thomas_b_conner

The Reluctant Shareholder and Other Tales Surrounding Telalink's Merger Agreement

thos@oneelevendigital.com (Thomas Conner) — Tue, 16 Sep 2014 19:14:06 GMT

As the summer of 1999 neared an end, so, too, did the independent life of Telalink Corporation. A “novel-thick” merger agreement with PSINet was nearing its final draft stage. Amidst the fine details being reviewed and re-reviewed, the Telalink leadership had to settle on a few things before we could sign the agreement and close the deal.

As the summer of 1999 neared an end, so, too, did the independent life of Telalink Corporation. A “novel-thick” merger agreement with PSINet was nearing its final draft stage. Amidst the fine details being reviewed and re-reviewed, the Telalink leadership had to settle on a few things before we could sign the agreement and close the deal.

PSINet and Telalink agreed to a 15% holdback, meaning they would hold on to 15% of the proceeds of the purchase price of Telalink, about one million dollars. If, during the holdback period, PSINet discovered that there was some material deficiency in anything that we represented (say, for example, number of paying customers, revenue, pending lawsuits, etc.), then they could draw on the holdback fund as compensation for our negligence. It was like a one million dollar warranty. We had to negotiate the duration and accounting. When I say “negotiate,” I mean we asked for a one year holdback and they said the deal was off if we didn’t agree to 18 months. So, it was 18 months. We asked for the holdback money to be placed in escrow so that a third party trustee would oversee it and be at liberty to release the funds to us after the 18 month period had passed. PSINet said they would hold the money or the deal would be killed. No escrow.

It was during the negotiation about the escrow where PSINet’s initial arrogance was most evident. Their lawyer was downright snobbish. “Guys, we’re a multi-billion dollar corporation with 14,000 worldwide employees and YOU’RE worried that WE won’t pay YOUR million dollars in a year and a half. What? You think WE’RE somehow going to manage to go out of business just like that and not pay YOUR million dollars to YOU?”

Anne Arney, our lawyer, calmly explained to us how to deal with this. “It’s like this. Are you willing to do the deal and and not get the million dollars? That’s the risk.”

“Yeah! Bill had already talked the deal up by a million so that would just mean we settle for what we were originally going to agree to. Let’s do this!”

The second issue was more of an internal matter. Do we take cash, stock or a combination of both? For me, it didn’t matter. I preferred all cash but if I got stock, I was going to diversify my assets pretty quickly so either way worked for me. I can’t remember but I think Tim was the same way - either will be fine but cold, hard cash is the preferred method of distribution. Bill wanted stock. All stock. He was willing to ride that stock price up, up, up. Certainly, the past 12 months suggested this was the trend. Several other staffers were aware that we had to make a choice. They were concerned.

“All stock?” asked one of our colleagues. “How’s that going to help me buy a house? I need some cash out of this. Am I going to have to pay taxes? How long would I have to wait before I can sell? What does that cost?”

There were many curiosities surrounding the method of payment. Such curiosities turned into concerns which turned into debates. I’m not sure how it was determined but Tim, Bill and I decided to recuse ourselves from the decision and we asked Bob Collie, Scott Sears and Michele Watkins to arrive at a unanimous decision- cash, stock or a combination? They caucused and rendered a verdict- “We’ll take the cash.” And thus, it was cash for all.

Finalizing the details. it was determined that there were some assets with which to be dealt. First of all, the Nashville Regional Exchange Point (aka “NREP,” although Mr. Southeast Region President somehow managed to call it “NRAMP”) was a carrier-neutral data center that was 50% owned by ISDN-Net and 50% owned by Telalink. While it felt awkward, there wasn’t much we could do about it. So, not only was ISDN-Net NOT going to be merging with Telalink. They were, in fact, whether they wanted to or not, going to end up co-owning NREP alongside PSINet, the very company that did NOT want to acquire them and wanted instead to only buy us. Yes, it was very awkward.

Next, there was the asset known as nashville.net which Bill Butler wanted and still owns to this day. Since that time, nashville.net has been an email service and currently serves as an events app and blog for shows around Nashville. Last was the piece that Tim, Andrew and I wanted- all of the code that was used to manage website content in the websites that we hosted. PSINet didn’t want any of this. In fact, they really didn’t want any of our infrastructure. They wanted our customers. The bottom line for them the would be moving all of our customers on to their services (even if what the customers were paying for was not available in our market). So, when it came time to break away some of the assets, they had no objection to transferring all of the code that had been written over the previous five years to a new company, started by Andrew, Tim and me, called Monster Labs, Inc. - for the price of $100.00. At the time, Telalink was generating about $80,000/month in web hosting fees.

Rounding third and headed for home, there was just one more seemingly simple task and that was to have a shareholder meeting to approve the merger. Without much concern on our end, PSINet insisted that 100% of the shareholders approve the plan. “Who would object?” I thought. “The original investors are going to make about 5 times their money. We had been issuing restricted shares to staff based on performance and some of them would receive quite a nice return for no cash invested. How could anyone be against this deal? This is a no-brainer! We’re almost there!”

Well, indeed, the chickens had seemingly been counted before they hatched. Here’s the scene:

Official correspondence was sent out around October 10, 1999 (certified with return receipt requested) to all Telalink Corporation shareholders announcing that a meeting would be held in the evening (after dinner was served) at the University Club of Nashville, Tennessee to vote on Telalink Corporation merging with PSINet Inc. If approved, the deal would close on November 22, 1999. The proposed details of the merger were included along with a form naming either Thomas Conner, William Butler or Timothy Moses as proxy authorized to vote in their absence. Even if a shareholder was going to attend, we asked that everyone submit a proxy just in case, for whatever reason, they had to change their plans at the last minute. We even named proxies for each other. And so we waited for the documents to be returned (which included postage paid envelopes).

Staff members and local family signed immediately. No sweat. We expected those to be approved, signed and returned immediately. I received a few phone calls from minority shareholders who were curious about what all of this meant. They just wanted to know was this a big happy event or was this a last act of desperation? These were mainly a handful of retired folks, friends of various family members, who put up $2,000, $5,000 or maybe a little more as a favor. “This is a VERY good thing!” I would assure them. “We are so grateful for your support over these past five years and we are very excited that you will be rewarded with a substantial cash return on your investment.” Aside from a few technical details regarding the process or receiving verbal regrets in response to the invitation accompanied by a promise to return the proxy statement right away, the calls were largely of a congratulatory nature.

Every shareholder responded affirmatively by the deadline, about ten days out from our meeting on November 7… except one, a minority shareholder whose investment was near the smallest amount. He had not replied to our request for a response.

“Not a problem,” I thought rather confidently to myself. “I know this person pretty well and he lives and works very close by. I’ll just give him a call. He’s probably just been too busy and needs to be nudged. I will offer to go to his place and pick everything up to make this as convenient as possible.”

The call went something like this:

“Hello, Mr. Shareholder?”

“Oh hi, Thomas!”

“Hey, I just wanted to make sure you got everything and that you were ready to sign off on the agreement and come to the shareholder meeting. Of course, I also wanted to make sure that all of your questions are answered.”

“Yeah, thanks for the call. You need to call my lawyer. His name is _________ and I can have my secretary get you his number.”

“Your lawyer?” My breathing became shallow and my mouth got dry.

“Yes, he advised against this and said you need to work it out with him.”

I nearly dropped the phone.

“Ohhhh, okay, then. I’ll call him right away. Thank y…” My voice trailed off. My heart was beating so fast that I was getting light-headed.

“Don’t worry, Thomas. You’ve got this,” I said to myself. “You’ve dealt with enough lawyers, tax accountants and auditors, IRS agents, state revenue auditors, due diligence analysts, angry customers and difficult staffers. This lawyer can’t possibly be that difficult.”

I called the lawyer.

“Yes, Mr. Conner. I know who you are. I’ve looked over the merger proposal that you sent to my client and he will not sign this or anything like this. This deal is nothing but a ‘get-rich’ deal for you and your friends. My client isn’t getting anything but crumbs. I’m going to look into this a little more in detail but we may need to file a lawsuit against you for fraud.”

“Ummmm…..I…..exactly….did you say…..uhhh……so…..”? The lump in my throat which had obstructed any discernible word finally shrunk enough.

“Sir, I beg your pardon but there HAS to be a misunderstanding of some kind. I don’t think I believe what I am hearing. Maybe I need to have our lawyer contact you?”

“I’m happy to tell your lawyer the same thing, sir. You can’t just trample over my client’s rights as a minority shareholder and expect him to just agree to anything you tell him to do.”

“Yes, sir. Thank you for your time, sir. Have a good day.” I was in full eeyore mode by this point. My voice was monotone and very soft. I sat at my desk and stared at my computer. “We are soooo doomed” was all I could think.

I got up and walked over to tell Tim and Bill. The solemn message soon evolved into pronouncements of rage.

“WHAT!!!!????” said Anne Arney over the phone. “How could he say that? Who is this lawyer?

I usually remember names but perhaps the sheer hauntedness of the words exchanged with our shareholder’s lawyer was just too severe. Perhaps, just as Lord Voldemort was “He-Who-Must-Not-Be-Named,” I must have convinced myself to block this monster’s name from my memory because I cannot remember….not that I would share such a detail with the public.

I gave Anne the lawyer’s name.

“Him??? Are you kidding???!!!” Anne was incredulous. “I know him. Don’t worry, Thomas. I will straighten him out. He has no idea what he’s talking about. Just wait until I talk to him.”

Anne is usually quite mild-mannered, soft-spoken and mostly calm. Not this time. She was incensed.

For 1.6 days, I brooded and waited by the phone. Every minute felt agonizingly slower than the one preceding it. I couldn’t focus much. Everything we had to do to close this deal. Everything that we had done over the previous five years. Every battle, external and internal, that we had faced. Every risk that we undertook. It had all come down to one minority shareholder’s lawyer slamming the brakes on us. I waited, accompanied by the sound of not much more than my heart beating. Finally, the phone rang.

“Hi, Thomas. It’s Anne Arney. I talked to the lawyer. The shareholder will sign. This is no longer a problem.”

Anne was back to her calm, steady self.

I became euphoric. “He will???!!! What did you say to him?”

“Let’s just say that I was successfully able to turn all of his objections into a clear demonstration of his lack of understanding. Basically, the lawyer didn’t understand that Telalink wasn’t just a passive investment for you and the others but that this was your job for the last five years. The lawyer thought you guys were trying to get a big payoff without investing much in it while his client was only getting a 500% return.”

“Without investing much……” Oh, only our LIVES!

I thanked Anne, hung up and told the others. “We’re back on track. NO ONE is to do anything dangerous before that shareholders meeting or the closing for that matter. EVERYONE will be safe, sound and cautious!”

The next morning, I was headed to work. Stopped at a four way stop, I looked in my rear view mirror and who, of all people, got out of the car behind me and ran to my window, which I rolled down. It was none other than our reluctant shareholder.

“I’ll sign! I’ll sign!” he said. “I’m really sorry for the misunderstanding!”

“No problem!” I said. I thought something different. Since then, we’ve had a laugh or two about it.

100% of the shareholders had approved the merger. 100% of our proxy forms were in hand. The meeting would be a formality.

November 7, 1999. A nice dinner at the University Club, Some nice words exchanged. My friend, Jim Brown, who was a local broker for J.C. Bradford, was asked to be present in case, for whatever reason, we needed a licensed securities dealer to be named by the company to act on our behalf for any transactional needs. Anne Arney and Ramin Olson, a recent Vanderbilt law grad and attorney working with Anne at Doramus & Trauger at the time, attended to keep order of things and to answer any legal questions.

There was but one vote.

“All in favor of approving the plan for the merger of Telalink Corporation with PSINet, Inc, say ‘aye””

A chorus of “Ayes”

“All opposed, say ‘nay’”

Silence. Phew!

I thought of my dad and how much I wished he could been there for this moment. There just aren’t too many times in one’s life when you get to experience such a precise moment of affirmation for your work. Somehow, I think my dad could have used one more of those before he died.

The resolution passed unanimously.

It was time to order some plane tickets and make reservations for a hotel in New York.

November 22, 1999, here we come!

PSINet Adventures- "Why Don't We Just Take Him Out and Shoot Him?"

thos@oneelevendigital.com (Thomas Conner) — Fri, 02 May 2014 19:10:03 GMT

In the summer of 1999, PSINet was performing its due diligence prior to the acquisition of Telalink and it provided our first insight into one of PSINet's more colorful personalities - our soon-to-be new boss.

Some really fun and exciting things are happening at Sitemason these days. That all started right around the beginning of the year and I have been remiss in keeping up with my blog duties. My last post about the loss of my cat, Misty, most certainly deserves a follow-up since I have been adopted by a new cat, Mrs. Patmore. I’ll write about her soon but allow me to return to the Telalink story for now.

The summer of 1999 was a flurry of activity. The letter of Intent and term sheet that we received from PSINet required the scrutiny of Frank Woods, our broker, and Anne Arney, our attorney. Of course, that was just the beginning of the legal activity that we were about to encounter.

Despite the monumental task of document, proofing, and editing, and the long list of tasks that were required of us to enable PSINet staff and their appointees to exercise their “due diligence” of our accounting, operations, customer list, infrastructure, staffing, etc., the news was already getting better. Before we could even get to work on some of the finer details of the transaction, Bill Butler had already received a phone call from PSINet’s “Southeast Region President.”

Now, at this point in the story I must tell you that I have decided to not reveal this man’s name. I’ll just call him “Mr. Southeast Region President.” I will describe him, but I’ve decided that his name is no longer important. I feel like I have more creative license if I can paint a picture of this man’s personality rather than publish his name and you, the reader, may feel compelled to Google him. Of course, I did Google him. He still exists. It appears that he’s still a tech executive and who knows what he’s like now? I don’t and I don’t need to know. All I can do is share what it was like to be around him when we were bought…

Mr. Southeast Region President liked us and we liked him…initially. He was from Brooklyn and I don’t really know how else to describe him but that he looked, acted, and talked as if he had stepped right out of a mafia movie. Sort of a Michael Corleone look with a Tommy DeVito (think Joe Pesci in “Goodfellas”) attitude and mouth- dark, slicked-back hair, svelte, nicely styled clothes, always tan due to the fact that he moved to Tampa. He was the kind of guy who would smile at you with his perfectly white capped teeth, put his arm around you and, while he’s still smiling, say, “Don’t f**k with me. Understand?”

