The Download Live
Thursday, Jan. 10, 2002; 1 p.m. ET
Thursday, January 10, marks the return of Shannon Henry's Download column to The Washington Post's Business section. Shannon spent the past year writing her first book, an inside look at the top players of Washington's technology community that will be published in November by The Free Press/Simon & Schuster.
Shannon will be online on Thursday to talk about developments in the region's technology community during 2001, everything from the state of venture capital investing to the effects of the Sept. 11 attacks on local tech firms.
When The Download last appeared on April 5, 2001, PSINet had not yet declared bankruptcy, MicroStrategy had yet to close its Strategy.com unit, and Proxicom was still an independent company. A lot has changed in just under a year, and Shannon will try to make sense of it as she takes your questions and comments. (Don't miss Shannon's Jan. 9 report on N. Va. tech 'godfather' Mario Morino!)
Washington Post columnist Shannon Henry has been covering the local technology scene since 1995, documenting the successes and failures of local tech companies, and the culture and ideas of local business personalities. Her column appears on Thursdays in the Business section of the newspaper, and she regularly hosts The Download Live on Washtech.com, The Washington Post Web site dedicated to covering the region's technology sector.
The edited transcript follows.
Editor's Note: Washingtonpost.com moderators retain editorial control
over Live Online discussions and choose the most relevant questions for guests and hosts; guests and hosts can decline to answer questions.
Hi, welcome. Send rants, raves, questions. Whatever's on your mind. Which today is much about Warner I see....It's good to be back.
Wouldn't it be nice if Governor-elect Warner set a trend in politics and all politicos put their money into blind trusts? Think of it...we could do away with issues of Wendy Gramm and Dick Cheney's involvement in Enron.
Shannon Henry: Definitely the issue of the moment. If you missed it, the Governor-elect has decided to set up a blind trust for his investments. So over the next 4 years he won't know what his money's up (or down) to. Warner could have gone the "disclosure" route, but he told me he felt this was cleaner. I agree. There are so many potential conflicts of interest and so much real work to do, why get distracted? That said, the blind trust-aacross the board idea may put off some good candidates. What do the rest of you think?
So, Mark Warner comes from a tech background and he's beloved by NoVa's tech leaders. But what can the governor of Virginia really do to help the region's tech sector? Besides fixing the roads and the schools, is there anything TECH that Warner can do?
Shannon Henry: Mark Warner would say he's not himself a technologist. Obviously it's impossible to predict what he'll accomplish, but his connections in the tech and finance world may make some things happen and may speed along change that the technology community favors. People have high expectations of him.
The blind trust across the board would have saved the Bush administration lots of the hassles they'll face with Enron...
Shannon Henry: Thanks, wiredog. If you don't know what he's talking about you'll soon hear more...
Falls Church, Virginia:
everyone's talking about that Mario Morino piece you wrote yesterday. Do you think he left because he sees no future here, or was that just a personal decision for him to get back to his hometown?
Shannon Henry: Mario Morino's decision to move to Cleveland was almost completely personal. The guy wants to raise his kids there, it's where his roots are. It couldn't have been easy, and he knows it's symbolic that the region's biggest promoter has moved out of town. What's interesting to me about his move is how few people knew about it--thanks to the private plane and the BlackBerry. Not that we all can have those things, but maybe work and play and life is getting more virtual, after all. I'm looking for more real-life examples of that.
So, what is entailed exactly by 'blind trust?' will his current portfolio be changed entirely? Seems like he'll still know HOW he got rich and which friends in our area need to be taken care of by his administration.
Shannon Henry: He'll get periodic reports updating him based on asset class, like "bonds" or "real estate." But good point, he knows what was in there as of Friday night, or whenever the trustee officially takes over. Still, for the next four years the trustee can buy, sell, change, morph, as he and his colleagues see fit, without the governor's knowledge.
Your work and reputation within the tech industry are second to none but what does the future hold for the No VA area? Do tech employees still outnumber government employees?
Shannon Henry: I'd love to see a new report on tech vs. govt. employees. The last one I remember is several years old and we all know things are not the same. Anybody out there doing one? I still think the Washington region is one of the most important technology areas in the country, especially, of course, because of the government contracting presence. But that's not new. Even during the dotcom boom, the federal government was "Fortune One," the top technology customer in the world.
Shannon, what do you know about the business group that's trying to bring major league baseball to N.Va.? Are there any tech bigwigs involved in that group?
Shannon Henry: AOL co-founder Jim Kimsey is in what most call "The Malek Group." Besides trying to bring peace to Colombia (South America, not Maryland) Kimsey's passion these days is bringing a team to D.C.
