But I think it's because we're probably more experienced in dealing with them. That was a downturn only of our stock price. It was actually a good time for our business. And it was a major dislocation between our stock price and our underlying business. Now we've just got a downturn in the business, and who knows where the stock price is going to be? As I say to our employees all the time, at anytime there is going to be a disconnect between your share price and the underlying value of your company. That's why you need to basically ignore the share price and focus on your own internal metrics and your own internal initiatives.
Q: You have had significant layoffs in the past year. Has your workforce stabilized?
Here we went from 2,700 at the peak down to about 900. I think so. We're basically trying to match our cost with our ability to generate revenue to make sure we manage the business appropriately for this market, and for this time that feels about right. Inside that 900, we're always hiring. We need great tech people, great product people, great online marketing people, great finance people. So we're always looking for fantastic talent to keep this place fresh and moving forward.
Q: In April, you disclosed a data breach (allegedly caused by former employees who used passwords to access customer information). Have any customers been harmed by this?
That issue is very, very unfortunate. The important things to note are that we discovered it, and we alerted authorities about it as soon as we discovered it. We do not believe that there was any customer who was harmed by this. If anything, they got an extra call from a mortgage provider to offer them a mortgage, which we don't think happened all that frequently. The law requires you to let all of your customers know this happened and that's exactly what we did.
Q: According to a lawsuit filed by the company, a former employee is a target of a criminal investigation in this case. Is LendingTree a target?
We alerted authorities about this. In our lawsuit, we allege this was caused by a couple of ex-employees. We feel like we have valid grounds in those lawsuits. We are not a target. We are the victim, and we have been continuing to cooperate.
Q: As part of the spin-off, you are set to receive restricted stock worth 1 percent of the company and options that would allow you to acquire another 10 percent of the company over time. What does this possible ownership stake say about your plans at the company?
What it says in negotiating the opportunity to come back here, I wanted to make sure I'm aligned with shareholders. My options are priced significantly out of the money. So to get that ownership stake, the shares of the company need to appreciate considerably, up to three times actually from where we start. I believe in the ability of our team here to be able to put those kind of returns on the board over time, and I want to make sure my compensation is in alignment with those shareholder returns. I'm a big believer in the company and, over time, the stock.
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