Bob Young, Red Hat co-founder, is calling it quits with the company he helped create to work on another startup showing similar promise.
According to a filing with the Securities & Exchange Commission (SEC) Tuesday, Young’s resignation went into effect Oct. 12. Red Hat officials made the announcement today.
Young said one of the reasons he’s leaving the board of directors, a post he’s held since 1999, is because being a board member is no longer the part-time job it once was with new SEC rules and regulations such as Sarbanes-Oxley.
“It’s actually an interesting side effect of the effort to impose stricter behavioral rules; directors have to work much harder than they did in the past,” he said.
And that work would have cut into the exciting things happening with his latest startup, Lulu, Young said. He said the company, an online independent marketplace he founded in 2002 where content owners can publish their digital works, is starting to show signs of real growth.
Lulu.com’s revenue growth is approximately 10 percent a month, the company said. Since the beginning of 2004, site traffic has jumped from an average of 10,500 visitors a day to 33,000 while book titles have jumped from 4,500 to more than 30,000 in that time. The company sold 41,500 paper books in the month of September alone.
The growth is something Young hasn’t experienced since Red Hat started taking off in the marketplace, and is an opportunity you can’t take lightly.
“Anytime you see this kind of opportunity, you know there’s at least another dozen other people who would like to pursue the same opportunity,” Young said. “In this industry there’s very little room for the second-place finisher, which is why focusing all my time and attention on Lulu is the timely thing to do now.”
Young certainly has experience in that arena. Young formed Red Hat in 1995 when he bought Red Hat Linux from its creator and eventual Red Hat co-founder, Marc Ewing.
He merged the Linux distribution with ACC Corp., his Unix and Linux software accessory catalog company, and rolled out Red Hat Linux 2.0.
Red Hat Linux has scored a number of victories for the open source movement.
Its 1999 initial public offering (IPO) was the eighth-biggest first-day gain in Wall Street history, according to officials, and its strategic alliances with tech giants IBM , Dell
and a host of others helped legitimize open source in the mainstream.
Young expects Red Hat’s success to continue, saying he is a large shareholder and plans to keep his shares in the company for a long time to come.