Back to the phone call with Bill. It must have been a hell of a call because, after Bill explained our business and told Mr. Southeast Region President all about us, he committed an additional million dollars more on the purchase price of the company and decided to travel to Nashville to meet us by week’s end. Bill, Tim, Bob, Scott and I arranged to host him for lunch at the San Antonio Taco Company (still one of my favorite spots) where he bought us all beers and fajitas.

Think about it. We were already willing to sign a letter of intent to sell out at $5.5 millions and this guy basically says, “I tell you what. How about we pay $6.5 million?” OF COURSE I liked him!

His message was this: “We love your company. We love how you do things. We love your team. We love your customers. We love your image. We love everything about you. The good news is that when we buy you, you’ll just keep doing the same thing. Hell, you can even keep the Telalink name. That means more to Nashville than the 'PSINet' name. I’m thinking we’ll say ‘Telalink, Powered by PSINet.' What do you guys think?”

We were all sold on this guy. He was going to be the best person ever to be in charge of us after we sell. “Wow, he really gets us!” we all thought. “How could we ever go wrong working with this guy?” Except…

The thing was, we all sort of thought that just MAYBE we WOULD leave at some point. And, if so, what would we do? It was pretty clear that Bill was getting very restless and was really wanting to go out on his own. Tim and I were content to work together and we talked about what that looked like.

There was ONE thing that Tim and I wondered about. Would PSINet have any interest in all of our code- the scripts that we developed for our web hosting customers? Basically, that’s what he and Andrew Webber, among others, had spent much of their time on- building scripts that made website development and management tasks simpler- like a form builder and commerce, to name a few- radically sophisticated stuff that few people could do in those days. If so, then great. Those guys would just keep programming scripts for PSINet. If not, then maybe we could keep the code and start another business. And, if that’s the case, then maybe it would make sense for Andrew to leave right after the acquisition and he could work for our new start-up. There was much pondering in those days. “What does PSINet want? What do they need? Can we work for them? Will they keep us? What if things AREN’T perfect after the acquisition?”

At some point during the due diligence and negotiations phase, the picture got clearer- PSINet would eventually move all of the Sitemason hosting to their own servers and convert those accounts to their own product. They did not see much value in our scripts and would not have any problem with us keeping that code. For $100, we were allowed to transfer the intellectual property to a new entity as long as we permitted the Telalink customers to have an unrestricted, perpetual use license of our code. It was a deal. With the ease of that negotiation in mind, and anticipating that we would all soon have a lot of cash, Tim, Andrew and I decided that Andrew could be “let go” from PSINet shortly after the acquisition and he would be in charge of starting a business around our $100 asset. Tim, Andrew and I would be co-owners.

“This will be a win-win!” said Tim. “We can show the PSINet people how responsible we are by helping them determine who they don’t need anymore. They can keep what they really need to run the company and save money and maybe we can even be rewarded with higher salaries for ourselves for making Telalink what it needs to be to fit their model.” It made total sense to me and Andrew was eager to get along and start something new.

All we had to do was convince Mr. Southeast Region President. Tim and I requested a conference call. For whatever reason, we had to arrange the call some time late in the evening. It was probably around 8 pm. All we wanted to do was tell him that we were very excited about the deal as were all of our employees. Additionally, we wanted to recommend that we should offer a severance package to Andrew and let him go soon after the merger. If the hosting was going to be moved and ongoing code development was no longer part of the company strategy, we were sure that PSINet would agree that letting Andrew go would make perfect sense.

I did most of the talking, confident that this would be short and easy. “We simply won’t need Andrew. There may be others who may not be needed and we MAY need to pay others more to keep them. Tim and I have looked at staffing pretty closely and we will have some more recommendations but we just wanted to go ahead and get it on record that Andrew will need to be let go.”

Tim added, “Yeah, we’re basically eliminating his job if we don’t code the Telalink scripts anymore. It just makes sense. We want to do the right thing for PSINet but we figured it wouldn’t be a bad thing if we prepare Andrew for this now, rather than wait until later.”

There was silence on the other end.

“Soooooo, would it be okay if we go ahead and plan this?” I said. “We know he’s going to be fine with it. In fact, he’s expecting it. How do you guys handle severance packages?”

Continued silence. I cleared my throat. Tim was in his office and I was in mine so I couldn’t see his face but this wasn’t being greeted with the enthusiastic affirmation that I was expecting.

“Ummmmm, hello?” one of us said. “Are you still on the line?”

Remember, a thick Brooklyn accent. “Aaaahhhh I gotta tell you guys. I don’t think so. Aaaaahhhh I don’t want to kick anyone out before I get a chance to figure out what the “f**k’s going on, you know what I mean? I mean, who’s to say this guy’s not going to run out and start a competing business and take half my f*****k bookings with him, you know? Aaaaaahhhh, no, I need to look this f****r over first. I don’t trust him. What else do we need to talk about?”

“Oh, no-no-no-no-no!” I objected nervously, in a high-pitched, faster-paced voice. “Ha, ha, noooooooo, not Andrew. Of course not. He’s good and, and, and, and we totally trust him. We just won’t have any work for him after the acquisition.”

“Yeah,” said Tim. “This is the best of all worlds. We won’t have to pay him and we certainly won’t have to worry about him competing with us. He would never do that.”

“We can get it in writing,” I interjected.

And then came the weird part.

“Hey, I got an idea….ahhhhhhh why don’t you just take him out back and shoot him?” said Mr. Southeast.

“Excuse me?” I said. By this time the “me” in “Excuse me” was probably a “high c” pitch.

“You heard me. Let’s just take Andrew out and SHOOT HIM If we don’t need him. Aaaaaaahhh, I gotta tell ya, Aaaaahhhh I don’t know what this is all about but there will be plenty of time to figure out who’s dead weight. But ahhhhhhh I don’t want anyone fired right now. I don’t want anyone taking the business out the back door. I’ll fire the f*****g dead weight when I know who’s f*****g dead weight. Anything else? Thanks fellas, for reaching out to me. Aaaaaaahhh I know you’re trying to do the right thing and trying to be a company player. Aaaaaahhh, I’ll talk to you soon. Good night.” Silence.

I ran into Tim’s office. “LET’S JUST SHOOT HIM???!!! What was that?”

Tim was laughing hysterically. “That guy’s a nut! He’s crazy! What is he trying to be, anyway? A real gangster? HA HA HA HA HA!”

“I think he really meant it,” I replied, with a half helping of paranoia and a half helping of sarcasm. “He wants us to kill Andrew! Maybe we’re being bought by a crime syndicate? What the hell have we gotten into?” I smirked. Truthfully, I wasn’t really wearing my conspiracy theory cap but it was funny to think about it.

“He’s a MORON!” said Tim. “A complete idiot! I’m pretty sure I’m not going to want to work for this jackass.”

“Now, Tim. we can’t just leave. We have employment contracts. We have non-competes. That was, for sure, a damn-weird conversation but let’s assume he was drunk or, at least, if he is a moron, that not everyone in the company is like Don Corleone, there.”

“Do what you want but I’m staying away from that fruitcake. I’ll do whatever I need to do to NOT interact with him.”

“I’m too intrigued,” I said. “Besides, we’ll have enough money that there’s no reason not to ride this for a while. We gotta stay and watch this show.”

“Oh, I’m staying. They’ll have to fire me if they want me gone. I just won’t do anything with Mr. Southeast Region President. I’m staying quiet and out of the way.”

It’s amazing how quickly things got strange. This was, most clearly, the beginning of the end. In a matter of a few weeks, we went from counting our millions in our heads and running Telalink in Shangra-la-esque fashion to wondering if our new boss was a mobster and was expecting us to “ice” Andrew. Just to be sure, we told Andrew to drive different routes to work in the future.

The Extraordinary Events That Led to the Sale of Telalink in 1999

thos@oneelevendigital.com (Thomas Conner) — Thu, 05 Dec 2013 20:06:01 GMT

Fourteen years after Telalink was sold to PSINet, the story behind the deal offers an intriguing look into how a Nashville-based Internet service provider navigated its way through the "speed-dating" process that ultimately resulted in its acquisition.

This story was never supposed to be told publicly. We had decided that we would let “what could have been” fade into the past like the 28.8K modem. Nevertheless, out of loyalty to Telalink folklore, once the story (or at least a version of it) came out years ago in a local newspaper, I no longer felt compelled to stay quiet and, around this fourteenth anniversary, it‘s time to offer my version of the events that led to November 22, 1999.

1999 started with a bit of a reprieve for me. With the help of Frank Woods, I was able to negotiate a payment plan with Gayle Fuson of Bohan Carden & Cherry so Telalink could cashflow again. Additionally, “irrational exuberance” was in full swing by this year. The market was going insane over tech companies. Cash was pouring into just about anything with a “.com” in its name. The NASDAQ composite was skyrocketing, hitting a record high just about every day. The Dow Jones Industrial Average was also hitting new highs but the tech-heavy NASDAQ was the new sexy. Everything was coming up roses for everyone but business schools. They were suffering because 20-somethings saw no point in spending three years getting an MBA when they could become a “dot-com millionaire” in a few months with nothing more than a radical idea to “shift paradigms” or “create “synergies” with a business plan that didn’t even include a revenue model. “We will monetize this model later,” was a typical statement.

Several businesses were setting up servers with Nashville Regional Exchange Point (“NREP”), so that was going well. By spring, Ken and Jerry from ISDN-Net and the Telalink leadership (Bill, Tim, Bob and Thomas) began meeting about merging and that led to my meeting with ISDN-Net’s CFO about financials. Not waiting to actually merge, we soon started meeting with interested buyers and we presented ourselves as two companies that were “in the process of merging” and interested in being bought out. So many suitors came calling. I disliked most of them. We’d have visits from these arrogant, boisterous, “alpha males” who wanted us to be impressed with their grand “roll-up” plans, meaning they had all of this investor cash to buy up little ISPs so they could then become dominant players in the market. Typically, a CEO or acquisition specialist would fly in and we all had to dance a certain way. EVERY time I was in one of these meetings, I couldn’t help but feel as if I were in some kind of speed dating session (note: I have NEVER participated in a speed dating session).

It felt something like this (remember, we’re speed dating):

CEO: “Hey baby, I think I like your stuff. You got it going on.”

Telalink/ISDN-Net: “Oh stop it (fanning ourselves) We’re just a coupla little ol’ ISPs down here in Nashville who got together and had some fun. Have yourself a tall glass of sweet tea. Now, how badly do you want us?”

CEO: “Well wait a minute. I mean, you should really want ME! Take a look at my roll-up plan. We’re taking the Southeast by storm and my investors have millions! I was once a professional wrestler before I became a Kenny Rogers Roasters manager. I know EVERYTHING there is to successfully bundle ISPs and become the next big player in this biz. We’re going to be EBITDA positive by spring 2002 at the rate I’m going, baby! I’ve read The Art of War! But never you mind your pretty little head. I don’t want to bother you with such saucy language. Let’s just jump in the sack together. I’ll pay you something based on this formula that my finance guys whipped together:

The original blog entry included an impossibly complex formula that has not yet been re-created

(blogger's disclaimer: this is a real formula but is really just for demonstration purposes only)

I have no idea what the hell this means but you don’t want to pass this up……and you can have a big time stake in our plan going forward....”

Blah, blah, blah. Whatever “the deal” was with the buyer of the day, we usually never got beyond the meeting where everyone was trying to impress one another. Meanwhile....

My first meeting with ISDN-Net’s CFO was a bit of a disappointment. We finally agreed to peek at one another’s financial statements for the first time. ISDN-Net proposed a merger in which Telalink’s worth was 40% and ISDN-Net’s was 60%. This was most deflating and downright insulting.

“Exactly how did you come up with this?” I asked.

“The numbers don’t lie. Our revenues are a lot bigger than yours,” said the ISDN-Net guy.

“Yeah, if numbers were all the same, that would be true. YOUR revenue includes a lot of equipment sales and consulting fees. OUR numbers include a nearly equal amount of RECURRING revenue. THAT’S what matters with ISP mergers and acquisitions,” I rebutted.

And so it began. Back and forth and back and forth we went with scenario after scenario. Slowly but surely, over months, the ratio headed more toward an equitable deal. This process frustrated me and gave me a healthy concern over how we would work together. I was feeling a little nervous and somewhat leery. Taking the minority stake in an operation of “equals” was definitely eating at me but we continued the exercise for some time.

One day, in the middle of deliberations, we got a call from PSINet, the company that had a strategic partnership with NextLink and that had originally told us, at Telalink about a year prior, that we were too small for their acquisition interests. They were suddenly interested in buying our combined companies- Telalink and ISDN-Net. Rarely did we meet in the Telalink office (our space was quaint) but the usual suspects were all there, in suite 1 of the Euclid Court Building at 110 30th Avenue South. Ken and Jerry from ISDN-Net; Bill, Tim, Bob and me from Telalink; Eric Lunn from PSINet.

“We’re very interested in your companies. VERY interested,” said Eric.

“Let me tell you something….unless we’re looking at ten times revenue, you can be interested all you want but we don’t have much to talk about because that’s what it’s going take,” said Ken in a pompous tone.

“Ummmmm, WHAT?!” I asked.

“Yeah, where did THAT come from?” asked Bill.

You see, ten times revenue would have been an insane deal. No one was paying that kind of multiple for companies our size. A multiple of two to three times revenue would have been a good deal. Asking for ten times your revenue was bold but unbelievably foolish. It just sounded as if we weren’t serious or, more likely, that we didn’t know what we were doing. It gets worse...

