I have to write about the Motley Fool.  Maybe you remember them from back about 1997-2000.  We were pretty big back then on investing, the founders, Tom and David Gardner were on CNBC quite regularly, we had a syndicated radio show (I was on it twice I believe), and we were quoted quite regularly.  I had come on with the company in 1995, and became a full time remote employee in 1999.  Since writing doesn't pay really high, I also worked as a subcontractor for a small engineering firm doing Code inspections for home builders. 

In 2000 two things happened - I picked up my own liability insurance and started my own engineering business.  The second thing that happened was the dot-com crash hit, hard.  In 2001 I left the Motley Fool and concentrated on building my business.

Tom Gardner (left), CEO of The Motley Fool and Me (right)

Unlike many dot-coms, my former employer survived.  One of the founders, Tom Gardner, is now CEO and we had an interesting talk last week.  From what Tom told me, their experience with the dot-com crash was very close to what many of us experienced with the housing bubble burst.  They had to re-examine their business model, and try to figure what would work.  They had to make really painful cuts.  The Motley Fool when I first worked with them as an unpaid remote staffer had about 10 paid employees, and grew to almost 400 employees.  Tom told me that they cut to about 60 people. 

I think the biggest problem they had was to figure how to make money in a business that never existed before.  In the end they went with a subscription model, which has worked very well.  They don't spend so much time in the media anymore, I don't think that does anything anyway.  I've been on WSB-TV numerous times and all it did was feed my shallow ego and get me made fun of by other engineers.  It didn't increase my bottom line, and I suspect being on CNBC didn't make that much difference for the Gardner Brothers, and they don't seem to have my shallow ego, so they didn't get that benefit either.

There were a couple things that struck me in the conversation with Tom about the downturn that he hit that must have been excruciatingly painful.  First, letting go all those employees.  The Internet is ranked up there with the wheel as one of mankind's great inventions, and we were right on the cutting edge of history, and here we were getting cut.  It hurt for all of us.  Letting go of people is always hard, I know that first hand now, although I never had to cut 300 some people (and Tom and David knew everyone personally, can you imagine?).

The very worst to me would be the media scrutiny.  I made serious mistakes in running my business during the housing boom.  Some of them were incredibly stupid.  Every now and then I go over them in my head and feel like an idiot.  However, I never had to read about my mistakes in the business pages of The Washington Post.  That would be rough to be "pilloried in print" as Mark Twain called it.

There are a lot of lessons that Tom and David could teach us, but we probably know now to watch our money and be careful with hiring people.  What's more valuable is we have to look at how they survived.  What I saw is that they came up with all sorts of different ideas, some were rather lame in hindsight (Henry Lucas, CEO of ECS Ltd. told me that every bad idea starts as a good idea).  However, they weren't afraid to try things and toss out the bad ideas and keep moving.  Tom said a bit of luck was involved too, because if the economic collapse of 2008 happened in 2003, they'd have been toast.

Unfortunately, we can't control luck and chance events, but we can keep looking for opportunities and stay flexible.  The events of the past few years have changed the environment in so many ways, and I suspect many of those changes are permanent.  We have to be flexible and adapt to the new realities.

Here's some videos of where it's at this week: 

Shipping Container House Progress 

Container House Interior