The Bubble Bursts (1998-2001)

In late summer of 1998 I was taking another of my periodic walks in the wilderness. I was tired of the constant travel and I wanted to roll my sleeves up and get into coding again, but I didn’t know how to pull that off. I took a long walk in the woods of ?? park which covered much of the west side of Education Hill in Redmond. The entrance was only a couple hundred yards from my house and it was a good place to walk slowly and ponder my life.

I remembered the times that I have asked a Higher Power for guidance and decided that I needed some help, so I simply asked for some sort of an indicator about possible next steps.


Later that day I got a phone call from a fellow named Danny Kolke.Danny Kolke He was planning a start up and needed an IT lead. We talked at length and Danny was very convincing. He had most of the team already in place including two of his brothers, Ray and Desmond. We agreed to fold The Socrates Group into Etelos and I dove in. Initially Danny wanted Etelos to focus on “Referral Selling” which meant that my job was to create a website that could manage referrals between referral partners. At least that was the idea…

Jeremy Caney

Initially, we shared space in Jeremy Caney‘s office in Redmond. I knew Jeremy through a mutual friend, Matt Tomlinson. Several years back I had called Redmond High School to see if they had anybody who could help maintain the many computers I had in my house. They recommended Matt and he was outstanding. He helped me for a couple years then went off to college and the Air Force. He is now an Aerospace consultant. Jeremy had started a company called Ignia and they had enough space for Etelos to incubate comfortably. We had hired several people including a systems administrator named Anne whose job was to build us an infrastructure.

Ahmad BaitalmalI also hired a developer named Ahmad Biatalmal and his wife Jemma. I vividly remember meeting Jemma and reaching out to shake her hand. She shook mine and then gently told me that her religion did not allow her to touch any man other than her husband. She and Ahmad were devout Muslims and two of the kindest and gentlest people I have ever met. I spent many hours with them learning about their belief system and I hold them both in high respect.

Ahmad was a native of Saudi Arabia and had taught himself English by listening to the radio and he spoke with no detectable accent. Ahmad proved to be the best hire I have ever made. He was (and I presume still is) a giant of a man and every bit as talented as he was big. Ahmad became our lead developer and I learned lots from him. Mostly, however, I learned that there are some people who are so much smarter than I am that it’s very humbling.

I hired several more developers, two of them women from India. One was very talented and disciplined but the other was… not so much. I had recruited a very diverse team of developers and we tackled the Referral Selling site very professionally.

In the mean time, I hired a second systems administrator to work with Anne and they built a first class server infrastructure with several large servers and two F5 boxes, beautiful diagrams and lots of security. Anne tightened our security so well that Ahmad and the rest our developers could not post updates to their code. We had a problem. Not a technical problem, but a people problem.

I had maintained my connection with Thommy Barton through the years and had even tried to become one of his trainers, but Thommy was very clear in letting me know that I still had considerable work to do on myself before I could become a trainer of his material. I introduced Thommy and Danny and we decided to take the whole company through Tommy’s training. We migrated en mass to a hotel in Port Townsend and spent a fascinating weekend learning how poorly we communicated. I vividly remember one of our team members demonstrating how utterly clueless he was about how he came across to others. He could present a facade but had no self-awareness of what was behind the facade. It was both scary and sad.

Thommy’s training provided us a lens through which we could examine our group dynamics. How did each of us feel about being included on this team? Where did each of us believe that we fit in the pecking order? And most importantly, how willing were we to be open and honest with each other? This last question was the real test because most of us, and especially the men had been trained to build a tough facade and let nobody see behind it. As a consequence we were all posturing and bullshitting each other rather than being honest and direct.

