture term, which describes two mutually complementary piece of wood that lock together like a pair of jigsaw puzzle pieces. And there's also the bird. Coker, who raised pigeons, says he loves the symbolism of doves, of "peace, purity, honesty and faithfulness."
He also tells the story of Paul Reuter, who started using homing pigeons to send stock prices from the Netherlands to London in 1849, as an alternative to waiting for the boats to deliver the mail. Investors paid for access to the information, and his business turned into the eponymous wire service that's one of the world's biggest.
Photograph by George Sakkestad
Mark Coker (left) and his brother Doug Coker look over the bestcalls.com website.
The dream quickly exhausted Coker's initial investment and maxed out his credit cards, until he landed his first big client, a company he knew from his former job.
Now, Dovetail has six clients, all of which are South Bay companies in the data storage business.
Dovetail also landed anti-virus pioneer John McAffee's business, which grew from a $20 million to $300 million business while it was one of Dovetail's clients from 1993 to 1997. McAffee made waves by giving his software away for free, long before Netscape did the same.
"He had this belief that software had spirits, and that it shouldn't be in a box," says Coker, who helped McAffee legitimize that kind of software distribution--which has since become an industry model.
"He encouraged people to pirate it," Coker says.
Working with McAffee, in 1993, was also Coker's first experience with investor relations and conference calls. McAffee had decided he wanted to bring in professional managers to run the company. "Before that it was just a bunch of long-haired, sweaty engineers," Coker remembers.
After McAffee hired an executive from Sun Microsystems, Coker attended his first conference call. "I learned things I never knew, and I was the one writing the press releases!" That was the spark.
Coker sees himself as an heir to Paul Reuter's legacy: getting people information they need while it's still relevant. But the mission to get all public companies to open their calls is still a bit far off. "We're asking companies to change the way they've conducted their investor relations for decades, and we're serving as a catalyst," he says.
BestCalls is trying to do that by using the company's subscribers and press coverage to bring attention to the issue, to elevate the stature of the public debate and turn the topic into a public debate.
But only a few individual investors are aware of what goes on during a conference call, which makes it hard to champion a cause if no one knows what you're talking about.
Investment trends are changing, however, and with more people acting as their own online brokers, Coker says that once the growing number of investors learn what they're missing, they'll start to put the heat on the companies they own.
Outside the technology sector, Coker estimates only 15 percent to 20 percent of companies have open conference calls, but 65 percent to 70 percent of companies on the high-tech side make their calls public.
Conference calls aren't just earnings reports in audio form. Much of the hard numbers can be found in the business section or in an annual report. What's most important to Coker is that the calls give investors a context in which to see the company, which at times can be much more valuable.
But even if companies have to be dragged kicking and screaming into a new investor glasnost, Coker is sure the cracks in the ice will continue to widen, until one day conference-call information will be at every investor's fingertips. In the meantime, he's working on a deal with Yahoo! that would incorporate the BestCalls schedules into that company's site.
"Mark has no fear," his sister Keri says. "He'll just go for whatever he wants, even if people think he's crazy, and it's paying off well for him."
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Los Gatos, California Since 1881
