In his latest email newsletter, Mahalo CEO Jason Calacanis discusses “How To Handle Layoffs.” It is a topic he knows too well, having had to go through a layoff of 10 percent of his staff earlier today. After repeating the text of his blog post announcing the layoffs, he offers some advice for other entrepreneurs on how to do it right. The email newsletter is reprinted below in its entirety.
Update: Why this is news. There is a lot of discussion, even outrage, in the comments and elsewhere about my decision to post this email, against the express wishes of its author and his subsequent request that it be taken down. We are not going to do that.
Like it or not, this document is news. Its author, Jason Calacanis, is the CEO of Mahalo, which announced a layoff yesterday. (He is also a TechCrunch partner apart from Mahalo in that we put on the TechCrunch50 conference togeher). At the time I posted this on Wednesday at 9:45 PM ET, the Mahalo layoffs were being discussed so vigorously that the topic was at the top of Techmeme. Although Calacanis had already written a blog post on the subject, he went into much more detail about why he felt he needed to go through the layoffs and how he went about doing so in the email. He also updated in the email how many people are still employed at Mahalo (30 full-time, 50 freelancers) in response to some reports.
The email went out to nearly 9,000 people. It was not a private email. And Jason Calacanis is not aprivate individual. He is the CEO of a high-profile startup and an Internet celebrity in his own right.
More importantly, the email shed light on an event that had happened earlier that day and that many media outlets were reporting on and speculating about. Here was a document from the CEO himself outlining his inner thinking on what had just happened. It was news.
I decided to publish the it in full, unadorned because it speaks for itself. Publishing it was no different than what we did when we recently put up Jerry Yang’s email to employees about the latest layoffs at Yahoo. Nobody complained when we published Jerry Yang’s email. Nobody thought it unusual for the Wall Street Journal to publish in full then-Yahoo SVP Brad Garlinghouse’s internal “Peanut Butter Manifesto” outlining the problms at Yahoo a couple years ago. News organizations big and small publish documents that come across their desks all the time. It is part of our job of informing our readers about events in the world.
There is no copyright issue here and there is no issue of me personally breaching an agreement. Nothing is off the record unless a reporter agrees that it is off the record prior to receiving information. I made no such agreement and Calacanis cannot unilaterally impose such restrictions simply by writing “Do Not Reprint” at the top of his email. Although I respect his desire in general to control who sees his email newsletters, in this case the news value of the document outweighs his personal wishes.
Beyond the layoffs at Mahalo, which are tiny in the grand scheme of things (six people), the email speaks to something that is happening across the startup economy. Every startup CEO is at least thinking about the need to cut back right now, if not going through the same ordeal that Calacanis had to go through. Others can learn from his experience. He actually has some good advice. Read the email. The fact that he was able to minimize the number of layoffs to only six people and how he did that is far more interesting than whether or not TechCrunch should have published the email in the first place.
Location: Mahalo HQ, Santa Monica, CA
Wednesday, October 22nd, 6:10PM PST.
Word Count: 3,381
Jason’s List Subscriber Count: 8,889
List management: http://tinyurl.com/jasonslist
Message type: Startups
Forwarding instructions: startups, VCs
Republishing: PLEASE DO NOT REPRINT
———————–
Given the challenging economic environment, we’ve decided to make some pre-preemptive cuts at Mahalo.
Although we’ve got a significant amount of cash on hand and the business is ahead of schedule in terms of traffic (4m uniques a month, double where we thought we would be at this point), we’re fairly certain that the advertising climate for the next two years will be severely depressed. To ignore this obvious fact would be irresponsible.
We’ve laid off a just under 10% of our full-time staff, cut our overhead by doing smart things like renting desks (we have six desks/offices available fyi), and reorganized our editorial department to focus on freelance positions over in-house editors. The net result of the effort is we are giving Mahalo another year of “dry powder” (or runway) to complete our mission.
We can now operate past 2012 even if we never make any advertising revenue, and truth be told, building advertising-based companies is my specialty (the last two, Silicon Alley Reporter and Weblogs, Inc. each broke 10m a year revenue between their third and fourth years). Perhaps we’re being too conservative, but I’ve rarely heard of companies that went out of business because they made cuts too early, and I’ve heard of many who have reported the opposite.
As the CEO of the company, the responsibility for these cuts is mine and mine alone. Obviously, I did anticipate that the market would correct and that is why we raised $20 million over two rounds of funding before we launched. That move ensures that Mahalo will be able to get to profitability and ride through what is sure to be a very deep and painful recession.
While I anticipated and prepared for the ‘internet winter’ we’re now facing (you’ve read my posts and e-mails about the startup depression, I’m sure), I failed to realize how bad the situation would get. It’s much worse than I thought it would be, and ignoring market conditions today would only mean deeper cuts down the road.
It’s my responsibility to make this hard decision, and I don’t take it lightly. To the people impacted, I’m very sorry that I wasn’t able to anticipate this better. It’s my fault and I’m sorry that you’ve got to bear the burden of my inability to better prepare.
Update: We still have 30 full-time folks in our office and 50+ full-time freelancers–so the reports of us cutting 1/3rd of our staff and having only 10 people are incorrect (gossip bloggers incorrect…what?!?!).
