Yuko Tsukagoshi, left, holder of a Ph.D., tastes a chocolate as she chats with Charles Chocolates owner Chuck Siegel on July 16 at a reception in San Francisco
organized by Jobnob to introduce Stanford graduates to startup firms seeking volunteers to work at least five hours a week in exchange for equity shares.
SAN FRANCISCO – Soon after earning his MBA from Stanford, Andrey Abramov launched his first technology startup – a cell phone e-mail service he says “died horribly” in the 2000 dot-com crash.
He recovered to earn “hundreds of thousands of dollars” a year in ventures including call centers, social networks, anti-piracy software for video games and a Web marketing portal for brain exercises.
Yet today, Abramov, 39, finds himself among newly busted entrepreneurs and displaced technology workers. And he’s offering to work for free for a chance at another comeback.
In the Silicon Valley region, unemployment tops 11 percent and investment capital has all but dried up. Here, unemployed tech professionals are showing up in droves at Bay Area mixers – and signing on en masse on career networking sites – to volunteer labor and expertise in exchange for equity shares in Silicon Valley startups that have no money to pay them.
At the Metreon retail center in San Francisco recently, Abramov joined dozens of unemployed or underemployed Stanford graduates for a reception with under-funded dreamers, from Internet marketers to video game designers to wireless gadget makers.
He stood there wearing a stick-on badge listing his expertise – “biz development and strategy, engineering, marketing, project management” – as 30 companies made their pitches for people willing to invest five hours or more a week in free “equity” work.
“If you are a company, please buy a job seeker a drink,” said Julie Greenberg, co-founder of a Web networking company, Jobnob, which sponsored the gathering. “They’re willing to work for free. It’s the least you can do.”
From San Jose to Alameda, and Santa Cruz to San Francisco, it is the new survival story of Silicon Valley.
With a half-million Internet, computer, biotech and financial services workers, the pool of jobless talent here is so deep that Jobnob scheduled separate college-themed “happy hours” for tech professionals from Stanford, Harvard and Berkeley alone.
Seeking to pair job seekers with startups, Jobnob began receptions with an open event last month at a San Francisco wine bar. It expected a turnout of 30 people. About 300 out-of-work professionals showed up offering their services.
“This is a time that’s really unique, where so many people with five, 10 and 15 years’ experience and advanced degrees are out of work,” Greenberg said. “Sitting at home looking at the Internet listings is not going to do it for them.”
Simultaneously, the “angels” of Silicon Valley – wealthy individual investors critical to tech startups – have suffered huge stock portfolio losses and largely taken flight.
So volunteer professionals are helping fuel the dreams of cash-strapped entrepreneurs such as Steven Echtman, chief executive of startup HearPlanet.
At the Metreon, Echtman worked the room and his iPhone. He showed off his application that lets travelers use mobile devices to get instant narrative guides for worldwide points of interest from Inca ruins in Urubamba, Peru, to the Pashupatinath temple in Katmandu, Nepal.
He isn’t yet “cash positive” in his dream to build the de facto “audio guide to the world.” But Echtman has signed on four equity volunteers, including Allison Sophia Jones, an Internet sales representative and former Davis resident who found him through the “meetup” link of a networking group, SF New Tech.
Jones, a 2003 international business graduate from the University of San Francisco, has been seeking another opportunity since a movie downloading venture she worked for went out of business 10 months ago.
“We just basically ran out of money. I hate when that happens,” she said. “They let me go along with my whole sales team.”
With hundreds of applicants for job postings, Jones said restless professionals with free time “are getting back to their core values and choosing to put forth their energies for something they believe in.”
Bruce Runyan, 55, a Stanford grad with a B.A. in physics and a master’s in operations research, worked 20 years as a vice president at software and telecommunications companies in California. But after a recent layoff, employers have largely brushed him off as overqualified.
So Runyan came to the Metreon looking to volunteer “for a team-level job to help build a company.”
Carl Guardino, president of of the Silicon Valley Leadership Group, said the current economic downturn is viewed as less devastating than the 2000 tech stocks meltdown. That wiped out hundreds of paper millionaires and ended the glitz and swagger of the Internet technology gold rush.
Now, Guardino said, an “ownership culture … an egalitarian culture of Silicon Valley lives on,” as unemployed professionals offer services in hope “of being part of owning a company.”
Abramov thought he had a winner in his last venture – WiFi Commute, a service designed to provide wireless access to rail commuters on Caltrain routes. But his business collapsed when he was unable to negotiate terms for buying and reselling bandwidth.
“My startup is dead. It’s like losing a baby after taking it to the limit,” he said.
His finances are so bad, Abramov said, that soon “you’ll see me in the soup kitchen.” And yet, at the Metreon event, a setting remarkably upbeat, he spoke about volunteering to help somebody else’s startup succeed.
“Maybe I’ll find an interesting project to buy me time or the right startup where I can fit in,” he said.
There were plenty of options to ponder.
A young entrepreneur was seeking a business developer for an Internet carpooling network he billed as “the new transportation paradigm for the 21st century.” A firm called Blue Tweet wanted sales associates to market online retailers on Twitter.
Randi Kofman, whose Palo Alto Adiri Inc. sells premium baby products, sought an Internet social media marketer “to reach mommy bloggers and tell them we are listening.”
“We’re a very smart company with a lot of stock options,” she said. “Because we don’t have a lot of cash.”
Jobnob co-founder Alan Shusterman, an Internet advertising product manager in tech’s go-go days, said the event in a Metreon business suite offered quite a contrast.
He recalled lavish parties of the mid-’90s, when Oracle Inc. once rented out San Francisco’s Nob Hill, including the Fairmont, Mark Hopkins and Stanford Court hotels, for thousands of celebrants.
“It was unbelievable. There was so much buzz. Everyone was worth $10 million on paper. And then everything crashed,” he said.
This time, Shusterman said, “there is no somberness, and the fact that these are such difficult economic times is actually spawning innovation.”
Navneet Aron hopes so. The 30-year-old former Intuit engineer manager formed a firm – mobiQpons – that allows people to instantly call up coupons on mobile devices and have retailers scan the devices or punch in the coupon numbers.
“I have access to talent that ordinarily you couldn’t get at an early stage for a company,” said Aron, as he called up coupons for Planet Hollywood, Home Depot and Bath and Body Works on his iPhone. He is seeking equity volunteer interface engineers and social media markers.
His business venture “was the best idea I’ve heard today,” said Heidi Klauser, a ’92 Stanford grad, retailer and former tech professional looking to find a new opportunity through equity work.
“No one in this room is living the dream of the pre-2000 days, when everybody had multimillion-dollar funding,” she said. “They’re not living the dream. But they’re still dreaming it.”
Stanford grad Tracy Ho, left, of Palo Alto gets the pitch from Amy Zhou of JustPinchMe, a startup seeking tech talent willing to work for free. With Silicon Valley “angels” mostly out of the picture, cash-strapped startups have been courting tech-savvy pros with dreams of their own.
