Question: What was Brooklyn like when you were growing up?
Answer: I grew up in an area called Bay Ridge. It was a middle-class neighborhood, a lot of firefighters and cops and blue-collar people. I wouldn't say it was the toughest part of Brooklyn, but it's got edge. There were lots of very real, hard-working, salt-of-the-earth kind of people.
Q: What did your parents do?
A: My mom was a nurse, and my dad owned a bar. My mom worked during the day and my dad worked nights, so my dad would take care of me and my two brothers after he got off from work at 5 a.m. He'd have breakfast with us and then take us to school, then after we got out he'd pick us up and take us to the bar and we'd work there. My two brothers and I did every job possible, from being a waiter-busboy to being a cook to being the janitor.
Q: Sounds like tough work.
A: It was very, very hard work. But that's how I sort of got my first entry into entrepreneurship. It taught me a really hard work ethic, which I think is part of why I've been successful in business. I'm not the smartest guy, but I work harder than most people.
Q: What else did you do when you were growing up?
A: I was sort of the intellectual nerd type. I was into computers, Dungeons & Dragons and martial arts. I started taking tae kwon do when I was 14 or15 and earned my black belt when I was 17 or 18. To this day I still teach tae kwon do twice a week here at Mahalo.
Q: So how did you get interested in technology?
A: When I was 10 or 11 years old I went to a summer camp with my cousins in New Jersey where they had a computer, and I was immediately drawn to it. So I begged my dad to get me an IBM, and I ended up using it to copy a bunch of software for this Mafioso-type guy who was my friend's big brother. And I told him that if he gave me a modem I could go online and download hacked software for him. So he gave me one. I guess you could say my first enterprise was copying software from people and selling it, which was quite illegal. But I didn't really realize that at the time.
Q: What other ventures were you involved in?
A: I was copying video cassettes. This other Mafioso guy owed my dad money from poker, so to settle the debt he gave him a copy of "The Empire Strikes Back" on video. These Mafioso guys would basically go to a movie theater and record the film with a video camera, so I had a copy of "Empire" before the first "Star Wars" film was even out on video. I used to charge $30 to $40 for a copy of it. I didn't do it for very long. I sold maybe a dozen tapes.
Q: Where did you go to college?
A: I went to Fordham University in New York City. I had to pay my own way, so I worked full time and I went to school four nights a week.
Q: Where did you work?
A: At first I fixed laser printers. It paid pretty well, but most of my money went to pay for school. Then after a year or two I became a network engineer, helping offices set up local networks within their offices and buildings. By the time I graduated I was earning around $50,000 a year and I thought, "This is a career."
Q: So you always thought you'd go into something tech related?
A: No. When I started college I thought I was going to be an FBI agent. I was going to double-major in psychology and computer science at Fordham, but the computer science they were teaching was very old and I thought it would be a waste of time. So I just studied psychology, and I was interested in joining the FBI. I contacted the bureau and got the application, but when I found out starting pay was $25,000 a year, I was like, "This is crazy." I could make more money doing what I was already doing, and I didn't have to get shot at.
Q: What did you do after you graduated?
A: I decided to stay in network engineering, and I got a job in Sony. But the job was so easy I had a lot of free time. And I wound up having a lot of friends in New York doing a lot of stuff in Internet and with CD-ROMs, so I started a newsletter in 1996 called the Silicon Alley Reporter to cover the community. It started as this photocopied newsletter that had spelling errors and captions that weren't filled in. But it eventually became a big, glossy, well-read magazine. We became a $12 million-a-year company with over 70 employees.
Q: How did you start Digital Coast Reporter?
A: I flew out and met with a couple people, and they introduced me to Richard Riordan, then the mayor of Los Angeles. We went out to this alleyway behind City Hall where Riordan smoked his cigars, and we talked for hours. Finally he said, "You should do this here, everyone would support it." And I did. I got a little apartment in Santa Monica on the water, and I spent one week a month there.
Q: Why did you end up selling the magazines?
A: The market crashed around 2001, and the company went down to 10 to12 people, and about $600,000 in revenue. I wound up selling it to Dow Jones.
Q: Were you discouraged by that?
