Never saw it coming

The mystery investors have turned out not to be the complete fools we were assuming after all.

Seems the long-awaited sackful of folding stuff is conditional on there being some kind of sustainable business to put the money into.  They were advised this would mean the loss of the charity tax status of the ‘investment’, but they were adamant. Specifically, they want running costs cut fairly dramatically, to somewhere approaching the ‘revenue’ figures they’ve been given. This isn’t the sort of linkage our financial boys are used to, but we do need this cash.

Now, this isn’t my decision, thankfully, but if it were I’d have to consider:

• rental for the vast amount of allegedly-managed-service office space we currently (partially) occupy – regrettably tied to a cunningly negotiated lease with a get-out clause somewhere around the time of the London Olympics;
• cutting development funding still further from the three-men-and-a-dog in their distant (and cheap) locale, thereby saving maybe 2% of overall costs and further endangering our ability to deliver code that doesn’t fall over in the first month;
• reducing salaries of UK staff who might in other times have accepted a cut but are all still hanging out for overdue salaries, commissions, etc.; or
• cutting the number of people in the UK office.

Funnily enough its the last option that looks most attractive.  Trouble is saying farewell means paying the overdues and in most cases (not mine, sadly) some form of redundancy.  Which is where the mystery investors can help out.  But they won’t invest until costs are cut.

Round and round we go.  Meanwhile a new software fix came out yesterday which looks the standard ‘addresses some known issues’ upgrade, but hidden in the fine text is the ‘data loss could result’ warning.  Questions are being asked as to how such things could slip through our rigorous testing and quality management process.  Not by anyone on the inside, mind you, we’re all stunned there haven’t been more and worse, given that the rigorous quality management process got cut in the last round (lucky bugger).

So I’ve been told my services will no longer be required (how sad!) once the investment comes in and they can pay me what I’m owed (how wonderful!).  Tried to act surprised and keep the smile off my face, which was easy when I realised that we’re still talking ifs and maybes here – the sackful of readies now not likely before Christmas.

I was also too timid to do my rant about the failures of management, but avoided making a complete arse of myself and thereby kept the pay-out promise on the table.  Like Christmas this year, a case of chicken rather than turkey.

Fit for purpose

There are days I think I’m not cut out for this job, and days I know I’m not.  Yesterday was one of the latter.

Meeting with major client to discuss modifications to software promised some time back for which we now have an agreed, do it by then or its all over, delivery date.  I’m told by our dev guys we’ll crack this easily (mind you they said that about the first date too).  Met with channel guys in cafe across the road beforehand.

Cafe is next to pile of wreaths commemorating victims of recent terrorist bombing which is by way of reminder that things could be worse no matter how badly this meeting goes.  Am reminded of this later when I catch myself wishing for a bombing or similar to set off alarms and terminate meeting.

Me, two representatives of channel and three client people, so we stand a chance of tying any votes if it comes to that.  I have three carefully prepared documents to table and all three stay in my bag throughout, as it quickly becomes apparent that Senthil, the client’s ops manager, will only be happy with documents he’s prepared or at least severely edited.  We spend the first hour arguing over whether our stating the technological background to what we’re endeavouring to produce is our sneaky way of avoiding meeting his requirements.  Initially I see his point, then I progressively come to realise that every time one of us agrees with him he moves his viewpoint further out to ensure argument.

Senthil is short, fat, bald and heavily bearded.  His smart suit, fat watch and bling cufflinks contrast with my usual scruffiness, but luckily the channel guys are reasonably turned out.  Whether his need for conflict is the classic short-guy syndrome is debatable, but he has a reputation for enjoying beating up suppliers which I’d heard but not entirely given credence to.  He is uniquely nasty in my experience, though he mostly does it with a smile on his face.  A smug, self-satisfied, you’re not going to enjoy this but you have to put up with it cos I’m the buyer smile.

Having finally worn us down on the definitions of what we were going to deliver (and changed pretty much nothing, but spent signficant time and energy doing so), we moved on to dates for delivery.  The date for delivery of software, as stated, was fixed a while back having moved once, and we knew we’d no chance of moving it again.  But having got the software in you have to implement it and let it do its thing.  Its thing last time took two weeks to do, so the channel guy was saying allowing two weeks again this time (even though we’d hope this time to be a lot faster) was prudent. 

Senthil rounded on this and started a major rant on slippage, not respecting committed dates, trying it on etc.  The channel guy patiently explained again this was not any change, simply adding on the necessary implementation time to the date we’ve committed to deliver the tools to do the job.  They might as well have been speaking different languages.

After a couple more to-ings and fro-ings the channel guy lost it.

