Ask HN: How was life for a regular dev during the dot com burst? | Hacker News Reader

Ask HN: How was life for a regular dev during the dot com burst?

642 pointstorben-friis400 comments

I'm a youngish developer (28y/o), and the constant recent comments of people predicting a new burst have made me curious about how life changed for developers at the time, and maybe what to expect if such a thing were to happen again.

I've heard stories of rich startup founders losing everything back then, but not much about what happened with the average devs. What was it like, living through those times? Did many people change careers? was there still a thriving industry in less risky tech companies? did salaries drop? I'm basically clueless about the whole thing.

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I had a summer internship at HP while I was in college. (I graduated in 1992.) When I graduated, the assumption/expectation was that they would offer me a job. They hesitated, and a manager who was unusually nice to me explained that HP hires people who will stick around for many years -- and thus, they weighed every hire carefully.

He went further and said that several years before that, when there had been a recession, everyone at HP -- all the way up and down the ladder -- worked 9 days out of 10, and took a 10% salary cut, in order to ensure that there wouldn't be any layoffs.

People spoke about the company, and how it treated employees, with great pride, and the way that they treated workers during hard times was one major reason for that.

If nothing else, I learned from these stories that the boss/owner should be paid last, after all of the employees receive their salaries. I've done that whenever I've had employees, and I credit that lesson not just to general business ethics, but to a sense that business is about much more than just profit.

It's hard to imagine a modern company taking such steps to avoid layoffs, but the story continues to inspire me nearly 30 years later.

Thanks Carly.

Yeah Agilent took the HP way with them...

Hey, lately i'v read "The HP Way: How Bill Hewlett and I Built Our Company" and your story really resonates to what the founders said.

Snippet:

> We have always considered that we have a responsibility to our employees to plan our work so we can assure job continuity. We do not intend to have a "Hire 'em and fi re 'em" operation. This poses some serious considerations. One is always compelled to fi nd the most effi cient way to get a job done. At times it seems the most efficient way is to hire a group of people, work them as hard as possible, and when the job is fi nished, send them home. Well, even if this is the most efficient way, we have never operated in this manner. Bill and I do not feel this is the best way for a company like ours to operate. We have very rigid requirements of technical competence to maintain and rigid requirements in the quality of our equipment. This requires that we have and keep good people at all times. So we feel it is our responsibility to provide opportunity and job security to the best of our ability. This means specifically, sometimes we ask people to work overtime in order to meet customers' demands rather than hire additional people. While this is an imposition in a sense to our employees, it seems to be generally acceptable and we feel it is preferable to "hiring and firing." This is something you all need to understand as supervisors.

https://gizmodo.com/the-hp-way-how-bill-hewlett-and-i-built-...

It's sad. Most companies these days (to include HP) are hire and fire shops. All of them deny it.

Want to know why my resume is full of 1-2 year stints? Because when a project is winding down I've learned to start looking for a new job - because it's the safe thing to do. Managers will tell you up until the day you get your layoff notice that your job is safe.

At my last real job, the entire IT staff was getting laid off when the new CIO came in. One team after another and replaced with contractors. We knew in November of 2016 things weren't going to last. I was on the last IT team still employed.

My manager was fighting tooth and nail to try and save at least some of us. But come February (3 months longer than other IT teams) the fight was over and he lost. We were all laid off. I was given 6 months severance + insurance if I would stay around for 1 month and do a knowledge transfer to the new team, one of the easiest decision of my life. The majority of the team were escorted off premises that day.

Manager's boss helped everyone secure a new job (except 1 who just disappeared never to be heard from again), I got a contract gig for double the pay of that job.

I still talk to everyone, and we are all in better positions today than we were there.

> one of the easiest decision of my life.

Which way did you decide?

The free 6 months of pay and insurance for staying for only 1 month!

>It's sad. Most companies these days (to include HP) are hire and fire shops. All of them deny it.

This is a good thing for people who want to work at those companies but are not yet employed there. Companies that can fire people easily are more willing to take a chance on someone without a perfect pedigree than those who insist on only hiring those that they are certain they want to work there forever.

It's a good book and I really respect their management philosophy which could not be more different than modern corporate theory. Just look at this snippet of Dave's statement on the purpose of a corporation (The whole thing is really worth a read).

"I want to discuss why a company exists in the first place. In other words, why are we here? I think many people assume, wrongly, that a company exists simply to make money. While this is an important result of a company's existence, we have to go deeper and find the real reasons for our being. As we investigate this, we inevitably come to the conclusion that a group of people get together and exist as an institution that we call a company so they are able to accomplish something collectively which they could not accomplish separately. They are able to do something worthwhile-they make a contribution to society (a phrase which sounds trite but is fundamental)"

Remember that Bill and Dave started HP as a 2 man operation in their garage during the great depression. They basically built the company from nothing into a technology power house over the course of their lives and the things that they went through clearly shaped how they ran the company. It is a testament that you can still find a large number of impressive engineers that were HP lifers.

Scania, the truck manufacturer, did this during 08-09. 10% paycut, 20% time reduction and they encouraged people to use the time to study and improve. None were laid off.

Much of this is not due to goodwill of owners, but unions.

Why not both?

These are specific examples, not general trends, so you should be able to cite evidence that these examples were due to union pressure.

Note that union boosters tend to want to push the narrative that all business owners and managers are evil caricatures of greedy capitalists who wouldn't give workers anything but scraps if not for the valiant unions protecting them.

Not saying it's never true, but know when to be wary of union people claiming this and avoiding the point that unions sometimes obstruct efforts to keep the company alive and not lay anyone off during hard times by demanding strict adherence to negotiated agreements on hours and wages.

A pay cut would be an "over my dead body" issue for many unions.

Edit: Since this apparently does not go without saying, the feedback loops in a union are all wrong for taking that kind of risk (remember, the pay cut does not guarantee company survival). People willing to rock the boat with calculated gambles like that do not rise to positions of authority in a union.

That depends on where you are. If I recall correctly, In ~2009-2010 German automotive unions worked together with management and employees and negotiated widespread reduction of work hours in order to prevent layoffs.

Of course unions/employee representatives have a different place here(e.g. half of members of the board of directors are elected representatives of employees.)

That's a quite specific german phenomenon that does not replicate much outside, specially around europe.

France, Spain, Italy, etc... Tire-burning trouble starts with just mention of the possibility

The Volkswagen Autoeuropa plant in Portugal did this, and as far as I know it went very well.

Where I work the non-union staff are not laid off in downturns, only the union staff.

If your company does business in the United States, they're violating the law. https://www.nlrb.gov/rights-we-protect/whats-law/employers/d...

Section 8(a)(3) of the Act makes it an unfair labor practice for an employer, "by discrimination in regard to hire or tenure of employment or any term or condition of employment[,] to encourage or discourage membership in any labor organization." (An employer that violates Section 8(a)(3) also derivatively violates Section 8(a)(1).) For example, you may not

- Discharge, constructively discharge, suspend, lock out, lay off, fail to recall from layoff, demote, discipline, or take any other adverse action against employees because they support the union or engage in union activities.

This is nothing to do with union membership: when sales are down we slow the production line (everything is just in time) and part of that is letting go people on the production line who are not needed at the slower pace of operations. They will be recalled if sales improve. You have to be union to work on the production line (that is in the contract), so there is no discouragement of membership.

What about companies where different parts of the company have differing work arrangements? For instance, my telco has some union workers in specific roles, as well as non-union retail staff, and a "management professional" category. If union people were getting laid off, it would be due to the role, but of course there would be no non-union workers in that role.

While I think this might be a good step in production work, it might be killing for firms in knowledge intensive industries. When this happens the first to move are the still employable and affordable youths. So the average age and salary might go up after a move like this. In the long run older firms get more trouble hiring youthful people, etc. Source: an interesting discussion with a union bargainer that was actually dismayed that young people disliked working hour reductions even though the firm promised no layoffs in return. My take away is that for some employees an honest severance package is better than working hours reduction.

I'm not certain it would be bad for knowledge intensive industries. My reasoning is that people would use their time more wisely and get more done. As for young people (also affects older), I think the implication `more time working => more done` is still deeply ingrained even when there are arguments against it[1].

I do agree that having forced off-time can be distressing to some people. Some may like to think they are indispensable to run the company, and suddenly they feel betrayed because their company doesn't need them working at 100%. Or they are optimistic and think the grass is greener elsewhere. Or...

Anyway, I think it would be interesting to see studies of """productivity""" when employees are forced to do part-time work. Based on what I know, I wouldn't too surprised to see good social benefits (but it doesn't mean everybody would thrive).

[1] A simple search here on HN: https://hn.algolia.com/?q=long+hours

Unions generally work for those who have been there the longest. The young workers don't like hour cuts when they see people who have been there for years not have to take the same cuts. Worse, when you are young it is harder to have the required savings in place. My bank won't accept a lesser house payment - if I have been there for 10 years inflation has indirectly made my house payment less so I can afford to live on less income, which benefits the older worker over the younger. (there are lots of bills in life, some do hit older workers more and I'm intentionally not talking about them)

I've actually seen the opposite of that, on medium/small firms (at least the ones I've worked on) when hard times hit the first to go down are the senior positions (except those close to management) and they're substituted with way cheaper out-of-college people.

Google "dead sea effect" for some interesting discussion of this sort of thing. Many companies end up with a majority of employees with no mobility, and the culture in those workplaces suffers because of this.

>the boss/owner should be paid last

Yup. My dad is big on that too. Always thought he overplayed it, but one day he explained that the people he employs are quite poor. So if they don't get paid they can't put food on the table - literally. While he has a bit more of a buffer.

I guess that’s the downside of paying people as little as you can get away with.

>I guess that’s the downside of paying people as little as you can get away with.

Fair point I guess...to an extent.

People somehow manage to live paycheque to paycheque regardless of the absolute number they get paid in my experience.

In this particular case - it's in the context of 40% unemployment. So the market equilibrium is quite low.

There's a definite threshold between "their responsibility" and "the economy's responsibility."

I'd say generally the number at which you can no long afford to (a) put a roof over your head in a reasonably safe environment, (b) buy enough at the grocery to feed yourself and any dependents, (c) afford necessary medical care.

When you're trying to figure out how to make your paycheck cover only those things, we're not talking about disposable income anymore.

I have done this when companies I worked at where having difficulties, I volunteered to wait for my pay and prioritise other colleagues who had less of a buffer (single parents for example)

Did mean in one case I had to take the hit when the company collapsed and claim via RB2 (this is in the UK) - of course it turned out that my employer had not been making my NI payments so no unemployment benefit for me.

>I have done this when companies I worked at where having difficulties, I volunteered to wait for my pay and prioritise other colleagues who had less of a buffer (single parents for example)

That's quite a brave move if you might end up never getting paid. Props

Well I would get the government safety net which pays out a proportion of wages id just have to wait a couple of months so I wasn't risking much a few hundred.

But when one of your co-workers is a single mum who lives in rented accommodation and is buying her electricity on a Pay As you go electricity key losing a months wages is more serious.

When I was a contractor in fintech, I did a lot of work for one guy on and off over 10 years. He was always very prompt in paying, and I only found out after some time that some of his clients (big banks) were very slow to pay him. At one point he paid everyone contracting for him out of his own pocket for nearly a year. None of us were exactly poor, but it contrasted with other clients who were happy to pass payment delays straight on to me!

These are the types of people that earn my respect and loyalty as an employee. No nonsense, no BS, no trouble!

Leaders Eat Last. A very good book by Simon Sinek but based on an old Marine Corps principal.

While other services have 'head of line privileges' - basically the more senior you are the more you can cut in line to get food at chow time. In the Marines, you always line up most junior to more senior.