“Okay, well, I’m not going to talk about multiples until we see your financials,” said Eric.

“We’ll overnight them to you,” said either Ken or Jerry.

“Ummmmm, WHAT?!” I asked. “I can’t have anything ready to send tomorrow. I’ve already got a busy rest of the day and it’s going to take some time to get everything compiled. I’ll need a few days if I really have to compile everything on this list!”

I was mad and starting to feel like a fool.

“Well, the sooner the better,” Eric said. Once we get what we need, we’ll be back in touch.”

That was pretty much it. Eric headed back to New York or Virginia, or maybe to his next acquisition target. As soon as he closed the door behind him, I vented my anger.

“Guys, you can NOT promise stuff on my behalf and flippantly tell someone that we’ll overnight the most current financials to anyone unless I say that I can live up to that. PLEASE don’t ever do that again. The list that he gave me is long and it will take my entire week to assemble this. And another thing....TEN TIMES REVENUE?! If I were that guy, I would have left this room as soon as I heard that! When was this discussed and how could you say something like that when NO ONE would consider that.”

I don’t remember the response but I stormed out in anger. Maybe I got an apology. I don’t know. By the beginning of the next week, I sent a FEDEX package to PSINet, certain that I had held everything up because I couldn’t meet the “we’ll send them out tomorrow” deadline.

Weeks passed and while there was no word from the PSINet people (I was certain that deal was dead), the Telalink and ISDN-Net folks had finally felt good about an arrangement that was at about a 51%/49% arrangement. Ken and Jerry had actually, maybe prematurely, had their attorney draft a letter of intent and sent it to us. All we had to do was sign and it DID finally meet with our approval. We scheduled a time for them to come over after the July 4th weekend. They would come to our office after lunch. It was pretty much set until….(Queue the music. What follows really did happen)

About 30 minutes before Ken and Jerry were to arrive, I got a call from a gent at PSINet.

“We want to buy you.” he said.

“Of course you do,” I said, sarcastically. “What’s your multiple? One times revenue?” I was starting to get pretty bold and snarky with all of these so-called “We want to buy you” conversations.

“I’m faxing a letter of intent to you as we speak. Looks like we’re landing right at just over $5.5 million. I don’t know what ‘the multiple’ is. I just know that’s what we want to pay for you.”

“That’s stock, right?”

“Stock, cash, combination. Whatever you want.”

“Uhhh, but that’s for BOTH companies, right? You guys want to pay $5.5 million for both ISDN-Net AND Telalink.”

“No, we’re not interested in them. Just Telalink. For one thing, we had to ask for their financials for weeks. And, once we got them, we saw a bunch of revenue that didn’t really interest us. We’re looking for the pure recurring revenue companies like what you guys have. Have you got the fax yet?”

Have you ever been given such astounding, such amazing, such undeniably good news that you heart started pounding hard, you started breathing really fast, you were shaking all over and you couldn’t actually formulate discernible words? I pulled the two page letter off the fax machine. The more I read, the dizzier I got.

"THIS was the deal!" I thought…."but wait! Ken and Jerry are on their way to see us right now! We CANNOT sign their letter of intent! I need to tell Bill and Tim right now!" I ran and grabbed Bill.

“You gotta…..you gottta…..you gotta look at this. C-c-c-come into my office r-r-r-right n-n-n-now……..look at this! I’m going t-t-t-o g-g-g-g-et T-t-t-tim. TIM!! TIM!!! TIM!!” I ran down the hall to find him.

I found Tim and grabbed Bob and we raced to the conference room, knowing that Ken and Jerry would be walking in any minute.

Imagine this next paragraph spoken in a nervous tone and a rapid speed:

“Okay, here’s what we do. It’s too late to call Ken and Jerry. They’ll be here any moment. We can NOT sign their letter of intent and we can NOT tell them why. They can’t know about PSINet’s offer at least right now. Keep you mouths shut. Don’t say anything! We’ll just stall. Leave it to me. Don’t say anything. Keep cool. Look normal. Act normal. Don’t panic. We don’t have to tell them anything. We’ll tell them later, in a few days. Just, everybody, stay calm. I’ll handle this.” These were my instructions and I sounded nothing like a calm, normal, non-panicky dealmaker. I was shaking all over and my voice kept trembling, my inflection indicating a very abnormal sense of nervousness. I needed to pee.

“We have to tell them!” said Bob. “It wouldn’t be right. They’re expecting to merge with us. They’re going to know something’s up. We’ve been talking about this for months!”

“I don’t disagree with you. We’ll tell them. Just can’t do it today. We HAVE to look at this offer from PSINet and we HAVE to do what’s in the best interest of the company…..and a $5.5 million cash offer is sounding MOST interesting. Look, today, we do nothing with no one but let’s keep cool and defer signing with ISDN-Net. We just need to….

KNOCK KNOCK! The sound came at the door. I hid the PSINet fax in a folder and clutched it tightly.

In walked Ken and Jerry.

“Hey guys! We’ve been looking forward to this moment all day, haven’t you?” inquired Jerry.

Bill, Bob, Tim and I collectively swallowed.

“Hey, have a seat. How’s it going?” one of us said.

“Okay,” said Jerry rather confidently. “We’ve done everything you requested. This letter of intent has got everything we negotiated included and, even though we feel like you’re getting more than your fair share, well, we’re ready to do this deal with you guys. Let’s sign this letter and get on with this merger.”

My voice was still unstable.

“Oh, yes, well, well look at that letter. It sure is there….”

“You see? Look! 49/51! It’s all there,” said Jerry. He looked at me, noticed my discomfort, wondering if there was a problem.

“Yeah, uh, oh yes. Yes indeed. Looky there. Yeah, w-w-well, you see. So, I don’t think we want to sign today…just yet. I mean, we need a little time to ourselves on this. You understand. You know. It’s a legal thing. I just think..” My voice trailed off.

“But this is what we’ve all been working toward for the past six months!” Jerry started to look pale as I gazed away toward Bill, Tim and Bob. Their heads were bowed as they stared at the table. Jerry was trying to make eye contact with someone. He knew something was terribly wrong. “I don’t get this. What’s wrong? Why won’t you sign? That’s why we’re here!”

“Listen,” I said. “I’m sorry. We didn’t mean to make you guys drive all the way up from Brentwood just to be told that we won’t sign. I’m, I’m really sorry about that.” My hands were clammy as I fiddled my fingers.

“We just need a little more time,” said Bill, his hand suddenly covering his mouth as his elbow rested on the table.

“That’s it. More time,” said Tim, looking up at the ceiling.

Bob couldn’t say a word.

Jerry lay his head on the table, his arms enveloped around his head as if he were an elementary school student who had just informed the teacher- “I don’t feel so well,” which would be followed by “Just put your head down on the desk, honey.”

Indeed. Jerry was down and out. Thirty minutes earlier and ISDN-Net and Telalink would be in agreement to merge. Thirty minutes, yes, but they DID have months to come up with a fair deal that would have rendered the PSINet offer a non-issue.

Still, I couldn’t help but feel sorry for the ISDN-Net guys. They were clearly disturbed and frustrated as we nervously sat around the table, no one offering any hint of what had happened.

“Well…..just call us,” said a defeated Jerry. “Let us know as soon as possible. We need to get this done.”

And I silently knew that it would never be done.

They left.

My heart rate returned to normal. My breathing, not as short and rapid. We sat at the table a little longer after Ken and Jerry. We looked at each other, eyes shifting from one to another while keeping somewhat still.

“That was weird,” said Tim.

“It was uncomfortable,” said Bob.

“We’re selling out to PSINet!” said Bill, smiling from ear to ear.

“I’ll call Frank Woods and Anne Arney,” I said. “Let’s call a company-wide meeting and meet back down here in 30 minutes. We’re doing it. We’re selling.”

It was July 6, 1999 at approximately 2:00 pm.

To be continued….

Adventures in Marketing, Collaborations, Joint Ventures and Merger Flirtations

thos@oneelevendigital.com (Thomas Conner) — Thu, 24 Oct 2013 18:59:18 GMT

It's kind of like high school- who likes whom; who's doing what to get whose attention; whose parents are allowing whom to do what and when with each other. Except no curfews and everyone wanted the geeks.

As 1998 evolved, Telalink Corporation became very visible in Nashville, thanks to a big contract that we signed with Bohan Carden & Cherry. We hired Chris Ferrell (then, a young, popular Metro city council member and now the CEO of SouthComm, Inc.) away from Citysearch.com as our marketing director and he embarked on an ambitious spending campaign with the Bohan Carden & Cherry team to make Telalink ubiquitous in Nashville. The cartoon-styled Telalink logo started showing up all over town on bus benches and a major ad campaign had our staff members appearing in The Tennessean all the time. I remember awaking one morning to read the paper and, as I sat down at the breakfast table, I did a genuine “spit-take” with my coffee upon viewing a quarter-page ad showing Hagan Rose (posed in front of a barnyard background) in overalls and talking about farming, giving blood and playing soccer...oh, and selling Telalink services.

“Wow!” I thought, “How much did all of THAT cost?!”

It turns out that we had developed a whole series of ads with Hagan the farmer, Michele the Chef and I can’t even remember the rest of the campaign but it was REALLY expensive. I think one ad placement in The Tennessean was $7,000.00 not to mention the actual ad production costs. I don’t think we had spent that much for an entire year in the past. All of those ads and bus benches enhanced our branding and awareness, for sure, but I was very uneasy about such a hit to our cashflow. Before it was all over, I ended up having to work out a payment plan with Bohan Carden & Cherry because we had racked up a $150,000 debt with them! We were growing but not fast enough to pay for those kinds of bills.

It was about this time that partnerships and collaborations started coming into focus for us. First, our relationship with Nextlink (later to be called and now known as XO Communications) was essential. They loved us and we loved them. Nextlink’s CEO, Don Hillenmeyer, and Telalink’s president, Bill Butler, were talking openly about how great it would be for Nextlink to acquire Telalink. Nextlink had gone public in 1997 and was spending a lot on building out its own fiber network in various markets but they were also looking at strategic acquisitions with some of that cash. To Don, acquiring Telalink was a no-brainer and he solicited Kevin Crumbo to assist with making the case for an acquisition. However, the Nextlink HQ leadership, which included Craig McCaw of cellular phone success (he sold out to AT&T for many dollars), was not as hot on the idea. Nextlink had already acquired an ISP in Atlanta and it didn’t go so well. They didn’t want to repeat that debacle, especially in a smaller market. We believed that it was a bad comparison but it didn’t matter. Nextlink soon after announced plans to enter into a collaboration with PSINet, one of the first large, commercial ISPs in the country. PSINet prided itself on NOT being a phone company and only being an internet company. Much of the internet traffic of the world traveled through PSINet’s network. In the early days, Bob referred to them as “pissy-net.”

“Well that’s that,” I thought. “PSINet’s going to squeeze us out of the relationship with Nextlink and we’re going to lose.”

It was around this same time that we started thinking about having someone represent us to potential buyers.

“If Nextlink can’t buy us, then maybe PSINet will, especially, when they see how much we can already bring to the table with Nextlink in Nashville. They don’t have nearly the depth that we have in this market. We could be a great acquisition for them,” so I thought. During that same time, we had retained Mr. Frank Woods, a local business broker, to represent Telalink to actively search for buyers.

“Frank, can you see if a company called PSINet would be interested in buying us?” I asked.

“Absolutely, Thomas! I‘ll let you know what I find out” replied the always-dapper, gentle-spoken Frank.

Within days, Frank called with bad news. “PSINet says Telalink is too small and they’re not interested. I’m sorry. We’ll keep looking for a better fit.”

While the marketing/ad campaign and Nextlink adventures were in full swing, we were also cultivating a rather interesting and innovative partnership with one of our main Nashville competitors- ISDN-Net (now called The Nexus Group). Born around the same time as Telalink (but we claim the earlier birth!), ISDN-Net was a very different feeling operation. While the Telalink team was younger, more playful and unconventional in its style, ISDN-Net was more serious, traditional-sales focused, offered consulting services and they just seemed more serious. Let’s just say our two cultures were very different. I mean, ISDN-Net probably forbade office cats and white Russian Fridays and probably didn’t have a cuss jar. The two owners, Jerry Dunlap and Ken Russell, were not likely to show up at a meeting in shorts or sandals ("He's wearing 'Jesus shoes,'" remarked someone at the golf course about Bill one day) like Telalink people. However, we DID respect each other as competitors and there was no doubt among anyone that Bob Collie was the most brilliant networking expert of anyone...and that’s how NREP was born.

Nashville Regional Exchange Point was a 50/50 joint venture between Telalink and ISDN-Net. Basically, it was a carrier-neutral data center. Customers could lease space on racks and have their servers that much closer to the highest speed telecommunications lines in town. Internet traffic that only needed to occur locally could now occur. I always compared it to the old “bank clearing house” model. At the end of every business day, local banks would meet up and exchange items that were drawn on one another. For example, if a check drawn on Bank A were presented for cashing at Bank B, then the two banks could settle up directly with one another that evening rather than through a more elaborate network involving other banks. The concept was the same for internet traffic except instantaneous. If I wanted to send an email to someone in Nashville but my provider was Telalink (meaning we were using Sprint internet “upstream” and Nextlink phone lines) and the recipient’s provider was ISDN-Net (let’s say they were on BellSouth phone lines and using UUNet internet), then my email would travel all over different networks and through multiple servers all over the country before landing in the recipient’s mailbox. NREP made this process much easier. The safety, redundancy and maintenance of data center services was projected to be one of the next big things so we were ahead of the game on this concept in many ways.

NREP sat atop One American Center in space that was once occupied by a mobile services company. I can’t remember which provider it was but we determined it was perfect for our needs... and oh-so-convenient to Telalink. This was an added benefit since Bob was running NREP and he could easily walk the block up the hill to One American Center to meet customers and show off the facility to prospects. By all measurements, NREP was almost an immediate success. We even hosted a ribbon-cutting ceremony in which then-mayor Phil Bredesen officially announced this as a huge step for Nashville advancing as a formidable player in the tech industry.

