The Rumors of our death are only slightly exaggerated.

[Note: If you've come here because of the Forbes story, please read this clarification and correction to statements made in that article. 17-Aug]

Rumors have been flying lately about the demise of PubSub.com. While I've seen quite a bit of exaggeration in various forums, I can't deny that things are not going well for us. Our days are numbered. A recent attempt to execute a merger has been blocked and we've been blocked from raising equity financing that would allow us to continue to pay salaries and pay off our $3 million in debt. Thus, our "doors" will close soon if we can't find someone to pull us out of the current situation. Persons with fast access to cash and a desire for some of the industry's best technology are advised to contact us rapidly...

I believe firmly that the cause of our difficulties is not the team we have built nor is it the technology we've developed. Both are great. What has prevented us moving forward is a battle with a group of minority shareholders, some of whom claim to be lead by our ex-CEO Salim Ismail and are, in any case, primarily his "friends and family." This group is using very unusual clauses in our Shareholder's agreements to block mergers or financings. We've found it difficult to determine their motives, however, some have said that they believe that it is in their interest to drive the company into bankruptcy so that they can buy our software and start a new company. Of course, I believe that by the time we go through bankruptcy proceedings, we won't have any employees and frankly, a software company without the employees that developed its software is worthless. Our assets will have a much higher value if we have the employees available, thus, the best course at this time is to sell our assets, trademarks, etc. to cover the outstanding debt and make our employees available to the purchaser.

The clause that is being used to block us is a "one-man-one-vote" clause that requires that a majority of the shareholders approve any change to the shareholders' agreement. Mergers and financings require such changes. Asset sales do not. What that means is that one of our shareholders who has 75 shares has as much voting power as I do with my 540,000 shares (38.8% of the company). So, a tiny minority is able to block us moving forward on any of the normal paths for raising money. If no alternatives arise, we'll be in bankruptcy and we'll lose the employees within days.

I'm proud of what we've accomplished at PubSub.com and I'm very happy to have been able to work with a great team in an exciting industry. I'm terribly sorry that we've spent so much time on this internal political issues and haven't devoted more time to pursuing our product plans and building a better product for our users. Hopefully, in the next few hours and days, we'll find someone who is willing to help us out of this situation.

bob wyman
(bobwyman .at. pubsub .dot. com)

Comments

[Colette]

"Salim is trying to protect his investment but Bob is going for the quick sale.” Bob's string of lifelong failures to monetize his brilliance tells us a lot about his personality and pyschological makeup. Salim's history of success, on the other hand, tells us a lot about him. The guy who failed to make money from his involvemnt in Lotus Notes and other ground-breaking areas of software and web development; or Salim, who serially picks out good ideas and makes them a success. It is clear to me that PubSub is a brilliant technology, but that the reason it has failed is not because of Salim but because Bob is simply too hard to work with. The histories of both men tell us a lot."

The person who wrote this paragraph certainly does not know Bob Wyman at all. This anonymous person must be one of two things: a disappointed idiot or just an envious user. Bob will never go for a quick sale for it is not the type of person who will do that. All his life, driven by his passion, love and vision for technology, Bob has worked very hard and his work has had a great impact on millions of people. The point regarding the “lifelong failures to monetize his brilliance” is absolutely non-sense. Bob could care less to monetize his brilliance for he is driven by his genuine love for technology – a technology that will enhance life for all of us. More importantly, his true motivation is driven by the love of his family. He wants to live a legacy behind him so that his daughter can be proud of him.

“It is clear to me that PubSub is a brilliant technology, but that the reason it has failed is not because of Salim but because Bob is simply too hard to work with. The histories of both men tell us a lot." Enough finger pointing!!! This is not kinder garden! I do not know the history of Salim but I know Bob’s history. I am sure Salim must have worked as hard as Bob but in different ways to make PubSub a unique company with such a great edge. All these years, they have shared wonderful and hard moments together…this is what builds a great team like this one. In this case, the only issue I can draw from all this is that both men need to learn to communicate better…the rest is irrelevant!

“Bob, I find these comments shocking. Would anyone ever want to give money ever again to someone who publically reviled their co-founder and business partner as you do here?
I doubt it.”

Dear Susan, I have no doubt that Bob and the PubSub team will find the money. Why would anyone with great vision, common sense and money not take advantage of this situation to make a long term profit? PubSub is unique and innovative. On the same note, everyone knows politics are parts of our working life and internal issues between colleagues are common…If you knew them both…you must have picked up their differences too… Regarding Bob is a man of great integrity and honesty and I trust his judgment! I am very pleased that he went forward and let it all out so if someone is interested to invest s/he will know what to do from there. It is as simple as that!