How we handled it
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Since many firms are rightsizing–or considering rightsizing–their operations now, I thought I’d try to explain how we handled the issue at Mahalo as openly as possible. Additionally, I thought I would go into how I handled it at my first company, Silicon Alley Reporter, where we cut our staff from 70 to 15 people over the course a long, painful year. My hope is that by getting into some of these details, I can share what I’ve learned about this painful process, and that you might be able to give me feedback on how we did and what we could do better.
The timing of the economic downturn and the need for these layoffs could not have come at a worse time for me. As many of you know, I’ve been out of the country for over two weeks visiting Athens, London and Seoul. We did 90% of reorganization while I was, quite literally, traveling around the world.
Speed
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The most important thing to realize in a situation like we’re facing is that, chances are, you cannot act too quickly, but you can easily act too slowly. For this reason, I decided that we had to come up with, and execute on, a cost-savings plan within two weeks. There is little upside in pushing out hard decisions like this slowly because of the simple fact that you’re burning gas while you’re deciding.
If you’re going to make cuts, set a time table based on analysis, strategy, debate and execution. For this process, I gave us about five days to analyze our situation and five days to develop a plan–there was some overlap obviously. We spent two days debating the right strategy and we executed the majority of the plan yesterday.
Again, there are four steps: analysis, strategy, debate and execution.
Emotion
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The six worst days of my professional career, on an emotional basis, were the four days I laid people off at Silicon Alley Reporter, the day I switched the name of Silicon Alley Reporter to VentureReporter, and yesterday when we did our layoffs/reorganization at Mahalo. There is nothing worse than looking into the eyes of the team that you’ve cultivated, challenged, pushed, and won and lost with, and having to tell them that they have been cut from the team. I’m sure this is how the coach of a sports team feels like at the end of training camp when many times they have to let go of great people who’ve done amazing work, but due to circumstances, they can’t keep them on the team.
It’s emotional, it’s personal, and it sucks. I’m not one to get depressed, but I would be lying if I told you that I haven’t been depressed about having to do these layoffs. While emotion is great when you’re in the heat of competition, it really doesn’t help that much when you’re doing strategy work. As such, you need to get the members of your management team to agree that you’re going to pursue your very difficult job with as little emotion as possible. If it helps, pretend you’re an outside consultant and you’ve been given the task to “save the company” with these cuts–because that’s not far off from the truth.
In other words, try and detach yourself from the emotion of the situation so you can make the right decisions. You’re going to have to tap into that emotional stuff later anyway–conserve it during your analysis and strategy.
Analysis: Assessing where you’re at and setting a goal
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The first step was getting out our P&L and looking at each line item in detail. For our business, we have a large editorial group, a modest technology team, almost no marketing costs except for our Mahalo Daily video show, and extremely tight overhead. We haven’t built our sales group yet, so that line item doesn’t exist. We do have some modest Google Adsense revenue which we have been testing for the past couple of months.
We had exactly three years of capital in the bank when we started this process, and while that is 2-10x the runway of most startups, I set the goal for the company to reach four years of runway. Absurd? Too conservative? Perhaps, but I’d rather be conservative until I know what exactly is going on in the market.
In order to get there, we needed to do some combination of cutting costs and increasing our revenue.
The goal was now set: four years of runway.
Analysis Part Two: Line by lining your P&L
————————
It was fairly clear in looking at our budget that we were spending two editorial dollars for every technology dollar. Our focus on editorial is what got us to four million unique visitors a month, and a nice loyal base of users at Mahalo.com, but the truth is we’ve been underspending on technology. This made it very clear to us that we had to cut the editorial spending as much as possible while maintaining the editorial integrity of our product.
The truth is that the massive editorial we’re building wasn’t getting us the bang for the buck that our technology was at *this* moment. At different points, investment in technology, editorial, or marketing can grow your business and it’s important to not get locked into a specific amount of spending on any one of those items. However, when you have venture capital–and a large amount of it–you can avoid the issue. This is the unhealthy truth about having outside investment: it distances you from the truth.
As a venture-backed entrepreneur, you have to be able see through the fog of millions of dollars of investment in order to find your way sometimes.
Question every dollar you’re spending and ask yourself: “Is there a better use for this dollar?”
When we “peeled back the onion” of our editorial spending, it became very clear that our most efficient work force was not the group of editors we had in our office, nor the remote workers we have in Manila (doing data entry type work), but rather the $10-12 an hour “remote guides” we have working from home. These editors cost us, all in, less than half of the folks in our office due to things like overhead, benefits, lunch, and equipment. The workers in Manila are half the cost of our “remote guides,” but they are 1/2 to 1/4 as effective (depending on the task).
This should have been more obvious to me since we pioneered the work-from-home model at Weblogs, Inc., where we had 300 bloggers working from home with only three or four people managing them–a 75 to one ratio (Judith Meskill actually managed 150 at one point herself God love her!).
Of course, when you’ve got a lot of venture capital and you want to grow fast, sometimes you give up on the most efficient model for a model that goes faster. That makes logical sense: overspend to take marketshare. Having people in the office was more costly, but it did get us to over four million users a month and 100,000 pages built. When folks pull up a list of “future search companies,” we’re always number one on the list because of this investment in content. So, it was well worth it.
In phase two of the company–and given the economy–we had to rethink our strategy.