With such great publicity for NREP, an obvious hit with the service and its implementation, not to mention a good feeling all around about our work as a team (i.e. Bob was clearly a desirable team member for ISDN-Net), it wasn’t too long before Ken and Jerry were openly talking about what a merger of ISDN-Net and Telalink might look like.

“We’d be the biggest game in town and no one could enter this market without contending with us,” said Jerry, with an enticing tone in his voice.

“And just think about what kind of multiple we could earn on our sales revenue if we sold out,” said Ken.

"Interesting. Verrrrry interesting.....” thought Bill, Tim, Bob and myself. “Marriage made in heaven or clash of two hopelessly different cultures?”

“Let us talk more about this marriage.”

To be continued...

Beautiful, Bountiful 1997. Hateful, Ugly 1998

thos@oneelevendigital.com (Thomas Conner) — Fri, 27 Sep 2013 18:56:14 GMT

Telalink was on its way to hitting $1 million in sales that fall. To celebrate, I called a surprise meeting one evening, announced that we had officially become a $1 million company and invited everyone for dinner at Amerigo’s by way of the longest stretch limousine that I could find in Nashville. The million dollar sales mark was such a landmark, and yet, we felt that we were just at the beginning. It was hard to look beyond Nashville with all of the opportunities in front of us.

Telalink was on its way to hitting $1 million in sales in the fall of 1997. Not too shabby for a hardly-3-year-old industry. To celebrate, I called a surprise meeting one evening, announced that we had officially become a $1 million company and invited everyone for dinner at Amerigo’s by way of the longest stretch limousine that I could find in Nashville. A million dollar sales seemed like such a landmark, and yet, we felt that we were just at the beginning. It was hard to look beyond Nashville with all of the opportunities in front of us.

What kind of opportunities? Well, for one thing, we were having a full-fledged love affair with Nextlink (currently known as XO Communications). That all started with the Telecommunications Act of 1996 which changed the landscape of phone services in the US. You may recall that until the law passed, there was generally one monopolistic provider in each market. In our region, it was BellSouth. If you wanted phone service, you bought it from BellSouth. If you did not like the service (and Bill frequently made his dissatisfaction of such known), then you had the choice of.....using BellSouth. There were no competitors but we absolutely needed BellSouth to keep adding more and more phone lines in order to accommodate our ever-growing connectivity business. I don’t even remember how many lines we had but there were enough that we ended up with the phone company just installing what looked like a rack of phone wires and various doo-dads to make it easier to turn on more lines for us.

So, when the 1996 act was passed, suddenly, there could exist what became known as CLECs (competitive local exchange carriers) and the ILECs (incumbent local exchange carriers- BellSouth, which became ATT) HAD to accommodate them in various ways, even if it meant that they had to allow the CLECs to use some of their fiber to connect a customer to their phone lines. Tricky, confusing and complicated but that was the new law. When Nextlink came to town and launched their Nashville operation on July 4, 1996, Bill and Bob were most excited. Why? Well, for one thing, Nextlink had no plans to sell Internet services. Therefore, no competition with Telalink. BellSouth was already in that business. Secondly, as the CLEC that wanted to compete head on with BellSouth, they wanted to do whatever it took to get happy customers. Bill and Bob were all too eager to let Nextlink cater to Telalink’s needs.

Before they went live, the Nextlink team, led by Don Hillenmeyer, hosted a reception to introduce themselves to the Nashville market. Bill and Bob, wearing the standard Telalink “uniform” of t-shirts, sneakers and khaki shorts, attended. While it was, at first, a little deflating to the Nextlink execs that Bob won the door prize (I think it was one of those new-fangled IBM compatible laptops but I can’t remember), thinking some college-age punk with no real business potential was winning the prize, they could not have been happier to find out just how much business the shorts-wearers represented for them.

As soon as Bill and Bob confirmed Nextlink's viability, they approached Jeff Lovejoy, a Nextlink sales executive, and said, “We can do two things for you. First, how would you like to sell your phone lines to Telalink? We need a few hundred so we can tell BellSouth to go to hell and die a long, painful death. Second, EVERY customer we have would probably be interested in moving THEIR phone services to you. Did we mention that we have a bunch of customers in Nashville and that we remind them of the hatred that we all share for BellSouth all the time?”

And just like that, Telalink became one of Nextlink’s number one customers if not THE number one customer, as well as the best referral source for Nextlink. Once again, the Telalink team was first to jump and the payoff for everyone was that much sweeter. Soon after, other CLECS came to the market and it wasn’t too long before we had racks in our “server room” with BellSouth, Nextlink and Adelphia all standing next to each other, almost like Coke, Pepsi and Dr. Pepper machines in a snack room. Of course, over time, the BellSouth rack was just a skeleton, sitting all by its lonesome, a relic of the past....and while I can’t say for sure, I would not be surprised if Feisty had not found it particularly enticing to find her way into the server room with a “Jackson Pollock-esque” turd spattering on the BellSouth rack. Sorry for that mental image.

It turns out that Nextlink was an excellent referral source for Telalink. "Hmmmm, a marriage made in heaven? Maybe Nextlink would need to buy Telalink one day? Just maybe,” Bill Butler thought to himself.

As we were booming in 1997, we also decided it was time to install a billing system. Until then, we were using a rather masterful program that was designed by Bill in Filemaker Pro. It was, however, getting slower and slower and I was getting concerned that there were some potential deficiencies from an accounting perspective (although a full IRS audit of 1997 proved that we were clean as a whistle). With all of our best minds, we settled on a program called Expansion, which was built by former ISP people for ISP people. We had found our solution....so we thought. After a rather unhelpful week of training in Glendale, California, where Bill and I discovered the new swing movement at the legendary Hollywood Brown Derby bar (of Swingers fame) and Kelly discovered Pappy’s strip club, we were ready to launch on January 1, 1998. It was a complete and utter disaster. Nothing worked. EVERY single bill included a charge for bobparks.com. “We can’t send these bills out like this!” I screamed. “Nothing is right. The amounts are wrong, the services aren’t all included and the only customer who should be paying for bobparks.com is BOB PARKS!”

It’s funny. 1997 was profitable, peaceful, exciting and rewarding. It’s as if someone had flipped a switch over night and 1998 was lurking around the corner, ready to work some evil magic on us. Personally, I was starting to feel it. I had bought a condo and rented out the extra room to a Vanderbilt business school student. Around the end of 1997, he was exhibiting more and more signs of paranoia, OCD and germaphobia and his actions and demeanor were getting more and more bizarre. For example, he would use a whole roll of paper towels to wash and dry his hands. Rather than throw the paper towels away, he would hide them behind the books in the living room bookshelf. He blocked the entrance to his bedroom and bathroom doors with jugs of chlorine. He put socks on the door handles. He bleached his clothes so much that one day, while he was leaving, I noticed that the entire back of his shirt had flaked off. He stopped driving his car and only rode his bike wherever he went with a garbage bag covering himself. He only used a bar of soap once and then left it on the shower floor- something I only discovered after he moved out. He acted very angry around me all the time. He would yell at me about irrelevant things and I think he threw objects at my cat. Not a pleasant environment to go home to but it took until May to get him out.

I also started out in 1998 moving my office, and only my office, to Cummins Station. Our friends, Dave Tempero and Stan Wilson, had closed down their business but they still had a few months left on their lease. They also had a bunch of furniture and equipment for which there was not an immediate home. So, they left everything as is and we, without enough space, decided to at least temporarily borrow the space for the time being. I was miserable and lonely down there. I was by myself most of the day until Jay Hawthorn would show up after class to help with accounts receivables.

It was the dead of winter; we weren’t able to bill for 40 days; I was sick; my roommate was showing some pretty clear signs of mental illness that was going untreated; my office was far away from everyone else; what else could go wrong? It wasn’t until the weekend right before February 9 that great programming minds of Telalink finally got Expansion billing software to work. At least, it wasn’t going to get any better than what we finally got. I remember asking for all able-bodied staff to show up on that Saturday to be prepared for a massive effort to print and fold bills (you didn’t email invoices back then) only to discover that we were still having problems. bobparks.com was still spooking our system among other things.

Jay finally came up to me and said, “What do you need for me to do?” I looked at him and said,”Take this cash, go to the Target and buy me a wooden, Louisville Slugger baseball bat. NO! Buy TWO baseball bats!”

“Seriously,” Jay said. “What can I do?”

“Seriously,” I calmly said. “Get the bats, now.”

Jay returned from Target with the bats just as I ordered. I took one grabbed some boxes and said, “If anyone cares to join me, I’m going outside to work out some of my aggressions. This feels like the least dangerous thing that I can do.”

I don’t really recall who joined me but I beat more cardboard boxes to a pulp that day and, I have to admit, it felt pretty good. Whether I, in any way, inspired anyone, or not, the billing system churned out its first bills on February 9, 1998. Cashflow was everything in those days and it turned out to be the beginning of time when the stakes felt a little higher, the risks a little more riskier and the pathway a little more perilous.

One Louisville Slugger remains within arm's reach in my office to this day. The other is at home.

Oh 1997, we didn't know how good you were to us.

Telalink Sales- Omelets to Order, Frozen Shoes, a Hockey Stick, a Beach Ball and the Cuss Jar

thos@oneelevendigital.com (Thomas Conner) — Fri, 30 Aug 2013 18:51:54 GMT

Meet a few members of the Telalink Sales team from the 90's. Enough stories for a television series.

In the early years of Telalink, sales just happened, almost unexpectedly. Bill and Tim placed a cheap ad in the back of the Nashville Scene, where the more risqué ads were, in the fall of 1994 that read, “Internet. 30 hours a month. $35. Call 615-321-9100.” Before they could really set up a system for managing sales, they were inundated with calls from Nashvillians craving the service. It was a powerful intoxicant and everyone wanted it. Such great demand with such limited supply was a good thing but it did present its own challenges.

Soon after Telalink got off the ground as an Internet enterprise, Bill’s mom, Mary Watkins, joined the team to handle all things related to sales and administration. During my "orientation," Mary showed me how every day she would call the bank and inquire as to the balance for the three bank accounts- one for Telalink; one for Telasar, the original consulting company that spawned the internet company; and one for Telaland. At times, when something needed to be paid for, it was not uncommon for funds to be co-mingled. The banker in me was somewhat mortified by the cash management policies but it’s what kept things going in the early days. Mary had no way of knowing what checks were being written by Bill or Tim so she took her chances on going with what the bank said was in the account for that day.

Sales was not a big challenge. Phone calls came in and orders were placed. I remember early on that Telalink required a copy of a subscriber’s drivers license. This was to have proof of age so that we could provide access to Usenet newsgroups in the “.alt” category. Within the .alt category, one could find adult themed subject matter, much of it related to unsavory or offensive content like porn, violence, pornographic violence or violent pornography. Oh, there was porn and quite frequently porn in the .alt newsgroups. You get the idea.

Upon presenting the proper credentials (generally by fax because until then, no one had an email account) and paying a $25 start-up fee, subscribers were provided with a floppy disk with an installer kit which included programs that you had to have for computers of that era to know how to handle an Internet connection. Trumpet Winsock and MacTCP were the programs required for this. In addition, the installer disk included a browser called Netscape Navigator (this was right before Microsoft launched Windows Explorer or at least before it was in demand) and I suppose it also contained an email program, called Eudora so you could use email.

With a username and password, you were set to go. You got an email address and a website that was essentially appended to telalink.net. So, my email address was thos@telalink.net and my first website was www.telalink.net/~thos. I decided to go with “thos” instead of Thomas or Tom because I had all but stopped using the name Tom after college and Thomas felt too long for an email address. I was still stuck in “the fewer characters the best” world with Microsoft files at the bank. Thos. B. Conner was how my grandfather signed his name and I decided that I needed something from my family past to hold on to as I found myself being hurled into the wild frontier of the internet.

As sales grew and Bill was generating bigger and bigger plans for more advanced, commercial-level accounts, we brought on Michele Watkins. Michele had amazing culinary talents and had relocated to Nashville in early 1996. Besides her love of preparing delicious meals, she had an affinity for “twang.” Think banjo, mandolin, plenty of fiddles, stand-up bass, acoustic guitar, rich harmonies and frequently energetic tempo. Genres like bluegrass, folk and Americana are often mixed in to describe twang and Michele really fancied it. She introduced me to twang or at least instilled an appreciation for a style of music to which I had not previously paid attention. Michele sold Telalink services during the day and usually found a live performance to attend at night. Music City is filled with opportunities to hear live music and “Meshel,” as she was also called, would often send out an email message inviting everyone to go out to a show. It didn’t matter to her if anyone joined her or not. She wasn’t going to allow the absence of a colleague to spoil a night of live music. Looking back, I wish that I had taken more time to join her. Michele always picked the best performances in town.

It was not uncommon to walk in to the office and have Michele say, “Good morning. What do you want in your omelet?” For me, she would even say, “I’m preparing a “Thomas-sized” omelet. Do you want cheese and spinach?” That meant she cooked a smaller sized omelet since I frequently struggled eating everything on my plate. Or, there was the occasional meal in which she would say, “This one is ‘Thomas-spiced’...” meaning it was not nearly as spicy as everyone else’s. There’s no other way to describe my eating style as anything but dainty. I realize that most people would not characterize this as the most masculine trait but I guess I’m okay with owning up to my daintiness.

It took hardly any time for Michele to hit her stride but, soon, our growth necessitated the addition of even more sales people. By late 1996, we added Hagan Rose. I had known Hagan since he was a pup growing up in my hometown of Winchester, Kentucky. Having dated his sister many years and remaining close to the family, I discovered that Hagan was looking for a new challenge after working in Kentucky state politics for many years. He met the love of his life in Nancy and they decided that a move to Nashville was a good idea. Next came Dana Haddock who also assisted me with HR responsibilities. Mary Mancini joined our staff in 1998 as our office manager after she sold the legendary Lucy’s Record Shop . After she sold the store and called to cancel her Internet account, we decided she was perfect fit for the Telalink culture and offered her a job. Brysson Curtis and Jeff Fink were also part of the sales team at various stages of the company.