When we returned to our office, we tried to integrate these principles into our organization. We even took a number of people including all of our new hires through the program again, but in my judgment, we failed completely to build a high performance culture of high inclusion, low control and high openness. Looking back on that experience, I have hypothesized that there were two steps missing. First, we needed ongoing coaching every week to help us ground the learning and work through practical problems. By “we”, I mean everybody on the team. And second, we needed to be willing to cull out of the organization those people who could not “get with the program.” This may sound harsh, but I learned the hard way that some people are scared shitless of looking into the mirror and owning their own shadows.

I am not claiming that our failure to become a better team was what caused our demise, but it certainly contributed to it. And I can own my part in this. I did not have the tough and direct conversations with Danny, Anne and others that needed to be had. Thommy was right. I still had lots of work to do on myself.

We managed to raise some seed funding, and were closing in on several large investors in the spring of 2000 when the Internet bubble burst. Up until that time, a could raise lots of money based solely on the claim that they had many thousands of “registered users” even though none of these “users” had done much more than visit the website once. It was absurd, and like the Tulip mania of 1637, the bubble had to burst. Ours did in May of 2000.

With our funds rapidly running out, I had to lay off all of our developers except Ahmad. I made the judgment that he was more valuable to Etelos that I could ever be, so I gave myself a pink slip too. Time for another walk in the wilderness.

The rest of 2000 was a very dry period. I was able to pick up small pieces of consulting work, but there were thousands of highly competent software developers looking for work too and the pickings were pretty slim. We lived off the equity in our house and fortunately the housing market was still growing, so we had a fair amount we could tap.

2001, The Year that Sucked

Late in 2000 I got work as a subcontractor to a contractor who was working on projects for Paul Allen. I sat in a room with half a dozen other programmers. We each had a chair and about three feet of counter space. It was rather spartan, but it was work. I can’t say much about what we did, but I can say that I left with a bad taste in my mouth about my perception of Paul Allen’s value system.

2001 was not a good year. Paul Allen’s office moved from Bellevue to downtown Seattle and most of the consultants (including me) got cut loose in January. The Nisqually earthquake hit Seattle at the end of February and memories of the 1989 Loma Prieta earthquake came roaring back. And Seattle traffic was getting worse and worse.

Donna and I decided it was time to look seriously at where we wanted to live. We made a list of criteria we wanted in the place where we lived:

  • Pacific Time Zone – We have lived on the west coast since 1978 and had no interest in moving back east
  • Small city – must be small enough to be able to go just about anywhere in the city in 20 minutes but large enough for me to find work. It also had to have lots of good restaurants.
  • Vibrant – the city should have plenty of diversity and at least one college.

We looked at places from San Diego to Portland but it was our son, Travis who pointed out the obvious. He was a student at Whatcom Community College in Bellingham and he said, “Well duh! Bellingham!”. We all agreed and started the process. We put our house on the market in May, 2001 and I started making a weekly trek to Bellingham simply to get to know the players.

Scan4359As Autumn arrived, we still hadn’t sold our house but I had setup temporary quarters in Bellingham. I hauled our Coleman Camper up to Fairhaven and parked it under a big oak tree on a lot where Travis had some friends. We hooked it up and rigged it for heavy weather  and I spent at least one night a week while I was searching for work. In this picture, Travis is cooking us dinner while Donna enjoys a glass of wine. It was quite cozy.

Our house finally sold in November and now it was time to find a place to move to. Given the financial setbacks we had suffered in the past couple years we decided to rent while we got to know the town. We looked at one house after another and our mood became as gray as the weather.

Just as we were about to give up for the day we stumbled on several listings in Silver Beach. The first was too small, but the second one, at the end of a cul-de-sac was quite promising. In fact, I was pretty sure it was just right as soon as I saw it.




Travis tested the traction on the floors and then we all measured everything and debated whether we could afford the rent. As you can see from the last picture, Donna liked the place too.

We got our buyer to agree to close at the end of December and once again, I put myself through that exercise I have sworn repeatedly not to repeat: moving. We loaded the biggest U-Haul truck we could rent and got everything loaded into it by the end of January 1st, 2002 and created a little ritual of letting go before we headed north.

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