How does it feel to be back at the Post after a year of scheduling your own time (rather than reacting to news events)?
Shannon Henry: Right at this very moment, talking with readers, it feels great. I really missed writing the column and the Post newsroom, especially, and this may sound strange to non-reporters, during a time of real news. But I recommend book leave or some kind of sabbatical to you all. I learned new things about writing, discipline and actually, gardening. It was a wonderful 9 months.
Welcome back. Complelling article
today. I have a question. I recall reading
your article about two years ago that dealt
with AOL and employee options with the
Time merger and you called it "real
money." You had Doug H talking about
opening up a car dealership. Good
paper fodder, but as the article in the
paper today by Carrie shows that it was,
in fact, not real money (it never was) and
that most of the options are now
What's the deal, did you not know it was
possible that the stock price could go
down and thus render the options
worthless? Did you think it really was
"real money" or were you caught up in all
the AOL hype and just made a mistake?
Again, welcome back.
Shannon Henry: I love this question. First, thanks for remembering something I wrote 2 years ago. You may be the only one. I went back to look at that story and it did have a bit of the wow quality of the time. But I also did question whether the merger would even happen and say really, who could predict the outcome 2 years later. For all those who are underwater, others did make real money. Just not nearly as much as they would have liked or I had expected. Thanks for calling me on it, it's good to look at past stories every now and then.
Morino, Case, Mandl, Schrader, Saylor... one way or another it seems Elvis has left the building in our area. Are we in a new phase of DC's economy where there are no more celebrity execs?
Shannon Henry: Funny, for the Morino story I was playing with a lede with..."has left the building." Yes. Different stage entirely. I think some of the above would argue that they are gone, but they are definitely in a much changed place. If you look at all the top tech stars of the past five years, almost all of them have disappeared, moved to something else or changed their gig in some way. Saylor, actually, is one of the few who still has the same job. What's interesting to me is what are they doing next? (Buying sports teams, running for office, etc.) And what does that mean for Washington's economy and culture?
Can you name drop about the book? Who will we learn the most surprising things about?
Shannon Henry: The book is scheduled for publication in November. You'll have to wait for surprises....;-)
Welcome back, Shannon. In your dealings with Michael Saylor over the years, did you encounter the same person that came across in the Post series? Is he really that much of a jerk?
Shannon Henry: The series by Mark Leibovich was great reading. Mark and I certainly have similar thoughts about Saylor, who in all fairness, is a complex character. What has struck me about Saylor lately is how he feels persecuted by so many people and groups and is so angry at so many. From the people I've spoken to about Saylor, it also surprises me how little he took their advice.
I look forward to reading your new book.
From your perspective, how did the entire tech sector dry up so suddenly? Could this be the result of bad decisions made by a few of the key players in the industry?
Shannon Henry: Thanks. Actually, I don't think it happened that suddenly. In fact the craziness was building for so long....it was almost painful. When I've talked to experienced executives about their now-seemingly-crazy decisions, most of them say they knew it was about to fall apart but couldn't help themselves....kind of like gambling, I guess.
Any idea where Alex Mandl is these days?
Shannon Henry: The last time I spoke with Alex he was running ASM Investments with his wife Susan, a former telecom executive. And he was talking to companies all over, looking for the right position. He said he would join a start-up again.
For those of us who'd like to write a book someday, what was the process of securing your book deal?
Shannon Henry: I had three main challenges--would the subjects and sources of my book give me the unusual on-the-record access I needed to make the story work; would my editors at the Post give me time off to write it; and would anyone want to publish it?
New York, NY:
Comments on the changed landscape now compared to when you were last reporting on it a year ago ?
Shannon Henry: The venture capitalists are, still, getting better deals than they used to. The stars are all having to re-invent themselves. Technology is more vital to people's lives and less vital to their portfolios.
Any tidbits you are willing to share on the new book?
Shannon Henry: It's called "The Dinner Club."
If memory serves, Russ Ramsey and Mark Warner spent a lot of time and money in 98-99 to get a major league baseball team in No VA. Whatever became of that group, I wonder.
Shannon Henry: You're right, though I'm not sure about the year offhand. Those two are friends from way back...both were on the FBR board and the George Washington Univ. board, too. Clearly, they're doing other things these days though Kimsey, Fernandez, Leonsis, Davies, Kay, Stamas, etc. have the sports bug.
Whatever happened to the Indian CEO High Tech Council? I don't seem to hear much about them these days.
Shannon Henry: You know several people have asked this. Are you still out there??
Does Steve Case still live here in the area, or is he in NYC full time?