Next we looked at our Mahalo Daily video show and realized that we were actually covering about 25% of the costs. Not too shabby, but not enough to justify a project that is not core. Since it is getting over two million views a month–25 million a year–it would be a shame to stop doing it. We asked ourselves how do we get this closer to break-even? It became fairly clear that cutting some costs here and getting closer to break-even–say to 50-70%–would be a good idea. As such, we moved the video editors from full-time to contract basis. Problem solved.
Strategy Part One: The obvious stuff (i.e. office space)
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The most obvious things we found on our P&L were operational things regarding our facility: office space, phones, servers, etc. We swapped our communication systems out and saved $1.5k a month, we rented out a bunch of space, we cleared out some other offices to rent them, and we cut down on non-essential travel (think: my never-ending speaking gigs). The saving here was solid so we moved on to the hard stuff referred to coldly as “human capital” by accountants. People.
Strategy Part Two: The hard stuff (i.e. people)
————————-
The editorial analysis above gave us a clear area where we could save a lot of money: by moving aggressively to a freelance, work-from-home workforce. This also gave us a fairly good idea of how to handle our layoffs and cuts: try to do a reorganization where we shifted our full-time editors at our office to work at home freelancers. Instead of simply laying off a bunch of our editors we could offer them the ability to work from home as consultants.
The good news? Most of the editors took this offer to become freelancers, and in fact many of them seemed to have preferred it. Some were justifiably not happy with it.
In life, sometimes you have to learn things two or three times. One thing I’ve learned two or three times now is that writers, in large part, like to work from home in their pajamas with a big cup of coffee and their loved ones by their side. I know this to be true because most of my e-mails to you guys come when I’m sitting in the garden with my laptop, a cup of joe, and Taurus and Fondue curled up at my feet.
Must. Learn. To. Learn. From. My. Learnings.
Strategy Part Three: Revenues
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We immediately started running more aggressive Google Adsense, and we doubled our revenue. Great for the bottom line, not great for user experience. We’ll keep thinking that one through obviously. Additionally, I’m personally working on five content-partnership type deals that will drive revenue. If we land one of them, we’ll cut 10% of our burn–I’m sure I can close at least one or two of them by the end of the year.
Bottom line: We’re getting focused on revenues a little earlier than we thought we would, and that’s never a bad thing in my mind. However, our goal is to build a service that has 7-10m unique visitors a month. We don’t want to get to break-even and stay for 4m for ever. That’s a nice business, but we want to build an EPIC business.
Debate
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This past weekend, the day after I got back from my trip, I had my management team over to discuss what strategy we would execute. It didn’t help that I was massively jet-lagged, but we got through it. We discussed cuts and what the company would look like after the reorganization. We decided to do the cuts at the end of the week, but after making that agreement, I decided we would do them on Tuesday in order to avoid it leaking and in order to get the company focused on the product roadmap again.
The fact is, too much debate is probably not going to help. As the leader of the organization, you can take all the information in and make a quick decision. If you cut too deep, you can hire folks back, and given the economy, it’s better you secure your company’s survival right now and think about scaling up when the market gives you some signs of hitting a bottom. There is no sign of a bottom right now–despite what the clowns on CNBC might say.
The bottom is when Google and Apple miss a quarter and/or lay people off.
The bottom is when unemployment numbers go down and consumer confidence comes up (not the other way around).
The bottom is when the massive wave of variable, ARM mortgages come up in 2009.
Execution
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Having done layoffs four other times there are specific mistakes I’ve made and lessons I’ve learned. They are:
1. Don’t spread layoffs over multiple rounds: This is a horrible idea because it creates massive fear and uncertainty inside of your organization. If you’re going to do layoffs, do them once, do them quickly, and explain to people that you’re doing just that. At Silicon Alley Reporter, I cut and waited for revenue to come back–it didn’t. So I cut some more and waited some more. Nothing. I did this four times and it created an environment of constant depression and fear inside the company. If I had more experience back then (I was only 29 years old), I would have looked at the 500k in revenue and said “we’re going down to 10 people and we’ll build back up as the market allows us.”
2. Don’t lay people off one at a time, do it as a group. When I did layoffs at Silicon Alley Reporter the first time, I brought people in one at a time thinking it would be more humane. I thought I’d give folks more one-on-one time. The result was that folks were waiting at their desks and talking to people on IM the whole time waiting for their call to come into my office. It’s best to ask all the affected people–and the folks not affected–to come into the room at the same time. Explain what’s happening–that you’re having layoffs or reorganizing–and let the folks who are not affected leave.
3. Don’t sugar coat it: You need to be 100% honest and up front with people about why you’re doing it and what your decision was based on (i.e. how you decided who to keep and why, what cuts you made and why, etc). Give folks as much time as possible to discuss the issues together as this is going to be very emotional and brutal for everyone involved–including you.
4. Cutting salaries over headcount is *generally* not a good idea: If you cut people’s salaries 10% across the board, everyone in the organization gets really pissed off because they either can’t cover their bills or they have to downsize their lives. You then have your best folks looking for jobs and the folks who can’t find jobs staying at the company. You just lowered your effectiveness and that sucks. It’s much better to layoff the folks you need to and keep the folks you have happy and focused on completing the mission. There are a few exceptions to this, including sales people and senior management. If you’re going to face a radically different market, you might need to reboot your comp plan for sales for everyone to feel good about it.
