Et Tu Brutus
Dan Gittleman had made a bundle of money selling a Company to HP. He had a technical team that had built some disk replication software system, and I believe he had built sales to over $10M a year. I researched his deal a little, before I went to talk to him, and I believe he sold his Company for over $400 million in early 2000.
His timing was impecable. He sold at the peak of the dot-com frenzy. When Rick and I went to meet him in Febuary of 2002, he was living in a 30,000 ft home yards from the ocean in West Palm Beach. Dan Gittleman had money.
Rick had found Gittleman by working with his brother (Dave?) a venture capital guy in Atlanta. I was enthusiastic about going to explain how CycleFree Software worked to Dan's smart technical team. Gittleman was a technical guy with money. I was certain he would be enthusiastic about the CycleFree Technology, and his interest would help reenergize the enthusiasm of Larry and Ed.
I had strong convictions. But I was wrong to be certain of anything.
I met with Dan and his technical team around a big table in his house. After exchanging polite conversation, Dan and Rick retired to another room while I fielded questions from his technical team about CycleFree Software. I could tell there was a great deal of skepticism, but they had formed a new company called Open Peak, and they could use some of the technology we had developed for ONGOER. I invited them to do due dilligence, come to Atlanta, and continue a dialog about the technology. In total, I talked to them about 90 minutes.
On the drive back to the airport, Rick asked me how it went. I thought it went well. Rick knew something I didn't, but he did not share it with me.
In March and April, some more discussions took place with the Gittleman team, but I was not part of them. Just like Microsoft, there was no follow up dialog regarding CycleFree Software, but the Open Peak team seemed to be impressed with ONGOER. Rick told me there was a funding agreement in the works for around a half million. But I was excited about something else. I had an advocate for CycleFree Software inside of Microsoft.
The Microsoft Researcher was a featured speaker at the ICSE 2002 conference to be held in Orlando in May of 2002. He and I had exchanged a few e-mails regarding CycleFree Software and he had agreed to have dinner with me at the Conference.
The Conference itself was a little disappointing. I thought our talk went well, Rich LeBlanc and I each presented part of the paper, but all the attention was on the papers in the Academic track. Our "industrial experience" paper had an audience of less than twenty people. However, dinner with the researcher went well, and I invited him to come to Atlanta and review the actual code to see how the kernel worked.
I was pumped when I returned from the conference. A smart guy at Microsoft seemed to completely understand the significance of the CycleFree technology. Good things were going to happen.
Simtrol's warrant to acquire 20% of ACIS had expired in March of 2002. Simtrol could have exercised the warrant in 2000, exchanging 500,000 shares of Simtrol stock for a 20% interest in ACIS when the Simtrol stock was trading at $4 a share. I thought they should have done this as it would have shown confidence in the technology. It would be giving up about 2.5% of Simtrol to complete a 20% position in ACIS. A sweetheart deal. But the board did not do this. I don't know why, perhaps they had no confidence in the technology.
In March of 2002, I had offered to extend the warrant, but I wanted to make sure that Simtrol would be funded. When I went to the conference, I still believed Simtrol would be funded and the warrant would be extended. When I got back from the conference I got a surprise.
I had been stabbed in the back.
That's how it felt.
Unknown to me, there had been several conversations between Gittleman and the Simtrol Board in which Gittleman had bashed the CycleFree Technology. The Open Peak team liked ONGOER, but they told the Board that I had Simtrol held hostage, that there was no real value to the CycleFree patent. At least this is what was told to me by Rick. While I had been talking about the technology to the Gittleman team, they had been text messaging Dan in the other room with messages poking holes in the technology. Dan shared this with Rick, but Rick had not shared it with me.
According to Gittleman, Simtrol software was built on top of technology with no true value that they didn't own. While I was attending the ICSE 2002 conference, Mike Miller and Curtis Smith were explaining to the board how ONGOER could be rewritten without the CycleFree Kernel. Meetings had been held in Boston, that I thought would lead to a coalition with the Open Peak people, but instead of rekindling enthusiasm with the Board their faith in CycleFree crumbled.
My friends of 15 years, Mike and Curtis, had not told me what was going on. My buddy Rick never mentioned it to me. To this day, I don't understand this. I wasn't given the opportunity to defend the technology. I wasn't in any of the Board meetings, and the Board was making a critical decision without the advice and counsel of their Chief Technical Officer.
I returned from the ICSE 2002 conference, with an ultimatum delivered by Rick. Either Simtrol would be granted new licensing terms, completely unrestricted (granting equal rights to the use of the kernel) or the software would be rewritten taking CycleFree out of the code. This was a ridiculous position as I knew the software would never get rewritten without the kernel. I don't know how Mike and Curtis advised the baord that this was possible.
I explained that I was willing to extend the warrant, but I could not grant unrestricted rights to ACIS technology without any compensation. To this date, Simtrol had paid nothing for the CycleFree development. They had taken the benefit of the hype of the technology to close funding for their own company, but ACIS had not gotten a dime of equity funding from Simtrol.
In June of 2002, two weeks after I had returned from the ICSE conference. Simtrol had a layoff of 50% of its workforce. I was a part of the people cut.
A month later, Gittleman backed out of his offer to fund $500K. Two years later, and Simtrol is still using the CycleFree Kernel, and the code doesn't crash!