PubSub is another great achievement for Bob and Salim with or without financial success. Whatever the outcome will be, it does not end here. There will be other fantastic opportunities for Bob, Salim and the rest of the PubSub team. Such talented group of people should have no fear…this is at the end just another great project…another lesson to learn from life...a new beginning...

Sincerely,
Colette

[The Skeptic]

Just what is (was) the business model?

Over the past few years, I saw people from PubSub speak at different panels and events, and they always dodged that question.

A harsh but true fact: investors are not going to pour more money in unless they can see how they are going to get a return on their investment.

Was there ever a specific plan, or was it more in the current Web 2.0 style (build an audience of users and figure it out later)?

[eugene]

To Skeptic,

There were plans, believe me. PubSub did not plan for not making money. The problem is that any plan requires more capital for equipments and staffs. The current problem is share holders who brought on board in angel round can't reach a common agreement for any reasonable way to raise capital for those plans because certain reasons. Therefore some entity may have a chance to buy it cheap for its IPs and reboot the company.

From another point of view. If a company with average less than 10 engineers, spent 3 years and 3 millions U.S. dollars to learn lessons on creating Internet scale publish and subscribe technologies, and gets listed on Wikipedia, the price tag is really cheap in comparison to 3 years old Google, Yahoo! and Microsoft. Google, Yahoo! and Microsoft did not make money until 5 years old or later. Well, then you should know even though to run a startup is much more cheaper as Paul Graham says all the time, but to scale up a start up, it still needs sugar daddies/mommies VCs or spoiling parent companies with fat pockets and investors who are willing to grow bigger cakes with smaller percentages.

[Skeptic]

Eugene,

Well I'm glad to hear there's a plan, but why the secrecy?

Just knowing a company's business model does not confer any advantage to its competition.

While it's true all those companies you named did not make money in their early years, you could tell what their business models were (even with a super-secretive company like Google, you know what the model is).

Not answering this question just adds suspicion: if you have a great technology AND a way to make money with it, why has it come to this?

[eugene]

Skeptic,

Thanks for pointing out. Great technologies and ways to make money with it doesn't mean a company will not fall. I don't want to make any person that I know felt embarrassed, but the lesson that I learned is a company needs a CEO who has primary focus and capability to execute the plan in those years given to him, and willingness from founders and angel investors to sacrifice their percentages of ownership to create a bigger piece of cake. And the willingness from angel investors to risk and take failures without suing VCs.

And I guess this comment just screws all my future business opportunities.

Eugene

[Skeptic]

Eugene,

I'm not trying to put you on the spot, but I find it more than a little amusing that neither you nor any any other person at PubSub would say what it was.

Advertising? Selling demographic (reach, views, etc.) data?

Why is answering that question so difficult?

[Bob Wyman]

Skeptic: The PubSub business model has never been a secret and we've never had difficulty expressing it. We not only had a plan but we had proved the ability to deliver on it. Had that not been the case, we wouldn't have been offered a merger with a great company and the planned support of some of the industry's best VC's. We didn't die because of a bad business plan. We were killed by petty in-fighting.

PubSub Revenue would have come from (and in several cases *did* come from):
1. Subscription revenue (for "special content" such as SEC Edgar "deep" searches rather than just the document header searches we provided for free)
2. Custom content streams. Such as those that we were providing (for pay) for KnowNow, Cymphony, FeedBeep and Burrelles-Luce.
3. "Powered-By" services where we would provide prospective search to other sites -- such as we did for Viacom's CBS Television stations for quite some time at a rather hefty fee.
4. Advertising in feeds
5. Technology licensing (i.e. software "sales")
6. "Private Topic" services. (i.e. A number of companies had asked us to host private PubSub topics to which they would publish content and which would be available only to a limited set of users or applications.

We had demonstrated markets for all of these revenue streams. The problem wasn't that we didn't have a business model and the business model we had was no secret.

bob wyman

[Skeptic]

Bob,

That was the clearest and most eloquent reply to that question I've ever gotten; it's too bad I did not meet and talk to you, as opposed to the other PubSub people (you'll forgive me if I don't identify them) to whom I put that question in the past.

It's a shame to see you fold when you had revenues; best wishes for the future.