Just days after graduating from Harvard Law School, Troy Williams ’98 found himself living in his car in the blistering heat of Houston, Tex. When he found an apartment, he didn’t bother to furnish it, buying only a few plastic chairs, sleeping on the floor, and eating only spaghetti with butter.
But Williams wasn’t down and out; he was pouring all of his energy, time, and money into building an Internet company.
“There were all these myths at the time about how easy it was to raise money,” said Williams. “I was convinced that I was six weeks from raising a million dollars.”
It ultimately took Williams ten months of promoting his plan to anyone who would listen. By April 1999, Williams had his first “angel investor,” and Questia.com was born.
Like Williams, a growing number of Harvard Law School graduates are eschewing secure, lucrative careers in law firms for the high-stakes exhilaration of Internet start-ups. Some are fueled by an entrepreneurial imperative to see an idea flourish, while others are drawn to the risk, creative independence, and energetic culture of e-business. But even though they’re not practicing law, these mavericks credit their law school training for their ability to survive–so far–in the tumultuous environment and furious pace of business on the Wild Wild Web.
From the desktop democracy of David Chiu’s (’95) Grassroots.com to the alternative dispute resolution services of Ali Dibadj’s (’00) Webmediate.com, HLS alumni have created products and services as varied as they are innovative.
How do they do it?
For starters, they have raised a lot of money–millions of dollars each–from friends, family, private investors, and venture capital firms. Most have managed to do so after the so-called Internet “Gold Rush” of 1999 began to go bust early in 2000. And even as headlines blared the almost daily demise of yet another dot-com late last fall–nearly 50 companies in October and November–the HLS grads remained guardedly optimistic about the viability of their companies. Still, unlike the many start-ups before them that bragged of their “pre-IPO” status, these entrepreneurs wouldn’t speculate on their stock market potential, choosing to remain privately held through the latest turbulence.
Most say they’ve taken big risks for low pay and uniformly report working harder–and longer–than do their peers in law firms. The payoff, they hope, is more than just a healthy profit, but also the deeply satisfying chance to create something that didn’t exist before.
The Urge to Innovate
Necessity is, apparently, the mother of many a dot-com. It is what inspired Williams to build Questia.com–a virtual college library that will offer the full text of tens of thousands of books and journals–following an experience he had as an editor for the Harvard Law Review in 1997.
“We had to check the citations and footnotes in articles submitted to the Review,” Williams said. “If they were case references, it was easy because we had Westlaw. But checking on the quotes someone might have taken from a book–it’s not so easy. We’d have to check page by page, sometimes reading a whole book. And I thought, we have all these legal cases online, why not books and journals? They weren’t available online then. So I started looking into doing it.”
Williams took his idea to Houston, where he’d attended Rice University as an undergraduate. In March 1999, he met Rod Canion, the cofounder of Compaq Computer Corp., while presenting the idea to a local business group. Canion was so impressed that he became Questia.com’s first investor. By last August, Questia.com had raised more than $130 million in financing. With Canion serving as chairman, the company now has more than 240 employees in Houston, New York City, and Los Angeles.
Questia.com launched the service to the public in January 2001, with 50,000 titles available. Working with 150 publishers, Williams said his goal is to get 250,000 books online by 2003. When complete, Questia.com will allow users to search the full text of books, follow linked footnotes to other books and documents, and use automated bibliography, footnote, and glossary tools. The service is aimed at college students and researchers who can pay a subscription fee to access the books and services any time of the day or night.
“It’s really what the Internet was supposed to be,” Williams said. “It will provide unlimited access to a virtual college library, with electronic versions of all the relevant books.”
Soyouwanna Start a Dot-com?
Peter Stris ’00 and classmate Brendan Maher hatched their idea for Soyouwanna.com while sitting in a parked car outside the Oxford Spa deli in north Cambridge in 1999.
“We had been talking about how we both weren’t so sure we’d go into law, but that we’d maybe go into business,” said Stris. “And one idea we had was to write a book called ‘So You Wanna Get into Harvard Law School.'”
At the same time, a friend of theirs was trying to get a book published but didn’t know how to get an agent. “We realized we weren’t sure how to do these things,” said Stris. “Between the three of us, we’d attended Harvard, Penn, and Stanford, yet we didn’t know how to do lots of things. So we came up with the idea of a Web site to explain how to do stuff. We were so caught up in the concept that we went online that day and registered the domain name and started calling our techie friends to help us do this.”