5. Be as generous as you can: Give severance even though you don’t have to. Vest as much extra stock as you can even though you don’t have to. Offer freelance work to as many folks as you can. Offer to give amazing references to everyone on the team and to introduce them to as many potential employers as you can. If you think there is a chance that you’ll have open positions available again at some point, offer them to people.
6. Don’t drag it out: It’s better to do these type of things at the end of the day, and if folks are done with their questions, let folks leave. Folks have families and a lot of issues to deal with, and there is no need to keep them around for the entire day or for a couple of more days. The folks who are left can clean up the loose ends.
7. Get everyone focused again: After the layoffs, you have to make sure everyone understands what the goals are–even if they haven’t changed–and get folks ready to kill it again. You can’t expect folks to not be in some form of shock for a bit, but you have explain to them that the reality is that the company must march on and complete its destiny. It gets easier over time.
Wrapping up
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Frankly, I was wondering if I should even write this e-mail. It’s very personal and hard to do these things, and since I’ve done it so many times, I’m thinking these insights might be helpful to you, my loyal friends.
In related news, it’s interesting to watch the negativity and obnoxiousness of some bloggers and anonymous commenters while these layoffs have been going on. You would think that during times of hardship, folks would attempt to take the high-road and be supportive of each other. It’s amazing to me how on blogs people just lose their empathy. Almost everyone is going to be suffering during this historic time and it’s best, as a group, to support each other.
I’m so glad I moved to this cozy e-mail conversation with all of you guys. :-)
The technology industry is a small community, I’ve learned, and when things go bad you can really tell what people are made of. Some folks are incredibly supportive while others take the opportunity to slam folks. Being an entrepreneur–creating something from nothing–is one of the hardest things a person can do. If folks are out there trying they deserve our support.
Be good to each other.
Note: Please feel free to forward this to folks you think it would help, but please don’t republish this on the web. Note: If you want to subscribe to my email list you can do so at
http://www.tinyurl.com/jasonslist
______________________________
Doesn’t it specifically say not to republish it on the web?
Another BS article from the king of tech-less nonsense, but with superior headlines, dot com go no-where fast, bubble boy king of San Francisco excess, Eric, the pintsize import, underling to lawyer moma’s boy Arrinton, privileged do-nothing except pontificate endlessly worthless sacks of red wine and microbrew snack appetizer, geek faking turds.
Good point. What the Internet needs is mature, thoughtful insight. How is it you don’t have your own company already?
Sorry, my hemorrhoids are flaring up, again. Disregard my post.
and doesn’t it always mean that it will be republished everywhere ASAP?
“Doesn’t it specifically say not to republish it on the web?”
In relation, it works the same way as saying “don’t tase me, bro”.
Bull – Shit
Come on. TC and JC are business partners… Mike, JC and Erick are friends… How could this post not be an obvious self-promotion? JC is no celebrity, but to TC is good to promote him as a celebrity. Just the most arrogant highlights:
Erick: “He actually has some good advice. (…) And Jason Calacanis is not a private individual. He is the CEO of a high-profile startup and an Internet celebrity in his own right.”
Jason: “building advertising-based companies is my specialty”
This is just ridiculous and JC advices here are quite obvious. This email is no news. The only news here is how many people don’t actually see this as self-promotion and keep arguing with Erick about copyright. It’s so funny. If this was less obvious I would think Erick and JC were arrogant jerks. But no. They are just having fun and probably laughing a lot right now. ;)
Doesn’t it specifically say not to republish it on the web?
I don’t work for Jason Calacanis.
Are you sure about that? You might want to check with Mike Arrington to see whether or not you work for Jason.
erick i’m sorry to hear that you were one of the ones cut.
shake it off, that mahooloo thing was a bunch of hooey anyway.
You should ask MA how many laws you broke.
Not a fan of the reposting – seeing that if people wanted to hear from Jason they would do like I do and subscribe to his mailing list. //g
“Republishing: PLEASE DO NOT REPRINT”
Did you not see this or are you just ignoring his request?
I am ignoring it. He is the CEO of a startup that just went through a layoff today, and he emailed his thoughts on the matter to almost 9,000 people. This is not a private email.
Yeah, saves me from having to subscribe to his e-mail list.
The fact that it is newsworthy does not mean you can copy it in full without his permission. You can quote from it briefly for the purpose of making comment, but running it in its entirety is a violation of his copyright. It’s not even a close call. What you’ve done here is illegal.
That’s like saying “Gee, I have this book, but lots of other people have it too. I guess I will just photocopy it and give it away”.
I know that this is their business/brand…but damn he sure has time to spend typing all this up and thinking about it. Instead, he could have been possibly thinking of different avenues to SAVE or KEEP his employees instead of preaching to others on how to do layoffs.
I think it is how Mike A. said it…these web 2.0 layoffs are just to cut the underperformers out.
He wrote about spending a week going over the budget, layoffs and reorganization, and you’re presuming the hour or two he spent on the newsletter would have saved the company?
Calacanis doesn’t need a blog, using TC’s audience is a much easier way to get his message out.
wow another book by jason. was this really necessary?
I remember way back when the executives and management took pay cuts before the layoffs happened.
Now the layoffs are to protect their excessive salaries.
Honestly, Erick?
I’m all for openness and sharing of information, and see no problem with your intentions here.
However, if one of your colleagues, friends, and business partners respectfully requests, for the second or third time, that others not republish his own content, don’t you think it might be professionally and personally courteous to respect his wish?