‘If there’s not basic trust around this table I think we might as well call the whole thing off!’

I misread this slightly and started packing my bag.  Conscious of eyes on me, I noticed that everyone else had read this correctly as some steam being released which then led to a general rapprochement whereby we could all agree next steps.

Senthil had several more digs but fortunately his boss, Trevor, also present, is a reasonable human being who intervened as required (though a little slower than I’d have liked) to get basic agreements in place.  We left just under two hours after we’d arrived, having agreed to the things we’d already agreed to before we’d come in.

Which is as close to an achievement as I can register for this week.

Disruption for disruption’s sake

Its been pointed out to me, re the flippant last line of the last post, that Motorola technology is almost by definition disruptive and you need spend only a fraction of time in the quiet coach of any mainline train to witness this.  Fair comment, and our office also has its share of ill-chosen ring tones ranging from the mad-woman singing ‘Ring ring ring’ through to car-horns, whistles and even bleating sheep.  One wonders whether the CIA et al are wasting an awful lot of airmiles and potentially damaging international relations when they could more cost-effectively abandon ‘rendering’ or whatever they call it and simply  put the suspect in a cell with 15 phones, just out of reach, set to randomly ring.  I’d certainly be ready to implicate my nearest and dearest after a couple of hours of that.

Anyway, disruptive having become our little corporate buzz-word some time back it might be worthwhile defining what we mean by it.  Well, I’d like to know, for a start.

Initially I assumed it meant disrupting the market, i.e. surprising the incumbent solution providers and becoming a solution of choice for the entire world.  Obviously this was mostly going to be by word of mouth given a marketing spend which wouldn’t keep us thirst free in the pub for more than an afternoon.  Nevertheless ultimately the world beats a path to our door, Microsoft, Symantec and Google all make outlandish bids for our stock that make Skype look like a steal, we all live happily ever after in a life of untold luxury, and Coventry win the Premier League in 2007.  Thus is the market extant ‘disrupted’, but all obviously for the common good.

Alternatively, the technology is so wonderful that another organisation spots what we’re up to, employs half a dozen teenage programmers in Bangalore to copy the concept, releases into an unsuspecting world (bearing in mind we still have to spell out our company name to each and every prospect, such is our presence) accompanied by advertising and marketing spend (which I think we’d describe as ‘cheating’), and everyone beats a path to their door, thereby leading once again to a disrupted market with the slight difference that we all end up selling Big Issues and collecting cardboard for bedding materials, muttering ‘unfair’ and ‘if only’ into our dotage.

The third way, however, is that the technology itself does the disrupting.  In this scenario we pretend to be protecting infrastructure and data but there are elements of the code which make subtle improvements to the client’s so-called ‘information’ over an extended period of time, until they can no longer function.  The trick of course being they don’t discover this until its way too late to do anything about it other than sue us and our channels for damages.  Disruption here is limited to Loftex and its channels and customers, who, fortunately perhaps, number but a few.
There are moments when I suspect we’re going the third way.  I hope I’m wrong.

Disappointment all round

Usual gloom and doom in the office with the (ever-fainter) hope of the mystery investor consortium not asking to see the books after all the only mitigation. Meanwhile fewer and fewer make the journey in and the quality personnel on the front desk of the managed-service office company are assuming we’ve had such a cracking year we’re all taking early and extended Christmas holidays. Which of course we may be, but not for the reasons assumed.
Disappointments mount up. The expected major deals are either being deferred to a point in time when we’re unlikely to be around or have gone to the evil scheming competition. In one case we have two channels competing for a very sizeable deal and their dissing of each other has caused confusion in the customer who is now ‘rethinking the whole project’. Think fast, buddy, or you’ll have to re-think the basic software as well, unless the escrow people will let you have a working copy.

Perhaps a disappointment but possibly a blessing in disguise is that we no longer have a system to record our miserable performance on, the supplier having finally had enough of unsigned or post-dated cheques and pulled the plug, ‘temporarily’. In the meantime we’re recording deals won while its unavailable on a yellow post-it note. Well we will when we have some.

Not getting paid hardly ranks as a disappointment as its so normal. After the shock of the early salary round expectations rose ever so slightly but the normal despondency has resumed in spades. There are super-secret meetings daily between those tasked with Corporate Finance and Overall Management Responsibility, neither of which term has had any significant meaning in recent months. Why the meetings guys? What’s to decide? If someone is offering to pay for a share of this debacle at any valuation our answer has got to be yes, unqualified, no ifs buts or maybes, you can put your drug-addled retarded teenage son in charge (that’s sort of what the last guy did), and we’ll all dress as maids and sing Gilbert and Sullivan medleys – if that’s what it takes (Finglass, please send me the name of your Octoberfest supplier, we may need costumes in a bit of a hurry if they read this). Just give us the money, please!