The pair worked on their new company from Maher’s apartment while juggling school and the Ames competition, for which both had become finalists.
“I don’t think I saw other students for a month,” Maher said of the intense period prior to the launch of the site in March 2000.
Sporting a cartoon goose (“The Great Goosini”) as a mascot, Soyouwanna.com (called SYW on the site) offers hundreds of humorous, step-by-step tutorials for doing “things they didn’t teach you in school,” from buying a cell phone to getting a sex-change operation. There’s even a tutorial on how to get into law school. The site is aimed at 18- to 29-year-olds who are typically in transition and looking for a “guide to life.” Not surprisingly, this group also spends $200 billion a year on goods and services, according to SYW. The site’s high user traffic attracts advertising, Soyouwanna.com’s primary revenue source.
While Williams, Maher, and Stris bypassed full-fledged legal careers to become Net entrepreneurs, Chaka Patterson ’94 and Janice Ugaki ’99 found their dot-com inspirations through direct experience in the legal field. The resulting innovations, they hope, may very well enhance the business of practicing law.
Patterson’s Juritas.com, based in Chicago and launched last November, offers legal professionals a searchable database of cases, court briefs, proceedings, and rulings from federal courts in major U.S. cities. Among the currently prominent cases available on the site are A&M Records v. Napster, U.S. v. Microsoft, and Benford et al. v. Firestone. The site will eventually add cases from the balance of the federal courts as well as state courts, and also offer profiles of judges and attorneys. The idea came from Patterson’s own frustrations when trying to research cases as a commercial litigator at Chicago’s Bartlit, Beck, Herman, Palenchar & Scott.
“Whenever I had to draft a brief, I found myself starting from scratch an awful lot when it came to the research behind it,” Patterson said. “But it was highly likely that someone had already done something on it. I thought it was silly to have to reinvent the wheel every time I did case research with all these public documents already out there.
“It was also difficult to get information on opposing lawyers and the judges,” he said. “We’d constantly be calling around asking what someone was like in court. Through Juritas.com, a lawyer can access a database of litigators and judges to find out what their styles are.”
Patterson quit Bartlit Beck and founded Juritas.com with a few lawyer friends last March, aided by funding from several angel investors. He now heads up a staff of 42 researchers and attorneys who work to provide summaries of cases, individual briefs, and pleadings for the site. Customers (primarily corporations and law firms) pay $4 per page view, or can buy a per-user subscription for $150 a month.
Like Patterson, Janice Ugaki said it was a common experience in a law firm that inspired her and a small group of friends to cofound Firmseek.com in November 1999. During a brief stint in corporate law at a firm in New York City, Ugaki observed the power of word-of-mouth referrals that lawyers shared with each other and outside connections.
“We’d get e-mail messages asking if anyone knew a good firm doing environmental law in Paris, for example,” said Ugaki. “Networks are really key to what kinds of clients you get. So we decided to take these informal networks online and then also go one step further and share comments and reciprocal business.”
Firmseek.com collects and centralizes this “informal” contact information and organizes it for easy access. “We call it Network Relationship Management,” said Ugaki. “It is intended for anyone looking for a professional services firm.”
The Washington, D.C.-based Firmseek.com now has a staff of ten and offers information on more than 11,000 offices providing services in law, finance, accounting, lobbying, consulting, and marketing. Law firms that signed on to Firmseek.com include Hale and Dorr, Cooley Godward, Holland & Knight, and Wilson Sonsini Goodrich & Rosati. Revenues come through fees the firms pay to be listed on the site and through their use of customized Web-based referral tracking tools. “We’re thrilled and relieved to discover a real demand for this service,” Ugaki said.
Deciding to take the plunge into an Internet start-up was surprisingly uncomplicated for these HLS grads, who share a high tolerance for risk and an irresistible urge to tap the power of the World Wide Web to fulfill their goals. Some wanted to avoid a career in law, while others saw the Internet as an extension of a dream.
For Questia.com’s Troy Williams, it was simply a matter of fit. After sampling a lawyer’s life at a New York City firm during his third year at Harvard, he knew instantly what he wouldn’t be doing.