It’s obvious that this is what he’s trying to avoid, and he appears to spend a large amount of time on each of these tomes. To see leaders in the blogging and tech field treat Jason this way is disappointing and, frankly, does not help to gain converts to new media, blogging, tech, or your business.
It wasn’t an easy thing to do. I like Jason and am conflicted, frankly. We are partners on the TC50 conference, which we worked together closely on.
But ultimately my responsibility is not to my friends, colleagues, or sources. It is to you, the people who read TechCrunch.
Is this news? Yes. Is it relevant? Yes. I really had no choice but to post. Jason is a publisher. He should understand that. And I hope you do too.
TechCrunch has been successful for a number of reasons, including its possession of great writers.
But I think it’s really important to note that while, yes, y’all should be mindful of your readers and the news they want to see, you should also be loyal to three other entities that got you to where you are today: friends, colleagues, and sources.
Obviously, you are not worried about (copy)rights (and really any other type of litigation, etc., which is another kick-ass aspect of this blog), but I think it’s pretty low to disrespect a friend and colleague’s wishes like this.
Erick, I respectfully think your priorities are a bit out of whack. I’m quite a loyal reader of TechCrunch and have been for years, but I would much rather see you honor Jason’s wishes than publish it here for my newsreading pleasure.
Erick, you’re full of it! Couldn’t you even do some thinking and add some original thought to the post. You just copied his work verbatim and you apparently feel no shame about doing it. You’re actually defending your actions. Incredible!
Jason. You’re only conflicted because you’re a complete fucking idiot, and your resolution of reality is 20/4000.
Dude, TC is barely over 3 yrs old and you are a sophomore in college. You’re either a total dork or a liar.
Tom — I guess I’m a total dork. Some people take an interest in things before college, you know.
You could have rewrote and just given the cliff’s notes of what Jason wrote. Respect the copyright. The writers of TC are great and I have no doubt you could have written something great about the email but republishing it is lazy and unethical, I think more of TC than that and you should as well.
Erick, I agree with many of the others who have posted here.
What you did was *potentially* illegal, but definitely scuzzy. You get a short term game (oh look, a sorta-scoop!), but at the (yet further) risk to your long term reputation and the dwindling reputation of TechCrunch.
Basically, you’re descending to the depths of Valleywag. “Anything Garnering Pageviews is Fit to Print.”
I would be reluctant to hire you. I’m sure others would as well. “What would he do to get a leg up?” No, scratch that, maybe investment banks would hire you. But other companies? Probably not.
Next time, be respectful, be smart… use an excerpt.
(and no, I’m hardly a fan of Jason in general)
Erick,
As I mentioned in my email to you, I would appreciate it if guys would not republish my copyrighted material.
You don’t have the rights to my email newsletter and I’ve specifically asked to not have it online. Do I really have to send a DMCA letter to your ISP?!?!
come on.
best j
See above. Would you rather that I post an excerpt? Because in the past, you’ve requested that your emails be published in their entirety.
I don’t want my email newsletter republished. Please respect my wishes. If you want to quote 75-150 words or less fine.
You’re interfering with my ability to run my newsletter business if you republish against my wishes.
why would anyone subscribe if they can get it here? Come on… really.
Why are you arguing about this in the comments section of the post? As if you couldn’t just pick up a phone and call him…
WTF JASON I’m confused ????
are you running a newsletter business of 8,889 subscribers or a $20m venture backed company
What business are you in? MAN GET YOUR FUCKING MIND RIGHT
“You’re interfering with my ability to run my newsletter business if you republish against my wishes.
why would anyone subscribe if they can get it here?”
So Jason, are you trying to get as many subscribers as possible? What is the newsletter business? When you started the newsletter you wrote:
“Today the email list has about 600 members, I’m going to cut it off when it reaches 750. Frankly, that’s enough more than enough people to have a conversation with. I’m going to try and build a deeper relationship with fewer people–try to get back to my roots.”
What changed?
Here comes the fake fight to make it seem like Calacanis and Arrington aren’t scratching each other’s backs. Just like the bulls**t voicemail last year about this time when Jason got kicked off the Gilmor Gang.
Remember how “j dawg” thought everyone should have access to those shows and that Gilmor was in the wrong for keeping it closed or private. My what a difference a year makes.
This is more effective PR and traffic boosting but very poor acting, and kind of undermining to our (your pathetic users) collective intelligence.
Team America 2:
Arrington and Jason as sworn enemies but secret lovers. @@£******
Jason, you should definitely send a DMCA takedown, out of principle if nothing else – otherwise, you set a bad precedent (selective enforcement).
Of course, this is not legal advice, I’m not a lawyer, blah blah blah. You should consult legal counsel–call up Mike and see what he says? :-)
Deeter, go back to 4Chan.
Does this violate his request to not have it republished? yes. TC should remove this per Jason’s request.
I think a summary could have been done to try and “report” what was written with a link to sign up for the newsletter rather than just being lazy and republishing the letter.
I appreciate Jason’s candor and that is missing from people today – oh that and loyalty. In my world relationships still matter.
Why are you guys writing so much about this guy?
I really don’t get it.
Pretty sad, Erick. And unnecessary. You’d get just as many page views by posting an excerpt.
Mike post emails all the time. Emails from people threatening lawsuits and all. Those are ok, but this is not?
