Peter, Todd and Paul stood outside the suite door. "Well," said Peter. "This is it. Once we go through these doors, there's no turning back. We either close the deal or get our resumes up to date." Peter turned to Paul. "Can you speak eloquently on distributed objects?"
"Sure," shrugged Paul. "Why not."
"Okay, this is how we should play it. Paul, you just got a battlefield promotion to Lead Engineer. Todd, you're VP of Engineering, and I'm Chief Architect. We'll figure out the management titles if we actually get financed. Any hard-core engineering questions will be answered by you or Paul. I'll try and establish that there MAY be market, without actually committing to any product."
Peter took a deep breath." Into the valley of death rode the six hundred."
Peter knocked on the door. A second later the latch turned and the Starfucker beamed from the doorway. He dramatically waved them into the suite. The senior partners of the firm were gathered around the living room, resplendent in carefully rehearsed casual poses on the couches. The Starfucker glided into the middle of the room, basking in the credit of being the person to bring in this fabled threesome. Vincent walked up to them, beaming from ear to ear. "Well, well, if it isn't the three horsemen of the apocalypse. What can I get you all to drink?"
Beer was the consensus, which Vincent brought back to them in gold-rimmed glasses. He then motioned them to the one vacant couch. They sat down as the other partners swooped in until they were all orbiting them. Vincent sat on one of the other couches' arm. "So, we hear that you two are thinking about striking out on your own again. I have to tell you, we very interested in what you have up your sleeves. And I see you also have your first defector."
The other partners laughed as Paul squirmed uncomfortably in his chair. Peter patted him on the leg. "Yes, we felt since we had the big ridiculous idea covered, we might as well find someone who actually could turn it into a reality."
"Great," said Vincent. "Then let's get right down to it. What are you guys thinking about doing?"
Peter cleared his throat and gave himself a moment to order his thoughts. "Well, we've looked at how the nature of this business had changed over the last couple of years, and have tried to identify the points of leverage that are driving the paradigm shifts." The VCs all nodded their heads in agreement at this blatant piece of vapor-talk.
"One of the points that has come into focus is networking, and more importantly, how networking has changed the role of computers, how computers interact with each other, and how computers interact with people." Peter was feeling pretty good, considering he had no idea where he was heading. In fact, he had still managed to say absolutely nothing, albeit in a very impressive fashion.
Peter got up and starting circling the middle of a room. He often found that pacing got the creative juices rolling a little faster. Maybe, just maybe he could actually find a way out of this. He waved his arms around aimlessly.
"The amazing thing is that during this paradigm shift, when the hardware and how it is connected has changed so dramatically, the software, and more important the underlying software architectures, haven't changed a whit. People still approach the underlying cement if you will, the data, as if it still exists in a solitary world on someone's desktop. But the world doesn't work that way any more. Computers are now about collaboration, about that data being sent, emailed, transmitted and flung across the globe in milliseconds. The world has gone distributed, but data is still essentially immobile in nature."
Stunningly enough, Peter suddenly knew where he was going. A quick peek around the room showed all the VCs at rapt attention. More importantly, Todd had not adopted one of his “you’re a ridiculous person” faces during the spiel.
"We have looked at what it would take to bring this all into the distributed age. And I'm not just talking about bastardized database programs like Lotus Notes. I'm talking about truly distributed systems with truly distributed data. Done correctly, this kind of new programming foundation could change every type of on-line activity that is happening today, from databases to file sharing, from merchandising to on-line transactions. You've already pointed out Paul, and he was our first grab for a very specific reason: Paul knows objects. Objects are the core to what this new foundation will look like. If you put his knowledge of objects together with our knowledge of distributed networks, you have the core of a team that could create this software."
Peter stopped and surveyed the room. The VCs were all in various states of contemplation. Peter almost imagined he could smell acrid smoke in the room from all the wheels turning. There was a long and very uncomfortable silence. Vincent was the first person to talk.
"So," he said. "What you're saying is that this is the perfect data structure for the Internet."
