Carlos Leyva

Silicon Stories

Chapter 1: Dirty Little Secret

The Usual Suspects

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I have a challenge to issue. Can anyone show me one example of any of the usual suspects producing, on a work-for-hire-basis, an innovative product or platform that has gone on to dominate its category? These folks are business consultants and project managers. They are damn good at what they do. If you want to implement SAP, CRM, Supply Chain Management (name the latest acronym), then give them a call. But if you want help developing next generation (or this generation, for that matter) software, then call someone else. Or else, the likely outcome will be that they walk away with a ton of money, and you are late to market with an average product (if you are lucky).

Software innovation is not what they do! Now let’s be fair. The reason that the usual suspects are often brought in is to cover some executive’s ass. Let me give you a clue, you cannot cover your ass when developing an innovative offering. It doesn’t work that way.

Inmates Running the Asylum

At about this time, BuyNothing.com hired a new CEO. He was some Neo-Nazi motherfucker from a large software manufacturer who was known for having a factory that cranked out idiots of his caliber. I met with him on several occasions. He inspired anything but confidence and trust. The last time we met, he actually threatened to sue me and a colleague from Houston for developing some innovative ideas that we thought might help save his sinking ship.

He was one of ‘dem foreign nationals who have the attitude that all Americans are stupid. Hey, if you weren’t stupid, you would be CEO by now, right? He happily informed me that he could care less if everyone in Houston quit. I happily informed him that he could kiss my ass. Welcome to the new economy!

It felt good telling a CEO to kiss my ass. This market was hot, and I had game! Not only would I leave, but I would also take my whole damn team with me, if the opportunity presented itself. I guarantee you that they were more loyal to me then they were to him. Treat key employees with disdain at your own risk. Industrial age arrogance will get you killed. Don’t believe me? Read the “Talent Wars” chapter for insights into the new balance of power.

EnergySavings.com

I was getting about fifteen job leads a day, and I was happy to see that things hadn’t changed all that much during my 3 year hiatus from the business. I ended up running the local office of EnergySavings.com. I asked for (and got) more money than the V.P. who had hired me. This is primarily because I chose to take a significantly reduced options package in order to get cash in hand. (You can’t spend worthless paper).

By now, I had no illusions about how dot-com mania was likely to end. If I had suspicions that things were fucked up in the software business before, I now had a smoking gun. It was becoming clear that smart bricks-and-mortar companies would eventually dominate the Net. You know, companies with real business models and real revenues. But for now, it was time to make hay while the sun was shining, because sooner or later, we were in for a dry spell. I started at EnergySavings.com as a hired-gun architect, and 3 weeks later, they asked me to run the Houston office.

EnergySavings.com was a de-regulated electricity play. They had started in California and were moving aggressively into other markets as individual states began to de-regulate. By the time I came on board, they were already starting to lose their grip on reality. Rumor has it they struck a deal on the east coast—a deal that was costing them $1 million USD a day. Try making that up on volume!

The Houston office existed due to historical reasons. There was a talent pool here that understood back-office energy systems, and one that had no interest in moving to the valley. The average age of the Houston development team was approximately 25. They had done an incredible job of bootstrapping these systems into a working model. That said, the systems needed some re-architecting in order to scale. That is what I was hired to do.

My team quickly put together the “As Is” versus the “To Be” views of our world. The plan for the “To Be” was approved by the executive team with one caveat: I was to attend a week long course on a new middleware package that EnergySavings.com had purchased, and then figure out how to integrate it into our plans. I had worked extensively in the middleware space in my past lives, so I was anxious to expand my denominator. The middleware company was located in the valley, and I attended (along with staffers from the west coast operation).

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