1. Great email from Jason … very informative and insightful.
2. I’m a little conflicted by the posting in the entirety. I think you’re on shaky legal grounds doing that.
Calacanis? Even I think he’s a complete idiot asshole.
Looks like a big publicity stunt to me.
JC is a walking publicity stunt., all he does is talk about how great he is, or the great things he can bring to us poor simple folk. Pretty sad that a company that supposedly can run for years without making a dime feels the need to fire employees.
Come on JC if you guys truly have the money then why cram so many ads down peoples throats when they use your POS search (if that’s what you call it these days) and why fire your top of the line employees?
To: Jason
From: Barack Obama
Jason,
Shut the fuck up you self-important piece of shit. You don’t know what the fuck you’re talking about, and I should know.
Barack
To: Jason
From: Sarah Palin
Jason,
You see the the Obama email. He is an Arab, and a Muslim. Holy Shit !!!
Please kindly donate your money to Republican campaign because I love buy clothes, makeup stuffs, and shits. Who doesn’t ?
Your Sweet Heart,
Sarah Palin
“After repeating the text of his blog post announcing the layoffs, [...]“
Erick, you DO know what a “blog” is and what an “email” is, right? Maybe you should do some research …
http://calacani...hard-decisions/
He repeats his BLOG post at the beginning of this EMAIL.
Right. Repost and/or link to the blog entry–as TechCrunch did in another entry. But, the email is private and is explicitly marked with a “do not republish” notice.
I can tell the difference. Can you? Erick couldn’t.
Calcanis is an asshole and Mahalo is a shitty business-model.
What’s the big stink on the re-post, its to fricking long to read anyway.
I did notice the comment about adding more AdSesense to Mahalo. Is it just me or does Mahalo sneekily place AdSense on the site so that you don’t quite know whats and ad and whats other copy or links. The CalCan guy seems pretty sly.
JM
PS: In all the platitudes of advice Sly offers, I think he forgot to mention his money daddy at Sequoia may have helped him think about doing a little pruning of humans.
Calcanofshit should be exported to Guantanimo.
The news that you feel you have an obligation to report is the first portion of the email, which was reported earlier today, about the layoffs.
The remainder is Jason’s insight into the matter. It’s not news that you’re obligated to reprint verbatim in it’s entirety. Summarize what Jason said in his email and be of service to him by allowing interested people to subscribe to his insight if they wish.
Doing that would be serving as a respectable news source and a valuable service to the tech industry.
Very well said, Shawn. I agree with what you’re saying completely.
You grew up too fast, yet your sensitivity on this matter speaks volumes. Erick didn’t just start a blog about tech, he’s been in the news biz quite a while; I’ll back his editorial prowess over yours.
Good point Shawn…
Yes, but where would the revenue-generating faux-controversy be in that? ;)
(That’s okay… I still love TC anyway.)
Jason – while I respect your wish to keep it from being re-published, it was sent to a massive number of people. I wouldn’t have had the opportunity to read it if it wasn’t re-published here.
With that, It was long and I read every word and can honestly say I have a real appreciation for how you’ve handled things and for your willingness to share it. This is something that will make the world a better place and I think TC’s republishing is in that spirit (hopefully).
Anyway – thanks for sharing it – it’s good stuff – the people who’ve had the opportunity to work with you should consider themselves very lucky – you obviously care deeply about everyone you’ve worked with.
“Jason – while I respect your wish to keep it from being re-published, it was sent to a massive number of people. I wouldn’t have had the opportunity to read it if it wasn’t re-published here.”
Do you realize how dumb this kind of thinking sounds?
You do realize that there are publications (WSJ, etc.) that have subscriber-only content? Do you feel it’s appropriate for someone else to republish their articles–their subscriber-only content–in full? They have a massive number of subscribers too. Does that then make it okay to reprint? I mean, there’s many people who otherwise can’t access the subscriber-only content!
At best, this is copyright infringement. At worst, it’s theft of subscription-only content.
Lets turn the rest of this comment thread into “guess how man laws Erick Schoenfeld broke” – correct guessers get a free subscription (HA) to Jason’s list.
GO!
Could it possibly fall under fair use?
Someone shut this douchebag up.
““guess how man[sic] laws Erick Schoenfeld broke”???
WTF cares. OMG, he broke a law, im calling the cops
You are a total douchenozzle and your site is an exercise in failure
@Alan – reprint in full as fair use? Four factors: 1) TC is commercial in nature; 2) copyrighted work was subscriber-only; 3) reprint in full, not summary or partial; 4) effect is non-subscribers now have access. Clearly fails all FOUR factors.
@Timmy – if you’re going to talk shit, at least have the balls to not post anonymously. But, thanks for playing, anyway.
it’s timmmy with 3 Ms; i will post however i care to post anonymously or not
And if your going to whine about laws of copyright, do it on your own shitty site b/c I don’t give a fuck
Ditto
Interesting article – he does have some good points thought.
$10m in revenue for Weblogs? That sounds great, but I think he sold the company for $25m right? That doesn’t sound good…
Personally, I would prefer smaller revenue numbers, and larger profit margins opposed to debt. Now that’s how you stay in business :)
This is so hilarious. I feel like I am watching this:
http://www.meta...ights_a_midget/
Sorry, having been on both sides of the desk, trying to come up with a rationalization is pointless and demeans the layoffee. I mean four years of runway? Come on…10%? What are you tithing employees? Did you take a 10% cut?