It drives home the responsibility leaders have to take care of the people who follow them.

Exactly. This also extends further. I have led and managed, and always try to take on the least appealing work while letting those I managed do the 'fun' work.

No US services have head of line privileges.

There's many reasons the owner(s) should get paid last. That's the moral reason. From the financial perspective, I've always viewed it as a risk/reward scenario. The people who are guaranteed paychecks aren't really taking much of a risk, except the general bet that their employer will continue to exist and need them. The owner(s), however, are taking a large risk in many different ways and if they are able to make a profit, then they should get a larger portion of it.

I've always thought of it in this investment sense with the risk to reward payoff.

> If nothing else, I learned from these stories that the boss/owner should be paid last, after all of the employees receive their salaries.

That's exactly how equity works.

Yep. High CEO salary, especially in startups, is a big red flag. Typically, C-suite/founders in startups should be paid enough to live on or $0 if they're already rich.

I’m from Boise, where HP headquarters are. Many of my friends parents were laid off unceremoniously in 2008/9. There was a lot of resentment

HP was a different company by 2008. The HP Way had been replaced by the usual corporate abuse - good for the share price, bad for everyone else.

The hiring of Fiorina is a good marker when HP started to go downhill, and the 2008 recession was like the climax of this somewhat tragic story.

When Bill and Dave were finally out of the company there was a stark 180 in philosophy. You can always tell when management is about to do something sleezy in any of the HP spin offs (including HP) because they invoke the founder's to justify their obviously poor decisions.

"I really think this is what Bill and Dave would have done"

Was it really better for share price? Not short term, but long term. HP was very respected before, not so much latter.

If your current investors want to pump the stocks up before using the pump to offload them into pension plans and the like, it makes sense.

Exactly! Short-term tactics are good for loot-and-plunder leadership, seldom for the business. And the market tends to be disproportionately interested in short term gains, so things can be antagonistically stacked against the business as an organization. After all, short-term is where the best combination of margins and flexibility lie.

This is similar to how many German companies adapt with recessions. They even subsidise in-house trainings to keep their employee's skills up to date during the non-working days.

I wish HP did the same reduce-work-hours scheme during the 2008 recession instead of the pay cuts w/o reducing the working hours. At least the pay cuts were voluntary but still...

I have a good friend who has helmed several very successful software companies. His philosophy is quite different: it is unfair to ask employees to work take a pay cut (and work more hours) when they could find another job that would potentially pay them more money.

I'm not posting this to argue with the HP philosophy, but rather to point out that there are other ways for management to care about their employees.

For the record, I stuck with my current employer through some hard times (forced furlough was the worst of it) because I appreciated what the leadership was doing, and believed in the goals of the organization.

Doesn't pass the sniff test. Employees can find another job while working at the place they got a pay cut. Sorry to say but your friend might have terminal executive-brain.

Well, they can always leave if they can find such another job.

I'd love to been suggested that arrangement instead of the "We're sorry we are out of money" excuse I got (while the company was heavily spending in other stuff). 3 months later they "got a new client" and posted new job ads to hire back the positions (while swapping all senior positions with junior staff).

What angers me about the situation is not that I was laid off, but that it was a decision only justifiable by focusing exclusively in the short term.

I'd much rather have a juicy severance package. If I leave out of my own volition I don't get the ~3 months' salary.

Dassault Systèmes is like that : the CEO publicly said during the 2008 crisis that layoffs would be the absolutely last thing happening.

The company froze the salaries and he kept his promise.

I was ~1.5 years out of college and at a small dot-com with a niche SaaS at the time. I distinctly remember 9/11 and the chill that came over our office that day. That passed in time, but our economic prospects never recovered. I used to hit the gym in the mornings and then work ~10am-7pm and I distinctly remember the day ~9 months later when the VP of engineering called me on my cell while I was finishing up my workout and asked when I would be in the office. He said to come straight to his office when I got in. About 85% of the company was laid off that day and I was among the "lucky" ones who was not.

What followed was almost straight out of the Silicon Valley sitcom. Management know our existing product was a dead-end, but with 85% of the company laid off, our remaining VC funds gave us a decent runway, so they decided to pivot to ... something. That is, the entire company (about ~15 of us) would sit around in the boardroom and try to come up with new product ideas. Needless to say, that went precisely nowhere.

The CEO was pushed out fairly shortly after that and I had been brought in through his network. My layoff came about ~6 months later in the second round of layoffs which constituted only me. Thanks to the VP of engineering going to bat for me, I did get 3 months of severance. I spent 9 months looking for another job and finally found one in fintech in NYC which turned out the be, to this day, one of the best jobs of my career. I also met my now-wife and many of my best friends there. That time was both the most traumatic experience of my working career and the best thing to happen to me at the same time. I know it was much harder on many other people, but it turned out for the best for me.

> found one in fintech in NYC

I'm interested in hearing which, if you care to share.

Well, it was nearly 20 years ago and with SoX and all the other regulations, the fintech industry now is essentially unrecognizable from what it was then. I worked for a bulge-bracket investment bank whose business today is dramatically different and a hedge fund that is no longer solvent. The reason it was good for me was that I was an inexperienced developer and I got to work with much more talented developers in an environment where results mattered. I learned a lot and became a lot better myself.

Did the company manage to IPO before it tanked?

No. And, thankfully, I had not early-exercised any of my options, either.

I know of one company that actually managed to pull off the pivot thing!

https://en.wikipedia.org/wiki/TippingPoint

They switched from an internet appliance (kind of like an early Chromebook) to smart deep packet inspection firewalls. Not a ton in common between those except that they both require hardware to be built.

If I remember right, local lore was that they pulled it off partly by realizing early that they needed to change direction and being well-funded enough that they had enough cash to start over.

Didn't slack start as a game studio? https://en.wikipedia.org/wiki/Slack_(software)#History

So did Flickr. Same guy behind it too. https://en.wikipedia.org/wiki/Stewart_Butterfield

Not in the dot-com years.

Here's another example of a successful pivot:

https://news.ycombinator.com/item?id=18063362

Posting anon.

In 2009, the startup where I was working was hitting the skids, and our investors (correctly) were not willing to back us. We all kept grinding for a month or two in honorable futility, but after a while, my bank account depleted and I had to go.

To make various ends meet and to keep my mental health during the wind down however, I took up some contract work that I found through various friends in the SF startup scene. One company that I really liked and did some small stuff for was Burbn, which was a mobile-only location check-in that was hinged around taking photos of your location.

Missing my friends in NYC (I made a lot of friends in SF, but my inner circle were my college buddies from CMU; I went to tech and they went finance, sigh), I decided to leave SF to head to NYC and get a fresh start.

As I was leaving, I wanted to tie up a few loose ends, so I emailed my contact at Burbn and said I was likely to be unavailable for any more work, but that I liked the project and hoped for the best for him. He responded and said that he was near funding on a small pivot, and that if I was interested, there might be a full-time role available. I declined - I was mentally done with SF and the startup scene (Larry Chiang, 111 Minna, the rise of FB spam-crap like RockYou, etc.) as it was then.

That person was Kevin Systrom; that pivot was Instagram.

Ouch! I hope your fresh start paid off, though.

Novell was a successful pivot. Novell started as a hardware company, with a proprietary computer based on the 68000. That bombed, so the pivot was to NetWare. That dominated PC networking for about 15 years.

I went through something very similar at a startup around 2010 (layoffs, new runway because of layoffs, random pivots trying to find anything to work)... so I guess some things never change!

I graduated from college and entered the industry just post-bust (early 2002.) I went to work for a company that had, 6 months prior, laid everyone off and decided to pivot with the remaining VC cash. I think it took them 3 or 4 months to figure out what the new company would be. That strategy wound up being successful for them (us, I guess...)

I finished high-school in 2001 and started working straight away (before college, I continued working part time during my studies). Being cheap was probably a big part of why I got and kept that first job for 4 years! I was paid a little above minimum wage.

I started about a year before you. I went into embedded rtos stuff. At the time it was comparable to the beat SV offers and by the time SV recovered enough to start offering double or perhaps triple embedded rates, I had learned i actually liked it an felt the amount of domain specific knowledge i had aquired was a good investment. I'm not sure that was the case, but at 40 having never changed jobs from that original corporation, I think I at least got stability and fun work out of it.

> it turned out for the best for me

Survivorship bias. What could have happened is that you spend 12 months looking for another job, nothing, you lose your house, end up on street, take some minimum wage job, never comment on HN. We don't get to see stories like that.

The stories we see is where it did turn out good. That's the commonality: you must step out of the comfort zone for something good to happen. However something good does not happen to everyone 100% of time.

Bias entails the misrepresentation of a population, but "for me" implies that the population consists of only himself, so the term bias is nonsensical in this context.

What value does a comment like this add? The question asks for the perspective of someone during the dot com bust and this was his.

"for me" is the key part of the sentence you quoted. If he had said "for everyone" then yes that would have been survivorship bias, but he did not.

Though if you are trying to point out the fact that we might get a skew towards success stories in this thread because those who actually made a success of the dot com crash are more likely to post about it then those who failed then I would probably agree with you.

9/11 was well after the dot-com crash. It didn't help, though.

the crash was not a singular event, 9/11 was at the tail end of it but it was crashing for a good 2 years or so from 2000-2002/3 (look at a graph of the NASDAQ from the 90s till today).

Yep. I worked for a small company that had been struggling through the dot-com slowdown. But 9/11 was basically the precipitating event for its final tailspin. I was laid off a week or two later and it continued to spiral down over the next 6-12 months.

Offered in the spirit of "don't believe everything you hear": I went into university and graduated during the post-bust winter. The few adults I knew, plus the Wall Street Journal, were unanimous in their opinion that engineering as a field was done in the United States and that all future hiring of software developers would happen in Asia.

I got on a plane to Japan immediately after graduation. It's been a fun and fulfilling 15 years, but I am reliably informed that there have, in fact, been engineers hired in the United States since then.

:) :) :) :)

Didn't mean any offence by this! I was merely indicating my appreciation for the humor of the original poster with his great command of the language: "have been reliably informed since..".

Though quite a few of them have been Asians. ;)

For most westerners considering a move to Asia, I'd recommend Singapore over Japan. It's essentially Asia-light, and salaries are higher.

Perhaps, but you're still lopping your SV salary in half, and if you want a central 1 BR that's not government housing, you're paying close to SF housing prices.

Well, those visas that allow you to work in SV don't grow on trees. (And you'd have to put up with California and the US.)

If you do have an American passport, you get a double-whammy in opportunity costs: you can already work in SV, and you still have to pay American taxes even when you are not working there.

---

The government housing in Singapore can be quite nice. But yes, you are going to live in a high rise tower, most likely. Not a country house.

Some people prefer urban living and short commutes.

One effect that I only appreciate after living in Singapore for a while and then visiting elsewhere: the peace of mind not having to look after all you stuff when you are out and about. In Berlin or London or New York, I need to constantly worry that someone would nick my laptop, if I leave it on the table in a cafe when going to the loo.

About the taxes thing -- you can subtract foreign taxes that you pay from your American tax bill, and you also get an exemption on your first $100,000 of earnings, so it really only affects you if you're living in a low-tax-rate country AND making a six-figure salary in USD.

(I'm an American living abroad so I deal with this every year.)

Yes. Specifically for Singapore those salaries are easy to achieve for techies, and sort of the point of living here as a foreigner.

Otherwise, you are probably better off in a lower cost place.

I assume you still have to do your American taxes, even if just to show that you didn't hit the threshold?

