After every party, comes the clean up.
Now that the dot-com boom is bust, what happens to all the party favors? Not just the high-end work stations, Blueberry pagers and laptops used for gearing up tech employees during their moment in the sun, but the massage tables, foosball sets and Coke machines that littered the landscape after the work-is-fun era fizzled.
Many of the more traditional trappings are sitting right where the dot-com folks left them.
John Doherty, a vice president at London-based UBQT Media, has been scouting for potential California locations for his employer. And much of the available office space is being offered “as is.”
“Most of the places are pre-furnished with hundreds of thousands of dollars of furniture and fixtures we’ve seen many still wrapped in the plastic, completely unused,” Doherty said. “Most of the companies can’t afford to get rid of it, or would rather you took it so they wouldn’t have to dump it.”
While some of the spaces are still occupied by skeleton dot-com crews, those folks’ days are clearly numbered.
“We visited a place where they had an antique Coke machine, pool table, foosball, retro-kitchen, etc. About 12 guys were working in what had been a 50-person shop,” Doherty said. “I asked the Realtor, ‘So if we like this, when could we move in?’ He replied, ‘The second you say you want this, these people leave the building.'”
Sometimes they don’t even get that second.
One source tells of working for eLearning, when that dot-com was vying with House of Blues as the prime tenant in a Hollywood office building.
Things got rocky in a hurry, and the building’s board of the directors forced the company out with scant notice.
The company had to leave behind upwards of a half-million dollars worth of NOEL workstations most still unassembled.
To this day, the ex-eLearning staffer doesn’t know if the workstations are still in the otherwise vacant office space, gathering dust, if the landlords claimed them, or if the company they were leased from took them back.
Mel Shipley, who runs an Iowa-based office liquidation business with a strong Internet presence, notes that he “absolutely” is seeing a better grade of “stuff” becoming available.
He often finds his tech leftovers from the “banks and insurance companies” that handle dot-com bankruptcy proceedings.
But while the grade of gear is higher, the content isn’t necessarily unusual he has yet to see his first massage table.
The most unusual New Economy fallout he has handled was “a semi-load of Snicker candy bars,” which he bought at 7 cents per and sold to an outfit in Chicago for 12 cents a unit. A tidy profit.
Auction action
Sometimes banks and insurance companies, rather than sell to liquidators like Shipley, sell the foreclosed assets directly to other businesses at auction.
Jake Hurn, business manager for West Hollywood-based Palm Pictures, attended one such auction where the assets of the notorious Digital Entertainment Network were being sold off. (DEN was the scandal-ridden online entertainment company whose downfall ignited the demise of the entire Web entertainment sector.)
While initially enthused about the auction, Hurn found “the deals there weren’t any better” than what he could find at a typical used furniture store, though he did come back with a few chairs and filing cabinets.
Most of the good stuff, he said, had already been picked over.
Other dot-com “stuff” that buyers have been swooping in to snatch is intellectual property. Victoria Anderson vice president of business and legal affairs at Urban Entertainment, one of the few successful Web entertainment plays attended the auction that followed in the wake of the Icebox bankruptcy. She was especially interested in the intellectual properties Flash animated shows like “Zombie College” and “Hard Drinkin’ Lincoln.”
But the asking price was $500,000 for the whole lot, and while that included all the spinoff rights, the only interest at the time was from overseas companies, and she wasn’t sure her own company could “derive enough revenue” to make such a purchase worthwhile. (The shows have since wound up as part of a distribution deal with San Francisco’s Mondo Media, which also specializes in Flash animated online toons.)
Few outright steals
Indeed, shoppers looking to score major bargains at dot-com auctions might be disappointed, said bankruptcy attorney J. Scott Bovitz, president of the Los Angeles Bankruptcy Forum.
The current asset sell-off is nothing like the wave of ’80s-era real estate and bank foreclosures, when apartment and office buildings went for pennies on the dollar. “This time around, you don’t have big valuable assets,” Bovitz said.
The computer gear becomes quickly obsolete, he pointed out. And landlords or soon-to-be-ex-employees often grab the rest.
What’s often left are the rights to a few viable intellectual properties, like domain names, software systems if adaptable to other businesses or the aforementioned Icebox shows.
“Dot-coms have just been a bust,” he contends even in their afterlife.
