Ten years ago they were the Young Turks of the business community – radical free-thinkers on the path to fame and riches thanks to their faith in the booming opportunities presented by the World Wide Web.
Companies including LookSmart, dstore and Sausage Software became household names, and created panic amongst rivals from traditional backgrounds.
But within a handful of years most of these companies had crashed out of existence, thanks to the aftermath of the April 2000 tech-wreck. They were sold for a fraction of their once-perceived value, or collapsed entirely.
But where are those entrepreneurs now? And what lessons did they learn about the highs and lows of start-ups?
Of the numerous overnight millionaires that dotcom boom created – and subsequently destroyed – few did as well as Steve Outtrim. Hailed as Australia’s first dotcom millionaire, Outtrim made his fortune through Sausage Software, a company he founded in 1995 at the age of 22.
Sausage made software tools for web developers. Outtrim took the company public in 1996, becoming the youngest chief executive of a public company in Australian history. Sausage listed its shares at 75 cents and they subsequently climbed to $8.20. At its peak Sausage employed more than 1,200 people with 3 million customers around the world.
Outtrim relinquished management of the company in 1999, before the tech crash, and left the board in 2000, but not before cashing out at least $60 million.
“I had the chance to retire at 26, which was always a goal of mine, but it didn’t really last very long,” Outtrim says.
These days he is putting his energy into what he describes as smart environments, otherwise known as ‘the internet of things’. He is involved in two companies, the enterprise software maker Majitek and a smart home technology company he founded in 2005, and EkoLiving. The latter is absorbing the bulk of his time.
“We saw a great opportunity in supplying energy efficiency products in homes as they were under construction,” Outtrim says. “It’s about bringing a change from this current use of technology in our environment, which I think is pretty dumb, to a world of smart environments.”
Outtrim says his motivations today are very different from those that drove him close to 15 years ago.
“It’s more a decision to follow my passions rather than chasing the dollars and every investment that comes along,” he says. “And that has taken awhile for me to come around to that way of thinking, but it is working for me at the moment.”
Sausage Software merged with SMS Management and Technology in May 2000, and the name disappeared soon after. Management of SMS was taken over by Wayne Bos, who presided over the company’s failed $4.6 billion takeover of another internet darling, Solution 6.
A one-time maker of accounting software, Solution 6 also owned an internet service provider, and Solution 6’s chief executive Christie Tyler used its soaring market value to purchase a slew of other business.
But the tech wreck killed the Sausage Software deal. This bad news was followed by embarrassment for Tyler and the company board when BRW journalist Nick Tabakoff revealed he had been convicted by a US court of being in possession of more 22.7 kilograms of marijuana, and had been involved in a failed software company, Lessonware. Tyler is believed to have left Australia within days of the revelations coming to light.
Bos moved on himself soon after, and has since been living with his family in the US, where he was involved in the sale of a US pharmaceutical company Natrol to an Indian company. He says that he continues to assist entrepreneurs and companies to develop their businesses.
Tyler however has fallen off the map. After leaving Solution 6 he was involved as chairman and CEO of the US mergers and acquisitions company MAII Holdings, which acquired the internet-based car rental company Car Rental Direct (CRD) in August 2001.
That transaction was followed by allegations from Phoenix businessman Jack Gunion that CRD had tried to steal his business. Tyler was fired and the company filed for bankruptcy protection in June 2003. He has not been heard from since.
James was the editor and publisher of SmartCompany and LeadingCompany for five years. He is now the Australian Financial Review‘s companies & markets editor, and a former BRW editor.
