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Livingston: And your financial future is contingent on them getting acquired or
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Williams: Right. After two years of pouring our hearts and souls into this, it
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seemed like a crappy option. Fortunately it didn t work out, though. There was another company in New York that was a startup but that had some funding we talked about merging with. And the group that was funding them actually gave us a bridge investment. They gave us $50,000 while we tried to figure it out. But that didn t seem like a good deal either. They wanted to do it, but we decided not to. (That company went away fairly quickly.)
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Livingston: Then you ran into Dan Bricklin. Williams: Yes. So this is December or January of 2001 and the second potential
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acquisition hadn t worked out, so basically we got to the point where we sat everyone down, and I said, OK, everyone is laid off as of today, including me. We had warned them a few weeks earlier that we didn t have money in the bank to meet payroll. Obviously when you are in that state, tensions rise a lot and morale wasn t good and relationships with my cofounder weren t good. I said, I am going to stick around because I took a half of a million dollars of other people s money. And we have all of these users. (The service was still running.) This whole time, this service is growing. In terms of users, we were getting more and more successful. Which also caused other problems in that we needed more hardware and we had all of these scaling problems. In January, right around the time that the rest of the company was being laid off, we did what we called the Server Fund Drive. We posted it on our website and it said, Hey, we know Blogger is really slow. It s because we need more hardware. We don t have the money to buy it. So give us money and we will buy more hardware and we ll make Blogger faster. Surprisingly, it worked really well. We had a lot of goodwill and people liked us and we had a good brand within our users because we were very personable and used the blog and we were just honest. We just said, We can t buy hardware, but we have plans and we are not going to go away if we can get past this hump, so send us some money. So people sent us money.
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Livingston: What was the biggest check you got Williams: We used PayPal, and I think we got bigger amounts from fewer
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people than we expected. We had several thousand users. 100 people or so gave larger amounts, and I am not sure what the absolute biggest was. We suggested $10, $20. Several people gave us $100, and then a company, CMP, which published Web Techniques magazine, offered to buy us a server outright, up to $4,000 worth. So between the users and them, we had around $17,000 to spend on servers, which is more than we had ever spent on servers, so it was a bonanza. It worked better than we had ever expected. We told people we were only going to buy hardware, so I wasn t going to use that to pay people. I just spent that money on hardware, but it got the site back up and running well and meanwhile we laid everybody off. Meg and I weren t getting along well at all and she decided to leave and everybody else decided to leave too.
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Livingston: So you had a major difference of opinion Williams: Yeah. I think a lot of that came back to the enterprise thing, which
she and some other people felt strongly was our best chance of making money. If I was the guy in charge and we were dying, it s reasonable to conclude it s my fault. And certainly there were other things I could have done. So everybody left but me. (A lot of them needed to leave since we couldn t pay them anymore.) Everybody left, and the next day, I was the only one who came in the office.
Livingston: How did you feel that morning Williams: That was a really bad time. Actually the day that everyone told me
they were leaving . . . I told everyone they were laid off and said, Work with me if you can. And at the time, everyone had already missed one paycheck, and they d had it. These are, of course, my friends, and we were hanging out all the time and we socialized together, so it s much more than just the employees. I think that same night I broke up with my girlfriend of 6 months.
Livingston: Sounds pretty grim. Williams: Yeah, it was just the craziest bad time. The good news about all that
was Blogger was still running and, with no employees, we didn t have expenses. So we went from having $50,000 a month worth of payroll, to a couple of thousand for our server infrastructure and our rent. It is probably closer to ten, between five and ten, but a manageable number, not paying me anything. I took some money every once in a while to pay rent, and I had long since put all my money in and credit cards and everything else, but that was actually a much more reasonable place to be because we didn t have to make $50,000 a month to pay people. We had to make a few thousand dollars a month. So then other ideas started being much more feasible, and I was in some other conversations. Now that we were known, opportunities came up. One of the first opportunities was a little company called KnowNow, who wanted us to build something, and later actually two of the people who worked at Pyra, including Meg, worked for this company, and I did a little deal with them to build something that was never launched. They killed the project, but it got me $35,000, which was like months of burn rate at that point. Shortly after that, in February, I ran into Dan Bricklin. Dan wrote me after reading my blog. We were pretty public in terms of our communication, so I posted when everybody left, and I wrote this whole story on my blog that was pretty widely read, Here s what happened: everyone s gone. It s just me. I got a huge outpouring of support from that, and one of the messages was from Dan Bricklin, who said that he thought what we did was great and he wanted to help. We ended up meeting at an O Reilly conference, which was in February 2001. We met and he basically agreed really quickly. He assessed the situation what I needed to keep going. (We had a lot of back bills at this point; we needed to pay our hosting bill to keep the lights on.) There were some confusing stories about what that deal was. Dan had a company called Trellix that he later sold, which was a web publishing platform.
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