But there’s disappointments even for the gifted few. I didn’t witness but can well imagine the disappointment when the email announcing the Marketwatch Editors CEO of the Year 2005 was opened on a certain PC. Ed Zander of Motorola? What’s he had to contend with? Call that a disruptive technology?

Christmas cards

Its that time of year which I hate anyway without the extra pressure of Loftex hanging over everything. No, I don’t hate Christmas per se, just some of the associated tasks like shopping, and (shudder) writing the cards.

Started tonight. Because of the relatives on the other side of the globe we need to kick this off early, though we never beat the wee girls in my daughter’s social circle who exchange about 50 of the smallest (but cutest!) cards each and therefore have to start in November as their writing isn’t otherwise going to be fast enough to complete the task by boxing day.

I always write the same crap cliche sentences, no matter what my intentions for the rest of the year. This is simply because when confronted with a blank card all parts of the English language bar ‘Hope all is well with you. We are all fine though S continues to grow and amaze us all ….’ disappear from the brain. I find myself creating material I too guffawed at when Simon Hoggart collated it in his books and columns on Christmas round robin letters.

But this year of course the sin is compounded by it being a lie! Things aren’t fine with us! I’m trapped in the last days of a criminal conspiracy which threatens to destroy me professionally and financially! I want to kill certain individuals and toss their entrails to the festive Christmas vultures!
Its traditional of course not to use that kind of language in cards which may be why the brain screens it out when you’re writing them.

Meanwhile Roger’s given us all cards in the office to send to all our clients and channels. Again, we’re all poised, pen in hand, wondering what to write.

‘Goodbye, sorry about the mess, love from all the gang at Loftex4′?

‘We know you’re a charity supporter as you sent us an Oxfam card last year – please send money to the Save Loftex4 Appeal this year’?

‘Aaaaaaaaarrrrrggggghhhhhh’?

Suggestions on a (Christmas) card please.

10 things to do while you wait for the end of your company

1. Re-write and post your CV for the 23rd time this morning, ensuring it plays up the talents and skills you have acquired riding this little white-water raft of a venture whilst in no way associating your skills and talents with the imminent sinking of same. A tricky one, but if you don’t believe it can be done you should replace the Loftex experience with something less shameful. Like jail, for example. For shoplifting, perhaps.
2. Call the ever-diligent job agencies who chased you down with breathless urgency when you first posted your CV but haven’t, when you really think about it, actually initiated a call to you for some weeks now. You’ve been dumped, and those useless scumbags probably never had a job in the first place, they just wanted your CV to impress their would-be corporate clients of the calibre of people they could present to any given opportunity, though of course we’d be looking for someone with a better CV than this, someone with judgment that didn’t have the blemishes of a Loftex4…

3. Phone round your channels trying to establish whether they have (a) jobs for the likes of you or (b) money to buy out the likes of your so-called management team. Tricky to pull off without giving the game away, so you defer for another day. While they have even a small chance of (c) the huge deal that changes the whole shooting match, you have to carry on as if everything is OK. One day, though, the pleading call is going to give the game away, totally.

4. Do some web research on the symptoms of depression, stress, gastric ulcers, and various syndromes you think this gig might have given you. Locate and identify with various forms of psychosis. Identify most others with your work-mates. Send anonymous emails to the CEO labelled ‘Munchausen’ with no other words. Somehow feel better for that.

5. Check eBay for prices on remaining assets in the office. This doesn’t take long, so check history on other items that don’t belong to us but that the managed-service office company might take a few days to miss. Ascertain that total fire-sale will realise enough for about an eighth of your personal debt. Plot method for pulling off sale solo without any of your colleagues catching on until too late.

6. Seek the magical external funds required. All other avenues having (allegedly) been explored, you’re now limited to vegaspoker360.com or the Albanian state lottery. Fail the former’s credit check, the latter technically illegal in states banning pyramid selling. Draft the email for a 419 scam while you try and work out how the scam actually works once you have the bank details etc.

7. Weep. Not terribly useful but can be cathartic provided you keep the tears off your keyboard.

8. Swear and throw things. Again, not terribly useful and may further decrement asset base. Can feel damn good though, especially if breakages can involve electrical explosions.

9. Go through the mental rosary you’ve been going through these last few weeks – ‘Sue them, county court judgment, call in the fraud police, call the other shareholders, sue them , county….’ etc. etc. Like a lot of religious ritual, not one piece of it actually will fix anything but the fact of its repetition, and the other adherents repeating it, somehow seems to have a mystic power that may lead to fundamental change. OK, not really.