His timing was impecable. He sold at the peak of the dot-com frenzy. When Rick and I went to meet him in Febuary of 2002, he was living in a 30,000 ft home yards from the ocean in West Palm Beach. Dan Gittleman had money.
Rick had found Gittleman by working with his brother (Dave?) a venture capital guy in Atlanta. I was enthusiastic about going to explain how CycleFree Software worked to Dan's smart technical team. Gittleman was a technical guy with money. I was certain he would be enthusiastic about the CycleFree Technology, and his interest would help reenergize the enthusiasm of Larry and Ed.
I had strong convictions. But I was wrong to be certain of anything.
I met with Dan and his technical team around a big table in his house. After exchanging polite conversation, Dan and Rick retired to another room while I fielded questions from his technical team about CycleFree Software. I could tell there was a great deal of skepticism, but they had formed a new company called Open Peak, and they could use some of the technology we had developed for ONGOER. I invited them to do due dilligence, come to Atlanta, and continue a dialog about the technology. In total, I talked to them about 90 minutes.
On the drive back to the airport, Rick asked me how it went. I thought it went well. Rick knew something I didn't, but he did not share it with me.
In March and April, some more discussions took place with the Gittleman team, but I was not part of them. Just like Microsoft, there was no follow up dialog regarding CycleFree Software, but the Open Peak team seemed to be impressed with ONGOER. Rick told me there was a funding agreement in the works for around a half million. But I was excited about something else. I had an advocate for CycleFree Software inside of Microsoft.
The Microsoft Researcher was a featured speaker at the ICSE 2002 conference to be held in Orlando in May of 2002. He and I had exchanged a few e-mails regarding CycleFree Software and he had agreed to have dinner with me at the Conference.
The Conference itself was a little disappointing. I thought our talk went well, Rich LeBlanc and I each presented part of the paper, but all the attention was on the papers in the Academic track. Our "industrial experience" paper had an audience of less than twenty people. However, dinner with the researcher went well, and I invited him to come to Atlanta and review the actual code to see how the kernel worked.
I was pumped when I returned from the conference. A smart guy at Microsoft seemed to completely understand the significance of the CycleFree technology. Good things were going to happen.
Simtrol's warrant to acquire 20% of ACIS had expired in March of 2002. Simtrol could have exercised the warrant in 2000, exchanging 500,000 shares of Simtrol stock for a 20% interest in ACIS when the Simtrol stock was trading at $4 a share. I thought they should have done this as it would have shown confidence in the technology. It would be giving up about 2.5% of Simtrol to complete a 20% position in ACIS. A sweetheart deal. But the board did not do this. I don't know why, perhaps they had no confidence in the technology.
In March of 2002, I had offered to extend the warrant, but I wanted to make sure that Simtrol would be funded. When I went to the conference, I still believed Simtrol would be funded and the warrant would be extended. When I got back from the conference I got a surprise.
I had been stabbed in the back.
That's how it felt.
Unknown to me, there had been several conversations between Gittleman and the Simtrol Board in which Gittleman had bashed the CycleFree Technology. The Open Peak team liked ONGOER, but they told the Board that I had Simtrol held hostage, that there was no real value to the CycleFree patent. At least this is what was told to me by Rick. While I had been talking about the technology to the Gittleman team, they had been text messaging Dan in the other room with messages poking holes in the technology. Dan shared this with Rick, but Rick had not shared it with me.
According to Gittleman, Simtrol software was built on top of technology with no true value that they didn't own. While I was attending the ICSE 2002 conference, Mike Miller and Curtis Smith were explaining to the board how ONGOER could be rewritten without the CycleFree Kernel. Meetings had been held in Boston, that I thought would lead to a coalition with the Open Peak people, but instead of rekindling enthusiasm with the Board their faith in CycleFree crumbled.
My friends of 15 years, Mike and Curtis, had not told me what was going on. My buddy Rick never mentioned it to me. To this day, I don't understand this. I wasn't given the opportunity to defend the technology. I wasn't in any of the Board meetings, and the Board was making a critical decision without the advice and counsel of their Chief Technical Officer.
I returned from the ICSE 2002 conference, with an ultimatum delivered by Rick. Either Simtrol would be granted new licensing terms, completely unrestricted (granting equal rights to the use of the kernel) or the software would be rewritten taking CycleFree out of the code. This was a ridiculous position as I knew the software would never get rewritten without the kernel. I don't know how Mike and Curtis advised the baord that this was possible.
I explained that I was willing to extend the warrant, but I could not grant unrestricted rights to ACIS technology without any compensation. To this date, Simtrol had paid nothing for the CycleFree development. They had taken the benefit of the hype of the technology to close funding for their own company, but ACIS had not gotten a dime of equity funding from Simtrol.
In June of 2002, two weeks after I had returned from the ICSE conference. Simtrol had a layoff of 50% of its workforce. I was a part of the people cut.
A month later, Gittleman backed out of his offer to fund $500K. Two years later, and Simtrol is still using the CycleFree Kernel, and the code doesn't crash!
posted by xlbder at 4:21 AM
2 Comments:
This is a sad story... I have one of my own involving Gittleman... where I ended up on the short end of the stick as well.
Drew, would love to hear your story...
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