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JotSpot Got the Goldmine. Its Partners and Customers Got the Shaft.

It’s kind of like the old story of the wife who works for years to get her husband through medical school and the minute he starts making enough money to afford the second BMW he dumps her for something younger and flashier. 

Kevin, who works at a company that builds customized JotSpot wikis for enterprises, writes on his Catching a Wave in Silicon Valley blog that despite being JotSpot’s only “Gold Partner” and having worked closely with the JotSpotters while they were building their business, his company was given absolutely no warning of the Google buyout, no support since, and has had to scramble to play “fire control” with its own customers. 

“What is truly interesting from our perspective is that no one at Google cares about the people who helped build the JotSpot product,” Kevin writes. “Or if they do, it is through the rose colored glasses of lots of money. I guess that cures everything.”

Kevin lists four key lessons he’s learned from the experience which anyone considering building a business around a startup should read and have tattooed on their forearm.  

Update 11/30/06:  Since Kevin has now taken down his post, I’m adding his four lessons here:

1. If you sign a partnership agreement, get some kind of notification clause that gives at least thirty days (preferably more) notice before any party terminates the agreement. We were notified of the merger on the same day it was announced and had to play fire control with our customers.

 

2. Look for signs of impending trouble. Before the announcement, we noticed everyone at Jot acting strange. Upgrades were being posted quickly and these changes were causing problems with nearly everyone’s code. Little or no communication occurred prior to the upgrades. Why would a company do things to hurt its customer base? Well, I guess the answer is that Google was the biggest customer and probably demanded the changes prior to purchase.

 

3. Pick your hosted application service provider well. Relying on web hosted application services is much more dangerous than I ever would have assumed. This is especially true for those services that are “closed source” like those of JotSpot. If an agreement is made with an application vendor like JotSpot, get some kind of service agreement that extends beyond merger/buyout. These type of agreements are a bit shaky but if the management team is any good, they’ll include them in the buyout agreement.

 

4. Part of the buyout agreement should include clauses specifying a roadmap. Taking an entire company “Dark” after a merger does nothing but cause problems for customers. In the JotSpot case, no one knows what Google is planning to do with JotSpot technologies. Will customer applications continue to work?

His parting words reflect both his disappointment and naivete:

My question to Google (and the JotSpot people) is how can you treat your customers, some of which have been there from the beginning so poorly? Does the Google mantra “do no evil” apply only when convenient? I’m wondering if the lack of customer focus will yet again provide us with another wonderful exploding “Tech Bubble” here in the valley. Just my two cents…. 

Memo to Kevin and anybody else who buys into the we’re just here to save the planet Googlespeak:  You’re not in Kansas anymore, Toto.

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