That’s how Jared described one of his entrepreneurial adventures to me, during a presentation about his business in the hopes that our investment company might participate in his Series A.
When Jared was a 28-year-old vice president, driving the hot new Beemer, wearing sockless sandals to board meetings, he was intoxicated with the idea that fundamental business principles were no longer applicable. Prior to his 30th year, he was the personal demonstration that hard work, sacrifice, revenue and profit were no longer necessary ingredients in a successful business, or a successful career. Many of you who witnessed or participated in the phenomenon of the “dot.com era” remember that businesses were receiving millions of dollars in funding, going public at capitalization values which had no relationship with multiple of EBITDA, prided themselves on having no business plan and were led by executives barely a few years out of college, if they ever attended.
I felt like a cultural anthropologist as we discussed Jared’s business and the investment opportunity. Here is what happens to a “dot.com” graduate who has lived through the insanity of that period, and still wants to create new businesses. I’ve also met the version of Jared that didn’t survive the implosion when investors started asking for their return, and finding little but a trickle coming back to them. And I’ve met a few of the lucky, early liquidators who cashed in for real currency, rather than stock in the acquiring entity.
Another dot.com graduate was William, whom I met years ago. He was one of those “new economy” entrepreneurs who built a business around a good story that had the words “internet” and “web” sprinkled liberally in it. Wisely, William sold his company for a mere $50 million, when others were holding out for the $100 million minimum that dot.com entrepreneurs were expecting. So there he was, at 30 years old, $30 million in the bank (after taxes), and no other saleable skills than what he had already cashed in on. What to do, what to do?
William played for a year or two. Tried to form a non-traditional business-networking group, which lasted a few months. Got his picture on the front of a magazine of some note. Then silence. I tried periodically to see if he was still in the area. Can’t find any evidence of him. I’ve always wondered what became of him. Retired at 30, just a few years of working experience and few skills outside of his original business. Sounds terrible. No purpose in life except to hole up in the counting house and take stock of one’s assets blooming or shrinking.
Thankfully, for Jared’s sake, his timing was not as astute. His equity rose to make him a millionaire several times over, then plummeted before he could convert it to cash, finally settling on a sum that could help him retool for a new future, and little more. Every so often, I get the opportunity to see how others deal with the lack of gain, the loss of gain, or the perceived loss of future gain. Each of these experiences is like washing mud from a statue. Whatever character is sculpted into the marble of a person’s personality is revealed when loss washes away the self-image that one would prefer.
Jared’s character was found more than a match for the losses he endured. Now, at nearly 40 years of age, he has been through enough, has learned enough to be a credible business leader. Here is a graduate of the “new economy,” humbled and astute. Creating a solution within the context of the evolved business processes that have changed medium but not message.
There is nothing so admirable as brash youth tempered by experience to produce humble competence.
Friday, December 10, 2010