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Hi, I’m Brad Feld, a managing director at the Foundry Group who lives in Boulder, Colorado. I invest in software and Internet companies around the US, run marathons and read a lot.

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The Feld Technologies Professional Services Agreement

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Dave Jilk, my partner in Feld Technologies, recently dug up a bunch of old stuff. I blogged one of the documents recently - The Simple Formal Beginnings Of Feld Technologies - and have a few other fun ones coming.

Today, let’s look at another example of a contract that we signed in the context of “keeping it simple.” Over the seven years we were in business, we used a very simple form we referred to as a “Professional Services Agreement.” This was the document that we signed with almost all of our clients. Every now and then we had to deal with something more complicated, but even large companies typically were willing to sign this agreement in 1990.

Over the life of Feld Technologies, we were never sued. We had our share of difficult client situations and were fired a few times, but were always direct and straightforward in how we dealt with stuff. We tried to always keep it at a business level and have a personal relationship with our clients so that when projects got into a difficult place, we could get together and work them out directly. And even when the answer was to part ways, we were always graceful about it.

The PSA shown above is our standard, but listing us as the client and MaK Technologies as the vendor. I believe it’s the first piece of business for MaK Technologies, a company co-founded by my long time and close friend Warren Katz. Dave and I met Warren through his wife Ilana, who was the employee #7 at Feld Technologies.

One of our clients was Monitor Company, at the time a young but very rapidly growing consulting firm in Cambridge. They used a bunch of Sun Workstations for all of their presentations (this was in the time of Harvard Graphics – well before the ubiquity of PowerPoint – which was completely inadequate for what they did). Instead, they used the Sun’s and Interleaf running on Unix. While we had a lot of hardware and networking expertise, we didn’t do anything with Unix (we were all about DOS and Novell Netware) so we subcontracted Warren’s company to help us with the Unix stuff at Monitor.

Warren and I have done many things together – some that have worked and some that haven’t. Twenty-two years later we still do business with a handshake. Warren has a great chapter about this in Do More Faster. Remember – keep it simple.

The Brilliance of The Struggle

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Ben Horowitz from Andreessen Horowitz has a beautiful post up titled The Struggle. He captures – in words – what many entrepreneurs, especially entrepreneurial CEOs go through. I’ve heard variants of it many times over the years and have experienced it myself in several companies where I’ve been the entrepreneur and many companies where I’ve been the investor. Ben states that there is no answer to The Struggle but offers some things that may or may not help.

I’d like to take it one step further and explain the brilliance of The Struggle. And I’ll begin at the end, by starting with one my favorite John Galt quotes.

“It’s not that I don’t suffer, it’s that I know the unimportance of suffering.” – John Galt

When you accept the complete and total unimportance of suffering, you can actually enjoy The Struggle. It’s just a step along the way, another experience in life, of the cumulative experiences before we ultimately die. Suffering, The Struggle, disappointment, failure, and self-doubt – these are all part of being an entrepreneur. And that brings to mind the famous Nietzsche quote.

“That which does not kill us makes us stronger” - Friedrich Nietzsche

Remember always that we all will die. And it’s unlikely that The Struggle will kill us. If we approach it the right way it will make us stronger. Here are a few examples from my first company, Feld Technologies (1987 – 1993).

Hyperion: While Feld Technologies was a software consulting company, the companies that installed the networks that our software ran on (mostly PC-based Novell Networks) were so shitty that we set up our own small network installation group. Some of our clients wanted to buy everything from us so we also sold them the hardware. We made about 20% margin on the hardware so this was worthwhile, especially since we were able to bill by the hour for all the time we spent on this stuff. People liked working with us – all of our new business either was “random” or “word of mouth.” We ended up working for a bunch of Boston-based VC firms and several of them referred us to their biotech investments. In the early 1990′s, biotech was white hot – these companies raised tons of money and spent it on crazy wet lab facilities, which included lots and lots of hardware. I can’t remember much about Hyperion other than they were out on 495 somewhere (it was a long drive) and they bought a bunch of hardware from us. They paid intermittently and one day we realized they owed us around $75,000 and hadn’t paid us in over 60 days. For another 30 days I called and kept getting promised checks, which never came. I vividly remember The Struggle – I was lying in bed with Amy in our apartment at 15 Sleeper Street (Apt 304 in case you were curious). It was the middle of the night and I couldn’t sleep. Amy could feel the wheels turning in my brain and asked me what was wrong. I told her I was worried Feld Technologies wasn’t going to make payroll because Hyperion owed us $75,000. I then went in the bathroom and threw up. It’s important to realize that it wasn’t that we were out $75,000, but the hardware had cost us 80% of this and we’d already paid our hardware vendor so we were really out over $125,000. We were a $1.5m-ish self-funded business at the time so this was a devastatingly large amount of money for us. After a sleepless night, on a totally empty stomach, I got in my car and drove out to Hyperion. They were still there (thankfully) – I then sat in the lobby until the CFO would meet with me, and I stayed in his office until he brought me a check for whatever they owed us. They went out of business a few months later.

