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Riding Homebytes' dot-com gravy train into oblivion.

Witness to the Revolution


I knew the revolution was in trouble when the free soda started costing a quarter, and the CEO put away his Razor scooter.

Soon after, I was laid off from Homebytes, the biggest of Richmond's dot-com "revolutionaries." There were many factors in the termination of my position. For one thing, I confessed openly my dislike of marketing. As the person in charge of writing copy for the marketing department, this didn't fly high.

Or maybe my downfall really began when I refused to dress up as one of the marketing cheerleaders for the official company pep rally. I just didn't know my place. I didn't know which lap to hop in during halftime.

Things seemed so hopeful when I started work there. On my first day in the virtual economy, I sat through orientation with other new dot-commers dreaming of fat stock options and an alternative to the corporate jockeying I heard my more-settled friends speak of. I had spent the previous year teaching college composition at three schools. So last June when a friend offered to forward my resume, I was ready to sell out. I had visions of paying off my hefty school loans with my profits when the company went public.

Besides, was different. It had a revolutionary mission: We were to use cutting-edge technology to help homeowners save thousands of dollars, sidestep Realtors and sell their own homes. Tongue in cheek, the company even borrowed an in-house slogan from revolutionaries — Viva la Revolution! — though for some reason it used the English spelling of "revolution."

A couple of months later, I sat huddled in an atrium at the Martin Agency with about 120 other Homebyters. We were dutifully gathered before a large screen where the company's eight-month history played out slide by slide to the strains of the Beatles' "Revolution." It was all part of our "We've Gone National" celebration marking Homebytes' ability to practice virtual real estate in every state in the United States.

The slide show took us back to the olden days, a few months earlier, before most of us were employed there, a time when the fearless CEO used to sit cross-legged on conference tables pointing at large grease boards. He seemed to be pointing to himself often, as well.

After images of the company's speedy nationwide expansion, a final slide showed a suburban home with a Homebytes' "For Sale" sign. That was followed by pictures of future conquests: the Taj Mahal and the White House. It was typical hyperbole, but it carried a whiff of the company's self-image. The desire for fast growth demonstrated itself everywhere — except in profit margins.

Homebytes spent millions to sell real estate in every state, not because it expected to make a killing off home sellers in Iowa, but because the words "the first nationally licensed real estate company" made venture capitalists drool. And it worked, at least for a while.

The company's marketing plan had roots in Greek mythology. Sporting his Harvard letter jacket, our marketing guru orated on how our product was a Trojan horse. Like the legendary Greek warriors who tricked their way into the gates of Troy by hiding themselves inside a wooden horse, Homebytes was to slip into the minds of consumers with a good deal, and then offer a "virtual mall" of ancillary products and services. The mission was to create a brand and name that would stick — like, say, Trojan, a famous brand name built on trust.

With additional venture-capital funding came a hiring-and-spending spree. The marketing department and Web-development team increased from four to 15 people. We were charged with making the Web site more "intuitive," a word that meant "my way" and "cool."

Next, "usability testing" on the Web site and in-depth marketing analysis were performed. The goal here seemed to be to restate the obvious, or to provide evidence for a vice president's opinion. Long meetings, followed by elaborate project plans, were initiated.

Finally, Homebytes made a big move: It bought a competitor, The California-based company had not made a penny in five years, and therefore had great potential. never saw black ink, but it had name recognition, a valuable dot-com commodity. Its value derived from its high rating from Gomez Advisors, a self-described "Internet quality measurement firm for both consumers and e-business." Since Homebytes could not get this rating overnight, it hoped to obtain one by acquiring

Homebytes strove mightily to convince Gomez Advisors that was now a part of Homebytes by linking the two Web sites together. But these efforts to get a high rating fell through when received a first-place rating instead of Homebytes.

Even after the head marketer declared, "Homebytes is America's No. 1-rated Homeselling Service for the Independent Homeseller," the rating never really helped.

Meanwhile, things were going great for me. I was promoted. I even convinced an acquaintance to leave her job to work at Homebytes. And, as if on cue, I immediately began creating flowcharts that served, ultimately, to increase the efficiency by which I could create more flowcharts.

Two weeks later, the first ax came through to "trim the fat." The employees of and several new hires — including the woman I had persuaded to come aboard two weeks earlier — received a phone call for a special meeting, where they were told to pack up and get out.

The rest of us, meanwhile, were invited to a pizza lunch. We headed to the adjacent building. As we gnawed our pizza, a Homebytes executive announced to us that the layoffs had begun. He whined about "radical shifts in the market" and the "tight squeeze on venture capital."

My co-workers and I were bemused. These market conditions were not surprising: Even the 6 o'clock news had reported the very same radical shifts for months. Yet we had been hiring up until two weeks before the layoff.

(My friend, remarkably, didn't seem to hold her short experience at Homebytes against me. Incidentally, the CEO of was kept on as that company's sole survivor: He had "name recognition.")

The truth was that Homebytes seemed to be still trying to dazzle investors with expensive technology rather than prepare for the long haul. When the company finally did shift its focus months later, like the Razor scooters that arrived around the office long after they were a dot-com cliché, it was a year too late.

Something had to be done. Homebytes dropped the ".com" from the name on the home page to convince wary investors that our Internet-based company was not really a dot-com. (It's a hard stigma to shake, apparently.) But, like the decision to remodel the elevator (in red lights and piped-in progressive rock music), or the almost weekly revisions to the organizational chart, every desperate measure seemed to fall short.

Finally, the revolutionary spirit sputtered and went limp. It had become apparent that more money could be made through referring clients to traditional Realtors than selling the actual Homebytes product.

Eight months after I started, I was laid off, along with the company's last remaining founder and a few others. (Apparently, companies need founders; he was hired back two days later). At least I got two weeks' severance pay and a couple of tokens along the way: a T-shirt and a shot glass with the company logo on it.

On May 1, about six weeks and another round of layoffs later, the on-line real estate company went bottom-up, leaving nothing behind but a homepage.

Well, there is one thing left. Before logging off, a last believer hastily scrawled the company motto on sheets of notebook paper and taped it to the window.

The window, which once belonged to the vice president of information technology, faces Main Street. "VLR FOREVER," the sign says. The acronym stands for "Viva la Revolution." Last I saw, the scribbled, yellowing sign was still there.

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