10. Blog. Actually, add to this one. New items for the list gratefully accepted. Come on, its not like you have anything useful to do, is it?

Too little, a trifle early

Some fool has paid their debts and suddenly we’re awash with funds.  Well, damp around the toes, anyway.  There’s still the distant howl of creditors outside, but we’ve enough to sustain us for a few more days.

Meanwhile, the emailed orders are flooding in.  OK, I’m overexcited, but there have been a lot of them.  Well quite a few. All for rather small amounts, but more than in the last few days than for the same number of weeks before.  And none of the biggies is coming in.  But there’s sufficient to believe that one of the monsters must also fall, soon.

This self-delusion is an aspect of my Loftex brain-washing I’m not at all happy about.  When I started here I could tell you that 10 licences at £500 each was £5000.  These days when asked what my 10-licence order amounts to I’m more likely to round it up to £10k.  Our erstwhile CEO would have rounded still further and by the time you heard it back from the other offices you’d scored a £90k deal with potential for a further million.

If my brain hadn’t been washed I wouldn’t be so happy getting my pitiful salary 7 days early, which is (bizzarely) what’s happened.  I’m still owed mega-oodles in commissions etc., so why am I feeling grateful?  And why have they paid it early?

Meanwhile chasing the channels that haven’t paid up continues.  I’ve done debt chasing before, but usually for larger corporates and usually for debt that’s over a month late.  Once the scheduled payment date is past, one of us is on the phone, and when the amount is less than £200 its starting to become obvious we’re in fairly desperate straits.  All in the cause, of course, and if I had any confidence some of it would find its way to paying something other than the bare minimum I’d have more enthusiasm.

So if you’re reading this, Mr. Foreign Channel that owes me/us $973.27 (and you know who you are), pay up now so we can buy our children Christmas presents.

Please!

Bigger offices, bigger picture

In common with most startups, Loftex started life in the UK in a tiny managed-service office. Then moved to a slightly larger one, more central. Then had a wall knocked through to expand said office to a modest but multi-roomed one. Then realised someone was going to want money for all this….

Right at the point that it looked like we might have to re-shrink the office, a stroke of luck. The managed-service-office people got evicted. Turns out they were in their turn renting what they rented to us, and their landlord (a state-owned enterprise of some infamy) had decided they needed the space for their own expanding workforce, having only lost £200 million in the preceding financial year and needing to staff up to get government’s attention (which they duly did, but that’s another tale). Now this was lucky for every tenant of the managed-service office company because (and who’d have believed it of the legal profession) their lawyers had screwed up and failed to notice a fine detail of their lease. Namely, the 30 days notice period.

This was some 60 days shorter than the notice period their own tenants had. So some humble pleading began, based on a need to relocate all tenants to one of their other fine facilities, none of which was central. Because if a tenant refused to budge a costly and embarrassing legal battle could be guaranteed to hit the papers (at least, the local ones).

So we were showed a series of offices, each grander and more remote than the last. And a deal was struck. Our man in charge of such things, Roger, did his best disgruntled terrier impersonation and got us twice the previous office space for half the going rate. Better, we needed a space they didn’t actually have, so ended up with a space way larger than we needed with a promise not to use the desks in half of it. Which we didn’t, much. Same as we only ever used the internet one at a time so only paid for one ‘live’ port with all the rest just for intra-office communications (these people were even slower than BT to realise what a router could do).

Life went on, the commute from the centre an irritation but the expanded space (including our own ‘boardroom’ should we ever appoint a board) pleasant enough internally. The surrounding wasteland took some getting used to (but saved the wallet from the deprivations of shops, sandwich bars and pubs) but the views of traffic queues and delayed trains were small compensations. We grew to fill the space, almost. We grew beyond our ability to pay the ‘burn’. We grew angry and mutinous.

In months when there was no guarantee of salaries being met, brochures for newer, bigger, fancier offices were spotted floating around the desks of key individuals. This is where my lack of financial nous comes up again. Apparently if you do deals where the first year’s rental is deferred this can make an apparently more expensive office cheaper. Obviously we’d have to spend our office hours sitting on beer-crates until furniture was made affordable (who knows, IKEA might have a ‘pay nothing till 2007′ offer any day now) and there might be small inconveniences in the target offices being in a village without public transport to speak of, but the overall benefit of having our name on a lease and being able to buy our own coffee out-weighed these considerations.