Yeah you still have to file your US taxes

Rents are cheap in Singapore. Way cheaper than they are in London. When I worked in Singapore few years back I paid at the time an equivalent of 1 thousand pounds for a brand new condo in a nice gated community with swimming pools and stuff. It was only 3 MRT stops from downtown.

In London to get something of comparable quality I would have to pay at least 3000 pounds if not more.

Around 2012, I found London relatively comparable to Singapore in terms of rents. Since then, rents seem to have come down by about a quarter. (I live in an HDB close to the CBD.)

Singapore has those 'gated communities', but it's actually the last place on earth to need them. ;)

I remember a Partner from the large global consulting firm that I worked for telling me a similar story: “There is no point getting in to engineering as it will all be offshored to Asia; much better to become a project mgr that ‘glues’ delivery together”. Since that point I always regretted not doubling down on engineering and have spent the rest of my career trying to become more technical.

Yep I remember them scare mongering with that line. Which really gutted the already short supply of developers available. I also remember when the outsourcing wave came crashing down on their dreams of cheap development labor and they had to come back hat in hand to US developers who understand US business processes to bail them out. BOA being a big one that's project busted spectacularly. Most of us that witnessed this period held their feet to the fire and jacked up our rates, due to the limited supply of developers.

People are still telling me this just last year. Met a couple of software developers that I believe worked at one of the more traditional large corps. Over the next half an hour or so they kept telling me about how software is a dead end career and all the jobs are going to go off shore soon. They seemed super depressed about their future prospects. No amount of me talking about career (and compensation) prospects of software developers would sway them. And this was in the Bay Area.

Maybe if they’re not doing their jobs properly, but even if their company is sending pretty much all jobs off-shore they still need someone to verify the quality of the contributions from those people, and that’s where your job will be.

Besides, my big company is starting to bring more and more jobs on-shore again after finding out that doing it all off-shore doesn’t actually work.

I work for a consulting company and any time we work alongside offshore developers (hired by the client to do parts of the work) its a nightmare. Maybe its just the clients being too price-sensitive and not knowing how to oversee offshore devs, but every time I've been in this situation, the offshore developers are slow to deliver, their quality of work is far below the standards of the team, and we end up spending time to fix their work.

I think the problem is they have zero stake in developing a great system. If anything, a barely working kludge that they can maintain for the next few years is best.

I remember being at Zellerbach Auditorium at UC Berkeley in 2001 or 2002. Bill Gates had come to urge students to please consider majoring in CS.

Interesting. How has your experience been in Japan? I hear that the work culture in Japan is bad that you have to grind for long hours at work. And then the culture is so different and the accommodations so small and you can't drive around in a big fat suv. For the culture part, it is okay as long as you like to experience new things, I guess.

Will briefly share my story, then offer advice:

I was VP Tech at a high profile ad driven startup. We raised $50M (Softbank money in those days). Spent a lot of it scaling up on Sun hardware, ran TV ads, saw tremendous response, then a week later the bottom in the ads business model dropped out. Literally a week later. Amazing.

We went from close to 300 staff in March (60 of which reported to me) to 7 in October. The CEO handled the layoffs.

Most of the developers who reported to me took months to find new jobs.

Many of the non-tech people who had found unique jobs in our business were not able to find similar work again and went to business school or law school.

I had worked day and night to scale up, then worked day and night to scale down. I burned out. I moved, stopped working for pay, lived on savings, went to grad school (in CS) for a while, then finally got back on the horse in 2005.

Some advice- worrying about the next bubble bursting is a distraction, like following the shiny. It is good you are asking the question, but the right plan to be making- a career plan- is what is important, and whether there is a bubble or not is kind of irrelevant.

You might lose your job in the midst of major investment, or you might weather repeated rounds of layoffs. Random things will happen uniquely to YOU. They have to all of us.

The average story is helpful context but it is not your story. Protect and defend yourself. You are the only one who can.

Idk I graduated into the Great Recession and ignored it at first. Undergrad just didn’t prepare me for professional planning nor woke me up to the relevant market pressures. I’d say it’s important to know what’s going on in the market to inform both things like immediate savings priorities, but also medium term choices and direction. For example, I knew my programming chops could be honed into marketable skill, but I didn’t foresee my math BS becoming as relevant to highly valuable jobs like it has.

I definitely wouldn’t have moved somewhere the economy depended so greatly on luxury goods and services, for instance. It was hit really hard by the GR.

I would emphasize this: worrying about the next bubble bursting is a distraction, like following the shiny. It is good you are asking the question, but the right plan to be making- a career plan- is what is important, and whether there is a bubble or not is kind of irrelevant.

Internalizing that can be the best thing any developer does. It is way more impressive to talk about all the skills you have acquired in your career in an interview than it is to talk about how your last company crashed and burned and you rode it right into the ground.

Make your plans for how you want to advance your career, what you want to learn, what field you want to work in, the companies that are places where you could pick up relevant skills. And plan for things you could do in the down time between jobs.

Interestingly this is also the attitude of many money managers (Warren Buffett, to take the best known example). You'd think at least they would take explicit, timed preventive action. Many (most?) of them don't.

I'm not sure exactly what you're trying to say about Buffett, but he's sitting on a gigantic pile of cash right now. He knows which way the wind is blowing.

Which is exactly what I'm doing as a freelancer as well.

Not sure this is a result of crash planning, or that good deals are hard to find at the top and he won't pony up unless it's a good deal.

> and went to business school or law school.

Familiar sounding story. I've got lots of friends who took it as an opportunity (or were forced by it) to switch out of tech careers. Lots of people I know went and became things like paramedics (at least three I can think of), nurses, doctors, lawyers. A bunch were well enough off to be able to reinvent themselves creatively as photographers, musicians, DJs, producers.

(I'm from Sydney, so it didn't hit anything like as hard here, I was at what would these days be called a startup in the online travel industry. We'd hit $1mil in turnover @~32% margins in Jan and had an offer on the table which my would have turned my ~5% equity into a quite nice house paid for outright if we'd taken it. Then when Sept 11 happened we lost 90% of our US customer revenue over night (which was by far the bulk of our customers). Didn't _kill_ us outright, but it took us ~2 years to recover back to our next $1m month. We struggled on for another half dozen years before selling the business to a competitor, and I eventually spent my entire share proceeds from that sale taking a handful of friends out to a (very nice) dinner.)

I worked at a company called Hydrogen Media in St Pete, Florida. We had a bell that would ring only when we got a million dollar deal. It rang multiple times a day.

Our office was insane. Exposed rafters with the trusses and everything painted black. Our walls were deep blue but had blue neon running the length of the room on all sides. No overhead lighting.

Our developer floor was elevated with sub-floor network cabling. We had a dev floor about 100 yards by 50 yards, the size of a football field, roughly. A little shy of that. Private offices had glass walls facing the dev floor. Our sound studio (these were the flash days) was a hollowed-out VW bus in a soundproofed room.

We had a fire pole from the bosses office down to the dev room, conference tables with in-layed TVs. It was pretty wild.

In my time there, I built ~400 replicated sites for Colliers realty, DuPont Registry's website, a bunch of websites for the Tampa Bay Buccaneers, the Tampa Bay Lightning's website among others. We were printing money.

The crash hit hard, and Hydrogen Media dwindled. Massive layoffs, and eventually it renamed to Bayshore Solutions and relocated to Tampa where they still do business to this day.

Damn. I’m surprised I never heard of you guys at the time. I was 20ish around that time living in St Pete. Was seriously looking for an “internet job” at the time even though I had almost no advanced experience. Things sure have changed since, especially since I moved to SF a few years later.

It was a rough point in time. In the dot com boom, people who could rub two lines of visual basic (for applications) were getting jobs. If you did not like your job, you could make a phone call and have a few offers waiting for you by the end of the day. Glorious stock options at promising startups after fleecing larger companies in panics about y2k and missing the boom. The parties and travel...

We were joking about the pets.com of the world - buying pet food, selling it at a loss, and trying to make up for it in volume. At least we had a business model that made money, a foosball table, and actual personal offices for each developer. When the stock market tanked... everything just shut down. People stopped buying or investing - and anything that assumed growth, for the most part, died. Starbucks with long, long queue lanes were empty.

As some companies died, there were opportunistic shops that were looking for solid talent. As they sold off our little shop of ten people, I ended up getting an offer and then being one of the folks left behind to turn the server room lights off. I had negotiated a start date a few months into the future, and very thankfully, they honored the offer. Things got worse. There were several more bits of belt tightening - we had a 25% round of layoffs later as the impacts of a bad economy really hit home. I did well/got lucky - but while the first round cleared out a lot of 'charlatans', I saw many solid people go on that black Friday

Salaries dropped - or at least stopped growing for most senior people. The rise of off-shore came and the realities of global economies eventually settled in. Large swaths of people turned their back on development... and here we are today, where it can be tricky to find solid folks again. The Wheel of Time turns, and Ages come and pass, leaving memories that become legend. Legend fades to myth, and even myth is long forgotten when the Age that gave it birth comes again.

> In the dot com boom, people who could rub two lines of visual basic (for applications) were getting jobs. If you did not like your job, you could make a phone call and have a few offers waiting for you by the end of the day.

Yea, that doesn't sound anything like today!

/sarcasm

There was no “grinding leetcode” in the late 90s...

Good point.

What were SWE interviews and interview prep like back in late 90s/early 00s?

UK experience. Turn up, usually do some sort of coding or skill test - which was mostly on paper and consisted of about half an hour or so worth of questions. Starting with a few gifts like an obvious error, or "explain encapsulation", through to 2 or 3 bastards that were probably the current department's idea of funny. 30min - 1.5 hr interview, usually with a quick wander round the department or building. Not uncommon to get an offer as we wrap up. No prep - just know the company you apply to, and know your stuff.

A few were still just interview with no test. Some would have a second round - mostly corporates, which were mostly a repeat of round one but with someone else. In that era I can remember just one whiteboard interview, which also required a surprise presentation. I passed, but didn't want to proceed. The interview put me right off them. :)

On the interviewing side it was actually depressingly common to have one or two turn up and hard fail the easy gifts, and completely fail to explain encapsulation, or know what a constructor was etc. There were quite a few trying to wing it with a couple of years C++ or Java on the CV when they maybe sort-of knew a bit of C and fancied a bit of the absurd y2k and dot com money that TV kept on about.

Oh wow, you built a product in 3 months that makes 1mm/year, you know Perl, sql and JavaScript, you’ve built 30 websites, you’ve run 3 successful businesses, you’ve built a framework to build web apps quickly? When can you start?

The cargo cult of the day were the Microsoft style logic puzzles, "how many telephone poles are there in Seattle" and that sort of thing.

I didn't expect a reference to the Wheel of Time.

> people who could rub two lines of visual basic (for applications) were getting jobs

If one can put two sensible lines of VBA that solves a particular problem (e.g. in Excel or whatever context), I believe such person has enough knowledge to not to be unemployable, even today. We are not talking about mid/high six figures - there are plenty of jobs in-between.

I graduated in 2002, took a "Beltway Bandit" consulting job testing Java code for a Treasury project in a basement in Hyattsville, MD, watched my older friends who graduated in 2000 into dotcom pay struggle to keep up payments on their Porsches, and counted my blessings for being able to pay my student loans and foolish new car purchase.

Two years later, I took a US Army contracting job in Germany, and through a couple of twists and turns, have been in the IT department of a large German auto parts manufacturer for eight years now... where we just got our 40 hour contracts cut to 35. My husband (engineer) and I live about the same lifestyle that our neighbors who are secretaries and mechanics do, so finances will not be a problem unless we're both unemployed for over a year.