There are always areas to be trimmed, but to make it sound like you are now the ‘expert’ is further validation that there are those that lead, and there are CEOs of start-ups.
All of the idiots flaming Jason on here are jealous that he was able to catch the blog boom and ride a nice wave. He put in a lot of work to get his shiznit started and reap the rewards. You can all go back to your hobit holes (Mom’s basement) and keep the hateful comments to your self.
The admins should ban your IP.
“The admins should ban your IP.”
Yeah, *that* will solve the problem. Pure genius on your part!
Love it. “Dry powder” seems to equate to terms like “burn-rate” that were being thrown around back in 1999. When the jargon gets thicker than bullshit, you know the real “runway” is shorter than a 100 yard sprint, and the finish line is a long drop off a cliff.
Great idea about getting rid of the desks though. Inspirational move!
what’s this now, the wild west? Now TC is above the law and copyright and can publish whatever they want, justifying it’s “because we’re doing what’s right for our readers”?
oh, c’mon, for chrissake. You’re doing this because the two dozen banners on the right side of the page. Don’t be hypocrite pretending to be Robin Hood. The more views – and clicks – the higher the pay for the writers.
Did Erick added any opinion? No. Did TC contributed to the topic in any way? Absolutely nothing. Any relevant investigative/speculative material? Nada.
Copyright is a bad thing, but copy-and-past is even worse.
“Did Erick added any opinion? No. Did TC contributed to”
Did you passed your ESL class?
These laws are US laws, and you have nothing to do with them in anyway.
Also I don’t see it hurting Jason’s subscribers, but instead boosting it.
Jason’s right. He is explicitly stating what he considers fair use of his personal material. On the good/evil scale Jason is on the good side of this one.
If this newsletter was sent in an unencrypted email, I say its fair game to publish. Its attributed and given context by Erick, so I think it’s fair use. Perhaps Erick should’ve asked first.
Subscribing to Jason’s mailing list appears to be free, so what’s the pain, really? It might actually drive some subs. And Jason does love a soapbox, no?
I wouldn’t have seen this note otherwise, and I find it insightful. So, thanks for writing it, Jason. Thanks to TC for posting. The subsequent drivel by the fanboys and haters is quite fun, too.
(1) Please feel free to forward this to folks you think it would help,
(2) but please don’t republish this on the web.
Isn’t republishing on the web is like a “foward all”? :-)
Did he really want the mail fowarded to all people it could help?
This is a clear case of shitting where you eat…. I’m surprised TechCrunch has to go there. I guess all is fair in love and page views.
It’s so strange to have been through a bust and recession after web 1.0 and then be in this one. Big, big difference, not necessarily in a good way.
I got this in my inbox tonight. Like most of Jason’s emails it was intelligent, honest and helpful.
I personally feel lucky to get email advice/perspective from him. Being someone who is an pretty much an ‘outsider’ I can’t understand the animosity he inspires from some people.
All I see from Jason Calacanis is ambition, talent and generosity of time and advice.
Couldn’t agree more… I’m not in the tech industry, but wish my industry (biotech) had more transparent, visible, and generous leaders like jason.
besides being the interwebz… what’s with all the haters?
Comments are the bane of Web 2.0. Depending on the site concerned, they bring very little value to the original article. TC comments are read by all the industry names and it’s interesting to see their discussions on the articles. Unfortunately, the unwashed masses tend to jump in and fling all sorts of dirty insults around. If you haven’t anything intelligent and useful to say on the subject, please step away from the keyboard!
Ah, now “the elitist” steps in and asks us to remove our “unwashed bodies” from the comment threads. What a charmer. Should we now provide proof of “industry names” before commenting? I don’t see where it says, “Provide your *industry name*” in the reply form, but perhaps my eyes are just too “unwashed” to see it. Help me out, oh highly self-esteemed one. I just don’t see where it says that!
Michelle: That’s very kind of you. Thank you.
Jason,
I’m on your mailing list too but I don’t have a problem seeing this email republished after reading your comments above with Eric. I’ll explain why.
I’ve had to chase after copyright violaters several times but I did not resort to posting DMCA threats in their comment sections in order to “scare them down”. In fact, I always handled such disputes by email.
I don’t go saying in my posts, “Don’t republish this on the web” (I don’t have to since copyright is automatically conferred) and I don’t go dragging people down in public trying to shame them when they do violate my copyright. I speak to them directly or their ISP (if I can’t contact them) first.
I’ve *never* had to take it any further than that in order to get the posts in question removed. One such complaint of mine even led to an entire spam site being shut down. And here I am, not naming names or taking numbers. And I remember most of the names of the websites and owners quite vividly.
Life goes on.
So what I’m saying is you’re handling this all wrong.
1) Decide if the email list is always private or if emails can be made public. You have waffled on this several times, simply by *not* asking people to *not* republish them.
I too have republished an email of yours on my blog (don’t DMCA me, bro, it’s still up – and you said “Share with others”…so, OK, I did). You never said not to republish that one…so the fact that you then ask people not to republish other emails of yours doesn’t make sense, since all of them are about equally “personal” in nature…I think your vagueness and lack of one solid rule on it is making problems for you.
2) if you have a problem with a particular site owner republishing your stuff email or call him. No response? Contact the ISP. But copyright fights in comment sections on blogs are going to make you angry and the other person feel small and/or defensive so handle it in private if you can.