Peter was stunned. They had bought it. Not only that, in their minds, this was connected to the hottest market in the galaxy: The Internet. The Silicon Valley VCs were falling over themselves to invest in Internet companies. Now suddenly Peter and Todd had been clumped into this happy bunch of massively financed companies. Of course little things like how to make money were almost irrelevant when it came to the Internet. It was pure hype, in its most simple form. Peter felt a little illuminating was required.
"You have to understand that what I'm talking about is not very flashy. It's plumbing. No one is going to download our software from the web and turn it into a consumer craze like Netscape or RealAudio. The real customers for this are other people who are creating Internet software. But if you do it right, you could become the defacto standard for how interactive data is transported across the web. It could be a licensing opportunity on a level with PostScript or ftp."
The VCs contemplated some more. Licensing was good. Licensing meant guaranteed revenue streams over many years. But not flashy meant possibly low valuation, and possibly a hard sell in the public markets. Plus, no one was going to wind up on the cover of Upside or Wired with a plumbing company. VCs, for all their financial acumen and careful style, still secretly craved glitz and glamour. Plumbing companies did not cause people's eyes to bug out at cocktail parties and Hollywood premiers.
Vincent leaned in with a concentrated expression on his face. "How big of a potential market do you think this could be?"
Peter had the flip answer ready to fire. "How many data packets do you think just went across the Internet?"
Someone on the other side of the room whistled quietly. It sounded like a great answer, full of size and scope, but it actually was relevant to almost nothing. For all the hype about the Internet, industry insiders knew that most of the data that moved across the Internet each day was actually good old boring email.
Still, it made for a great answer. One of the partners piped up from the back of the room. "What kind of a team do you think you would have to put together to get this rolling?"
Peter wasn't ready for this kind of boring, management question. He decided a quick deferral was in order. "Todd, what is your feeling for the engineering team you would have to put together for this?"
Todd harrumphed a couple of times, and then turned and silently questioned Paul next to him. He gave a noncommittal shrug. He was stuck. Slowly the answer came out of him. "Well, let's see. We would probably need another networking guy, a good protocols jock. Um, then we would need some sharp database guys, and a language expert. Paul is unbelievably sharp on the objects, but there are the wrappers and APIs, which would probably consume another head." He stopped and nodded his head silently for about five seconds. "About ten heads I think."
There was more silence as the VCs consumed this new information. Everyone knew what was rattling though their heads. Each engineer's cost to the company was probably $125,000 dollars "fully loaded," or including ancillary costs a year. That was $1.25 million a year that had just been tallied. There was management and marketing, which probably crawled the cost up to $2 million, The VCs didn't want to finance a company for less than a year, so $3 million was probably the starting line. They had just entered the wonderful world of "seed financing," the money that would initially fund the corporation. The hardest part of the seed round was that with no idea, no product, no launch plans and no hard expenses, it was almost impossible to set a valuation for the company. The valuation was crucial, since it would determine how much of the company the VCs would get for their investment.
Peter realized that they had unintentionally entered the first round of the relationship known as "the bob-and-weave." This phrase came from the early rounds of a boxing match, when the combatants would dance around each other, parrying and feinting, looking for the weakness that they could exploit in later rounds. The VCs were now circling around the yet-unborn company, looking for reasons why they should get more of the company pie for their efforts.
Peter realized that they were charging into this part of the relationship without any ammunition. He decided a strategic retreat was in order. "You know, we have some slides that we made that explain the concepts and vision a little better. Maybe we should hold off plowing into this too deep until we show you those. It builds a little more structure around the basic ideas of the company."
This seemed sensible enough, except for the fact that the slides didn't exist. Todd mouthed unmentionables in the general direction of Peter. Paul was now fully convinced that he was on the Amtrak to Hell. He had no idea how Peter had managed to dance around the issues so far, but he was terrified as to what might actually appear on those slides.
Vincent charged right into the breech. "That seems perfectly agreeable. Why don't we plan on a breakfast meeting tomorrow morning, and we can all see this presentation you've created."