My advice: don't take on unnecessary expenses that you would have a hard time backing out of (big car note) or that would tie you to a place (mortgage on something that would be hard to sell for what you owe), and think hard about what are needs (eating healthy food, recreation) and what are wants and conveniences (having prepared food brought to you, expensive activities and exotic travel). Go ahead and enjoy your wants a bit while times are good, but be ready to cut them out when the punchbowl gets taken away.

Great advice. I have a friend who went into finance in the run-up to the Great Recession. He spent his first big bonus on a Ferrari. Then the crash came, and the Ferrari sat in a parking garage (over $1,000 a month because it was a premium car) while it took him years to find another job. Also, nobody was buying a used Ferrari in '08 or '09 so he couldn't even get rid of the damn thing haha.

I was working at Treasury in Hyattsville around that time (in the basement as a matter of fact, where I think most of the contractors lived) but that was my first job after getting away from all of the .com bubble-busting BS.

Salaries were still pretty good (but flat) for those pros who stuck around and had actual technical skill, but a lot of the newer people to technology had it much rougher.

HPTi?

I graduated from college right amidst the bubble bursting, and it was brutal. Fresh college grads and junior developers were competing with displaced veterans for entry-level positions. ~1 year prior I had been offered $120k/yr to drop out of school and move to Pittsburgh to take a job. I decided to stay in school to finish my degree instead, and by the time I did the bottom of the market had fallen out and I was unemployed for 7 months and finally landed my first professional software development job in Washington State for less than half the salary of the job I'd previously declined.

I thankfully had my CAD/CAM background & contracting to fallback on while hunting for those 7 months, but it was enormously demotivating & disenfranchising. I was within a couple weeks of just abandoning a career in software entirely and going back to what I knew permanently.

I expect it all worked out in the end, as I'm now CEO of a startup doing a thing I'm really interested in and have successfully raised money to fund it along side our early revenue. But, it was still immensely crappy at the time and shocking to see just how extreme the pendulum can swing in terms of available jobs, pay scales, etc.

Did you look into the history of the Pittsburgh company? My guess is you did the right thing, in a year you could have been in a strange city looking for a job with no degree.

I did. It eventually folded, but the people I knew that worked there managed to go into some pretty impressive gigs. One ended up as a VP at Apple on the iTunes Music Store side of things, if I recall correctly.

It's hard to say how things would have worked out otherwise, but I'm not living on that git branch in the repository of life, and I fear what it would take to resolve the merge conflicts, so I just chug away on the feature branch I'm currently on until the whole lot of it is deprecated. There are two nascent forks running around here that I think show promise.

I like your thought process.

My experience was very similar- I was working on my resume the morning of 9/11 at the start of my senior year. My friends and I all boasted about how we would refuse to even entertain any offers below 75k prior and several had already secured offers at the end of their summer internships.

The bottom fell out of the market, and though I had two summers an intern under my belt, there were hordes of devs with 1-2 years experience in specific stacks I was competing against. Most offers that were secured were rescinded.

I was somewhat fortunate- I did not plan on going back to the place I interned at, but facing no other prospects I reached out and they offered me a job- for literally 37k. I swallowed my pride and took it- it was a small consulting firm, close to my house, and they had just scored a new project for a major sports organization.

I kept looking on the side in hopes to get a better offer, but got literally zero bites on it. After one year there (and my boss tried to get me excited about a 3,000 but 10% raise) I got my first actual response to a submitted resume for a place that seemed terrible. The month after that I got a second call, that didn't work out. The month after that a third callback- and they made an offer on the spot- for 55k. I was over the moon- it was at least a living wage, and working in finance for a group that was working on what would later be called high frequency trading.

Things picked up from there, but I didn't hit that 75k mark for another year or so.

It’s funny to hear stories like this, because I didn’t begin my career as a software dev and 37k would have seemed like incredible money to me fresh out of college in ‘06. My first job, I was making 21k and I felt pretty ok about it. I’m making an order of magnitude more now, but I’m grateful for learning how to be happy on a 21k salary. Literally everything over that feels like excess that I could do without if need be. Makes it easy to choose the work that I actually want to do, too.

That must have been in a LCOL area... 37k was not enough to move out of my parents house comfortably... 55k was, at least I could live with roommates and still save a bit- I was in NYC though.

I was at ask.com during the crash. The first bad part for me was the options. I planned on selling them the instant they vested. A week before vesting they were trading in the low hundred dollar range. The day they vested they were in the dollar range, with a strike price of 10 dollars. Thank goodness I didn't exercise them or I'd be stuck in the tax boat. So it was demoralizing, but I still had my salary, and I was young enough for that to be enough.

I weathered three rounds of layoffs and that was pretty harsh too. Every morning we'd check fuckedcompany.com and look for Ask in there. One morning it popped up with a 60% layoff in two days. It was almost exactly right; 16% of staff were laid off. Someone mis-heard the number.

I was in a smaller off-shoot office, so when people were cut they were called into the managers office, and while there security would pack their desk. When they came out of the office the box was just sitting on the floor, right outside the door. By the second round the manager just wouldn't come in that day, and the main office would send some stranger to do it.

At first I rationalized the people who were cut as people who weren't valuable, weren't adding to the bottom line. They were the less technical people, and their jobs were more nebulous, so it was easy to ease any mental pangs. It was a way of coping with something similar to survivor's guilt. Then when I was laid off, well, it was a tough time for me personally. I couldn't help applying the same rationale to myself. I wasn't valuable. I wasn't adding to the bottom line. The company is better off without me.

They gave me a pretty nice severance check. I convinced them to keep me on for another week to document my project. It was actually one of the only cash-positive projects at the company, due to contracts with Visa and Nike. That extra week pushed me into 2 years of tenure, which bumped my severance from two months pay to three.

I did not do anything mature with the money.

Generally the attitude I saw was to hunker down and try to weather the storm. Nobody interviewed because nobody could get recruiters to answer the phone. And nobody wanted their manager to think they were interviewing; that was a great way to be called in first during the next round. And lots of late nights working; gotta show you're still committed, despite everything crumbling around you.

"Hunker down and weather the storm" was exactly how I felt in 2000 and 2008 both. I actually didn't know many tech people that lost jobs, but.... everyone stopped hiring, everyone stopped quitting. Just lay low.

+1 for reminding me about fuckedcompany.com — that was the first thing I read every morning. We didn’t pop up on it but I heard the news of our layoffs on the radio that morning when I was driving in - we were public and it was a pretty big layoff. As for what life was like after, my wife was pitching in midtown NYC on 9/11. It took her a week to drive back home. I knew a lot of founders who for many months kept pitching VC’s after 9/11 like everything was going to turn around the next day. I remember one who was just floored when a VC literally said to him: look, I took this meeting to do you a favor: stop pitching. Seriously. Anyway I don’t think it was until 2005-2006 before I stopped looking over my shoulder for news of layoffs in whatever job I had.

Man alive I lived on that site during those years. If you don't remember or if it was before your time: people anonymously posted internal emails, layoff notices, and so on. Some of them (the Cerner "tick-tock" email comes to mind - though it looks like it appeared on a Yahoo board first) were legendary. And the FC forums...oofah.

https://www.bizcominthenews.com/files/cerner-1.pdf

yep completely forgot about that dark humor of the period. Thanks guys for the throwback.

I went through it, and started a company soon after it crashed and then a couple more during the downturn. Ironically a lot of money can be made in downturns if you know where to look and how to approach it.

What I saw and experienced was enterprise devs basically just kept doing what they did. Startup devs that could went into (or back in some cases) to enterprises. Enterprises used it as an opportunity to snag up good devs at a bit of a discount in many cases.

To be fair, true developers were not really negatively affected at least not more so than other professions. One nice side affect I thought was that the crash cleared out most of the people claiming they were developers but had no real experience or talent. Most of my friends and people I worked with were fine and at worst might have gone back to an enterprise gig or in many cases were already there and didn't really miss a beat.

IMHO, if we have a crash this time (versus just a softening market), it will be similar as the need for quality software devs won't disappear. It will take longer to find a position in general and there won't be as much money floating around but decent developers are not going to have a hard time putting food on the table or finding work. Remote work will suffer, pay will suffer and VC dollars will drop dramatically, but the average developer will be fine.

> To be fair, true developers were not really negatively affected at least not more so than other professions.

That was my experience as well, all the weird roles got cut in companies, all the crazy extras removed, but the companies that had working business models kept on trucking and hiring competent developers, and competent developers at unsustainable businesses had no trouble finding new work.

Because at the end of the day, the dotcom crash was about the crazy financial expectations of internet-enabled companies, not a rejection of the internet itself.

Austrian school of economics believes that occasional recessions are useful because they destroy bad ideas (not exclusively bad ideas, but many bad ideas) and therefore free up resources for new ideas. Some of which will be good, some bad.

For a huge example: Madoff was only discovered because of the 2008 crisis. SEC had plenty of evidence against him for years before that, including the fact he did not actually trade! The guy didn't even trade securities and posted consistent double digits returns! The SEC did not investigate. Only when clients started asking for funds has the scheme collapsed.

I that is the SEC for you. At one if the firms I worked at we had an algorithmic trader who did hundreds of thousands of naked shorts (selling short a stock he didn’t own). He always canceled the order, bought shares, or swapped internally but was still a no-no, and he would do this thousands of times a day. He got caught and we put together a report of his activity that required a hand truck to deliver. The SEC took one look at that and made the firm promise to increase their internal oversight and that was it. They didn’t even open any of the boxes.

Naked shorts are still legal if you're a market maker, for example. They're not entirely bad, it's sort of like credit - it's only bad when you fail to deliver. If you do deliver then it's great as it lubricates the system. See "Regulation SHO":

https://www.sec.gov/investor/pubs/regsho.htm

Not sure if this was the case at your company, i.e. if they had the permission to do so. If not then I don't know why they didn't prosecute that trader. Most organizations cannot do naked shorts and have to pre-borrow securities.

    occasional recessions are useful because they 
    destroy bad ideas (not exclusively bad ideas, 
    but many bad ideas) and therefore free up resources 
    for new ideas. Some of which will be good, some bad.

I feel this was absolutely true for the world of internet applications.

The stuff built in the early dot-com era was typically garbage from a technical standpoint. Heaps and heaps and heaps of spaghetti code written in PHP, Perl, and ASP Classic. You could theoretically write maintainable code in those technologies if you were truly dedicated but this was decidedly not the norm.

Think of literally any basic best practice for writing either the server or client portions of a web application that we might follow in 2019. In, say, 1997 those best practices hadn't been invented yet and even if you traveled back to 1997 in a time machine you couldn't implement some of them since the technology hadn't been invented yet.

From a technical perspective, roughly 2002-2006 was when things started to get really good from a technical standpoint.

- A lot of untalented folks (people calling themselves "developers" but with no real coding ability) were filtered out of the industry.

- A lot of lessons had been learned about how to build this stuff.

- More and more people were getting high-speed internet access.

- The use of AJAX to build responsive client-side applications became a thing, thanks largely to...

- ...Google, who released two absolutely world-shaking web applications in Gmail and Google Maps. These became something of a guiding light in a number of ways. Both from a technical showcase of what could be accomplished with web standards, and a design perspective... it showed a lot of pointy-haired bosses that what people wanted was minimal design and maximum usefulness, not a flashy multimedia experience.

- Other "Web 2.0" tech like RSS matured and enabled LOTS of cool demos (sadly we've moved away from this...)