Reading your comments above with Eric makes you sound nasty – “Do I have to give you a DMCA?” and makes Eric look defensive and picked-on by you…all distractions that nobody really needs. Embarrassing to see that for both of you.
Misc. thoughts…
I think it would help you if you keep writing for your mailing list and let people republish the emails if they want since it seems to keep getting you more subscribers. Don’t protest, “Oh, I want to keep it small”- if you did you wouldn’t have let your list grow to almost 10,000 people from a mere 750 in just a few months. You could’ve stopped adding more people at some point. The emails that get reposted on the Web are doing that for you, and you keep adding more people as they sign up, so I don’t see where the conflict is. If you *want* more subscribers, this sort of reposting is what’s getting them for you.
Then, curiously, you call your email list “a business” …why? I hadn’t noticed you trying to “monetize” your emails…they don’t become a business for you until you do, right?
Lot of fun on this blog ! reading most of the comments i am starting to feel like beeing on some sort of people-hollywood-life crap blog :-)
By the way, who care about calacanis ?
I got bored after 2 mins…10% is death by a thousand cuts
News is news.
This is disappointing that Techcrunch reposted this. For that, I will probably stop reading this Valleywag wannabe.
Yes, it’s sad when you are being compared to Valleywag.
Next thing we know, that idiot Loren Feldman will be posting a video about this crap – only after he is finished blowing Arrington.
From everything valleywag says I thought this Calacanis guy was a real jerk, but this email comes across as compassionate and intelligent.
Garth: I’m actually almost 50% human… despite how Valleywag and certain other trolls might portray me.
At the end of the day everyone related to the layoffs/reorganization is going to do just fine. The folks we had to let go are talented and will get new jobs. I will be the greatest reference they ever have for the rest of their lives, and who knows if the market gets on track we might be circling back around to hire some of these folks.
It’s difficult to know what to do at a time like this because the economy is in uncharted waters. Almost everything we’re experiencing now is unprecedented… I’m 75% sure things will be worse than we expect. All we can do is tighten up our ships and prepare to weather the storm.
It’s sh@£ like this that turns us into trolls. PR should be a little more subtle. It smells real bad Jason. Real bad. We ain’t all hillbillies … son.
Yeah that is awfully toolish and a cheap way to generate content for your site. On the other hand, I just signed up for Jason’s email after reading his poignant letter. So there’s that.
Erick….Really? now
So, how many people do you think are going to be on Jason’s list after this post? – Great publicity stunt guys!
Is it right, is it wrong, is a publicity stunt? It happened, now get over it.
Jason, did you seriously expect this information wouldn’t get out when you sent it to 9,000 people? If you weren’t prepared for it to get put out there then maybe you shouldn’t have put it out there to anyone at all. It shouldn’t have happened but things that shouldn’t happen happen all the time. Learn from musicians- their music gets leaked all the time, but the best ones learn how to use it to their advantage. The person that is ahead of the game is on top of the game. Have a plan for what to do when it happens. Don’t do damage control after the fact. Integrity and privacy are two prized commodities that are not always upheld by others. Different people will always have different values.
Erick, I understand your job is to report the news, but at what cost? Your integrity, your ethics, your honor, your respect? How many people did you alienate in the process? Was it worth the price of reporting this bit of news? As a blogger maybe you believe you’re not held up to the same standards as traditional newsmen. I would beg to differ with that. In today’s ever-increasing digital news reporting marketplace you and your fellow bloggers become the first source for news and as this being the case you should hold yourself up to the same standards, if not better. This isn’t the wild west anymore and you can’t play fast and loose with morals and ethics. There are consequences to actions. Maybe today you won’t see them but you will eventually reap what you sow.
If this was a publicity stunt, bravo. Both of you gentlemen have just made a big coup in creating free PR and increasing buzz on both of your ends.
In the end this is a conversation about nothing. Essentially it DOES have to do with someone’s rights being violated versus the precedence of the news being reported above all else. Realistically, however, most likely no action will be followed up upon Techcrunch from Mahalo and all this yelling and screaming of i’m right/you’re wrong will amount to nothing.
Jason if you’re serious do something about it.
Erick if you’re serious back up your actions with legality.
And if none of you are serious then seriously stop the noise.
What are you all arguing about? Jesus, it’s quite simple! He asked for it not to be re-published on the web and TC has done just that. They should take it down and issue an apology. That’s it, move on.
I find it hard to believe that you would just blatantly ignore the request to not post this on the web. The man has a right to have a newsletter if he wants, and you have infringed on that. Really disappointing move here for TechCrunch.
Full of admiration for Jason’s words. I’ve done what he’s just done a couple of times myself and I think he’s just laid out a template for how to do it that I wish I’d had back then. As to whether it should have been republished: sure. It’s real news. The NY Times would have used it (although they may not have used all of it). I’d be surprised if Jason is actually pissed off about this, though. The whole episode reflects really well on him…
“But ultimately my responsibility is not to my friends, colleagues, or sources. It is to you, the people who read TechCrunch.”
Erick,
As a reader of TechCrunch, and subscriber to Jason’s mailing list, I’m asking you point blank to remove this. As you said, your responsiblities lie with the readers of TechCrunch, and as you can see, they’ve spoken.
-Ben
@ Ben, don’t you see it’s PR, and you Jason’s little bum puppet? Bend over.