Damn. Peter was gambling that they would want to see the slides when they got back to California, after the whole COMDEX thing was over. He assumed that the VCs would be booked solid while they were in Las Vegas. Vincent had just shot one past him when he wasn't expecting it. There was only one way to play the hand he had just picked up.
"That would be great. What time would like us back here?"
"I think a nine o'clock meeting would allow us enough time to go through this and still make it to the floor to see some more people."
"Great, nine o'clock it is then. Guys, we should probably leave now and make sure we get our beauty sleep."
Todd and Paul lurched up from their couch and walked over to Peter. Todd was blasting him a withering look. It was starting to resemble the “you’re a ridiculous person” face. Peter figured he better get him out of the room before he started the meltdown. They all quickly waved to everyone, shook a few outstretched hands, and then retreated out the door as fast as they could. The door closed behind them and Todd turned his full wrath on Peter.
"Are you INSANE? We don't have any slides. In fact, we don't even have any ideas that we can put on the slides if we had them in the first place."
Paul was leaning against the far wall, slowly collapsing towards the floor. Peter held up his hands. "Look, it was the only way to short circuit the meeting. I gambled that they would be too busy to meet with us here at COMDEX."
"Remind me not to gamble with you any more," said Paul from the floor.
"Look," said Peter. "This is seed financing. They care more about us than they do about any specific product plans. All we have to do is come up with ten solid slides, and we're in. Ten big picture, big concept slides that tie together roughly to give an idea of where the company is going."
Todd looked at him. "Oh gee, is that all."
"Ten slides Todd, that's all we need. Then we can relax."
"I'm never going to relax again in my life," said the voice on the floor...
Peter and Todd sat in the room and stared at the laptop in front of them. They had quickly fired up the computer the second they returned from their meeting. Paul was on the couch, pretending to sleep but really imagining Lazarus bursting through the door with the hounds of hell slobbering in tow. Peter and Todd thought about letting Paul slink back to his room, but there was the off chance that they may need to put some actual facts in the presentation, and Paul seemed to be the only person who actually had a feeling for the software.
Peter and Todd continued to stare at the screen in front of them. Power Point was successfully purring away, but nothing was being typed. Peter and Todd stared at the screen, then stared at each other, then back to the screen, Nothing was happening. They stared over at Paul, half asleep on the other side of the room. "Paul, wake up."
Paul grumbled, then cracked an eye. "What."
"Want to give us a quick crash course in distributed objects?"
"Not particularly. Any other questions, or can I start to panic now?"
"Look," said Peter. "We just want to get some basic terminology and concepts to put in the presentation."
"Great, what do you have right now?"
Peter and Todd looked at each other. "Well, nothing actually."
Paul's other eye cracked open. "Nothing?" He looked at his watch. "You have been at this for two hours. What exactly have you been doing?"
"Well, in our defense, Power Point has crashed on us twice already."
"Tell you what. You two do the first five pages, and I will do the next five." Paul rolled over, sighed dramatically and went back to pretending to sleep.
Peter and Todd turned their attention back to the computer. Peter tapped absently on the keyboard. "Okay," he finally said. "Let's start from the beginning. What do we feel the mission or goal of this company is. One of the things the VCs are going to want to know about our start-up is what the religion is. Why do we want to start this company? Why do we thing we are better than everyone else?"
Todd looked at him. "Are we better than everyone else?"
“Look. There's a fine art to starting a start-up and having it be palatable to the venture community. Rule number one is passion. You have to look like you are on a religious crusade, a quest to create passion in the hearts of the consumer.”
“Easy for you to say. We have no idea who the consumer is in this case.”
Peter leaned in to the computer. “Not relevant. As I said before, all we have to do is prove that there is a market, and the assumption will be made that there are consumers. If the forest is big enough, no one will bother with the trees.”
Todd snorted. “You have heard of the expression ‘the devil’s in the details,’ right?”
Peter was waving his finger slowly in the air. His fingers descended on the keyboard. They hovered above the laptop for a moment before he started lightly tapping away on the keys. Across the top of the first slide he typed “Current Internet Paradigm.”
Todd’s head sank into his hands. He groaned.
“Oh God, it’s the ‘P’ word.”