- Pressure from Firefox forced Microsoft to finally embrace some more web standards and we edged away from the brink of a Microsoft-ruled internet

Dunno. Practices in 1997 and 2002 didn't differ in very appreciable degree, just that piles of crap C++ became piles of crap Java. AJAX was made possible not by Google but by Microsoft's XHR and IE5. RSS never took of in any appreciable commercial way…

I would say the bust had no substantial impact on technology side of thing. Perhaps the pricing became bit more modest, and sure, lots of careers were "filtered out".

Ajax was made technically possible by Microsoft XHR and IE5. It took Gmail and gmaps to bring this to wide attention.

Yes. I remember people (including me) being a bit amazed by the web version of Outlook that first made use of it. Technically MS introduced this functionality in IE5 in 1999, as an ActiveX control.

It was a Microsoft-only thing for a while though, until Mozilla/Safari/Opera implemented their own versions. That took a few years IIRC.

At any rate, Gmail was what made the world really take notice of what AJAX could do.

For the record there where a lot of people that where doing the same thing before the XHR object, they where just using an iframe and polling to get the data which was usually an HTML snippet or XML. They would construct the url for data with JS in the main frame, change the url of the hidden frame to point to a different CGI script, get the data and read it into JS variables. It was just that none of them got the exposure of Gmail or Outlook web. Now in saying that iFrame polling was a huge hack and a major PITA but it worked. IIRC one of the major CGI/Perl chat apps used this hack to update the web chat window.

>I would say the bust had no substantial impact on technology side of thing.

I think that it did, because it focused development efforts of companies that remained in business. Many failed dot-coms should have failed before the bust, but they kept acting like working businesses as long as they had capital available. They diluted markets, absorbed development talent by offering equity and large salaries, and in general distorted the whole industry.

After the bust, the technologies and idea that got attention/effort/built up were the ones with a solid foundation, not the pipe dreams.

One thing I will add too, is if you do go back to the enterprise or at least out of tech, make sure you don't allow yourself to stagnate or miss the upswing. I saw that happen to friends who got salary stuck making half what they would had they joined the broader market during the recovery. Enterprises can rescue you in some instances, but they are not usually great for salary growth outside of a few key places and people.

So I'd only caution people to pay close attention the whole time so you can know when to jump back into the market and to capitalize on that next salary increase.

>Ironically a lot of money can be made in downturns if you know where to look and how to approach it.

Can you expand on this? I'm honestly curious about what machinations begin once a company dies or the market sinks.

Start a new company. Lots of talent available and investors look for heads-down new things. Classic Namazu stuff.

Capital's harder to get, but personnel and real estate is cheaper if you get funded. And then while you develop, hopefully the market recovers, and there's cash available for subsequent rounds and with customers to buy your stuff.

And it really depends on who your customers are. The amount of cash available during a recession doesn't change. It just gets more sluggish and people tend to be more reluctant to let it go. But it's there all the same.

I don't know if people tend to be more reluctant to let it go, they just change where it goes. As an example, a company I worked at during the dot.com crash made a lot of bones in regulatory compliance until 9/11...at which point, redundancy and high availability became the money machine.

What is "classic Namazu stuff"? I have never heard that phrase.

It's probably not super common, I just like to use it to describe economic upheaval and opportunity.

So there's this giant catfish in Japanese mythology, the Namazu. It's captive in the ocean, under a giant keystone held down by the daimyojin Kashima. When Kashima gets tired or distracted, he lets off pressure a little, the Namazu wriggles around to get free and that wriggling sets off earthquakes and subsequently, tsunamis.

After an earthquake, there's always a rebuilding and a redistribution of wealth. And after the Edo earthquake of 1855, woodcut prints depicting the namazu and society (namazu-e), money falling from the sky, businessmen vomiting and defecating money, etc. got super popular. (https://www.illustrationchronicles.com/When-Giant-Catfish-Sh...)

Others already mentioned some keys.

But a couple key things change (many more do too these are two I look for), yes capital is harder to come by, or at least requires better fundamentals and connections but the overall market is in a selling mood (e.g. good buying market). So enterprises and healthy businesses are looking for things to buy on the cheap (which is relative to the high of the market), and how to expand cost effectively. There is of course a cool down period that you have to get through before this starts happening.

Enterprises after they snap up their initial FTE roles they need to fill start looking for a lot more consultants to fill project roles versus bringing on more FTE's. This opens up more consulting gigs at pretty favorable pricing usually. You can now hire people to expand a consulting practice because people are less expensive so you can grow when things are "down" for others.

When the air pops out of the system people also get discouraged from the market and run away. A lot of the speculators will back out and so it becomes a more sane environment for a few years. If you are a developer and just work through it as things recover you change jobs a couple of times and you can really jump your salary during the recovery because there is a time when demand becomes super high but supply again is low. This also is again where it is awesome to be a consultant, I kept increasing the rates for my company all through the downturn and people would pay.

Outside of tech a downturn is usually time to capitalize on real estate, rentals and a host of other things. But you have to set yourself up to do this usually a little before things take a full slide into that first year. But if you are relatively debt free and can take some debt on during the down point of the market on real estate you can make a lot of money on the upswing. To be clear, real estate may not crash at the same time or rate, or may not at all. But the demands for rentals vs buying changes as does the buying power of people, so you can leverage those both.

> To be fair, true developers were not really negatively affected at least not more so than other professions.

I did fine in 2009 when I was laid off, getting a job in a month, but hiring can be random and I knew some great people that struggled to find their next role. Some developed issues as a result that raised the bar yet higher. People are crazy and irrational so never take these things personally. Deliver good work and keep acting in good faith to find a place that will treat you well. Smart people don't want to live in contexts of misery.

Yea, I think this is the normal thing that happens to good people that do their work and contribute to the team. And you are so right, don't take it personally because that can eat you up and it was almost never personal.

> To be fair, true developers were not really negatively affected at least not more so than other professions.

My anecdote is the opposite: My father was an engineer at a company that made machines for semiconductor manufacturing.

They had a physical product, customers liked them, they sold each machine at a profit - none of the obvious-with-hindsight folly of companies like Pets.com.

However, when the dot-com bust happened they went out of business anyway. Turns out the collapse of the likes of Pets.com dropped the demand for semiconductors from the point where every wafer manufacturer wanted to expand capacity to the point where no-one wanted to. Boom, no orders. And of course, some investors when they see 'tech stocks' are falling, will sell your stock even if your business is much less speculative than the likes of Pets.com.

There were three lessons I learned:

1. Your business may be nothing like Pets.com and may seem to have strong fundamentals - but if the bottom falls out of tech stocks, you can end up unemployed anyway.

2. When the going gets tough, satellite offices get hit before head office.

3. If you have car/mortgage/credit card payments, you can get insurance that covers the payments if you lose your job. A lot of the time this isn't a good investment - but once the company started laying people off and everyone could see the writing on the wall, people with debt brought gold-plated insurance and were glad they did.

One more note for your first lesson: you might have a hot product that you sell at a product, but your own salespeople can kill you.

Lucent (AT&T spun them off to commercialize things from Bell Labs) had the absolute best product of the late 90s/early 2000: the Ascend MAX DSLAM/modem bank. Before that, an ISP needed T1 phone lines (24 channels) plugged into a CSU plugged into 24 modems plugged into a chassis that would emit serial that would be plugged into a router, along with a server that would do authentication and logging for billing and IP assignment. The Ascend MAX turned all of that into one box: phone connections to ethernet and all services provided and remotely administrated. Insanely great.

The problem was that Lucent's salespeople were very good, and the market for new ISPs was huge -- everybody was starting one or expanding their available markets -- so Lucent started offering financing.

When you finance your house or car, your loan is backed by the asset: the house or car still has some large percentage of the loan value at any given time, even with depreciation.

When you finance your ISP equipment purchase, Lucent assumed that they could always repo the MAX and sell it at a discount to some other growing ISP.

They didn't count on the ISP market collapsing.

Yes, it can definitely be the opposite. And product companies can have the hardest time if their target audience was the bubble companies or those that supported the bubble companies. This is also part of why I think a lot of things are different this time around, although we could still crash, but I personally feel it would be different.

Last time much of the entire market and product was new, e.g. web purchasing was barely in its infancy, companies were building up around that and the web wasn't an integral part of peoples lives, yet. Today, everything we do is around smart devices, the internet etc, so I don't think a collapse like we saw during the dot com boom/bust is likely. But that's just my opinion, could be totally wrong.

I worked through the tail end of the dotcom boom and saw all of the dot com bust.

My company went from 1500 people to about 300 people in 1 year. Layoffs decimated the company, and eventually we were bought by a competitor. I have coworkers who were out of a job for 2+ years. One of my personal friends on H1B had to pump gas overnight, and transferred his balances between credit cards just to stay alive. Entire technology parks were abandoned wastelands.

Even worse was that the idea of "outsourcing" to India started up during this time. So not only we were losing our jobs, the thought was that we could possibly be losing our jobs forever, because why wouldn't the engineers in India be just as effective for 1/5 the price? The per-capita job loss in Silicon Valley was worse than Detroit in the 80s, and the job losses were so bad that the traffic on 101 was actually okay.

I honestly felt like my way of life was dead, I even went to the hospital for a panic attack. Take into considering that while the wages for software engineers were high, they weren't as high as they are now. I was making good money, almost 6 figures, and it felt like I might have to find a new job in less than 5 years. It felt like a very dire situation.

After a couple of years, things started to stabilize, and it didn't feel so dire. However, I think people who went through the bust like I did were naturally reticent about joining companies like Facebook, Google, Netflix, etc which were the next wave of companies that defined Silicon Valley so we missed out on a lot of upside.

Why do you think the outsourcing never got quite as bad as everyone expected?

You get what you pay for, high quality code costs money and off shore talent will generally immigrate to first world countries if they have the talent cause of wage suppression abroad for the same skillset. My 2 cents

I think the other commenter is probably closer to accuracy. Here in NYC, offshoring to Chile/DR and other countries in the same timezone is surprisingly popular, even for early stage startups. The idea that people will just immigrate is a bit of a stretch. Coming from an immigrant family I will tell you that some of the most talented people stayed behind while others got lucky. My $0.02, just like anyone else's, and I know people currently in India launching really great code schools, but the talent argument never held in my mind.

Communications is a big factor: if you can’t make good software in house, adding a time delay and lack of business knowledge won’t help.

The savings are almost always overstated by a huge margin: people with equivalent skills charge more or move. Most of the sales pitches assumed you’d get good results at, say, 20% but don’t work when that’s really 85%.

> Take into considering that while the wages for software engineers were high, they weren't as high as they are now.

That is a common misconception when people do not take inflation and housing cost increases into account. $1USD today is worth only 65 cents in 1999 according to the consumer price index:

https://www.wolframalpha.com/input/?i=1USD+in+1999

CPI inflation is only 56%, but house prices in the Bay Area have risen 280%:

https://www.wolframalpha.com/input/?i=median+house+price+san...

https://www.mercurynews.com/2018/06/22/median-price-tag-for-...

Tech worker salaries only seem high relative to salaries for other workers, because the tech worker salaries have not been falling in inflation/housing cost adjusted terms for the past 30 years. IMO computer programmers are, as a whole, grossly underpaid today, just not as underpaid as much as people in other lines of work.

Backdrop: I was inspired by games and went to CS undergrad with the hopes of becoming a videogame developer and ultimately a designer/director. I started college just as BBS distribution gave way to the World Wide Web; I had to learn HTML in order to distribute my shareware games.

Moonshots: I dropped out of school with only a year left to graduate because the Web development startup I launched with two of my friends was getting out of control. We were charging over $100/hr in the 90s and still having to turn down clients. We worked on amazing projects I can barely remember and made a pile of cash. But we were kids and couldn't get along so we split. I joined another startup that got bought out and put more cash in my pocket which led to me following leadership to yet another startup... that died pretty hard in the Fall of 2001.

