One of the lesser known members of the LLC at Intervocative has posted this at Intervocative:
http://www.intervocative.com/Forums.aspx?task=viewtopic&topicID=291974
"Hello everyone,
My name is Kyle Pearson. I am/was 1/6th of InterVocative Software LLC. It’s been pretty entertaining reading the forum for the past few weeks. A lot of people are very imaginative exploring theories or ideas about what was happening.
Why I’m I posting now and not before? Simple, things were already “not so good”. I didn’t want to making things any worse. However, I’m going to give a little info to the background/history of IVS and maybe shed some light onto what has been happening.
Back during the mid 1990’s, Ken Cole and a few others from the same company started an informal side company to explore some software ideas. They bought a domain name called InterVocative. Due to “real” work, the projects went stale and so did all activity.
Fast forward a year or two later. I was a developer under Ken Cole where we were all working for a Fortune 500 company. Being frustrated with being dictated bad IT practices, I approached Ken Cole with the idea of starting a company to do software the way “we” wanted to write software. Obviously, he had similar frustrations and thought it was a good idea.
The initial question from Ken was what exactly would we create? Many of us would stay after hours and beat each other up playing various network enabled games. I had an idea to take all of the current RTS games, evaluate what was good/bad with them, and then start to produce a RTS game “we” wanted to play. The idea was to use established tools/graphics engines to produce a concept game which could be used to shop it around to game publishers. The next issue had to do with personnel. We realized that we were going to need help, so just like in the NFL draft, we began to pick people out of the company who shared our interest and thought might want to contribute. We picked 3 others which gave us a total of 5 members for “the group”.
The group of five began to meet after hours at work for brainstorming and requirements gathering for our “game”. Several meetings took place which brought about great discussions. During the discussion, we realized we needed to think about a name to represent the group. Ken Cole mentioned that he had already purchased a domain name and had some server space already available which we could use. The first issue was that one of the early participants of his InterVocative adventure had moved on in his career and had relocated to another part of the country. Ken suggested that it would only be fair to at least offer him the option to continue with this venture. He was offered, but decline to participate. So, this new group of 5 was the starting of a “new” InterVocative Software.
However, like most things line life, the job that pays the bills got into the way. The game work slowed to a complete halt before it ever took off. During this time, our main company’s IT direction was changing. The older technology used to produce their applications were being replaced with the RAD tools of the time. All of the developers began to use some their experimentation at work to discover some ideas for pet projects. After some time, I was approached by Ken Cole about his pet project called DVD Organizer. He asked if I thought it was something which could be marketed by InterVocative. My reservation had to do with the fact that it’s very difficult if possible, to make any money on shareware applications. At this time, another member was experimenting with image file manipulation. It looked like InterVocative could have two products to attempt to market.
At this time, DVD Organizer was a little further along than the image system so most of the energy was focused towards it. The name of the program was adjusted and a lot of brainstorming began around the feature set. At this time, we began to work on a website for these hopeful products as well develop the security (key) system. Other work started to revolve around formalizing IVS as a legitimate company in the forming of the LLC. To aid in the paperwork handling, a 6th member was added who was also a work associate of the group. At this time, the ownership of DVD Profiler came up. We explored several scenarios which included selling the software to IVS, or licensing it. We choose the later to allow the developers to retain ownership of their code.
During that time, myself and another IVS member parted ways with the “day job” company. This left 4 members at the original company, myself and the 6th member were now in a remote location. Communication was good during this time. We developed some internal resources to help distribute company communications as well as to keep the “group” together even though we were geologically separated.
However, the communications slowed and myself and the 6th member began to become excluded from a majority of the decisions and discussions. How can this happen? Well, IVS operated under the principle of a simple majority. So, with 4 members in one location, that created a simple (local) majority.
Discussion started to become heated as some members began to feel that other’s were not pulling their weight. At this time, I made it clear that IVS was “not” DVD Profiler. IVS was a company to allow the developers to develop their “own” software for IVS to market. No one in IVS was restricted to “only” work on DVD Profile or projects only related to DVD Profiler. While this didn’t exactly make me popular, everyone agreed but that meant the payment system would then need to be addressed. We established a system which would pay a small percentage made from a product back to IVS to be distributed to ALL members. Then, the owner/contributors to that product would receive the rest of the income.
This sounds nice at first because it solved the immediate problem, but it created some problems which lead to the demise of IVS. The payment system was fixed. In the case of DVD Profiler, the income was split into two pieces:
1. The “founders” portion
2. The contributors portion
From there, the contributors decided how their split portion. What’s bad with this? The distribution is 100%. What this did was fix the payments, regardless of “continual” work. If someone thought they “deserved” more money, that mean someone had to take less. The other problem, since the contributors’ portion became fixed as well, if a non-contributor decided they wanted to now contribute, they could “never” increase their income (based on the same problem of the 100% distribution problem).
