Dog Bites

Fangxaminer Watch continues; dot-com failures and the economy

Yeah, talk to the sock puppet. The sock puppet cares.

Looking for a little more anecdotal evidence, we asked John Doffing, president of StartUpAgent.com -- which specializes in recruiting tech industry workers -- exactly how bad things are. "Last week we received over 1,000 unsolicited résumés from really, really talented people who worked for companies that don't exist anymore," he answered.

Still, in Doffing's view, most of those companies should never have existed in the first place. "It was almost like a reality distortion field mixed in with a big Ponzi scheme," he said. "There just was so much money out there that a bunch of really dumb companies got funded -- the Gazoontites of the world. I mean, selling hypoallergenic pillows online and raising $30 million [in venture capital]?"

In fact, he believes the shakeup will be good for San Francisco's soul. "I've sat at dinner parties where everyone's a millionaire and complaining about how expensive it is here," he said. "All of the making the dot-coms into the enemy -- there was some truth to that. Definitely there was this get-rich-quick culture that was disconcerting."

Doffing did note, though, that not all the laid-off workers will be reabsorbed by other companies. "There's a lot of people out there who will have trouble finding the same kinds of positions as they had before," he said.

Helmar Sowick, president of Oakland-based Mac People, said much the same thing. "I just feel bad for a lot of young people who made a lot of money and got a false impression of what the job market is long term," he told us. "It's going to be tough for them because it's going to be a lifestyle change."

Sowick predicts some recent Bay Area arrivals may soon be packing their U-Hauls. "There are some people -- the lower half are going to have to look elsewhere," he said. "People are going to have to be more rational. There was a lot of inappropriate arrogance. [Former dot-com employees are] going to find a little humility is going to be necessary, a little perspective."

Often, of course, when an industry is in trouble, it looks to local government for breaks of various kinds -- but Dog Bites suspects many high-tech firms have already burned through nearly as much political capital as they have venture capital. After all, just two weeks ago San Francisco voters elected an almost entirely new Board of Supervisors; many of its members-elect ran on platforms that couldn't exactly be called dot-com development friendly.

"We made some poor policy decisions with regard to planning," said Sophie Maxwell, District 10's new supervisor. Like several of the other new board members, she believes citywide planning policy is due for review, and that the city shouldn't have a different set of rules for dot-coms. "If somebody turns a live-work loft into an office there ought to be a procedure for them to pay the fees they ought to pay," she said.

District-next-door Supervisor-elect Chris Daly noted, "Over at 17th and Bryant, you had that executive who was bragging about avoiding development fees. That kind of thing is not OK just because we might be going into a recession."

And on election night, District 11 Supervisor-elect Gerardo Sandoval made a similar point when we dropped by his victory party. "We need to take a look at all the land-use decisions that have been made," he said. "There're a lot of different forms of corporate welfare."

Meanwhile, the new boss is the same as the old boss over at the Planning Commission, which has just approved the Mission District's largest-ever office -- oops, we mean live-work -- development, to be built at the corner of 16th and Alabama. But we have to wonder whether, now that commercial rents are falling and high-tech start-ups are failing, we might be treated to the novel spectacle of people actually living in live-work lofts.

"I would say that from what I know of the people of the new board, they have very articulate positions on smart growth and slow growth," said Board President Tom Ammiano. "I think it would be safe to say that under the new board, the chances of office space becoming a priority the way it was under the previous board -- no, that ain't going to happen."

Besides, the New Economy doesn't look nearly as invincible as it did a few months ago. "The idea seemed to be that we were moving toward this high-tech or dot-com economy as the sole source for economic development," said Daly. "But you talk to someone in investing, and they'll tell you you need diversification."

"Generically I think the development issue is what this is all about," said Ammiano. "The [dot-com] industry as a whole took advantage of the administration's willingness to be so effusive. I don't think the new board is going to be so willing to say, "Here, take the whole store.'"

Hi Mom

Finally, Mecklin (Damn him!) wants us to make this special announcement: Dog Bites will be appearing on NBC's Today show this week, probably either Wednesday or Thursday, in a segment (turns out that's TV lingo for "item"!) about the, um, troubled Fangxaminer. This will be our first-ever television appearance, so try not to judge too harshly. And if we don't see you before then, happy New Year.

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