Perhaps unluckily, the opportunity to move evaporated when a bunch of asylum seekers with cash gazumped us, so we stayed put. Well, almost. Again the managed-service office people made us another offer we couldn’t refuse, so we moved again, this time within the building. Even bigger, yes, and definitely grander for the Politburo side of the office. Once again parts of it aren’t strictly ours so we pretend not to use them. Aside from one instance of an entire live server-rack being accidentally left in a ‘spare’ office, we’ve not been caught doing so yet, either.

Without naming rights for the building we still have unfulfilled ambitions in the real-estate aspects of our corporate existence, but at least now visiting clients get a better sense of what Loftex is all about.

The key to this of course is that the size and physical separation of our offices is such that from the meeting rooms, the wailings of the staff are inaudible.

When is a technology not a technology?

The acquisition of IDspare took over a year and involved considerable efforts from a number of Loftex’s management.  In particular, the legal teams on both sides expended huge energies in defining what we were buying, for how much, over what time-frames, etc.  Regrettably the technological aspects of the technology weren’t really explored until the last round of documents.

Even as I write that I find it hard to explain or understand.  If its a technology, surely the techies would be involved in examining it, trying it out, making sure it performed, before we even talked about what it might be worth?

Apparently I’m naive in these things, because its not at all necessary.  A disruptive technology doesn’t necessarily involve anything tangible, like code.  So it should have come as no surprise when the key element that we all understood to be the guts of IDspare turned out not to belong to the people we were buying IDspare from.  It was (and is) rented from a couple of guys working out of a garage in South London.  Good code, works as it says on the tin, but not for sale.  They’ve written a song and want their 2p every time it gets played.

Which of course is going to be a gazillion times if the business model informing our modest multi-billion dollar valuation is anything to go by.  Which perhaps it isn’t, but thats another story.

So what were we buying?  Turns out to be a concept.  Now anyone who’s read anything about the dotcom bubble knows that concepts can be worth billions.  Or, after a pause for reflection, not.

Now we own a concept, which to be worth anything to our clients is going to have to be used to aggregate technologies, some of which we own and some of which we have to buy as we use.  Which means we no longer have the problem of being solely reliant on our own small team of developers.  We’re also now additionally dependent on an even smaller team of developers, and an implementation team owned by the erstwhile IDspare owners.

One of my larger former employers made a lot of play about its ‘Methodologies’.  I used to be very skeptical about the value of these, given they were largely concepts with fancy logos and a lot of management consultancy words.  I now see that they had quite a lot of value.  We need to get some logos done and a CD made, sharpish.

Pushed or jumped, revisited

Seems he hasn’t fallen after all.  Or at least not as far as we thought.  Not fatally, certainly.

Seems there’s an investor.  With money.  And a willingness to spend some, now.  

Seems there’s hope.

But we’ve been here soooooo many times before, and the source of all these rays of hope?  Oh yes, the man they couldn’t hang.  So I’ve taken the projected cash input, divided by ten, taken the announced likely input date and added three months, and even then this isn’t total disaster – a very unpleasant Christmas, for sure, but possible survival beyond for some (probably not me, but some).  And if its true as related….  But no, it can’t be, it never has been so far.

I hope I’m really wrong about this.  But if I am, you’re going to assume I’ve borrowed a plotline from Dallas where all the characters come back to life cos it was all a bad dream.

Maybe I have.  Maybe it is all a bad dream.  Bloody hard to wake up just now, though.  

The unbearable lateness of peeing

Significant pain endured today doing a web demo for one of Charlie’s clients.  Alan the uber-techie being out demoing somewhere else, I had to step in and use his machine to show the software in all its (carefully rehearsed) glory.

Would have been better if:

1. the screen-saver on the demo machine wasn’t past its free-show date and therefore takes the best part of a minute to invite you to send $9.99 to some porn-central place in Costa Rica;
2. the (also freebie) virus checker wasn’t running (and – yikes! – finding things) when we started;
3. the web-demo software we’re using wasn’t also past its free trial period – we’re on to our eighth free 15 days with this one and we’re starting to run out of sufficiently different email addresses;
4. the ‘please apply these Windows updates’ icon-ette wasn’t flashing away on the toolbar;
5. the VMWare session wasn’t also asking to be updated – not sure how legit the copy is so don’t want to go there, either;
6. the client knew his own email address.

Once we got going, it was fine.  Client’s embarrassment at not knowing his email (‘this explains why I haven’t been getting some of the messages I was expecting’ (some?)) balanced off the obvious cheap and tawdry aspects about our end of things.  Everything he asked about we had an answer for, in most cases two answers;  Charlie’s initial bluster and my bumbling semi-techno one.  Not always in that order, and not always utterly contradictory either.  He was dead impressed, generally. 