“Lawyers are relatively risk-averse people,” Williams said. “Let’s face it, when the market is going well, you’ve got mergers and acquisitions, and when the market is down, you’ve got bankruptcy. Once you make partner, it’s like an annuity. They’re not going to fire you. But in business there are risks and consequences. I’m a risk-taker and I thought, ‘I’m in the wrong profession.'”
Scott Andrew Selby ’98 felt the same way, and, though he passed the bar in both California and New York, he has no intention of practicing law beyond his role as general counsel for Fashionwhore.com, the fashion, arts, and lifestyle Webzine he launched with his brother in 1999.
“I’d never go back to law as a profession,” said Selby, who had worked briefly in trademark law at a New York City firm. “I like more creative work. I love doing stuff that’s a gamble.”
Selby’s first experience with the fashion world occurred at Harvard Law School, when he organized a runway show that featured student designers and models. “I loved it,” he said.
His first big legal challenge at Fashionwhore.com came last March. The e-zine’s staffers drew the ire of police when, as part of a “guerrilla marketing” scheme, they stood on a street corner in Greenwich Village handing out pill-shaped candies in plastic baggies with the Fashionwhore.com logo printed on them. When the police tried to confiscate the seemingly contraband packages, Selby got a phone call.
“They didn’t cover anything like this at Harvard Law School,” Selby said in news reports at the time. “It was predictable that the police would question our promotion, but I never imagined my job in a new-media company would ever involve my having to explain to a police officer the difference between ecstasy and TicTacs.”
The Selby brothers also run Panapet.com, a Web site design company that uses Fashionwhore.com as a showcase to attract clients. New York designer Cynthia Rowley is among those on Panapet.com’s growing client list.
“For me, the transition was not that difficult,” David Chiu said, of leaving his job as a staff attorney at the Lawyers’ Committee for Civil Rights in San Francisco in late 1999 to start Grassroots.com. “My goal has always been to work for social change. In my first jobs, I could do that through the law. I really view the Internet as just another new avenue for change.”
Headquartered in San Francisco, Grassroots.com is a political action Web site providing both nonprofit and for-profit activist groups across the political spectrum with Web-based tools for fundraising, database management, public outreach, and networking. National in scope, the site also provides a virtual forum for citizens, politicians, and activists seeking information, donations, or support. Clients pay for site hosting and data management tools, while information about issues, candidates, and political groups is free.
“We like to call it two-click activism,” said Chiu, who cofounded the site with HLS friend Perla Ni ’98. “With just two clicks, a citizen can take action. With the first click, they come to the site and learn about an issue. With the second click, they can take an action–e-mail their representative, join a group, send money, or volunteer.”
Chiu said he views Grassroots.com as an extension of his public service career. “We’re engaging the American citizenry,” he said. “Working in politics and law is often very intense, but the same can be said for a fast-moving Internet company.”
An MBA from Law School?
The pace is fast and furious. The details are endless. The stakes are high, often expressed in millions of dollars. The pressure, intense. In these ways, the new-economy marketplace bears a striking resemblance to courtrooms and case law.
This is a discovery that greatly pleases Williams, who said law school is more than ample training for the rigors of e-business. “I realized that lawyers are incredibly intelligent when it comes to business,” he said. “They have a great business sense–in some ways greater than business people.”
Steven Lurie ’93 and Julia Schwartzman ’97, who joined Keen.com in 1999, couldn’t agree more.
“Law school definitely applies,” said Lurie, who left Microsoft to become the manager of business development at Keen.com, a site dubbed the “first live-answer community” where users pay per-minute rates to get answers to questions via telephone. “It helps develop the attention to detail and the ability to analyze matters.”
“You often have to look two steps ahead,” said Firmseek.com’s Janice Ugaki. “The legal training prepares you for a variety of things. You learn to think on your feet and make important decisions quickly.”
For Ali Dibadj, founder and president of Webmediate.com, being put on the spot–as he often was at Harvard–was just the preparation he needed to bring his business idea to fruition. “I had a degree in electrical engineering, so I was familiar with analysis,” he said. “But law school helped me to analyze language and concepts, and to break up big problems into smaller pieces. When a venture capital firm asks me a question, I am able to think and respond quickly. Everyone at Harvard Law School was smart as hell, frankly. It really prepared me for this.”