Shannon Henry: He has been quiet, hasn't he? As far as I know, he's still living here, his kids are in area schools and he doesn't have plans to move. Some AOLers have become much more ingrained in Washington society, like Case, Leonsis and George Vradenburg, while Bob Pittman seemed thrilled to get back to NY when the deal happened.
Hi, welcome back. Regarding the "drying up" of the tech sector and execs, there are many, viable "movers and shakers" and up and comers making good tech in this area. Many of them are women. Any thoughts on how to best bring them to light? Any insights and who you see as helping us over the hurdle? Thanks.
Shannon Henry: I agree. New companies are being started right now by people we've never heard of. Email me about them at email@example.com, for starters. Some of the top women in the area such as Patty Abramson and Kathy Clark have started groups that encourage women in technology and finance. When I ask the successful area women how they did it, many of them say the same thing as many of the men--they developed one or two trusted mentors who taught them along the way.
Sanju Bansal of Microstrategy still heads the Indian CEO High Tech Council. Info can be found at http://www.c2mm.com/indianceo/main.htm
Shannon Henry: Thanks.
Speaking of lost councils, etc. where have all the "networking" events gone? It almost seems as if the oppportunity to meet and greet and swap great tech trends in the Washington area has disappeared as well. See any change to that in the near future?
Shannon Henry: Hmmm. I've been planning a column on this topic. Anyone who has thoughts on it, send me an email. First, so many people are just trying to save their company they don't have time to schmooze. Many of the networking events have become veiled job searches. I have yet to see how the networking groups are changing to reflect the current reality, but I'm still looking.....
Does the Washington area stand any better chance of becoming a major tech capital thanks the implosion of the sector? I'm thinking the recession hit Silicon Valley and Silicon Alley a bit harder -- no?
Shannon Henry: Well, Silicon Valley is simply bigger than any other tech sector. They're higher, so the crash is harder. But as much as this region has grown, technology is a bigger part of the Valley's culture in general. I don't see it going away in either place. It's not all or nothing. Size aside, Washington is just different from NY and the Valley. The government, yes, you are all sick of hearing that already, not only the contractors but policymakers make it different. And the govt. labs that may be working on some great new innovation now.
I think the blind trust idea is a start, but campaign finance reform is the bigger need. Just think of those intimate conversations on the energy policy for the country between Mr. Cheney & Mr. Lay.
Shannon Henry: More on the blind trust...
You mentioned that Russ Ramsey has already been appointed to the Warner staff. Isn't it true that Russ has political aspirations of his own? He spent a lot of time at the Clinton White House and even hired some of Clinton's staffers, didn't he? Seems like both Mark and Russ have made enough money in Tech/Finance to make the Virginia 100 list year after year. Isn't power the only thing left to achieve for them?
Shannon Henry: You get at one of the themes in my book. It seems strange to the rest of us, but the personality of many of these moguls is that of becoming bored by one thing and wanting to attack the next challenge.....they've made millions, created a company, now what? More Washington-area techies are talking about running for office than you would expect. I can't speak specifically about Ramsey, although he and Warner are quite close and Ramsey does have at least one ex-Clinton staffer working with him now. FYI, many of these high-level Washington tech guys call their right-hand-man (yes, usually a man) their "chief of staff."
In response to the question regarding networking groups.
Twelve of us started a networking dinner group eraly last year. We are all from different industries yet often call on the same prospects and have good information to share.
Rather than the herds at large gatherings we actually get to know and help each other. While our primary goal is to generate business there are other examples of assistance- job counceling and matchmaking!
Take the initiative. Grab some cards from old events and pool together some friends. It is a worthwhile investment.
Shannon Henry: Is this eJunto? Sounds like a good plan. Smaller groups, more real interaction. Will you email me at firstname.lastname@example.org?
Re: Blind Trusts and Warner:
I used to work on the Hill and my boss put his stock holdings in a blind trust when he was elected. But if you think he or anyone else wasn't paying attention to what those stocks were doing over time, I've got a bridge too sell you. Blind trusts are a good thing, but let's not overstate their importance.
Shannon Henry: Yes, it certainly seems to be an imperfect arrangement. Got any alternatives?
Has Warner indicated that promoting telecommuting to be a priority. Can't think of a better place to start than NOVA.
Shannon Henry: I wouldn't be surprised. This is an idea whose promise is long overdue.
Hey, thanks for all the insightful questions. You guys must have been saving them up. Sorry I couldn't answer them all. Now that I'm back I expect to do a live online every other Thursday around noon or 1pm. Keep those great questions coming. Bye!
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