Problem was the thing started late and I made the mistake of nodding when asked by some passing oik if I wanted another coffee, having just had one and needing a pee before even logging on.  Drank the extra coffee while setting up, which just made things worse.  Charlie’s explanations seemed to get longer as the demo wore on, the client kept asking questions which invited multiple answers, examples, anecdotes from days long ago….

Eventually I had to fake a telecom outage to escape.  Hung up phone and killed Webex simultaneously for realism’s sake and legged it down the corridor. By the time I got back there was a message saying thanks for the demo but the client had another meeting to go to, so apologies if we’d been cut short. 

They don’t know how close to the truth that was. 

Key performance indicators

For me, today, posts per hour into this blog. But at one time…

One must confess its never been the most splendid performance from any of us. Those of us with sales targets never hit them two quarters running (one quarter on target was always reason enough for a celebration). The techie guys could point at numbers of problems handled and resolved, but if that had ever been measured in anger it was easy enough to manipulate. The fund-raisers cunningly never had targets written down, though collective memory suggests failures against whatever targets had been talked up.

When targets were first set for us sales monkeys, I recall an evening interlude in a beer garden discussing possible targets for all staff. These were of course to be SMART objectives: (Silly, Measurable, Amateurish, Realistic and Trivial). Among the more popular suggestions at the time, particularly for the ELF participants:

• Attend 10% of meetings on time or within ten minutes of advertised start time;

• Words per day (for the Chief Legal Officer – at one time this target would have been a challenge if set above 3, if by ‘words’ we meant ‘words that will form part of a signed agreement’);

• Interference in channels threshold

• Payments to staff not more than 7 days late (we set this target to what we foolishly thought was an achievable level);

• Whinges about referees in sporting contests involving antipodeans less than 2 per televisual weekend (for…. well lets just say this one’s personal);

• Purchase of other companies to be restricted to offers less than twice the amount of existing debt;

• Buzzword bingo restrictions (i.e. less than twice per month) to apply to the following list of terms (to be amended as necessary, partial list only shown here):

1. new paradigm
2. disruptive technology
3. in the market
4. the marketplace
5. awesome
6. its not a job, its a ticket
7. I can promise you…

Reporting format changes to be less than 20 per annum.

The list went on, there were some even sillier ones, it was a jolly evening all in all.

Regrettably, we didn’t implement.

We are that business school case study

Here’s a couple of test questions for the MBA candidates among you:

Let’s say you have a technology that already has a good security reputation. Let’s say you’re being courted by a reseller of digital certificates. And let’s say they convince you that you should PKI-enable your product, so it can use PKI as an authentication protection. And let’s finally say that at the time all this is happening there are three major vendors of the underlying PKI technology all desperate for an application or two to come along and start driving the sales of certificates up the old J-curve that’s been promised for a decade or so.

Would you:

1. play the three against each other and see which one offers you most help, support, cash or other inducements to use their certificate type as your base? or
2. sign a deal commiting significant lumps of your cash to the first one you talk to?

Here’s another hypothetical situation. You meet with the certificate resellers alluded to above over a beer or two at a trade show. You’re in love with their technology, business model and corporate image. You’re pretty sure they feel the same way about you. You’ve got the sexy application which is going to drive sales of their dull old certificates, after all. You have a very small sales force with limited technical nous, they have a whole bunch of people who seem to know their onions. Here’s the easy choice, do you:

1. allow them to use your technology to sell theirs, on a reseller commission basis? or
2. get them to introduce you to their reseller partners? or
3. sign a deal where they promise to sell $US20K of your software and you promise to sell $US200k of theirs, just as soon as you understand what it is they actually sell?

Last one now. There is a piece of software functionality you’d like to have which will cost you gazillions to develop and which already exists for a reasonable fee. No, you’ve jumped ahead, prepare to be surprised slightly here. Even your big nasty competitors with the army of talented and compliant developers don’t re-invent this wheel, so neither will we. Everybody in our game buys this functionality, mostly from the one place. We need access to it for our server product, in particular, but at the time we’d sold slightly more copies than there are fingers on the left hand of a short-sighted butcher. But volume discounts are on offer. Not everybody needs this functionality, but when they do need it, they’ll pay for it. Would you:

1. get the best unit price you can and offer it on demand to clients? or
2. commit to a sales number with a claw-back clause if that number is not met, meaning a need to pay slightly more for units actually bought? or
3. give it to clients for free and pay a fixed amount for every single copy of your product sold, whether or not the functionality paid for was wanted or implemented?