A: Not really. We always felt the market was too high for Internet companies. We didn't understand how companies with no revenue could be worth billions of dollars. I gave up trying to understand it. Instead, I thought, "I'm going to try to time that." So I moved to Los Angeles and started a network of blogs called Weblogs Inc. in a down market in 2003, and America Online ended up buying it in 2005.
Q: What happened next?
A: I agreed to stay on at Weblogs and about six months in, AOL asked me to take over as general manager at Netscape, which they owned. After six months, I left and became an entrepreneur in residence at Sequoia Capital.
Q: And then you started Mahalo, which is like ?
A: It's sort of like a search engine, but with a twist. We tried to put three things together, all on one Web page: search results from different services like Google and Twitter; content similar to an abridged Wikipedia article; and a Q & A; service. The difference between Mahalo and another search engine like Google is that our results and content are chosen and moderated by real people. Algorithms are great, but I always felt that search should have a human touch.
Q: Can you give me an example?
A: Sure. Say you search for a Tesla Roadster, the electric car, on Mahalo. You'll get a short article about the Tesla which was written by someone on our team. You'll also get the top seven links to other sites that talk about the Roadster. There will also be a part where you can ask questions about the Tesla Roadster. Someone from our team or one of our registered users answers those questions and moderates all the content. The idea is to give people all the information they want in one place.
Q: Where did you get the name Mahalo?
A: It's Hawaiian for "thank you." The original name of the company was 20.com but then I realized that it wasn't a very warm name. At the time I was in Hawaii and I kept hearing people say mahalo and I thought, "Gee, that would be a good name for a company." The name was already owned by this guy in Hawaii, so I tracked him down and gave him $10,000 for the rights. He gave it to me under the condition that I never use it for porn.
Q: Earlier this year you blogged about how Mahalo had accidentally hired a convicted hacker who was awaiting sentencing. How did that happen?
A: When we hired this employee, he had outstanding references and none of them mentioned he had been convicted of hacking. His references were so good we didn't even Google him, which frankly was stupid. We wouldn't have hired him if we'd known about his past.
Q: But you didn't fire him.
A: When I found out, I sat down and talked to him and he explained the situation. He was basically a good guy who had done something stupid when he was younger. I talked to the board of my company and to lawyers, and most people advised me to fire him. But I thought, "This guy has two months before he's sentenced, and all he wants to do is work here." He didn't have access to sensitive information at this job. So I kept him on.
Q: Why did you blog about it?
A: I knew it was going to come out. I wrote a letter to the judge in support of him, and that was entered into the public record. A reporter called me up, and I stalled him so I could write the blog post and get my side of the story out first. I also went with him to his sentencing, where he was sentenced to a couple years in prison.
Q: Would you hire him upon his release?
A: I would. I kind of related to him because of my background. I mean, I could have been in jail for two years for pirating VHS tapes when I was 14 years old.
Q: I noticed you post a lot of photos of bulldogs on your blog. Do you have any?
A: Two, named Taurus and Fondue. I had a bulldog when I was growing up, and I had one when I was living in New York. They're very loyal, affectionate creatures. I'm crazy about them.
Q: What was it like to compete in this year's World Series of Poker?
A: It was a lot of fun. I've been playing poker for a few years, but this was the first time I played in the World Series. I think poker is a great exercise for a CEO, like chess or backgammon. It's very similar to running a startup company: You have a certain amount of resources and you can decide when to compete and when not to, and you have to constantly make decisions with incomplete information. That's what I do all day long.
Q: Where did you place at the World Series?
A: I made it halfway through day two. I ended up 3,000th out of about 6,500 players, which I'm told is incredible for a first timer, but I was ready to throw a chair through a window and toss my car off a bridge. I was infuriated when I got knocked out.
Jason McCabe Calacanis
TITLE: Chief Executive
BORN: 1970; Brooklyn, N.Y.
EDUCATION: B.A., psychology, Fordham University
CAREER TURNING POINT: Selling Weblogs Inc. to AOL
MOST INFLUENTIAL PEOPLE: Mark Cuban, billionaire entrepreneur and owner of the NBA's Dallas Mavericks, and Jon Miller, former CEO of AOL
PERSONAL: Lives in Brentwood with wife and two bulldogs, Taurus and Fondue; expecting a girl Dec. 10.
HOBBIES: Poker, tae kwon do
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