Aftermath: Money, parties, travel, and then boom... it was over. Although I had been an irresponsible child with my earnings, I had the good fortune of having some saved some before I was laid off - and I could collect unemployment benefits.

Like everyone else, I couldn't find work anywhere. There was a flash cartoon back then called "Laid off: a day in the life". Good times, good times. I went back to school to finish earning my BS in CS. While in school I tried desperately to get a job in the service industry. I couldn't even land a job waiting tables. Managers told me that they had plenty of people that could work at any time and they didn't want to fuss with people who had school schedules. One manager told me he had over 1,500 applicants at his new restaurant. After having held a Director title in 2001, I ended up starting over again with a fresh degree and a job as a Jr Videogame Programmer in 2003. At least I was working on videogames instead of web! (spoiler, I'm back in web, but that's another story)

I still don't think I've fully come to terms with the unrealistic expectations I developed early in my career. I rose to success quickly because I had a head start in web tech just as the industry around it was taking off. After the crash I had to work hard for things like everyone else which means coming to terms with the realization that I am not as special as I thought I was.

The cartoon if anyone is interested: https://www.youtube.com/watch?v=5dMFM-Jqji0

This just solved a huge mystery for me.

One of my first managers I had after becoming a developer used to say, "Listen, if you don't get your stuff done, you're going to be having fudge stripes and pringles for breakfast, ok!?" All of us junior devs had no idea what the hell he was talking about.

I always thought, "That doesn't sound too bad to me."

It was actually a reference to this cartoon. Thanks for solving a 10 year old mystery for me!!

For what’s its worth, it beats frickin workin

I had 12 years at a major tech company, then I contracted for awhile. Before the bust I felt like a film star fielding calls whenever I was looking for work. Fun is the word; I was so in demand. When the bust hit I was actually choosing to take some time off (and taking classes). After that I was the only person in my Java class who got a job, out of 35 or so, and that job was one third my previous contractor hourly, and it was intermittent. On, off, on, off, with that small company. One of my friends in my class was unemployed for two years. I live in SF and the Mission had been flooded with bright young wannabes with shiny degrees, and they all disappeared during the bust. One horrifying thing happened that I was close to. The small company that I had gotten a gig with went under and the CEO committed suicide. That was a few months after my final check. He was a brilliant and funny guy. I have had a lovely run of success lately and I try to remember how much of it is luck plus timing. Also we underestimate the true hardness of hard times. Best to be appreciative.

I went from being a hotshot who had multiple offers all the time with sign up bonuses to somebody who could send out 100 resumes and not get a single response and once I got a response I was offered much less than I was used to. It was very depressing but also educational. It took me quite a while (probably too long) to accept this new reality. I feel the same may happen to a lot of Startup guys who make big money in their 20s now.

Not all success is your own making. Often you are just riding a wave that takes you up but will also take you down if you are not careful.

> It was very depressing but also educational.

Indeed. When 2008 hit, it was reminiscent of what ~2002 felt like, except instead of tech it was basically happening to everyone. In that way I felt more prepared to deal with the new crisis because I'd learned from the old one.

What did you learn?

Several things:

- Any news about a "recovery" has nothing to do with the reality you are likely facing.

- The worst of it is in the long-tail, not necessarily the initial shock.

- The change in the market from, "We can grow our way out of anything!" to, "Quick! Circle the wagons and lay low." happens a lot more suddenly than you expect, but there are also warning signs.

- You're super valuable and totally super employable right up until the moment that you're not, and in the wrong place at the wrong time you have no control and almost no influence over changing that, so be prepared to weather it or jump ship.

- Super high software developer salaries seem somehow correlated to VC-pumping, and when the market fundamentals kick in, you're likely to find yourself facing steep cuts, so live like you're a mechanical engineer, not a lottery winner.

- Value the team not the employer, you might meet them again elsewhere, while the employer might fire you at the first crisis.

I was so lucky to be in university from 2007 to 2011. When I got out, things were cooling down again...

After reading this thread, now I get why /r/financialindependence is so full of IT guys like me. We got so roasted during 2001, that we never ever again want to be dependent on our cosy well paying jobs we know not to take for granted. I think FIRE is mostly an insurance for us who has seen those dark days. Like 50% of the other swedes working in IT, I got kicked out of the trade for many years. Moved to China, had a crazy wild life there, married there and moved back to Sweden after 12 years. Currently work in one of the four big IT consulting firms. After the 2001 IT bubble/crash, I still today fear that the crash will come again and wipe us out. Today I grow a healthy sized emergency fund and my investment portfolio is very hedged against a stock market crash. I suggest the same to anyone who asks me for advice.

Very interested in FIRE myself. Would love to hear more about your hedging strategy!

what is FIRE?

Financial Independence (Retire Early). ie have a ton of money saved up and invested to live off the interest without working.

Indeed. I had a cushy government job for years and remember reading about FIRE. But at some point, I decided I'd go freelancing and although you earn better, it definitely put the fear of recessions in me, and I've seriously started my FIRE journey. Including, like you said, a hedged investment portfolio.

Got stuck with a huge tax bill on my stock options when Yahoo went under, took 10 years of brutal back to back contracts to pay it off. The state didn't care that I had nowhere near the opportunities again they just mercilessly hammered me for taxes until I paid it off a couple years ago but took nearly 15 years to pay off the tax debt and meanwhile I could invest in nothing else.

That is awful. If you had more money could you have fought it? Was prison threatened?

The IRS at least for now doesn't throw people in jail because they can't pay. There aren't enough jails and being in jail negatively impacts ability to pay.

Sometimes if the amount is ridiculously out sized compared with ability to pay the IRS will settle for a lower amount.

Notable if the IRS ever filed a lien against you: IRS Form 12277 Application for Withdrawal of Filed Form 668.

That happened because you exercised and didn't sell?

Also, we may be hearing many stories like that after the Bitcoin bubble when IRS goes through the records more carefully. Always remember to take profits the instant you make those profits, put some of that cash aside for yours and IRS's sake. Always.

No, that is nothing like bitcoin. Stock options get exercised at fair market value and you immediately owe taxes on the paper profits, even if you never get a cashout. For example, if your strike is 10 cents and when you finally exercise the FMV of the company is $1 per share, you have 90 cents of profit per share even if the company is still private.

Bitcoin is a commodity, if you buy at $10k and the value drops to $5k, you have straight losses. You don’t owe taxes on paper gains unlike the totally ridiculous and insane situation with stock options. The government blows.

I meant for people that bought low and then traded around the top. If you switched BTC to, say, ETH around the peak - you created taxable income. Even if you've lost almost everything since then.

A buy, full ride up and down to the same level, followed by a sell shouldn't be taxable income.

Golden rule is if you exercise sell enough immediately to pay off the tax burden. If you have a lockout get it written into your contract that you can sell them to another private holder (e.g another employee, investor). It's legitimate for a private company to want a lockout, they don't want external influence in a company but most will allow internal if you get it in contract.

It was rumored that a friend had a $1.5million tax bill on options he had exercised. He apparently held onto his shares riding them down to about about $300K or so in value.

Not sure how he resolved it (whether he negotiated his tax bill down with the IRS or came up with a payment plan).

Isn't this what bankruptcy is for?

Can't file for bankruptcy for taxes due. Nor legal liability (ex. Auto Accident liabilities)

You can’t file for bankruptcy within three years of the tax becoming due, but after that, you can have federal income tax obligations discharged in bankruptcy.

Unrelated to bankruptcy, ou can also file for an offer in compromise, which collapsing option values or an excellent candidate for.

I've seen something similar to this in other responses in this thread, how exactly does one get a big tax bill for your stock options while simultaneously not being able to pay them off? I'm not understanding something about the situation.

I mentioned it in my post.. a lot of financial people recommended taking loans to buy stock options.

Also in some cases especially with public companies they gifted you the options as income. That got marked as income even if the stock then tanked and you couldn't sell the stock for what the gifted value was.

There were various ways to get yourself screwed up.

Taxes on equity and option grants are complex beasts [ISO/NSO/RSU, Conversions between ISOs to NSOs, Income vs. Cap Gains, AMT, 83(b) elections, Exercised vs Non-exercised, Vesting schedules, etc]. Unless you personally understand the nuances in everyone of these cases, you should 100% work with a tax professional (and if you do understand, you are probably a tax professional!).

Here is an earlier discussion on taxes on options: https://news.ycombinator.com/item?id=10020063

I worked at a place starting 1998 that blew through 48 million dollars in the span of two years. I was employee no. 7, and we grew in those two years to 250+, offices in San Francisco, Las Vegas, and New York City. I remember the crash where my project manager was not looking too hot one day and he told me he had lost $100K in stock valuation the day before. We all had thought we were going to be rich. In 2001 I quit because I was so stressed out. I mean, I would walk to work through sunny SF thinking, "Please, let a car hit me today". Not that I was doing anything stupid toward that end, and not that I wanted to die; just wanted to be laid up in the hospital for a while.

I quit in May, the company died a painful death about a couple months after that. I heard it was pandemonium there. They simply could not raise any more money. Plain and simple. But of course, I had no severance and no unemployment.

But whatever. It was what it was. I basically got stoned and played video games for the next 5 months. I really needed that. Fortunately I had some money saved away because at that time I wasn't doing anything with stock trading. So there was that.

From October to February I looked for a job, and got hired at a pretty good place, but wow the sentiment was completely different.

>I basically got stoned and played video games for the next 5 months.

Did you find this 5 month period notably changed your life philosophy/trajectory?

Well, actually I stopped smoking pot after this, so in that sense at least the answer would be yes.

> I would walk to work through sunny SF thinking, "Please, let a car hit me today".

I don't know what SF was like in the early 2000s but that honestly sounds normal for SF.

IIRC, It was the perfect storm. Y2K bug projects were complete, Microsoft had been found guilty of monopolistic practices, the euro conversion projects were winding down or complete. I think Greenspan was raising the fed rates, and taxes were due, so people were selling to pay those. Then 9/11 happened and that was the final nail in the coffin.

This was the first, "learn to code," era that I recall, so there were a lot of not-necessarily computer savvy people in the industry, and they were getting hired. Once things started to slide, companies just stopped hiring as a sort-term strategy, many held layoffs too. Many people were pushed out of the industry for good. I was stuck as a contractor and in-between contracts out of blind luck. I was 4-5 years into a promising career and I couldn't find work for 6 months. I felt absolutely worthless.

Fortunately I knew a guy who was a partner at my previous contracting firm. He just pulled a CIO position in a city 2 hours away and they needed someone to take over their engine (software shop). I had to pick-up and move, but I got a job that paid a lot less than my previous ones.

I survived, partly because I worked hard, like I was scared to lose my job. I still work that way. People take notice and will call you when they switch companies and need to fill a position. Because of this, I haven't had to do a formal / cold interview since the dot bomb.

Another item of note was the acceleration of hardware design and manufacturing moving to China. While it did not directly affect the .com boom, a lot of those individuals that where left in hardware saw their jobs dry up due to all the web companies going bust thus killing a portion of hardware demand and their prospects for their jobs coming back where pretty much nill as when they market recovered that hiring happened in China.

I experienced the fallout of the dot com bubble burst, graduating from University in 2003 and interning in college.

I was a front office developer analyst at leading buy-side finance company. One memory that really stuck was elsewhere in tech, if you were in an infrastructure related role, full time employees were receiving letters saying:

"The company is downsizing. Your position is one that is scheduled for strategic reassignment to an offshore consultancy (TCS). Following this transition, your position in the company will no longer be required. If you stay with the firm and help train your replacement, you will receive X months severance. Thank you for your cooperation."