Webmediate.com is an online alternative dispute resolution service aimed at enabling e-commerce to flourish by giving individuals and companies a place to work out disputes over failed or mishandled transactions.
Dibadj bills Webmediate.com as the “e-commerce safety net” for the “B-to-B marketplace” that will enhance online customer service for any company offering online transactions. Tapping the expertise of attorneys, professional mediators, and even a few retired judges, Webmediate.com offers an automated settlement system, Web-based mediation, and Web-based arbitration. Webmediate.com charges fees based on the kind of services used. While the fee for the automated system is based on a percentage of the final settlement, hourly rates apply when arbitrators and mediators are involved.
Relax, Dude, It’s a Dot-com
Foosball, couches, table tennis, free food, and pimply-faced vice presidents of information technology. This is likely to be the image burned into most people’s heads of what it’s like to work at an Internet company. But for most of these dot-com “dudes,” it is more myth than reality.
What’s closer to the truth are long hours, low pay, high pressure to meet the expectations of financial backers, and a general requirement to wear many hats to get the job done.
“The intensity of work in a dot-com environment is pretty similar to studying for law school finals,” said Keen.com’s Julia Schwartzman. Last fall, Keen.com had just completed a third round of financing, bringing the company’s total venture capital to $109 million. “Raising money is quite a feat. There are challenges in these changing market conditions. But Keen.com has been able to raise money in this environment. We have a really fun work atmosphere, and the energy level is much higher because there’s a lot of work to be done. We are all very results-oriented. We’re building a business.”
Busy, Busy, Busy
“I’m doing legal work, like a general counsel, but also cleaning filing cabinets and dealing with financial issues,” said Ugaki, of building Firmseek.com. “And, when I call the help desk for a computer problem, it rings right back to me! The work culture is very informal here, and we all work long hours–maybe 90 hours a week–but I love what I’m doing. There’s a new challenge every day.”
At Juritas.com, Chaka Patterson said he works an average of 14 hours a day–the same time he put in at Bartlit Beck–but took “about an 80-percent cut” in pay to build his company.
“The reality is that you work extremely hard. The fundamental difference is that I own a substantial chunk of this company,” Patterson said. “Building a company from scratch is incredibly exciting. I’m building something every day and have the potential to leave a lasting legacy.”
As for foosball, Patterson said that’s not what his company is about.
“We just got a major client who signed on with us because they saw us actually working when they came into the office,” Patterson said. “There are no Ping-Pong tables, no keg in the corner. I don’t care what people wear, and there’s no clock to punch. But we generally have a 24-hour turnaround time to get work done. We don’t have a game room because the reality is that if you have time to play, you ought to go home and be with your family.”
Soyouwanna.com’s Stris and Maher go even further, insisting they’re not really an Internet company.
“We’re an old-school company,” said Stris. “We actually intend to make more money than we spend. [Unlike many dot-coms] we have no ads on buses and we’re not buying spots on the Super Bowl. We’re a slim, efficient operation. We’ve had amazing press coverage, without any real PR people on staff. We’ve spent zero dollars on advertising so far.”
Working out of one room in an apartment in New York, Fashionwhore.com’s Scott Andrew Selby said the line between work and fun has long been blurred for him.
“I work all the time, in a way,” he said. “I work more than I did as a lawyer but pretty much enjoy it all the time. It’s easy to confuse my work with play because I have to go to fashion shows and parties in order to network and get ideas and material for the Web site. It’s fun, but it’s serious too.”
Grassroots.com’s David Chiu said he puts in about the same hours every week–between 60 and 80–that he did as a civil rights attorney. “But I’ve actually had a salary increase,” Chiu said.
“I love it. I think you can be much more creative in business than in law. You’re not constrained by legal procedure. There’s a real premium on thinking outside the box. And unlike litigation, which is constant fighting, business is about getting to yes and negotiating a win-win situation. As a founder and senior manager, I don’t have to focus on minutiae and parsing of legal matters. I get to focus on higher-level decisions.”
Still, he said, there are great challenges in creating something that didn’t exist before. “There are no guides, no models for what we’re doing,” said Chiu. “The learning curve is enormous. We’re trying to cut a path where none existed.”