There are no right answers. 

But I can tell you what happens with the wrong answers, if you’re interested.

Did he jump or was he pushed?

Or perhaps more properly, was he pushed or kicked over?

Some of us would like a chance to throw other heavy objects down after him, anyway.  

Allegedly today he gets the big confrontation.  Unfortunately this will be by phone as he’s scurried back to his homeland last week when the words ‘thieving’ and ‘git’ were first being bandied about the office in relation to his activities over the last years.  I’d love to see his face.  Actually, no, I’d like a video of his face so I can edit it down to whatever bits of contrition remained from what I’m sure will otherwise be a bravura performance.

Charlie’s talking about the police again.  I started that when the red mist came down last week.  Since then I’ve come to realise that’s a bit like calling the cops onto your local when they have a lock-in but don’t invite you;  satisfying in the short term but ultimately self-harming.

No doubt Cookie and the rest will provide full and frank feedback once the various ‘board’ meetings are completed later today.  Well they might if we make enough silly noise.  Open communication is the least of the unfulfilled promises to be seriously upset about, but somehow its the most irritating.

Ho-hum,  just as well the blood pressure check was last week.

No Cups, again

Managed service offices are fine in that they mean you don’t have to spend time on difficult but ultimately time-wasting decisions like what colour chair fabric to go for or whether to offer a choice of tea-bag types to staff.  Its all done for you and generally the choices made are the opposite to what yours would have been, so you get to experience things you otherwise wouldn’t.

The downside is they are expensive, relative to straight rental or property purchase, because you have to pay for the pimply youth who will answer your main office number with someone else’s company name, and for the woman who puts stamps on your mail for which a 200% surcharge will of course also apply.  In our case I’d kind of assumed that being out on this industrial estate which would be reasonably accessible if it weren’t in a part of England whose roads seem to be part of an upcoming reality TV show (I’m trying to find the M4, get me out of here), and in a building whose occupancy rate led to its Marie Celeste nickname locally, that we’d be getting a healthy discount on the going rate.  Imagine my surprise therefore in yesterday’s showdown meeting when someone asked the question of how much our rent was, and the answer was a very large number indeed.

Well it certainly looks large to me, being as it is more than three times what I get paid.  For that sort of money you’d expect some level of service and quality of facilities.  Well I would.

There’s no bloody clean cups on our floor, again. 

Laws of time and why they no longer apply

Like every organisation flogging technology, Loftex enjoys (check definition here) the natural tensions between sales and development.  Development’s view being:

‘This is one fine piece of technology – go forth and sell it’

To which the traditional sales response is:

‘My customer will buy it if you port it to GCOS-7, make it do weekly instead of monthly and change the interface to blue with a Verdana font – and we need it by next month guys’

To which development’s response is too well known to bother reproducing here.

To add to those tensions we located our development guys in an office nowhere near any of the operations and sales offices, with minimal bandwidth and a phone system uniquely irritating in its early termination of vital conversations.  Our communications with them were restricted to complaints about the existing code and uncoordinated demands for radical changes.

They were driven by an enhancement list which we saw immediately after each release was finalised, which had apparently been built from bulletion board rants (which they’d had printed and sent to them as the bandwidth wouldn’t support participation), GNU user group whinges (ditto) and the occasional night in the pub with the team.  The commercial focus was therefore not always in line with our expectations. 

The battle was extended by sales (oh all right, me) demanding the development of new security features including interoperability with external digital certificates and/or security tokens.  After an inordinate amount of bullying development finally delivered, two and a half years ago.  We’ve yet to sell our first implementation of the two-factor security version.

So that’s given development an ongoing mandate to ignore us completely ever since.  Our only hope was to get Cookie, the CTO, on our side.  And what better way than to make him head of EU Operations?  Then our problems would be his problems, wouldn’t they?

And for the first few months we scored, big time.  Cookie went with us into the channel meetings and the trade shows and made all the promises we were too scared to make, in the knowledge that he still had a CTO stick to wield and make things happen.

Somewhere along the line though, development smelt the wind and realised Cookie had been turned.  They plotted, they connived, they organised.  They announced organisational changes which none of us sussed as significant.  They consistently bleated as to their reduced numbers and increased workloads.  They threatened not to honour the holy days of product releases.

They won, in a word.  The so-called CTO now finds himself apologising for non-delivery of the ‘extras’ promised to all and sundry.  The sales guys find themselves explaining to channels how Q4 could actually be as late as June next year, due to a misunderstanding of when the year started.  The clients needing specific functionality find themselves buying elsewhere.

I’d say we’ve lost sales as a result, but my record doesn’t really support any assumption of knowledge of what people want in a software product. 