The other tech teams had to work with offshore consultants while doing work that managers hadn't figured out how to outsource. IT management essentially had a mandate to outsource anything possible and lower costs. Creating value for business was secondary. Managerialism sucked all of the life out tech. Being a programmer wasn't enough. You had to solve business problems.

This turned out to be very useful advice. I saw all around me the consequences of not doing so. So, I learned programming during the day (mostly sql, relational db modeling, scripting and reporting) and unfamiliar finance and business concepts on my own during nights and weekends. This helped me advance myself into greater challenges and varied terrain.

I'm no longer in finance but got a lot out of the experience. I did the best I could with the resources available and without compromising my integrity just to survive at someone else's peril. I learned that managerialism can bring new product development and growth to a complete halt. Technology solutionism over promises and under delivers. Business cycles and availability of credit determine who gets their moment of power and influence. No role is guaranteed.

Keep hustling, people. Complacency and convenience may alleviate stress, but if you are not growing personally or professionally, you may struggle worse during hard times. Never stop developing yourself.

For me, the most crazy change was several stories in the early 2000s of running into (literally) used car salespeople who mentioned they were software devs for a while in 1999. They were hustling cars in 1997, hustling code in ‘98 and ‘99, and back to cars in 2001.

I spent the crash in the financial industry which was hit in its own way: one fire-sold company office, one closed satellite office with a job transfer to a consulting company maintaining the same codebase for the company who closed the sat office. That last was my worst job ever but paid rent. The day the final retention bonus/bribe to take the consulting gig hit my bank, 6 of us resigned to come over to our next early-mid-stage startup. My ex-colleagues from the original office seemed to have slower job searches but all found interesting and fruitful work. (The office was a D. E. Shaw & Co. office: fully staffed with higher than average caliber devs. All found work reasonably quickly.)

In the 2008 GFC, that was much less a tech bubble and more a general financial issue. Our company just grew more slowly as the world worked itself out of that crisis, so I have no meaningful insight about that one.

To the extent that this “bubble” feels much less severe than 1999, I suspect more than 3/4 of qualified devs will do just fine in any tech bubble burst. Terrible devs barely hanging onto their job now could easily be shaken out into another field. That might even be better for them overall.

> They were hustling cars in 1997, hustling code in ‘98 and ‘99, and back to cars in 2001.

Hasn't changed that much, except now there's the in-between step of getting hustled by a boot-camp promising big $.

There were Visual Basic boot-camps during the dot-com boom.

Interestingly, I was just on linked in and saw what appeared to be a car advertisement on my feed, and I was annoyed- but then I looked at it more closely and saw it was a guy that had become "head trader" at a financial firm I worked at shortly after I left in the middle of the crisis. He is now a sales manager of a lexus dealership.

I was going to un-link with him, but realized this is a good reminder that you are on top of your game until you aren't, and if you don't keep on the leading edge of things, the world will pass you by.

I was in the middle of college when that bubble burst, and I kinda felt like I was being cheated out of the opportunities I was expecting to have when I went in. Most of this centered around the internship/early-career period that is quite vital to one's career growth later on.

When I went into college, they talked about all these great internship/co-op opportunities that everyone got. So each year I went to the career fairs seeking them out:

- Freshman year: Go away, we only want juniors

- Sophomore year: Go away, we only want juniors (though I got lucky and had a single hit that I did take up on)

- Junior year: Go away, the tech economy crashed. We only showed up because we didn't want people to forget we exist.

After college, I attempted some semblance of a grad school experience to bide my time, while looking for work on top of it. Unfortunately, I often felt like I was competing with all those people with the critical "4-5 years of experience" who were unemployed. Furthermore, everything I did find seemed to be crappy contract positions requiring tons of experience for very little pay.

Eventually I got a gov't job that needed my degree, but didn't use or develop my skills. I got quite depressed, as I felt like all my education and personal development was going to waste and was going to rapidly become worthless. When I finally escaped, it was to a worthless job at a different employer that actually had future grown opportunities. This ultimately allowed me to pivot into the kind of job I actually wanted, and the rest is history.

Of course the takeaway from this is that I was already 4-5 years post-graduation before I had the opportunity to take my career in the direction I was expecting to go immediately after leaving school.

I worked for etoys.com in London and Santa Monica. Was worth $6bn at peak market cap and got delisted after dropping from $80 a share to below a buck. I survived multiple layoffs. Ran their warehouse management software for Europe. Lots of people got screwed. Big tax bills after exercising options and not selling and watching it drop. Family investing and losing everything. The perl community was fairly invested in etoys because we were a big Perl Apache and MySQL shop. Met my wife there. Was fun during the good times but layoffs suck and so does having the job market shrink. Taught my wife and I what not to do and how to run a lean but growing biz. Today we run a self funding company of 40 people in the cybersecurity space. So it all worked out just fine.

I was doing an internship in 2001 during my master and at the time many people wondered if one shouldn't quit univeristy to start a high paying job (people would hire you no matter what).

Fast forward 1 year later, i started a PhD in a research lab working on sound hardware / software in the SV. The day i arrived i noticed something weird : the first floor of the pretty big building was completely empty. There were still computers and mugs on some desks, but other than that it looked like a weird epidemic killed everyone.

I learned later that half of the employees of the research center (including the local boss) had been fired two weeks before i arrived, and everybody had been moved to the second floor. I couldn't complete my PhD because they wouldn't finance new research anymore, so i went back to France and look for a job. After a few months trying to look for work in the audio field in vain, i finally ended up finding a job at a consulting firm, doing mundane backoffice development (database, web-based interface, in corporate environment).

So, basically it went from "we'll hire just anybody, even unqualified", to "PhD looking for a job" in just a year.

I spent two years welding ships together at the shipyards in San Diego. Yay fallback skills!

There are times when I miss it. Of all the jobs I've had over the years, it was the most meritocratic. If you did your job well and didn't cause too much rework, they loved you. I don't miss the hazardous/chemically toxic work environment, though. Those two years felt like a decade of wear on my body.

didn't you wear any protection?

I'm sure he always wore a condom while welding. UV protection is important.

Of course. You still spent several hours on site getting to the work area, breaking to eat lunch, etc. I had it a lot better than the guys that didn't feel like wearing the respirators, but PPE isn't perfect.

Think of it like wearing shoes at the beach. Yeah, they protect you from most of the sand as you're walking around, but enough gets past that you still have to dump them out when you leave.

I worked for a tech support and CS outsourcing company. I was developing the tools they would use for call logging and associated things.

They were growing rapidly by offering support services to all the new dot com startups. Hours were long, the pay was decent and my head was being fried by having to juggle multiple tech platforms and languages thanks to the differing requirements of the clients.

Then came the bust. Within a matter of months we went from having 2000 support people on site to just 400. To survive the company started targeting non dot com clients. For the most part that meant providing CS support for companies like utilities and retail stores. Standards went downhill and ethics became something other companies thought about. We also lost our on-site subsidised canteen.

One of our post bust clients was Comet, the now defunct UK electrical store. We provided technical support for their extended warranty holders. One of the requirements that they insisted upon was requiring the customer to attempt a full re-install of Windows before agreeing to send out an engineer. I thought this was dodgy AF, especially since the support staff were so untrained. They were making customers reformat their drives because they didn't know how to change the keyboard layout from US to UK. Part of the support staffs training was to be told that the DOG debug tool could fix noisy hard drive and they would ask callers to use it to destroy and recreate the FAT. For an IT support company they knew very little. Their head of training, who had no formal IT training of his own, had some crazy ideas about to fix computers.

One day I got a phone call and the caller introduced herself as "Hi, I'm xxx xxxx and I'm a researcher from BBC Watchdog, just to let you know I'm recording this call and it may be broadcast". While I was trying frantically to flag down a manager, the caller was demanding that I answer questions about an 85 year old WWII veteran who spent 10 years scanning photos of his army friends only to lose all his work because someone told him to reinstall Windows. I didn't usually get phone calls seeing as I was an in-house dev, what happened that day was that the everyone else had been told not to answer the number Watchdog called from (there was previous) and the phone system bounced the call around until muggins here picked it up.

I left soon after that.

I entered the industry in 2000, and it was "programming geeks"—people who dug computers and thought coding was fun—who survived the dot com bust mostly unscathed. Dabblers, fillers, talkers, people-managers, org-climbers, etc. had some pretty lean years.

That isn't to say some programming geeks didn't get sacked, but they tended to land on their feet. Also, it was often the hard-negotiating salary-seekers who found themselves in the cross-hairs, and possibly facing a slight decrease in standard of living, because of the big price tags they'd put on themselves.

I was a young-ish dev at a smallish (200 or so people) company in the Bay Area during the dot-com crash. I came in one day to find that something like 1/3 of the people in the company, seemingly chosen at random, no longer worked there. Those of us who remained were consolidated into one floor instead of the two we had before. My salary and options were not affected, and the (basic by modern standards) free food stayed pretty much the same, though I think WebVan was no longer around to deliver it. I left soon after that, and the company lived on in cockroach mode for years. I think it was eventually acquired, but I haven't paid much attention.

One reason my experience wasn't catastrophic was that I was at an infrastructure company, not a hype-driven one like Pets.com. If/when the current ad bubble bursts, average devs will fare best working at companies several steps removed from the hype. People may not want micro-targeted ads, but they'll still need software.

I got hired as employee #12 in a dotcom in March 2000; by December I was out of a job. In between, the company raised and mostly spent about $35 million. The biggest single expenditure was a huge deal to own a topic channel on AltaVista, which was one of the big portal sites of the day. Everyone was building portals because search engines were dead ends that were hard to monetize (seriously, this is what people thought). Yahoo was the 800 lb gorilla of websites that everyone tried to emulate.

I knew a bit of coding and was scheduled for the Arsdigita boot camp [1] that would learn me up to be a real programmer. Instead I got laid off with 3 months severance. They had the decency to do it on December 2 so I had health care through Christmas.

I got a job with a local tech consultant about 3 months later, which paid the same as the dotcom job. I kept my dotcom stock option paperwork for a little while for nostalgia's sake... {sigh} I thought I was on my way to being rich the day I got those papers...

[1] https://philip.greenspun.com/teaching/boot-camp

(This will give you an idea of what a web programmer was expected to be able to do back then. Today what would you call someone who can install Unix on hardware, install and configure Oracle, install and configure a CMS, and code up an entire web site?)

I'd call them an "intern" or "entry level".

In November 2000 my options were worth $2.4m on paper but they did not start vesting until January. In January they were worth -$1.5m and never exceeded the strike price again, at a company that is still public and worth > 10 billion today. They laid me off in february. I got healthy in 2 months and found a small startup with a 15% paycut but the CEO was a WeWork-level crook with a jet and he absconded with all the money 8 months later and it failed. I finally got a stable job in mid 2002.

I don’t know how stock options work. If you’re laid off do you no longer have access to them?

The contracts can be written with any language. But generally yes, you lose them. If they are vested you can exercise them - meaning you pay your own money to buy them and own actual shares.

If you’ve vested any, which is usually 25% after the first year, and then monthly for the next 3 years. You get to keep those shares if you can buy them at your strike price. If you get laid off, you may only have 90 days to exercise (buy) your vested options before you lose that right. Some companies more recently are extending that time.

In the dot com crash era it was common for your options to have a strike price higher than the stock price (under water) so no sense in exercising them, since they are worth negative.

To qualify as IRS Incentive Stock Options (ISOs), they have to expire shortly after you're no longer an employee; some companies these days offer options than will instead become non-qualified and have a much later expiration, but that wasn't common in the dot-com boom.

