LifeLock Goes Public, Sees Stock Price Fall; Tempe Company has Sketchy History
LifeLock launched its new persona as a publicly traded company on Wednesday -- then watched as its initial stock price fell by several percent.
LifeLock, the Tempe-based anti-identity-theft company founded in 2005 by Robert Maynard Jr. and Todd Davis, had expected to sell shares at $9 apiece, but the price dropped after sales began and ended the day at $8.36, financial news networks reported.
The above-linked CBNC blog post quotes Davis as saying that the setback is temporary, and that the company is poised for tremendous growth.
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LifeLock founder Robert Maynard Jr. resigned from the company in 2007 following a New Times article about his past.
Overall revenue grew over the years for the company even as criticism of the business mounted. But profit figures released by the company prior to the initial public offering show that the company, heavily in debt to its investors, has only recently begun to earn a profit.
What's astonishing is that makes any money at all. Critical articles in the Phoenix New Times and other publications in past years showed the public that the company's primary service -- setting fraud alerts on a consumer's credit report -- can easily be done by the consumer, if it needs to be done at all. As we've reported previously, if a LifeLock customer is victimized, the company hires another company to deal with the problem.
The Federal Trade Commission fined LifeLock $12 million in 2010 for making false claims in its advertising. The company changed its practices, but still relies on fear of identity theft to bring in customers.
In 2007, a New Times article exposed founder Robert Maynard Jr.'s lies about how he came up with the idea for the company, and reminded readers of his past troubles with the FTC. Our 2011 article on LifeLock showed how CEO Todd Davis, after publicly revealing his Social Security Number, had become a victim of identity theft 13 times.
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