As the sales team grew, it really developed its own sub-culture of eccentric behavior. For example, and I never really did know why, Hagan had a pair of loafers that he frequently removed and placed in the freezer during the day. Also, to this day, he calls me his Nubian Princess and I don’t remember what I did or said to have earned such an endearing title but, sometimes, I think you just have to let things be as they are.

I recall taking part in “sessions” where, usually in the sales office (which was really the old video game living room area in suite 6) we would get in a circle and bat a beach ball around. There were various rules. For example, you had to name someone who had really pissed you off recently before you could hit the ball so you had to enter the game with some aggression and an extensive list of the freaks who had somehow complicated your life. There was a constant flow of people in and out of the Telalink world who were hard to please, clueless about the Internet business and what we did, were fiercely competing against us at various levels...you name it. Let’s just say that, in the “Mean People Suck” culture that was part of the late 90’s, our sales team was quite adept at ritually “beating in effigy” all of the mean people by virtue of a ceremonial ass-kicking of the collective list of the condemned, all represented by the multi-colored orb of hate. We went through a bunch of beach balls. Usually, we were able to replenish our beach ball stash at the annual ITEC Expo which was a huge event at the Nashville Convention Center. Since it was a two day event (maybe it just felt that way), you could easily grab a dozen or so un-inflated beach balls at some booth where they were being given away as schwag items.

Then, there was the hockey stick. I assume this was introduced by Mary but surely someone else knows better the story behind that. Basically, the beach ball arena turned more and more into a street hockey space and sales team members would take turns trying to score a penalty point from one end of the room to the other with another sales team member defending the goal. Instead of a puck, they used rubber balls. Again, some random company’s schwag item that multiple Telalink members procured throughout the day at a business expo. You had to cautiously peek in the sales room before you entered, lest you get whacked with a beach ball or rubber “hockey” ball. The hockey stick sits outside my office as I write this blog.

The, there was the “cuss jar.” With such a colorful team, it was not unusual for the daily interaction among these folks to be laced with obscenities. However, when Dana got pregnant, she proclaimed that she did not want her fetus exposed to such an environment and she introduced the “cuss jar.” It was intended to be a deterrent. For every curse word that one uttered, one was penalized and forced to pay a quarter into the cuss jar. It reminded me of when my 4th grade teacher made children pay a nickel in the “ain’t jar” when invoking the colloquialism.

It didn’t quite turn out exactly how one might imagine. In fact, the presence of the cuss jar likely contributed to even more salty sailor language. Most everyone in the office would just dump their unwanted extra change in the jar. While that seemed a convenient service, it also emboldened some to simply pre-pay for use of their cuss words later. No one really enforced the cuss per quarter policy and by the time the jar was overflowing with coins, most everyone would claim that they were more than paid up, usually accompanied by an expletive- “I paid a _____-full of _____ing quarters last week so I’m probably good for at least another ______ing week or two. ______, if you want me to throw some more god ______ coins in, just say so......” While I am not sure that anyone actually went to the bank to cash in for rolls of quarters, it got pretty full. I remember one staff member brought a bucket full of change to dump in the jar and, of course, the result was that there were enough coins to fill at at least 5 cuss jars. Now, I’m not proud of any of this but I also didn’t think I could intervene so I just let it be. However, the question finally arose- “Now what do we do with the money?”

One might think that our beloved sales team determined that they could take all of those coins and do something virtuous. Maybe buy something for Dana’s baby shower or donate the money to charity. No. What it became was a jackpot. Each “player” had a day of the week that was his or her day- Monday through Friday. Given the proliferation of car wrecks that were occurring on West End Avenue between 29th Avenue and 30th Avenue, it seemed likely that there would be enough car accidents to keep the pot emptying fairly quickly. Basically, if the car crash happened on your day, you won the pot and it started all over again. All if this in the interest of ensuring that Dana’s unborn child was not prematurely exposed to vulgar or corruptive influences.....the wholesome, Telalink way.

The Mind Games of Mindspring

thos@oneelevendigital.com (Thomas Conner) — Mon, 29 Jul 2013 18:49:48 GMT

In which "All-you-can-eat" internet service for $19.95 is introduced in 1996 and forces the Telalink team to become the "business internet" provider in Nashville...and we get free moving labor.

Before I begin this next story, I want to acknowledge that this may be the last post that I get in before the great “Telalink Reunion,” to be held on the 20th anniversary of the founding of the company. If you’ve been reading this as a former staff member, a former intern, a customer or a part of the Telalink community in any way, join us on Saturday, August 3, 2013 at Flyte to share stories and enjoy the fun we had in starting and building this company. We will start up around 5 pm. Bring your Telalink memorabilia- photos, shirts, mugs, “moose pads,” etc. I would love to know in advance if you’re coming. You can find the invitation here:

http://bit.ly/13S3GX9

It is also being promoted on Facebook here:

http://on.fb.me/1e4RTGG

And now, on with the story....

As an early-stage ISP start-up in 1996, Telalink Corporation was definitely experiencing a meteoric rise in popularity with customers, interns, the local media and, yes, there were others. Our good friend, Ken Pence, then a captain with the Metro police department found a great resource in Telalink as he convinced Bill and Tim to host a website for the police academy as well as his “Rate Your Risk” website. To this day, Sitemason , Inc. hosts rateyourrisk.org .

Then, there were the Mindspring folks. In case you don’t remember, Mindspring was incubated at Georgia Tech and was one of the first ISPs to go nationwide with a $19.95/month “all-you-can-eat” internet access plan. Everyone was touting "no busies" as part of their benefit list but Mindpsring had tons of capital to expand their infrastructure and they could back up their promise.

Before Mindspring came along, we were selling access, first 30 hours/month, and then 60 hours/month for $35. The Mindspring model was one of the first competitive challenges that we faced as a fledgling provider. The truth is, Mindpsring never promised that a customer could stay connected day in and day out without being kicked off of their dial-up account. Mindspring was simply gambling no one would ever need or want to be online 24 hours a day and, even if someone attempted it, the connection could be interrupted so that no one had a “dedicated account for $19.95/month.” It was a numbers game that we always felt slightly worried about because we wanted to tell the truth. We didn’t think we could actually advertise “unlimited access” and be honest about it. We certainly couldn’t do it for $35/month. So, I worried that Minspring was simply going to take all of our customers away overnight but that's not exactly what happened.

One day, I got a call from some “reps” from Mindspring. “We want to buy Telalink,” said the young man. “Ummmmm, okaaaay, how much?” I said.

“That all depends,” said Mr. Mindspring. We need to know EBITDA, churn, burn rate, retention, etc., etc....”

Suffice it to say that we were in no position to share our financials and I had no idea what the dude was asking for anyway but they were persistent. In fact, twice, the Mindpspring folks just came to our office and hung out. Both times, I remember getting to the office and there they were, just sitting on the steps of the front door. No appointment. No advance notice. “

We just thought we would come over and see what you guys were up to,” said one of the scouts, who could not have been over 22 years old.

“Oh, nothing really,” I said. Just playing some Battle Arena Toshinden and probably going to play some frisbee golf over at Vanderbilt a little later. Will probably just drink a lot around 2pm. Wanna join us?”

“Not today but just let us know if we can buy you. Have a good day!”

The second time the Mindpspring folks came to hang out, I was having some more office furniture delivered to accommodate our growing support and sales staff. We had opted for the white oak tops with the gray bases, probably the cheapest line of furniture that Office Depot sold. So, as the Mindpspring “acquisition team” sat in the yard in front of the office and the Office Depot truck was dropping off our white oak desks, I yelled over at them, “Hey, since you're here, why don’t you help us move this furniture up to the third floor?”

Sure enough, as we formed an assembly line of staff members to carry big Office Depot boxes up to the third floor, there were these guys from Mindspring joining in. They seemed all too eager to make themselves useful and, even though I never was interested in selling to them, I really appreciated them on that day.

As it turns out, Mindspring was not the force with which we would eventually reckon. In fact, despite their aggressive ad campaign in the Nashville market, literally touting their service over “the local guys who started their ISP in the basement” (this was not directed against us but it was universally applicable in most markets), we held our own and hardly lost a customer to Mindspring, even though we offered limited access at a higher price.

By mid 1996, we were trusted as a team that knew how to take care of business accounts and we, somewhat innocently, had given a lot of services away to the non-profits in town. It turns out that giving away internet services to the non-profits did two things: 1) it got us invited to the biggest and best parties in town; and 2) all of the board members were finding out about the need to get their businesses online because they heard about the generous gift that Telalink had recently given. Just like that, we were the commercial internet service provider of choice. Sure, you could pay for a cheap account with Mindspring for your residence but Telalink was a commercial quality provider. When you wanted to get serious about quality service with impeccable support, you called us.

In hindsight, maybe we should have sold to Mindspring or maybe they should have sent a more serious team to go after us. Mindspring merged with Earthlink in 2000 and became huge. We stayed independent and grew bigger and stronger. Other competitors, and eventually a swarm of merger/acquisition offers, were to arrive another day.

Hooray! We're Number One! Wait....Really?

thos@oneelevendigital.com (Thomas Conner) — Sun, 14 Jul 2013 18:47:20 GMT

This is a story about how some basic accounting and being part of the most intriguing industry in the world paid off for the Telalink peeps.

My early months at Telalink consumed me. I worked day and night, seven days a week. I lived in Tim’s parent’s guesthouse in Bellevue. Tim’s dad went to work very early and when his Range Rover drove by the guesthouse, that was my alarm to get up and start my day. I drove in by 8:30 am and usually didn’t go home until 8 or 9 o’clock at night. My TV hardly picked up a signal so there was really nothing to do but go home, feed the cat, go to bed and start the whole process over again the next day. I remember pulling out the scales one day a few months after I started working at Telalink. I had lost almost 10 lbs. Working. Hardly eating. It was easy to skip dinner back then.

The Telalink office was open almost all the time because Tim and Tommy still lived there and epic games of Battle Arena Toshinden on the Sony PlayStation (a new video game console for which Tim and Tommy camped outside the store so they could be the first to own one) were known to be played most any time of the day. Telalink was a local hangout for the budding geek community and so I never felt that alone when I was there. I could usually work at my computer and be serenaded down the hall by the screams and shouts of gamers when Fo would start dancing on this big transparent globe and use his Edward Scissoresque hands to totally whack Rungo Iron’s pitifully slow ass. Or, perhaps the matchup was between Duke Rambert who would speak in his French accent, “You fought well!” after he just finished off Ellis (whose phrase was “I never give up!”) or Sofia (“Anytime! Anywhere!”).

As I dug deeper into the Telalink “accounting,” it was pretty clear that I needed to reconstruct things from the beginning. Bless Bill and Tim’s hearts. They DID account for everything and their logic made total sense. You had to appreciate their honesty too. I mean, not too many people would actually use the word “bail” in the memo line for legal expenses. My favorite was the asset line item for “automobile” which, every month, would go up by $50 or so. By the time I got to that account, it was around $400 or so but it had been $350 the month before. I THOUGHT that Bill had transferred ownership of his Dodge Reliant K car to the company and maybe he was letting the company pay him on installment so they would add to the value of the car every month. Not exactly how an accountant would do it but it was my best guess. Well, my hunch was way off. Basically, anytime they put gasoline in the newly leased 1995 Toyota Avalon, they charged the expense to “auto.” That’s just how it was in the early days.

But there was a bigger issue for me and that was, “How do we know how we should be doing?” When I was in college, I learned all about studying the comparative data that Robert Morris Associates (RMA) provided for industries so you could “common size” your financials to see how you faired among the industry averages. Thing was....there was no comparative data on Internet Service Providers. No one knew anything about performance metrics in the mid-90’s about ISP’s. So, I had no idea how we were doing among our peers and I guess it really didn’t matter as long as I could find a way to keep the cash flowing and the business growing.

Our relevance to Nashville was starting to catch on. The Nashville Scene, thanks to Joel Moses (no relation to Tim) was covering everything we did. The Tennesseean even published a photo of me standing at my “desk” (a folding table in suite 6) while Tim was connecting my computer with a caption that said something like “Telalink Expands.” Channel Four ran our 15 second ad and the national scene was going insane. Netscape had gone public in the summer of 1995. Amazon.com and EBay were founded that same year. Anybody could get email through hotmail, a website from Geocities ( I always pronounced it as one would say “atrocities”) and ICQ was all the rage for instant messaging. The times were changing and fast.

One day, as Bill sat next to me in our office (what had been his bedroom in the not-too-distant past) he received a phone call unlike the ones I was used to hearing. Usually, he was on the phone telling the BellSouth/ATT the same thing, “Let me speak to your supervisor. Let me speak to your supervisor. Stop talking and let me speak to your supervisor,” Yeah, they loved him and he loved them over at Bellsouth. No, this phone call was from the editor of Business Nashville magazine. While still on the phone, Bill shook me, started waving his hands and mouthed “We’re number ONE!” That’s right. In 1996, Telalink Corporation was named the fastest growing company in Nashville by Business Nashville. They took a photograph of us and wrote something about how they had never featured an Internet company before. How fitting was it that all of this Internet rage was going on in the world and a little company like Telalink was introducing a whole new industry to Nashville.

So, the truth is, we were only asked to turn in percentages. Sure, if you earn $10 in one year and you earn $1,000 the next, that’s 100 times growth, right? Anyone can grow fast when they grow from nothing. I’m sure it wasn’t exactly that warped but we were hardly pulling in big numbers by the time we were recognized for being the fastest growing company in Nashville. No matter. There was something very validating about actually being able to turn in something that was factual. No more growing car assets. No more guessing. We were a serious player in the market and we were figuring it out before anyone else was. A bigger challenge would be if we could be the fastest growing company (using Nashville Business‘ criteria) in 1997, two years in a row. In fact, we could and we were!

