B&D alumnus Galli quits Amazon.com to lead VerticalNet

New president, CEO to chart expansion of online powerhouse


July 26, 2000|By William Patalon III | William Patalon III,SUN STAFF

Former Black & Decker Corp. executive Joseph Galli Jr. swapped his No. 2 slot at online retailer Amazon.com yesterday for the top job at VerticalNet Inc., a powerhouse in the new - but fast-emerging - sector of business-to-business online commerce.

Galli, 42, who had been Amazon's president and chief operating officer since June 1999, was named the president and chief executive officer of the Horsham, Pa.-based VerticalNet yesterday.

A passionate marketer known for his concern for customers and ability to motivate his employees, Galli is widely credited with being a key force behind Black & Decker's successful line of DeWalt commercial power tools. Analysts say that these skills - along with the overseas experience he gained as head of Black & Decker's power-tools business - will be a huge asset to his new employer, which has just embarked on a global expansion.

"This is clearly a win for VerticalNet," said Todd C. Weller, an analyst who follows B2B e-commerce companies for the Reston, Va., office of Legg Mason Wood Walker Inc. "If you look at his experiences, international and industrial, you'll see he fits in well here" at this point in VerticalNet's development.

As chief executive, Galli succeeds Mark Walsh, who was bumped up to chairman. Michael Hagen, a VerticalNet co-founder, continues as chief operating officer. Walsh will be responsible for crafting the firm's overall strategies and Galli will execute VerticalNet's global growth plans, the company said.

"This is a great opportunity," Galli said in a telephone interview late yesterday. "There are already great deal makers here; they bought 15 companies in the past year. Now I want to imbue it with a sales-focused culture. I am going to build the best sales force on the planet."

Walsh said "great companies know when to add power, and as president and CEO, Joe is capable of capitalizing on VerticalNet's tremendous momentum while managing our fast-paced growth."

Amazon and VerticalNet are examples of how the Internet is nurturing new kinds of businesses and new types of companies.

Amazon is a virtual retailer that sells wares to consumers, one at a time. But VerticalNet has created a template of technology it can use to build and manage virtual marketplaces - online "communities" that VerticalNet refers to as "vertical trade communities" - serving industries as diverse as food and packaging, financial services, manufacturing and telecommunications. These communities become marketplaces in cyberspace, allowing users to buy and sell products and services, and exchange information. This can make the industry more efficient, while keeping a lid on costs.

Yesterday's announcement sent VerticalNet shares up 62.5 cents to close at $57.375, though they traded as high as $59.25 during the day. Amazon's shares fell $1.125 to end trading at $37.625. Amazon's stock price is down about 75 percent from its Dec. 9 high of $113.

Both Galli and Amazon said the parting was amicable.

Indeed, Galli said it was difficult to leave Amazon. He joined that company two months after his April 1999 departure from Black & Decker, reportedly because of a power struggle with Chairman Nolan D. Archibald.

Galli said the Amazon job opened his eyes to the immense potential of online commerce. However, the Pennsylvania native, who owns a farm in Glyndon, said he realized that he wanted to return to the East Coast, where much of his family lives.

"For me, this is just a great, great opportunity" on many levels, he said.

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