Unlike the dev team, of course. 

The last piece of the jigsaw

Some of you will recall the year-long debacle that saw the purchase of something that turned out to be more concept than software, and if you don’t, well, the salient point was that it gave Loftex several components of a whole which defined the term ‘Disruptive Technology’ and for which the world would beat a path to our managed-service-office door.  Of course completing the whole was an assumed end-goal and would require, first, integrating the bits we did have (i.e. the bits our guys had written and the bits we thought we’d bought but turned out we’d only bought the brochures for but could now rent (exclusively) for very reasonable amounts which in most cases were less than we’d be able to sell the whole for).  The bits we didn’t have were the nice-to-haves, the icing on the cake, the bits no-one would demand but that once we implemented would make the competition just run into a corner and whimper.  But we didn’t need them now and nobody expected them. Kind of like security and Microsoft.

Imagine our surprise then when the corporate coup announcement was made back in September, that we’d been successful in our approaches to WoodTech and now owned the IP to iWash.  Owned because we’d bought.  Bought when we can’t pay existing creditors, including yours truly. 

iWash is a fine product as far as I can tell, and has been bought by happy clients numbering more than several, allegedly.  WoodTech didn’t really want to sell it but it fitted our corporate strategy better than theirs (oh dear). It has the benefit of being developed by people of the same nationality and location as our own highly talented developers, who’d like to save on office costs.  Once we’ve integrated the bits we already own (or sort of) integrating iWash should be a doddle. 

iWash is that last piece of the jigsaw.

Trouble is we’re still looking for the edge pieces to get started. 

End of the working day

Ooooh that was nasty.

But totally predictable.  We have a bunch of options involving cutting salaries (from low to very very low, presumably), cutting staff (can go with that in a number of cases), increasing sales (well, derrr!), and (why didn’t we think of this before) getting some more investment capital.  The current state of the ‘hole’ or ‘debt’ as accountants prefer to call it, is roughly twice what any of us thought, excluding re-structurable debts, long-term directors loans, and ones we’d rather not think about just now.  But that’s not apparently bad as quite a lot of that debt has yet to be asked for in a direct or threatening way.  If we keep very quiet the tax man might just forget about us this year.

None of which says, panic not, you will be paid and go to the Christmas Ball, Cinders.

Maybe that’s our best hope – put on a panto based on this blog and other scurrilous writings. Look behind you! What? It’s your chance of getting out of this with any integrity, stupid.

How to buy nothing for quite a lot of money

This post explains how to add a lot to your technology profile, how to break the existing service-led paradigm and how to bundle the unbundleable, all without doing anything worthwhile.

First ensure that your capable technical personnel are kept up to date after each deal that you do.  Its important they’re not in the loop beforehand as their foreknowledge may cause the resultant IP purchase to be less than totally disruptive.  The best people to take into early technical negotiations are lawyers and accountants, but a CEO alone can also accomplish a lot.

Second change your mind about every aspect of the deal as you do it, preferably within a couple of days of reaching total agreement (each time).  This will ensure that the counter-party becomes wary and will maximise the opportunities for further meetings over meals and alcohol, thereby cementing a great long-term business relationship.

Third, offer to buy out anyone with attractive Intellectual Property whether or not you have any cash to do so.  This will ensure the counter-party’s full respect throughout the relationship.  It also means when you offer stock instead of the expected cash the negotiation to reach a mutually acceptable number will be short and sweet.  It will also give your in-house lawyer something to do.

Following these rules allowed Loftex4 to re-define Disruptive Technology.  As those of us still here can attest, from close-up knowledge.

Middle of the working day

Today is show-down time (allegedly). We’ve had a few of these, but maybe this one is the one. Last week there was (allegedly) a bailiff wandering the offices looking for assets of value. Good luck, mate, we’ve all done the same wander – if you find anything it probably belongs to an employee.

So today we get to hear the real situation, the truth about the balance sheet, the extent of known debt, and the ‘action plan’ for locating and securing the needed additional finance. And probably a cure for cancer as well.

My guess is it’ll be another acrimonious bout of whingeing and moaning which will be met with hand-wringing and perhaps a degree of contrition but no real answers – though these will be promised, of course.

Just had a ‘pre-meeting’ with a couple of fellow complainants, discussing lists of questions, what we believe the status is, etc. All a waste of time. There’s one question, and I already know the answer:

Q: ‘Where’s my ****ing money??’

A: ‘We haven’t got any to pay you’

Now we can have that conversation another 50 times or we can just fold up the tents and go home. I’ve already put my sleeping bag away.