"Thanks for Calling Technical Support. How Might I Help You Understand How Stupid You Are?"

thos@oneelevendigital.com (Thomas Conner) — Mon, 17 Jun 2013 18:38:59 GMT

A brief commentary on the evolution of technical support at Telalink Corporation. Just remember that Bill was phenomenal in many other areas.

Some time before I joined the company, I remember watching Bill Butler take a phone call from a customer. With headphones on, he listened. He listened a little longer. He remained calm. He listened some more. At one point, he interjected, “Do me favor, will you? Stop talking. Just... stop talking. Stop it. You need to be quiet for a moment. Stop talking. Stop talking.” Clearly, the customer on the line did not stop.

“This is not a good role for Bill,” I thought to myself. “He could upset the customer or perhaps make them feel like an imbecile.” I, myself, had wondered if I was in fact going to receive this treatment. The extent of my computer usage was pretty limited and, even then, most of my experience was on Windows. I usually saved files with 6 characters, something Bob explained to me was no longer necessary. Using a Mac required me to un-think my Windows ways. Bill would say, “See, this is so easy. You just drag this here, click here and throw the installer in the trash. Put this in your applications folder and just create a folder for these files. Why did you install ‘Kill Bob?’ You didn’t? Someone must have been playing a game on this computer after you went home.” Truthfully, I thought “Kill Bob” had something to do with our Bob (Collie) and I thought, “”How harsh!”

Finally, one day, when I asked Bill for help on something very simple, he said, “You’re just a victim, aren’t you?”

“As much as you’re a victim of accounting, you smartass! Now help me with this file!” I replied.

Technical support at Telalink quickly went from Bill’s hands to an employee who stayed with us very briefly. He started just before me and left within 5 months. Our approach to technical support, while unintentional, was more like an exercise of letting the customer know how stupid they were.

This is when something truly wonderful happened. I don’t know if it was luck or brilliance but along came Scott Sears: Vanderbilt class of ’92; computer science major; Bill’s fraternity brother; Rio Bravo bartender; member of the band, Room 101; Mac enthusiast.

Since Telalink was practically across the street from Rio Bravo and Scott was always visiting to do something with his Mac or the Room 101 webpage, I saw him frequently. Our need for someone to not only take over technical support duties but to craft a technical support strategy, a customer care philosophy, was starting to grow. Getting connected to the Internet in those days was not easy and the development of customer service with start-up providers was always lacking. This was true for Telalink, until Scott came.

It took a little convincing to employ Scott. He was happy doing what he was doing and was under no pressure to join our fledgling start-up but we all thought Scott was the right fit for the company. I can’t remember what the starting salary was but it couldn’t have been more than $20,000/year. With offer on the table, Scott found me one day and said, “Can we talk? Just the two of us?”

The bottom line for Scott, after talking to his dad, was that he needed some assurances about a few things. First, he needed to know that Tim and Bill, whom he had only known as classmate and frat brother and not colleagues, were going to be serious enough about doing what we needed to do to make the company succeed. He had some suspicions. Second, he wanted to know that he would have a chance at an ownership position. My reply (paraphrased):

Scott, I know exactly how you feel. Tim and Bill are best friends. They don’t really understand everything I’m doing and I really don’t think I even understand our business yet. But I can tell you this- we’ve had to scrape by with some tough cashflow issues these past few months and my greatest fear was that Bill and Tim would come to me and say, "We need this piece of equipment and it costs $30,000,” to which I would reply, "We don’t have the money so we can’t afford it." I feared that they would then say, "All in favor. Motion passes two to one. Now, Thomas, go and buy the equipment!" Not only has this not happened but they have completely trusted my judgment on every matter and supported me 100%. It’s not always been the best news around here. We’ve had some real challenges but I feel like we are a true team and we’re facing the challenges with trust, respect and mutual support. We really need you to make the team better. Even if our plan isn’t perfect, our team will be much better with you. I once learned that it is better to have an A team and a B plan and than a B Team with an A plan. I really hope you will do this. Who knows? We may be on to something really good. If you are as good as I think you are, you will be an owner.

Scott accepted. I think the "A Team with a B Plan" resonated with him. He transformed crappy technical support into a beautiful customer care model. When everyone else was hiring “certified technical support specialists,” we went for the bartender, the guy who could listen to your troubles and help you take the pain away. For Scott, it was about empathy. He once said in a shareholders’ meeting, “We will go to no end to take care of our customer. If we have to get in the car and drive to the customer’s office or house after hours, we will do it.” He meant it. He and the people he hired (a few of whom were musicians) became the gold standard for customer support. Scott watched over the support team and personally appointed that group as the customer’s ambassadors to the rest of the company. I had his back. If Scott ever said to me, “Thomas, this customer had a bad experience with us and they should not pay. Will you refund their money?” I always did. This kind of service resulted in extreme customer loyalty. As it turned out, we were going to need that loyalty. I’ll write about that another day.

Since we sold Telalink (and yes, he was a shareholder), Scott eventually became the Director of Operations for Emma where many former Telalinkers work to this day. Also, he and fellow Room 101 band member Scott Atkinson are the proprietors of Flyte World Dining and Wine where customer care and the very best service are alive and well. Nicely done, Mr. Sears!

"The Radius Must Authenticate to the Sparc"

thos@oneelevendigital.com (Thomas Conner) — Mon, 20 May 2013 18:35:25 GMT

My first day at Telalink Corporation, October 11, 1995, was fascinating. I had not been in the office for more than an hour when I received my first phone call. Actually, my desk, computer and phone were not actually set up yet so Mary Watkins, Bill’s mother, took the call. “It’s someone from the Winchester Police Department. Evidently, the neighbor whom you paid to clean out your basement and garage broke into your house and stole a window air conditioner,” said Mary. “The policeman wants to know if you want to press charges.”

One of my neighbors was battling a drinking problem. When he was sober, he was a great guy. When he got drunk, he became somewhat mischievous. I gave a hundred dollar bill to another neighbor who agreed to be the escrow agent. If neighbor #1 (the beer lover) cleaned the basement (it was really a cellar. This was a century old house that had belonged to my grandmother) and hauled off all of the trash, neighbor #2 would transfer the $100 to him. Neighbor #1 performed to expectation. Neighbor #2 paid neighbor #1. Evidently, neighbor #1 then proceeded to liquor store #1 and perhaps liquor stores #2, #3 and #4 where he proceeded to convert the $100 into another form of liquid asset. He imbibed the rest of the day and found the courage to claim a small window air conditioner as a bonus. Neighbor #2 was able to watch neighbor #1 break into my house and find his way to a second floor bedroom before the commotion erupted during the air-conditionerctomy.

“No need to press charges,” I said. “Tell him to put the AC back and stay out of my house. I’m about to rent it out and if he does something like that again, I’ll have to take a more punitive approach.” Sadly, my new renter proved to be a colorful enough character in her own right but I will save that for another day.

Much was happening at Telalink in those days. Joel Moses was dedicating his weekly column in the Nashville Scene to all things Internet. He was giving Telalink plenty of good coverage and Channel 4 (WSMV) traded out commercial spots (“Internet! Twice the Speed! $35!”) in exchange for their own website and access. In fact, not long after the web came along, local news stories about porn on the web were gaining in popularity. It seemed like Tim, ordained by the Nashville media as the foremost authority on Internet porn, was always on the news, discussing the latest trends in the more salacious content on the ‘Net. Bill once commented that he knew that we were on to something when pornographers, gamblers and churches all wanted on the Internet.

By this time in the story, Tommy was out, although he was still in. Still an equal shareholder with Tim and Bill, and still a resident of 110 30th Ave N, Tommy decided that this was no life for him and he opted to take a full time job with Vanderbilt. Not long after I arrived, we all agreed that the best arrangement was for me to simply buy him out. That would free him of any responsibilities as a principal and it would validate the importance of my position, not only as the financial officer, but hopefully as leader, negotiator, organizer, and strategist. For example:

Issue #1: ITS Communications found out about Telalink and approached Bill about reselling Telalink service as its own service in the Nashville market. Telalink would get paid $10/month per customer. ITS would sell and support the service. While this sounded like an easy deal, ITS sold the hell out of the service and, if I am not mistaken, they sold it unlimited internet access, a still-new concept. Telalink customers were only allowed 30 hours a month but that was soon doubled to keep up with the competition. You see, unless we had an available phone number for every customer to be able to dial into our service at the same time, the first hapless soul to dial in when all of the lines were occupied would get a busy signal. Remember the early ads “no busies?” So, part of the challenge was to limit usage and kick people off after a certain amount of time online. We also gambled that not everyone would dial in at the same time. However, when ITS private-labeled Telalink service, the model was nearly blown up because they were selling accounts faster than we could add phone lines and ITS support was terrible. Back then, customers needed a lot of help, and some luck, to get online. Telalink had created an installer kit that got users set up and it included a free version of Netscape Navigator. ITS customers started to figure out that they were actually just dialing into Telalink and, because they could not get adequate assistance from ITS, they would just call us. Bill was not happy with the arrangement so I read the contract that they signed. It looked pretty simple to me. All we had to do what was give ITS 60 days notice of our intent to cancel. So, I wrote a letter to ITS, referenced the agreement, sent it overnight and added that we would only agree to renew at $35/month per customer. We got an instant response. They argued that this was the same price at which they were selling the service and this would kill their model. We agreed but showed no signs of letting up. If I recall, we were able to triple our ITS revenue for about 4 months while slowing down our phone line orders to a more reasonable level, not that Bellsouth was cooperating with our requests anyway (see paragraph 5 of http://www.thomasbconner.com/post/2013/02/28/whats-an-internet-again.582282). ITS decided to leave us and we were happy to dissolve our association. Suddenly, we had plenty of capacity to grow our customer base.

Issue #2: As I recall, Bob was traveling back and forth to “Convent Place” quite a lot in my first few days at Telalink. Part of the reason was related to sheer brilliance. Telalink worked a deal with Charles, the owner, who had converted an old convent into an eclectic assortment of offices, yoga, banquet space, etc. The deal was that we would feed the entire building with a big pipeline of dedicated internet access and then break out lines to individual subscribers throughout the building. It would be a very cool amenity- one of the first “wired” buildings in Nashville...and Telalink’s margins would be very attractive. The not-so-brilliant part was the idea that we would move half of our personnel to Convent Place. Now, at the time, Telalink occupied two condos, conjoined by an enclosed upstairs landing. That’s a total of two kitchens, 4 bathrooms and total of 7 rooms (one was already our server room) that could be used for office space/work stations. Why would we need to split up our team and occupy space in another building? While it first appeared that we had no room, it was also true that Tim and Timmy still lived there. Bill moved out and his bedroom became our shared office along with Scott Holden, “aka Splotchy.” To learn more about Splotchy, go here . In addition, Vanderbilt friend, Dave Tempero (currently IS Business Manager for Network Systems at Nintendo), had his consulting business, Sector 3, operating out of one of the rooms. Finally, there was one more consulting company called Nvision, owned by Shawn Yeager, and I really never knew him or what his company did. He was sort of like Lazlo from Real Genius. Ever so often, I would see Shawn come and go with nothing more than a “Hey, how are you?” and then he would disappear. My point was that it seemed really important to me that we should try to work near one another (i.e. in the same office space), at least until I got a little more familiar with the basics- the who, what, where, when, why, and how of Telalink. In other words, it might be time for some other folks to move out so that we would have enough room for Telalink staff. No move to Convent Place.

Issue #3: No insurance. None. On anything or anyone. All I can say is that the first insurance sales person who cold-called me was a lucky man. Until I could get a business commercial liability policy, workers compensation insurance and health insurance coverage for everyone, I went to bed dreaming of catastrophes, injuries and other unsavory workplace disasters that would render Telalink to the status of defendant or debtor.

Issue #4: No staff meetings. What I remember were one-on-one conversations and debates between Bill and Robert Beckett, Bob and Robert, Bill and Bob, Splotchy and “the fat guy,” as he was occasionally called and almost everyone had some kind of crude comment to share with Tim in the event that Feisty (Tim’s cat) pooped on a cable or someone’s work area. Izzy, the other office cat, was generally well liked, as was Feisty, but Feisty was unbelievably artful in her fecal distributions throughout the office. I decreed that we would have weekly, face-to face meetings and, accordingly, would take notes. This proved to be a challenge. First, Bob spoke too fast. Secondly, it seemed like everyone spoke in code with letters: TCP/IP, HTML, ISDN, T1, T3, FTP, 56K, 28.8, Bitsurfr, blah, blah blah. At one point, in the midst of a spirited debate between Bill and someone, probably Bob or Robert, his passionate argument boiled down to one Shakespearean moment when he declared, “The Radius MUST authenticate to the Sparc!” He even used hand gestures. I had scribbled indecipherable comments throughout our first staff meeting but there was one thing that resonated, “The Radius must authenticate to the Sparc.” I thought to myself that if there is one thing that you take away from this meeting today, you will believe with all of your heart and all of your soul that the “Radius must authenticate to the Sparc.” The moment came for the scribe to report what was said earlier about something so I re-read my notes. “Bob said something about something that I did not understand. Bill disagreed. Robert disagreed with Bill but said Bob was wrong too....Let’s see, something, something, something and, oh, Bill says, ‘The Radius MUST authenticate to the Sparc.’ That’s really all I got.” Everyone laughed. It must have been funny. Don’t ask me why. Seventeen years later, I still don’t know what they were talking about. By the way, Robert Beckett is now Services Technical Leader for Cisco Systems. You can see him, still talking code, here.

Our meeting adjourned and we reconvened at either Harvey Washbanger's or Rio Bravo. I forget which but it HAD to be one or the other.

