Throw your CEO under a blog bus

AND IF he or she can withstand the three-day onslaught of probing questions, you will have a highly credible and effective piece of investor relations communication.

This free-for-all blog interview is infinitely more credible than the stage-managed Q&A on an earnings conference call, or a broker conference audience, or even a rowdy annual meeting. More credible than a media interview, more credible than a feature in Fortune (ok, it depends).

Seriously, I’m having a hard time thinking of when I’ve ever seen something more effective at building credibility with investors. It’s riveting stuff.

Oh, but it takes guts to do this. And Steven Sprague, CEO of Wave Systems Corp., has a lot of guts. The picture of the serious-looking Mr. Sprague was taken before the grilling, though you’d think it was after.

Toughest question is from “Digital Dancer”:

Dear Steven: Wave System subsidiary, Wave Express (WXP) brought in a total of $29,000 in revenue for all of 2006. It is headed by your brother, Michael Sprague, Pres. and your father, Peter Sprague, CEO. The VP of sales is an old family friend, David Nadig. Wave has funded WXP with more than $56 million (including interest) to bring in $29K in revenue. My question is, why shouldn’t shareholders view WXP as a mere vehicle to provide your family and friends with paychecks and bonuses? Both your brother and father made well over $100,000 each. In addition, Wave, the parent company, funded a lease with Michael Sprague for an additional nearly $50K/year to house WXP headquarters in his personal loft apartment in New York City. All of this seems a bit suspicious to me, but I would love to hear an explanation, since one has never been given.

Kudos, too, to the SeekingAlpha.com gang for coming up with the concept. It just keeps getting better…

Every small-cap that can’t get people to pay attention needs to get on this show.

My word! Changes the game. Go see it. Read it all. I’m not doing it justice.

Update: I’m informed that David Collins at IR firm Jaffoni & Collins spearheaded this for his client WAVX.

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