Avatar: My parter Dave Jilk and I were at a gas station filling up his red Ford Tempo with gas on our way to Avatar in Hopkinton. We knew it was going to be a terrible meeting and each of us was incredibly anxious. We were in the middle of The Struggle. We’d taken on our first Mac custom software project and were using an RDBMS called ACI 4D which was new to us. It was one of the two choices on the Mac at the time (the other was Blythe Omnis) – each had their own version of suckage especially when compared to the PC-based 4GL called Clarion that we used for most of our clients. We we’re really struggling with 4D – performance on the Mac was awful, the networking dynamics were weak (and the Mac networking software was terribly slow at the time), and our understanding of how to really tune it was non-existant. We had heard of some successful 4D implementations but they were hard to find out much about. We knew this was likely our final meeting where we’d get fired, even though that rarely happened in our world. We were meeting with Tom Bogan, the CEO, and a few other people on his team. We liked Tom a lot – he was a very direct and thoughtful CEO and we knew we were failing him. Over the preceding months, we had tried extremely hard and worked many unbillable hours trying to get things working, but just couldn’t. I don’t remember the ACI folks being very helpful and I remember a number of conversations with Dave about “the fucking Macintosh.” We were deep in The Struggle. Tom eventually fired us (I don’t remember if it was at that meeting or not). He and I lost touch over the years (I’m sure he was glad to be rid of us) until I had breakfast with him in Boulder in 1997 when he was first looking at investing in Rally Software. I started out the meal by saying “hi – sorry we did such a crummy job for you at Avatar” and he responded, graciously, with “that was a long time ago, wasn’t it.”

I’ve got a lot more stories like this from Feld Technologies and several other companies I co-founded, including Interliant and Email Publishing, along with long stretches of time at Mobius Venture Capital. All of them share The Struggle and when I reflect on it from my perch at 46.5 years old, I recognize the unimportance of suffering.

What Was The Address of Your First Real Office?

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I’m fascinated with first offices.  I’m not talking about the bedroom, the dorm room, the garage, or the apartment.  I’m talking about the first real office.  Here’s mine.

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Bill Warner took this picture of me standing in front of 875 Main Street in Cambridge, MA last year.  My first real office – for Feld Technologies – was the fourth floor.  The building is a narrow five story building (three windows on the front) – long and skinny – 1600 square feet total.  The elevator opened directly into the office, the front of the building (that you see) was to the left; the bulk of the space was to the right.  I vaguely remember a cave like office near the back along with the bathroom and lots of open space in the middle.  When we moved in all of the left over shit from Pegasystems was still there – they were the previous tenant. 

While I had offices in my bedroom at my fraternity (351 Massachusetts Avenue) and in my bedroom at my parents house in Dallas, this was my first real office.  We had to take out the garbage and the place always smelled like damp, sweaty, anxious nerds.  We had some great times and some awful times, but this was where it all really started for me.

Where was your first real office?

Video Interview: We Suck Less

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Steve Bell of Startup Trek came to Boulder about a month ago and did an interview with a bunch of Boulder people, including me.  Following is part one (12 minutes) of the interview where I talk some about my history, my first company Feld Technologies, and the Feld Technologies’ motto (“we suck less.”)

I also spend some time talking about how I first learned how to do deals, acquire companies, and make angel investments.  You get to learn how I met Fred Wilson, Rich Levandov, and Jerry Colonna.  And, as a special bonus, you get to see a reasonably tired version of my avatar sitting in one of the chairs in my office.

The Durability of Swag From Feld Technologies

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Every now and then I run across someone who is still using software that we wrote at Feld Technologies.  Some of this software dates back to 1987 – a fact that never ceases to amaze me.  And – no, I can no longer provide tech support at any price.

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We didn’t have much swag at Feld Technologies.  In fact, I think the only swag we had, other than a few t-shirts which still make their appearance every now and then, is the mug pictured above.  A fraternity brother of mine from MIT emailed me this picture recently – apparently this mug sits on his desk and serves a very mug-like purpose. 

I remember how agonizing it was to buy these mugs.  Should we get 50?  100?  There was probably a price break at 200 and we even considered that.  Were they too plain?  Should we spend an extra $0.17 per mug and get a grey background to match our stationary?  Who should we give them to?  Should we charge for them?  Decisions, decisions.

Anyone recognize that font?

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