Interns Respond

thos@oneelevendigital.com (Thomas Conner) — Fri, 03 May 2013 18:32:21 GMT

was really glad to get some feedback from the Telalink intern graduates following my last post . There were a few posts in response on my Facebook wall that I thought needed to be merged into my blog so that’s what I am doing today. Before I do, though, I was listening to a story on NPR about how women novelists in the US were being classified in Wikipedia ( http://n.pr/16eApbn ). I was only half listening when the word “Kaldari” rang out and I realized that Ryan Kaldari was being interviewed!

Ryan was one of the original “unofficial” MLK interns who attended UC Berkeley before working for Sitemason for many years. He left us to work for Viacom and he now calls San Francisco and Wikipedia his home. One day, I’ll write about how, as a student, Ryan wrote a $2.00 counter check to Rio Bravo to pay for his soda but he either forgot to sign the check or wrote so illegibly that no one could figure out how to contact him, which was only necessary because the check bounced! The Rio Bravo team knew the Telalink crew well enough to venture a guess that the $2 mystery check writer was somehow associated with them. And now, let’s hear from some of Ryan’s colleagues from MLK.

First, Paula Pfleiger Thrasher writes: “I think I mentioned in the other post, not quite the full story on how the internships started. Carl Tashian was the first MLK intern, but I think he may have even started before the first official school co-op internship thing for school. Carl can fill in details there. I didn't start until October-ish timeframe in 1995. I had originally lined up an internship downtown that fell through right as the school year started, then ended up instead working out at the McClures in Belle Meade in the receiving department doing data entry on bill of materials/invoices/etc. I did that for at least six weeks then my boss got arrested for tax fraud. Plus it was mind-numbingly dull. So I was looking for a new internship when Carl invited me to Telalink. I started working help desk, and there was a paid employee called Rich (I think - I forget his name? Anyone else remember?). He was kinda passive aggressive and a little jerky. At that time Bill (Butler)/Bob (Collie) were sick of answering customer calls so they put up with him. He eventually quit (got fired?) and at one point the entire help desk team was pretty much me and Bill's mom (Mary Watkins). Crazy. Then we hired Scott (Sears) and later Marc (Powell). I never wrote any real sexy or famous sites, but I did write that dang support website complete with filemaker database backend (I think? can't remember) along with a little homegrown ticket system. Didn't make Time magazine though - ha.” [editor’s note: I am not disclosing the name of the jerky guy but I can state that he was not fired. He left for another position with another company]

Daniel Templeton writes: “I was at Sun until it became Oracle and about a year and a half longer. I'm now two Years at Cloudera, the leading Hadoop distro provider. I did indeed marry Cari, and she's now been at Google for six years.”

Finally, Carl Tashian shares this fantastic memoir:

Starting around 1993-4 I had dialup Internet access via CTRVAX and later via PPP from Vanderbilt's CS department. I paid by the CPU hour or something. Which at first was expensive, but once I moved to PPP it was actually the wrong way to bill things, so I could be on all day and would barely pay anything in terms of CPU. And perhaps that is why, at some point, Vanderbilt limited access to the university community and shut down outside accounts like mine...

But I was hooked to the Internet at that point. I was running a MUD and writing code for it, running a BBS w/UUCP that needed nightly Internet access, I was playing with the first generation of web browsers, I was a newsgroup junkie, and I couldn't imagine giving all that up. I think I got an AOL account for a minute, but that didn't work out--it wasn't close enough to the metal.

So I found Telalink. It was exactly what I wanted, but too expensive for me. Something like $40 per month? Way out of my price range. So (and I honestly think this is the first time in my life that I'd ever done this) I cold-called Telalink and invited myself over. I came up the back stairs and climbed a ladder to the roof, where Bill and Bob were grilling up some food and working off of RoofNet, which was really just one ethernet cable snaked through an open window. Anyway, that first meeting was a little awkward, because I was a shy kid so new people were a challenge. But after chatting a bit we went downstairs and I remember Bob showing me around-- the Linux boxes, the Cisco routers, ISDN modems, etc. It was definitely a wonderland for me, and the fact that Telalink had a 256k link was a huge draw.

I remember telling Ryan and Paula about it. Anyway, I'm not sure how it came up but I started spending more and more time at Telalink. This felt like it was way before the official internship, which would have been from Sept 1995 to June 1996, where I worked about 25 hours a week at Telalink. Tim, Bill, Bob really stayed out of our way as interns, gave us full access to everything and pretty much let us explore our curiosities as long as we didn't get in the way too much. I think in particular Bill is a great leader in that way--very trusting. And that's how the HTML guide came to be--just by being curious and having the time to follow it through.

It felt a lot more like a real job during the Official Internship period. I think it was Ryan, Paula, and I. At some point, before we hired Kelly Setzer, it seemed like all of the web & DNS servers were my responsibility. Bill gave me a pager. I took it very seriously. I'm sure I made a lot of mistakes, and I remember, when Kelly came on board, realizing that he was a Real Sysadmin. I learned a ton from him. Telalink was a great learning environment across the board, life-changing for me. And I think things like the HTML guide got me into college, ultimately. Because I wasn't that psyched about school, didn't take it seriously, and didn't test well. I wanted to make things people would use. Still do.

BTW the Telalink Virtual Tour website is still up ( http://tashian.com/virtela/ ). I it threw together by scanning some pics from an old book on telecommunications from the school library.

It’s stories like these that remind us just what a frontier it was back then but, maybe even more importantly, what great relationships, vocations and contributions came out of this “internship” community. So much passion to learn and create. I hope that we can get some more stories from other Telalink graduates. I also wonder where and how these stories are happening now.

Release the Interns!

thos@oneelevendigital.com (Thomas Conner) — Mon, 22 Apr 2013 18:29:21 GMT

The story of Telalink can’t be told without dedicating some time to its innovative “internship” program.

Suffice it to say that Bob Collie was the first, true, original intern, especially since he was known as “Bob, the intern.” As a freshman at Vanderbilt, he quickly found his community, not so much in a student organization, but in the Telalink server room/”data center” and in the friendship of Bill Butler and Tim Moses. After a successful “hack and tell” operation with the Telalink team in the fall of 1994, Bob quickly became a fixture at 110 30th Ave North. Remember, there was no such thing as an educational program anywhere in the area related to anything with respect to server configuration, networking or HTML programming. If you were a youngster who was discovering the ‘Net, you were out of luck unless you found the Telalink guys. Bob, was self-taught and a natural at managing servers, so his “internship” was really an unpaid job, not that there was money to pay him anyway. Luckily, for Telalink, Bob was more motivated by his love for that world than a world of classes and studying at Vanderbilt.

Following Bob from Vanderbilt were Andy Warner, Chip Cox, Lewis Pennock and Jay Hawthorn. How early did they get involved? Early enough to register domain names like andy.net, bob.net, jay.net, lewis.net and cox.net. The “.net” suffix was considered to be much more prestigious than the “.com” ANYONE could get a .com registered but only the internet-savviest of the world were ordained with a .net status and, thus, our “interns” were proving to be on the forefront of that which the rest of the world had yet to experience- having your own domain name, and then, having your own website and personalized email address. The “novelty” of being able to have an email sent to “bob@bob.net” wasn’t driven by some profit mechanism. It was just cool. By January, 1997, Bob, Andy, Lewis and Jay had established themselves so well as the Geeks of Nashville, that Joel Moses of the Nashville Scene wrote a feature article about them: http://www.nashvillescene.com/nashville/geek-is-all/Content?oid=1181073

By July, 1995, I had made up my mind to quit my banking job and move to Nashville to become Telalink’s CFO. Tim, Bill and I agreed that I should take a week off from the bank to visit the office, work out some kind of agreement and start finding a place to live. After days of searching for an apartment, I was all but ready to give up when Tim had a plum of an idea. His parents had just moved and no one was occupying their house in Franklin. “I’ll call my mom right now to see if you can temporarily live in the house that they are trying to sell,” said he. The bad news was that an offer to buy had been submitted that day. The good news was that their new home came complete with a guest house, an unexpected enticement which made the whole deal possible thanks to the generosity of Tim’s parents. Everything fell into place. Bill and Tim made me an offer- “We’ll give you ownership in the company. We don’t really know how to pay you. You have to work 60-70 hours a week.

During my week stay, I slept in what was Bill’s room (he had already moved out) and what is now the Sitemason conference room. I remember waking up the first day and walking across the hall to take a shower. Feisty, the office cat, managed to push the bathroom door open, so, even though Telalink was open for business and Bob, Chip and Mary (Bill’s mother) worked in the other room down the hall, my bathroom door was wide open for all to hear me shower. This proved to be one of many Feisty antics. What a way to be “exposed” to my soon-to-be new place of employment! With a better understanding on my part that Telalink/Telasar/Telaland really didn’t have a firm grip on finances, a place for me to move and a work “contract,” I was in. We decided to seal the deal with a celebratory trip to the Ocoee River for a day of whitewater rafting the next morning. I was particularly interested in getting to know Tim better. I had plenty of opportunities in the past to hang out with Bill, but Tim was still the mystery. Our whitewater trip was a perfect way to see how we would work together as we raced through the rapids. Mid-way down the Ocoee, the boat capsized. Everyone went over except for Tim. He started pulling people in. Just as he was instructed, Tim grabbed my life preserver and pulled really hard. He pulled so hard that he literally threw me right over the boat and back into the water on the other side! An omen?

With Telalink staff, friends and significant others in tact, we headed back to Nashville. Later that week, Andy Warner built my first webpage at www.telaink.net/~thos. However, the earliest available version is at http://web.archive.org/web/19980114073339/http://www.telalink.net/~thos/ . I think Cregan Laborde, also a Vanderbilt student/Telalink intern, actually made the one that you see in the archive. That is from 1998.

I know it sounds weird but between that week in July, 1995 and my arrival date in Nashville on October 10, 1995, I didn’t have Internet access. I bought books about the Internet, including one that published the most popular websites on the ‘Net, sites that had gotten “thousands” of hits! I came across one called the Speedtrap Registry and I quickly recognized the site’s author- Andy Warner- Vandy student, Telalink “intern,” Internet geek, Good Morning America guest.

In September, 1995, a month prior to my arrival, Bill met with two students from Martin Luther King, Jr. Magnet High School- Paula Pfleiger and Carl Tashian. “Do you have any internships available?” they inquired. “What’s that involve?” Bill replied. “Well, we get out of school early and come over here to do....whatever you need for us to do. You get free labor and we get class credit.”

“Can you start tomorrow?”

“No, we have to get this approved by our teacher and the school.”

“Show me what to sign and tell me what I need to say.”

Days later, the official MLK internship began. Carl wrote what some have considered to be one of the best HTML tutorials ever - http://tashian.com/htmlguide/ . Within weeks, Ryan Kaldari, then known as Ryan Smith, offered to do whatever was needed and didn’t even care about getting course credit, compensation or internship status. He hardly needed it but Telalink was the place to be. Soon after that, other students from other schools were starting to show up every Tuesday night. Telalink provided pizza and if you came around enough, “interns” got a free internet account, meaning you got dial-up access, email and space to build your website. An internship program made in heaven for the budding geek.

October 10, 1995, a year and a day after the death of my father, my cat, Misty, and I arrived at 110 30th Ave North. I walked in the back door of suite 5 to discover about a half dozen interns, gazing and marveling at a new server and a new rack just about to be affixed in the server room. My arrival was upstaged by the new toys and intern night was bustling. Truly, the formative years of Telalink were enlivened by pre-teens, teens, 20-somethings, recent grads and the occasional old people who descended upon the Telalink offices every Tuesday night. Telalink graduates are all over the world now. I’m sure this list is incomplete but I trust others will add to it and correct as needed:

Bob Collie- ena.com, CTO

Lewis Pennock- ingramcontent.com, Director, Consumer Direct Fulfillment; previously involved with Rex Hammock’s smallbusiness.com startup

Jay Hawthorn- Barclays Bank

Carl Tashian- ourgoods.org and yerdle.com; previously a senior engineer with zipcar.com

Paula Pfleiger- dmiinc.com, senior director

Ryan Kaldari- Wikipedia Foundation, editor

Andy Warner- Google.com, isn’t really allowed to tell us

Doug Brown- nashville.gov, operations analyst

Andrew Webber- Corsairartisan.com, head of operations and distilling; previously worked at Sitemason.com

Cregan Laborde- Birmingham, AL VA hospital, MD

Daniel Templeton- cloudera.com

Cari Bloodworth Templeton (Married to Daniel)- ?

Adam Solesby- ?

Matt Stevens-

James Campbell- Central Intelligence Agency

Nick Holland- populr.me, CEO; founded centresource.com

Brett Duncavage

Email Address and Chief Financial Officer

thos@oneelevendigital.com (Thomas Conner) — Fri, 01 Mar 2013 19:26:53 GMT

February 25, 1995- Vanderbilt men’s basketball hosted University of Kentucky for a Saturday afternoon match. An old classmate, James Gilman, and I decided to meet up in Nashville for the weekend to hang out and catch the game. I think we somehow pretended to be students and sat in the rowdy section. At least that’s how I remember it. Vanderbilt lost, 71-60, to the #6 ranked Wildcats. Oh well, time for the next activity. I agreed to stop by and meet up with Bill Butler after the game to find out about this Internet business thing.

“This is a website,” said Bill, pointing to the Mosaic browser with an image of Reba McEntire. We can build these and businesses will start to market themselves on them. “Okay,” I said. “How does putting the image of Reba on your computer make you want to buy her records, assuming that’s the plan?” “No,” said Bill. “I’m typing a unique address on this web browser and it’s allowing me to see Reba but it’s not coming from my computer. I could look for other things. Look, the White House has a site.” He types H T T P : / / W W W . W H I T E H O U S E . G O V. I watch a site load, slowly, with text and images revealing themselves. “Oh, yeah, this is just like America Online and Prodigy. I even use a Compuserve account at the bank to download Freddie Mac loan prices,” I said, thus restoring my status as someone who understood what the hell Bill was showing me. “Well, kind of,” he said. “The Internet is actually a lot bigger and ANYONE can add their own site with their own information. Everyone will want this.” “Uh huh,” I nod and stare at the web page with images of team Clinton-Gore.