To put it in perspective, if you were paid $100 per month to do nothing. However, if you actually did a whole bunch or work, you still only got $100; what would be your motivation to do anything?
With that in place, the level of activity from all the members but two severely dropped off. However, the payments didn’t. Now, for the people who were located in the “founders” portion, it really didn’t amount to a ton of money. I was one of them and I can tell you it wasn’t something I could retire off of or quit work and live off. ? It was more than nothing, so I will never claim it never meant anything.
As most of you know, Ken Cole left his main job in order to pursue working on DVD Profiler full time. He was not given a salary from IVS. He used the money he was receiving from the contributors portion to help supplement the loss of income.
I’m speaking here from only what I know from my perspective here on out:
During this time, Ken Cole became frustrated with the lack of effort from the other members of the company verses what they were getting paid. He decided after some time to approach the group for a buyout.
Now, he did this as a business partner and a friend. He give his opinion on what he thought would be fair for the buyout and allowed the members to provide their input. However, it fell on deaf ears and nothing ever materialized. He had no desire to continue in the current direction with IVS. Now, as I stated earlier, IVS never purchased DVD Profiler from Ken Cole and it was a product he bought to the company. In light of that, he began to work on pulling out the components which he didn’t write himself. Then he began work on a new company and a new version of DVD Profiler. Now, this information was not announced to IVS and there was never a requirement that he had to.
After several months, the members of IVS (myself included) received an email from Ken Cole announcing that he has started a new company called Invelos and that Invelos would be releasing DVD Profile 3.0 about a week prior to launch. In this email, Ken still expressed interest in proceeding with a buyout of some of IVS resources. So, at no point was Ken not interested in some closure with IVS.
At this point, things became a little more heated internally in IVS. At some point, the other members of IVS sought to create a Temporary Restraining Order against Invelos and a lawsuit. How could this happen? Simple majority. I found out about the TRO and lawsuit after Ken Cole was delivered the papers. None of the other members of IVS contacted me about this action. Technically, they didn’t have to as all they needed was a majority and apparently they had it. They also knew I wouldn’t support such an action so calling me to ok it would have been a waste of time. I mean, how can you sue a friend? However, it would have been courteous to call me and say “Kyle, we don’t need you to ok this, but here’s what we intend to do”. However, like it not, I’m part of the TRO and the suit as they can say they represent IVS as the majority.
This is also where I don’t really understand the reasoning. The TRO and lawsuit stand to gain absolutely nothing. Ken Cole never stopped talks about a buyout. In fact, the TRO and lawsuit only served to put IVS into debt and ruin any following it might have had. The problem with putting an LLC in debt is that the members are now responsible for that debt. So me, not being part of the suit or wanting a TRO, had to pay money out of my pocket to for the debt “they” incurred for these actions.
Now, at this time, a buyout should have been completed between Invelos and IVS. However, the current terms are half of what the original terms being offered before Invelos was in conception. So what did the other members of IVS gain from all this? Absolutely nothing.
I’m I bitter? To some extent, yes. The company was formed to allow people a place to develop and market products “they” wanted to do make. It was unfortunate that DVD Profiler was the only product ever marketed, but that’s not IVS’s fault. No one in IVS was told they couldn’t work on what they wanted. Where IVS fell was in it’s creation. There should have never been a 6 way partnership, and it should have been formed as a corporation to begin with so we could have had some more flexibility with the payment system. We didn’t create a way to foster people into “wanting” to develop new idea.
When people started arguing over who owned the code, while it wasn’t necessarily “my code”, that did frustrate me. They turned into exactly what “we” as in the people who started IVS didn’t like and what made us seek something like IVS for refuge.
I’ve seen a lot of posts like “Why does Ken need anyone? The other members are just mooching off him”. Well, successful companies have people of many talents to allow them to focus on what they do best. A technical person doesn’t always know the business aspect of things and vice versa. The people in IVS were there for a reason, however, since most of the people were technical they took a technical approach to the company (i.e. more features, more releases = more money). While that is a valid approach, there are other approaches to business. I wish the members of IVS could have seen that, but my discussions never went anywhere when trying to explain that aspect.
I wish Ken Cole the best of luck with Invelos. Those who like DVD Profiler and would like to keep using it for years to come, support Invelos. It will only live with support.
-Kyle Pearson
Kyle Pearson
Principal Partner
InterVocative Software, LLC"
It confirms a lot of what we all thought was happening. I hope Ken doesn't mind me posting this here. |