What’s Next for Zendesk and Momentive After Deal Collapse

The board of Zendesk may want to rethink the company’s name, at least while they still have a job, as there’s certainly nothing zen about the enterprise software firm nowadays. As was inevitable, Zendesk’s proposed acquisition of Momentive Global, once known as SurveyMonkey, went down in flames today when Zendesk shareholders voted overwhelmingly to reject it. Next up are activist campaigns expected to be waged against both companies’ boards that could threaten the jobs of their CEOs.

It’s hard to think of a parallel situation in recent corporate business history. And it’s a good reminder of something CEOs often forget: Unless they have absolute voting control, they’re not really in charge of their companies. Take Zendesk, whose activist investor, Jana Partners, has already declared plans for a proxy battle to win four board seats at the company’s annual shareholder meeting this spring. Zendesk seems about as vulnerable as a company can be. CEO and co-founder Mikkel Svane has only 2.2% of the stock and no supervoting shares to insulate him from shareholder sentiment. That sentiment isn’t likely to be positive, given that he ignored widespread investor pressure to abandon the deal.