“But that’s not the only focus right now. We’re selling dial-up accounts so people can access the ‘Net. They can get to websites, news groups, build their own site and they get an email address....” Bill was clearly enthused. He explained that Telalink was an “Internet Service Provider.”

Oh yes, the “Internet! Well,” I pondered aloud, “I don’t know about this website idea but I think you’re on to something with this whole ‘electronic mail’ idea. I think it would be cool to send messages back and forth to someone without using the post office or a fax machine. So, if you’re selling accounts with access and it includes a......”

“An email address,” said Bill.

“Cool name!” I said. “Yes, I think businesses would love that. Who knows what they will do about a website. Maybe that will appeal to them too! So, what’s all of this got to do with me?”

“Well, you’re a banker. You know something about money. We’re selling accounts like crazy but, every day, we have to buy something or order something else. We can’t keep up ”

“Of course! You want me to help you find someone to manage the financial side. I don’t really know anyone but I could help you look at some resumes and maybe we could interview...”

Bill interrupted. “Tim and I were thinking YOU might be able to be the ‘money guy.’”

“Me? Chief Financial Officer?”

“Cool name!” he said.

“Oh, that would be rough. I live four hours away and wouldn’t be able to give you all enough time. I work pretty much a full work week at the bank.”

“I’m suggesting that you quit your banking job, move to Nashville and be our full-time....what did you call it again?”

“CFO- the...Chief Financial Officer?”

“Yes! Tim and I want you to be the CFO of Telalink Corporation!” proclaimed Bill.

At almost exactly the moment that I felt the full weight of the proposition set before me, a youthful, energetic lad with glasses and braces burst through the doors of the “server room” into a makeshift office/media room/warehouse of computer parts, junk etc. I thought that perhaps he was speaking a foreign language but I was able to decipher a few English words within the rapid fire succession of unfamiliar phrases and technical jargon. I think he was talking to Bill but perhaps it was just the boy’s vocal way of organizing some rather abstract thoughts into a way of explaining them to someone when such an explanation was needed.

Bill interrupted the quasi-soliloquy, “Yeah, I’ll be right with you. I’m sort of with someone right now.”

“Okbye,” said the youngster. It’s as if he was born without a “verbal space bar” and all of his words were a constant flow of connected letters and the separation of the words was really up to the listener. I’m not sure but he may not have seen me.

“That was Bob, the intern,” said Bill.

Tommy Williams recently offered a comment on how “Bob, the intern” came on board: “Bob Collie...was an incoming freshman at Vanderbilt and wanted Internet access and managed to break out of our improperly configured A/UX machine to a shell account and then was nice enough to tell us what we had done wrong.”

A match made in heaven? An 18 year old freshman hacker and a couple of 20-somethings with a start-up Internet Service Provider. I didn’t even know Tim that well. Evidently, I had impressed him during a previous visit when I suggested that Telasar, their consulting business, might be able to get a line of credit to finance the purchase of equipment they were selling. I remember, even then, Tim responded to my suggestion, “You want a job?” Truthfully, it wasn't THAT insightful of a comment.

I looked around and saw, Feisty, Tim’s cat, wandering around the room. I saw dirty clothes, dirty dishes, video game controllers and cardboard boxes piled up. Bill was wearing a pair of shorts with two gaping holes in the back. His boxers hung outside of them. I couldn’t tell if I was in a scene from “Animal House,” “Real Genius” or “Wargames.” Clearly, this would be a transition from my more formal banking life.

“I’m going to need some time to think about this. You got any financials?” I asked with great curiosity.

“Sure,” said Bill, confidently. “I’ve been taking care of all of that stuff. Let me just print out what we’ve got in MultiLedger.”

With balance sheets, income statements, GL reports, account details and a headache, I left Nashville. My head was spinning with questions. I forgot to look at the fuel gauge and managed to roll into a closed gas station off the Bluegrass Parkway where I spent the night. At 6:00 am, the attendant showed up. I refilled and headed back to Winchester asking myself:

“How can I possibly do this? How can I NOT?”

"What's an Internet, Again?"

thos@oneelevendigital.com (Thomas Conner) — Thu, 28 Feb 2013 19:23:22 GMT

My office at 110 30th Ave North is surrounded by windows, offering a nice panoramic view of the west side of town. I probably have the best view of the Vanderbilt football team’s victory flag waving over the stadium, a rarity since it has not had such a lengthy presence during the offseason. Perhaps of more interest to readers of this blog is the 5” pipe protruding from the wall directly behind me. It is partially hidden behind a bookcase and is hardly noticeable since it is only about 8 inches from the floor. In the springtime, baby birds usually chirp incessantly from a well-fortified nest on the other side of the stuffed paper towels that have been crammed in the hole to serve as insulation.

There is little to suggest now that this was once the gateway to Telalink Corporation’s oh-so-primitive “data center” in the early years and that this pipe would allow for Nashvillians to take their first ride on the ‘Net. It was late summer/early fall 1994, not a particularly fond memory for me as I was still living in Winchester, Kentucky. My father was dying a slow, agonizing death from cancer. My family struggled with how to best care for him but there was no denying that he would not survive, even after radiation, disfiguring surgery and radical doses of chemotherapy. Dad was relegated to a lonely existence of morphine patches, Ensure, “pity” visits from friends and hospice services. I say “lonely” because he was largely left alone much of the day while my mother was teaching and my brother and I both worked. Hospice eventually sent caretakers to sit with him during the day but that was after the morphine made it too dangerous for us to let him be alone. What does this have to do with anything?

On the day that Dad became a hospice patient, a sentencing that did not quite sink in with him since he was planning to get better, I remember telling him that I would see him every single day for the rest of his life (I knew what his hospice patient status meant). My routine was largely to come home from the bank, change and head over to sit with him before dinner. One night, as we watched “NBC Nightly News with Tom Brokaw,” a feature segment about the “World Wide Web” was the headline story. Dad was hardly able to focus but I remember commenting to him, “Dad, can you believe this stuff? They’re talking about doing business, advertising, listening to music, connecting businesses to customers with ‘web sites.‘ This is like some kind of science fiction thing. This will never happen any time soon. This kind of stuff has gotta be decades away, don’t you think, Dad?” He agreed with me but the truth was quite different. Dad was slowly dying, not unlike his clothing manufacturing company which was shuttered a few years before, just a distant memory. Far from the dead and dying, my friends Bill, Tim and Tommy were in Nashville, birthing and raising one of the earliest ISP’s right off of West End Avenue, helping to sweep in the new economy that would change the world forever.

A small advertisement in the Nashville Scene was sufficient to lure a few hundred customers to Telalink right out of the gate. The rapid pace that these entrepreneurs had to keep to stay just slightly ahead of the growing user base could be likened to that “I Love Lucy” scene, the one where she and Ethel are trying to wrap the candies on the conveyor belt before they go by and the process just keeps speeding up. I don’t really know who did what but I do know that Tim was programming some of the first websites in town. Smokey Mountain Knifeworks, Davis-Kidd, an ad agency that was famous for its jingles. I’m going to have to let him name them. Bill, on the other hand, was battling the whole modem/Bitsurfer configuration and trying to keep enough phone lines open to handle the demand for service...which, brings us back to the pipe in the wall...

BellSouth was obligated to sell phone service to the office at a residential rate, which was a cost advantage for Telalink. The problem was that BellSouth was not exactly thrilled with delivering all of these phone lines to a condo off of West End Ave for the lower margin service and, often, they became somewhat slow to reply to Telalink’s new orders. This constant battle with the monopolistic Ma Bell of Nashville would last until July 4, 1996 when the game changed but that is for a later story. At some point, the orders were so great, that BellSouth had to cut a hole and insert the “bird-house” pipe in the wall of the Telalink data center to accommodate all of the lines. What used to be someone’s bedroom (I think it was Tommy’s) became the designated location for Bitsurfers, modems, routers, hubs, switches and web servers, all of which were starting to pile up fast.

Albie Del Favero and Bruce Dobie owned the Nashville Scene back then. In early 1995, these guys jumped on the ‘Net. They worked out a deal with Telalink to get the Scene online in exchange for advertising. WSMV/Channel 4, did the same thing. Hammock Publishing, Curb Records and Griffin Technology, to name a few, were soon to follow. They needed access and they needed websites. Telalink was eager to get out in front, especially because Telalink wasn’t just selling dial-up accounts. They were selling ISDN access- twice the speed of regular dial-up service. I am sure that someone will correct me but I think a single channel ISDN dial-up account was 64K and most regular accounts were 28.8K.

Tim kept the books in MultiLedger. Bill devised a billing system with FileMaker Pro and started building on an idea that the lads had conceived earlier- Nashville.net- a website that acted like a “virtual community” where websites would all be represented on a caricature map of the city of Nashville. You should check this out: http://bit.ly/XJHTKV . Truly, these guys were ahead of their time. Already, they were imagining the web as a thriving community with opportunities for commerce soon to come.

As much work as it took to: launch a start-up ISP on a shoestring budget; develop a competitive pricing strategy; handle an avalanche of sales calls; negotiate strategic trades; craft a technical support policy; manage exponential growth; learn HTML well enough to know that good programmers don’t necessarily make for good web designers (and vice versa); establish a users’ starter kit (complete with NetScape Navigator download!); do a little accounting and billing ever so often; battle daily with BellSouth; and constantly buy and install more hardware; the Telalink team was having fun and attracting some of the most brilliant minds around. The Telalink “Intern” program spawned an unbelievable number of successes, something I will address in another posting. Indeed, Telalink in 1995 was the wild frontier in more ways than one. Parties on the roof were legendary. All night video game marathons were common. Work or play, it was never a dull moment.

After my dad died on October 9, 1994, I became restless in my hometown. After a few months of finalizing Dad’s affairs, I decided to get away from things and headed to Nashville to meet up with some friends for the Vanderbilt-Kentucky men’s basketball game. I called Bill Butler to let him know that I would be in town. “That’s great! I need to talk to you about something,” he said. “Can you come over after the game? I want to show you our Internet company.”

“Cool,” I said. “What’s an Internet, again?”

To be continued....

Attention: Bill Butler, Tim Moses and Tommy Williams

thos@oneelevendigital.com (Thomas Conner) — Fri, 01 Feb 2013 19:21:36 GMT

I experienced a lot of nostalgia last night while attending SouthernAlpha’s inaugural Spark Nashville at 3rd and Lindsley . Listening to the panel discussion with Marcus Whitney and Nicholas Holland, I was fascinated with the stories of these “pioneers of the industry” when I happened to notice the familiar profile of Bill Butler in the balcony. If I were in a movie, the scene could not have been better scripted. For there, hovering with saintly presence above these “old” gents in their reminiscing about the old days (early to mid 2000’s) was a true visionary for technology in Nashville before there was any awareness of any kind by most anyone. How could this be, you might ask? Pull up a chair. Pour yourself a beverage. Raise your hands, clasp your hands with fingers intertwined and, with your best Wayne’s World flashback impersonation, come back with me....”doodl-oodl-oo, doodl-oodl-oo, doodl-oodl-oo, doodl-oodl-oo........”

August 2, 1993. Telalink Corporation was established by Timothy Moses, William Butler and Tommy Williams. While the debate remains to this day which company was the first Internet Service Provider in Nashville, I would put forth this date as one of the earliest known dates for the launch of a fresh start-up with the intent of networking computers for retail purposes. It is true that I have frequently commented that Telalink was the first Nashville-based ISP and, well, it’s my blog so prove me wrong, blog readers!

Bill, Tim and Tommy had already launched Telasar Consulting after they graduated from Vanderbilt and had made a name for themselves in Nashville as Mac experts, installing hardware and software, offering technical support to users, rollerblading onsite to provide whatever service the client needed. Bill and Tim’s geekdom goes back even further to their days at Battleground Academy in the 80’s when they successfully networked their computers by way of some innovative hacking that I am sure they absorbed through some cosmic phenomenon, not unlike what one may have encountered in “War Games,” “Weird Science” or “Real Genius.” Ah, the 80’s.

Telalink was launched with about $50,000 from friends and family and the primary use of those funds was to launch a service that would allow for computers to connect to other computers through an elaborate configuration of modems, routers, hubs and a cat named Feisty. While Feisty was not essential to the operation, she/it did provide for plenty of entertainment at 110 30th Avenue North, Suites 5 and 6, Bill, Tim and Tommy’s personal living space, geek hangout and workplace.

Telalink was nearly a bust. Remember, our good friend, the Internet, really didn’t reach Nashville until 1994. The problem at Telalink was that the technology was primitive, the connections were complicated, the phone company (yes, there was only one and it was known as BellSouth) was uncooperative, and the market was hardly educated. And, as much as they knew about computers and how to connect them, that whole “running the business” part of the business was occasionally an oversight.

Not long after the money ran out, the AMEX was run up and the Telasar funds were being diverted to cover the costs that Telalink was causing, Sprint came-a-knockin’ on Nashville’s door in the summer of 1994 with dedicated pipes to “the backbone.” Our heroes, sensing an opportunity, signed up for a 64K connection before the local Sprint sales rep. had a chance to learn just what she was selling. Meanwhile, the boys had already been learning about browsers (or browser at the time- Mosaic) and the oh-so-sexy HyperText Markup Language (HTML). Programming a site on the World Wide Web was quickly becoming the thing that the hip geeks were doing.

By August 1994, With Sprint connection in hand and a cheap ad in the back of the Nashville Scene (yeah, the famous back page ad section which included some of the more unsavory opportunities) advertising “Internet Access for $35/month, 60 hour Limit,” telalink.net was born. Yes, “.net.” Any schmoe could apply for a “.com.” but “.net” was the more elite suffix, signifying that you were an Internet company. Nashville, meet the Internet. Internet, I believe you know about Nashville by virtue of a previous introduction by Vice President Gore. Yes, indeed, the “Information Superhighway” is here!

To be continued.....