wasn’t going to...
wasn’t going to launch. They hadn’t understood the tradeoffs. A couple weeks
later they launched.
Livingston:Was there anything that you think people misunderstood about the
demise of ArsDigita?
Greenspun: I haven’t written that much. I’d like to write some reusable lessons.
We have some uniquely clever things that we did, like making websites
that were multilingual. Just engineering stuff. I just haven’t had the time or the
energy for some reason.
People focus a lot on the bust-up phase. It upsets me that they remember
the wrong things like, “This Greenspun guy sued the venture capitalists.” This
is not true, first of all, since I was a defendant, not a plaintiff.
It really upsets me that people think of ArsDigita as a venture
capital–backed company. It wasn’t. It was a company that I started and backed
financially, basically by myself, but within a year or two brought in some other
smart, good people. It upsets me that they think of ArsDigita as a company that
the VCs somehow played a big role in starting; that I sued them and somehow
got money trickily. That bothers me. I financed the thing. I put in money and
years of labor, and right at the tail end—they were only in there for about
18 months from the time they invested to the time it went bust, and at that time
the company was more than 5 years old. So it was not a VC-backed company; it
was a company that took VC money just in an attempt to shortcut the underwriting
process in going public.
I did not make money through litigation. I bought some shares, took a risk,
sold them in the end at a much lower return than I would have if I’d never
taken the VC money in the first place. I could have just taken profits out of the
company on a year-to-year basis. Just take dividends, instead of giving such
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large bonuses to the employees—some combination of slightly lower bonuses
and slightly less retained earnings in the company. So it was a simple story of
investing and then selling shares. The litigation was a sideshow. In the end, they
bought me out the same as if they hadn’t sued. They just thought, “Well, maybe
we can steal control of the company instead of having to buy it,” and, when
that didn’t work, they bought it just like any reasonable person would have
expected to.
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