My First Three Months at an Internet Start-Up

By Eric Goldman

For 5½ years, I practiced Internet law as an attorney at a large Silicon Valley firm. Although clients had frequently asked me to join them, I always passed. Then, I fell in love with a company called Epinions, Inc., and I joined the Internet start-up as its first in-house lawyer.

Truthfully, Epinions isn’t a “pure” start-up. Epinions launched 8 months ago, has 100 employees and has raised $33 million in financing from blue chip investors such as Goldman Sachs, Benchmark Capital and August Capital. But the company has retained a start-up attitude, giving me a reasonably authentic perspective on life in an Internet start-up.

A Little Space, Please?

At the law firm, I had a good-sized office with a large desk, lots of bookshelves, and of course four walls and a door. Not surprisingly, I’ve had to give up these “luxuries.”

My “office” is in our Redwood Shores satellite facility, which initially had 20 people in a single 4,500 square foot open room. There were no offices or cubicles; initially, each employee had a 32” x 80” wood door “desk” resting on two plastic sawhorses. My desk was in a 3-desk cluster—meaning that 2 people were 5 feet away, all day, every day. Also, my desk and the desk behind me formed a 3 foot wide internal pathway, so I had to scoot my chair forward each time someone passed.

The tight quarters were especially stressful the day the co-worker who sat behind me wore her snake around her neck all day. My co-worker tried, somewhat unsuccessfully, to assuage my snake phobia by telling me “it’s OK—he doesn’t bite, he’s a constrictor.”

Within 2 months, we ran out of space in our Mountain View headquarters, so employees were moved from Mountain View to Redwood Shores. As a result, the space holding 20 people was reconfigured to hold 54 people.

To save space, each person’s desk was allocated 60” instead of 80”; so each wood door was taken outside and buzz-sawed down to size. I know it’s irrational, but it was quite an ego blow to have the carpenter tell me to clean off my desk, watch him take my desk outside, hear the “bzzz” sound of the buzz-saw through the windows, and see my freshly-chopped desk returned to my plastic sawhorses.

With more people squeezed into the office, we ran into capacity constraints. One day, a co-worker and I needed to negotiate an agreement with the other side’s lawyer. The conference rooms were being used, so we called from my desk. We told the attorney that we were using a speakerphone in a large open room, but he must have forgot. The call took an unfortunate nasty turn and the attorney, a little agitated, loudly announced over the speakerphone—to the shock and mild bemusement of me and my 50+ co-workers—that he was not interested in comparing the size of our respective genitals. Needless to say, I ended the call shortly thereafter.

Maintaining personal space has been tough even when traveling. One weekend, the company held a strategy retreat for 10 of the company’s managers and 2 board members at a board member’s 4 bedroom house in Truckee. Even the mathematically-challenged can quickly spot the key capacity constraint—4 bedrooms, 12 people. When sleeping assignments were made, I “lucked out” and drew the futon in the den. The den was effectively the lower level’s central room which provided access to 3 bedrooms and the laundry room. In other words, instead of sitting in the hallway, this time I was sleeping in the hallway. The foosball table was also in the den, meaning that bedtime had to wait until the spirited foosball tournament ended.

Law on the Frontier

Having been an Internet lawyer for several years, I had substantial experience dealing with law on the frontier. Even so, new challenges awaited me at Epinions.

During my first week, I worked on a project to give “business” cards to 300 or so of our power users as a traffic-driving effort. Usually, companies give business cards only to employees because a card recipient could assume that the card bearer is authorized to act on the company’s behalf. It took some tricky maneuvering for me to explain the legal risks to our marketing/creative team and negotiate an acceptable compromise.

Also during my first week, I reviewed our multi-million dollar TV advertising campaign. The ad concept was simple but elegant—our site allows users to review products and services, so our ads show our reviewers restating their online reviews on camera. But as usual with dot com ads, the execution was provocative; thus, the ads included such memorable moments as:

• A user illustrating his unhappiness with the Apple iMac computer by pumping bullets into an iMac at a shooting range. In light of the controversy about guns, especially kids with guns, we let our users vote whether or not we should air the ad. Once the iMac fanatics learned about it, the vote ended up very negative, and we never broadcast the ad.
• A user favorably reviewing a breast pump as she uses it. The ad is not titillating, but one-half of the stations refused to run it or pulled it after receiving user complaints. In response, we issued a press release quoting the La Leche League: “the breast was made to feed a nursing baby, not to sell beer or other products as is often the case with advertising.”
• A user criticizing her “lemon” Chrysler mini-van (repaired over 15 times) as she tries to give it away to people on the street. Many stations refused to run the ad because they feared Chrysler would stop advertising with them.

Another tough responsibility has been dealing with business partners trying to take advantage of overheated demands for their services to extract more favorable terms from us. We’ve had to successfully navigate all of the following situations:

• A key vendor refused to deliver the tapes containing the final versions of our ads just days before they were first set to run unless we amended our contract to provide more favorable terms to them.
• An Internet access provider demanded more money than the contract required or we’d lose our Internet connection.
• A co-brand partner, the day after contract signing, demanded that we renegotiate a key (and heavily-negotiated) contract provision or they wouldn’t perform.

Surviving…and Flourishing?!

Epinions’ CEO gives nicknames to almost all employees. Initially, I was nicknamed “Eazy E” after the popular rapper. However, as people dealt with The Lawyer, my nickname quickly devolved to “Uneasy E” or just “Uneasy.”

No, it’s not easy being a lawyer in an Internet start-up. The company works hard, has minimal infrastructure, usually comes up with novel/unprecedented ideas, and faces many tactical and strategic challenges. Plus, I haven’t gotten rich yet—indeed, I took a 50%+ pay cut—nor will I soon, if ever.

Nevertheless, working in an Internet start-up is great. I learn something new every day and work with a dedicated and smart team on a product I believe in.

But the best aspect of my new job is my sense of ownership that infuses my actions. At the law firm, I advised clients about the pros and cons of their actions, a duty I took seriously, but I felt distanced from the final decision because I did not bear the resulting financial consequences. In contrast, my decisions today are driven primarily by the costs and benefits I will bear as a company stockholder, a far more empowering and satisfying way to make decisions.

So working at Epinions has required me to make many adjustments, but I think I’m surviving—and perhaps even flourishing—in the Internet start-up environment.

About the Author: Eric Goldman is General Counsel of Epinions (http://www.epinions.com), an online buying guide offering brutally honest consumer reviews, and an adjunct professor of cyberspace law at Santa Clara University School of Law. He was formerly an attorney at Cooley Godward LLP, Palo Alto, CA. He can be reached at eric@epinions.com.