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Don't Look Back
A bi-weekly column with timely, relevant and possibly irreverent insight into the BC technology industry.

Something Ventured:
December 20th, 2002

By Brent Holliday
Greenstone Venture Partners


"So make the best of this test,
And don't ask why.
It's not a question,
But a lesson I learned in time.
It's something unpredictable,
But in the end it's right,
I hope you had the time of your life"
- Green Day, Good Riddance (Time Of Your Life)


For most of the technology industry in BC, 2002 will be entirely forgettable. In fact, if 2002 was a dog, you'd take it out back and shoot it. I'd rather have a needle in the eye than live through this year again. In 2010, you will talk about the years of the first decade of the new millennium and skip over 2002 with barely a mention. It'll be the blank spot immediately after the big party finished. "You know, it started with a bang and then I got kind of drunk in 2001 and, well, frankly I just don't remember 2002. Must have blacked out."


Who's with me on this sentiment?

    Current and past employees of Motorola Canada now looking for work?

    Any of the continuing horde laid off by other BC technology companies, big and small?

    Anyone holding stock options as part of employment compensation?

    All of you that used to be busy taking companies public on the CDNX (TSX Venture Exchange?)

    Anyone, union or non-union, working at Telus (do they hand out barf bags for the stock volatility in what should be a stable slow growing company)?

    Any of you holding a brand new degree that says Class of '02 that has a fridge papered with rejection letters?

    Any entrepreneur trying to get investment this year from angels, VCs or the public market?

    Anyone sick of the words "downsize", "rightsize" or "cut the burn"?

    Anyone whose RRSP or other investment portfolio in technology is somewhere south of Admiral Scott?

If your answer was No to all of these and you had a good time in 2002, then you work for ALI Technologies, Electronic Arts, Crystal Decisions or Larry Campbell. Either that, or you have been featured on that TV show "Kink".


These are the days that the media just loves. The reporters were forced to interview mealy-mouthed CEOs of up and coming technology companies and write positive stories about the "new economy". They did this just long enough to get a good "hate" on. It is always harder to write about positive stories and have positive, insightful opinions than it is to just kvetch. Now, the revenge is palpable. Every pedestal is being cut down, every bull being gored, every sacrificial lamb, rotisseried. Unless you are being investigated by the BCSC or SEC, your PR person can't get a story done. In this environment, it would be tough to sound bullish. But in the spirit of Christmas and just, plain feeling better, let's talk positively about the BC technology scene for the remainder of this column and the rest of this god-forsaken year.


Here's the best news for 2003: It is not going to get any worse. I'm not saying that just because the sentiment is that it simply can't get any worse... because it can. One simple, awful attack by any type of wacko extremists on North American or western European soil will, in fact, make it worse. What I mean by the statement is that the technology industry has bottomed and the spending in technology has stopped decreasing.


Before you start whooping it up, the year ahead is not likely to see dramatic growth. In fact, any growth in tech spending would be remarkable. The thing that makes 2003 interesting is that stability and consistency are likely to be good things. Even if growth is not there overall, knowing that the person you are dealing with will buy something and that they will still be there in a month when you come calling again, well, this is a good thing. If the overall telecom spending market in North America is $55B next year and it is not in doubt from quarter to quarter, it will be nice to know that there is some business to be won. If the overall market is stabilizing, vis a vis spending on technology, but is not growing, then the challenge will be to take market share away from someone else. We can live with that, right? We can strategize, position and sell to win some market share.


While the market will not sizzle, the calmness of steady spending and the lack of earnings warnings in 2003 will be very refreshing. I think we will do handstands at the end of '03 because flat and steady will seem like a world of difference from 2001 and 2002.


So enjoy your holiday this year. Take a few deep breaths. Know that you won't have frantic success next year, but that, with solid execution, you will make your numbers. The slaughter is over and long, slow steady growth in technology markets are much more likely on the horizon.


What Do You Think? Talk Back To Brent Holliday


Something Ventured
is a bi-weekly column designed to supplement the T-Net British Columbia web site with some timely, relevant and possibly irreverent insight into the industry. I hope to share some of the perspective and trends that I see in my role as a VC. The column is always followed by feedback (if its positive or constructive. I'll keep the flames to myself, thanks).

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