For companies that expect to survive for years after the layoff, they may give you X months on payroll, and then Y months severance. Your options expiration because of no longer being an employee would generally start after the X; but I think most of the layoffs then were immediate --- the companies needed you off payroll ASAP, so they could stop paying healthcare and what not.

it depends on the company most companies take away your options 90 days after you leave and they are known as "golden handcuffs" because nobody wants to leave! Some companies like Lyft allowed early hires to keep options for up to 7 years. This can actually be a problem because there are SEC rules limiting private company stock (not option) ownership to 500 shareholders at most. Many companies let you exercise options when you leave by buying them. I did this at one company - but the owners were crooks - and when they raised a new funding round of $3,000,000 they just put it in their personal bank accounts of the CEO + 5 VPs and shut down the company!

It was late '99 or early '00 when I went to work at my first "tech" startup. We'd raised 70-something million, and all the stars were aligning. We'd go to lunch and bring a calculator so we could work through "worst-case scenarios" millions of dollars were in our future. I remember passing up other job offers that also included a lease of a new BMW as part of the signing.

Of course, with the down-turn, and given that we were effectively trying to position ourselves as CRM middleware, all bets were off. The business dried up, and our burn-rate was through the roof. Word got out the day before about the upcoming layoffs. The next day there were kegs of beer that sat out in the engineering pits.

IT had a helluva time, as a lot of people walked off with their laptops and company-issued phones. The dirty secret was that there was also a complete (still shrink-wrapped) palette of brand new 2U Dell servers in the loading bay that mysteriously went missing in the CO office that day.

Like a naive babe in the woods, I survived the first 2? maybe 3? RIFs. Even as I was building a website that listed all of our hardware and furniture for sale, and unracking and packing all the servers from the colo—I still didn't get it. Reality hit like a brick.

I was lucky enough to fall in with a good group of folks who continued to follow each other to other companies either as employees or as contract work for the next few years. There were maybe one or two scary months, but overall it was manageable. (Also lesson learned: your network is THE MOST IMPORTANT THING)

I stupidly left college to join a dot com for all kinds of fun things like a huge salary, bonuses, dual monitors, my own office space, a big cool office building.

Then, after about 6 months, the company funding our company just pulled out. Left us with a few bucks in the bank.

I took another dot com job about 400 miles away and got out of there. Lots of people there had no jobs after that, but a few of the smarter crew went on to huge companies like Microsoft.

The next dot com I went to, I was there through 9/11. Something inside me changed after that and I actually quit to pursue a different type of work. That dot com also went bust, but it never had any hope anyway. The owner was self-funding it with money he made from investing in dot coms - but he cashed out at the right time, and he was basically making a clone of another service. It was pretty terrible.

It was certainly a strange time.

The funny thing is, I just got hired as a contractor to work for another dot com that reminds be of those ridiculous days. At least all my eggs aren't in that basket. I hope the best for them, but the similarities are scary.

Could you elaborate on the similarities?

In Switzerland, the worst event was not this one but 9/11 in 2001.

In a matter of a few hours all new IT/IS project were cancelled and budgets for IT/IS were frozen to below the minimum in all companies. It took almost a year to recover a little.

I started my career during the summer 2001. I was hired in seconds without any technical test.

All (no exception) my friends who wanted to chill during the summer before finding their first job... ended jobless for 1 full year.

The timing was brutal. I made the mistake of hanging on with a sinking company until the end of 2001. In 2002 there were so many resumes chasing so few jobs that I wonder if anyone even saw mine. I didn't collect another paycheck until early 2004.

Why were jobs in Switzerland affected?

I do not have the numbers from 2001, but even today USA is our 2nd partner: https://www.bfs.admin.ch/bfs/en/home/statistics/industry-ser...

I had just gotten hired as employee #9 by a startup which was growing fast making software network components, and after me three more devs were hired in the next month.

Next month we moved into a much bigger office, with a lovely view and lots of space for growth - then boom, the crash (gradually) struck: the three people who'd come in after me were let go, one at a time, and the rest of us were asked to work part time - volunteering how much part of the time was. We split the office and squashed into a small part.

I worked one day on / one day off for a couple of years (maybe a bit less) while our boss scrambled for sales. He was a great guy, was very open and helpful to us all, and did eventually get the company back on its feet and eventually sold it. The five founders did well, the boss retired three years later, and even I did OK (worked for the company that bought us for eight more years, then also retired.)

I was living in Florida, working for a Boston-based WebDev/ISP consultancy. Smart people, high-flying projects, free snacks, nerf shenanigans, constant hiring, with bonuses for you-name-it. I'd recently gotten a nice bonus for bringing on my good friend as the office's systems administrator.

Business slowed, clients missed payments, people started watching f*d.com, the first round of layoffs came, the execs did a tour and promised all was ok, the second round of layoffs came. We spend a lot of time at Starbucks contemplating plan B.

One day I came in and the laptop wouldn't connect to the network. I stick my head in my friend's office, and say "My laptop won't connect, is there something I should know?" He gets that deer in the headlights look, rushes off to check with the management, and a meeting is convened where the third layoff happens, something I'm part of and he's not (Probable cause for me being out: I didn't play ball on a traveling assignment I didn't want, was OK with the outcome. My friend hung on to the bitter end, and we laugh about it now.) The hardest day was sending back the extra paycheck the company had accidentally sent.

I started looking for jobs, but I started getting calls from friends who heard I was available for a week here, a month there, a six-month thing, etc, etc. I wound up forming an LLC and staying self-employed until decided I needed a nice safe job just before the financial crisis.

>people started watching fd.com

what is fd.com?

It was a chat forum website called fuckedcompany.com. today a similar website is thelayoff.com. there is one subforum per company and everybody spreads rumors about how near is the end at xyz.com and why ...

fuckedcompany.com - it was a site that collated news about all the "dotcom" era companies shutting down.

https://en.wikipedia.org/wiki/Fucked_Company

> sending back the extra paycheck the company had accidentally sent.

Sorry, didn't get it....

What I can tell you with some confidence is that something like the dot com bust can never happen again in our industry.

The strange thing was how suddenly it happened. It felt like the majority of projects got defunded in a matter of weeks or months. Our funding disappeared as the VC firm collapsed together with its parent company. Our customers (telcos) stopped approving any new projects that weren't guaranteed to be profitable within the quarter as they were hit by a ruinous bidding war for frequency sprectrum at the same time.

The reason why I'm saying it can never happen again (in this particular industry) is that tech/internet was a tiny and isolated part of the economy back then (called "The New Economy"). Today's tech industry is huge and very diverse. It's part of everything now. The largest corporations on earth are now tech firms. Back then, there was nowhere to go for many employees in that sector (at least for a while).

I was fortunate enough to have saved a bit of money, partly because I had refused to take stock options in place of proper payment. So I was able to self-fund some projects that I was interested in with a goal of creating an organically growing company. I've been avoiding the whole high growth VC culture ever since, which may have been a mistake in purely financial terms.

You need to frame it in terms of the times. The web was relatively new, and there was a dramatic shortage of talent. Remote work was pretty rare, and the infrastructure to support it was very nascent.

Web development wasn't very mature: just knowing HTML could net you a nice paycheck. You could go even farther with basic spaghetti-code skills in languages like PHP, ColdFusion, and ASP. Frameworks really weren't a thing. Javascript wasn't used for much more than form validation, so you could go to your favorite "DHTML" website and find scripts to copy.

Couple this with the high pay, and there were a TON of "developers" who were one- or two-trick ponies. Someone who honestly was better suited for sales or management were writing code and making big bucks, and assumed this was their life path. For many, they turned into developers. Many didn't, and left.

In my experience, if you knew more than one backend language, and were happy working in boring fields (often in boring locations) like travel or healthcare or energy, you probably didn't go without work for long. (I was at Sabre at the time, working in their HR department, and 9/11 affected me more than the dot-com bubble)

I was employee #4 in a startup in 2000, just before the burst. At that time the situation was crazy. For instance our founders had made an ambitious business plan to raise money in the next investment round. It was sent back by our investors because it was not ambitious enough: basically they asked to blindly multiply all the targets by 10. This was completely unrealistic but the founders did what they were asked and promptly new investment money came rushing in.

And then the bubble burst and the sentiment was 180 degrees opposite. By then our company had already acquired some customers and was making some money, and was ready to expand and grab a significant piece of the market. However it didn't matter what we did or what business plan we made, it was just impossible to raise any kind of money whatsoever. So our startup continued living its zombie life until it was taken over by a competitor a few years later. In the end I was lucky because this way I could survive the years after a crash while still having a job. But it left me with mixed feelings about the so called angel investors. It didn't appear to me that they had any idea what they were doing.

I was on the East Coast, 2500 miles away from Silicon Valley. But we felt it out here too.

It was hard to know if you (as an internet application developer) would ever make a nice salary againn.

I don't think anybody thought that skilled and experienced internet application developers were going to be out of work forever.

It seemed clear that the internet had definitely solidified itself as a part of everyday life. There was going to be an internet, and things to do and buy on there, and people were going to have to build those things.

I think my main concern was how lucrative it was going to be. I briefly made $100K in my early 20s in the early 2000s with just a few years experience. Even at the time that didn't really seem sustainable.

When the crash hit, I soon went back to making $40 or $50K. That was nice enough money but I didn't know how far things were going to fall. Would the market be flooded with programmers? Would I eventually be making $25K as an experienced developer? Would I make $100K again someday?

So I worried a little bit... not too much.

There were still jobs and they were OK enough.

I wasn't in the valley at the time but was part of a startup that lost our angel funding before it happened because the angel's funds were overcommitted already in failing startups.

My view has always been that during the dot com boom, companies were so short staffed that they would basically take anyone on, regardless of their technical skill, with the hopes of training them up to learn programming. Janitor, receptionist, your weird cousin Eddie who ate glue - all of them could get a tech job if they really wanted one.

When the bubble burst, lots of people lost jobs. Both skilled people and unskilled. This was a huge darwin moment for people who'd worked at startups. Lots of people went back to whatever they were doing pre-bubble. The better people typically found work, even if it took a little while to do so.

In my view, it really did serve as a healthy shake-out of talent in the long run. This very well may happen again soon...

I was a lucky one I guess. One day we came into work and there was guards at the the door checking IDs. About 1/2 the place got let go that day. We went from having dreams of being millionaires to just being happy we had jobs. I bailed out at some point, but the place is still going, some of the same people are even still there! It was scary as hell to see this place go from 80 people to 100 something and back to 80 in just a year or two.

One day it was all froth and then all of a sudden there was no work. I was lucky enough to have had enough money in the back to be able to spend the following two years studying, travelling and working on open-source software, and actually had a really good time that I look back on fondly, but I knew many people who had to switch from a very lucrative job at a startup to waiting tables and such.

Lesson: if you're making good money now, save (and if you then find yourself with nothing to do which pays, try to make the best of that time by doing interesting things that you would normally not have the time to do).

I've lived through the dot-com burst, 4 recessions, 3 stock implosions, 3 personal tragedies, and more mergers and acquisitions than I can remember. I have written millions of lines of code and have never missed a day of work.

It has had nothing to do with choice of technology, industry, physical location, contacts, or luck (I think).

The only common denominator I can cite is finding out what people (customers or employers) really need, figuring out how to build it for them, consistently building it, and staying friendly and helpful throughout.

Do that and nothing else matters. Don't do that and keep worrying about it. It's that simple.

This thread is scaring me.

Question on exercising and such. I have all exercised options, but not all vested, been here about 2 years, so half vested. Didn't pay taxes at exercise because there was no difference between exercise price and market price.

What happens taxwise if my company goes under? Don't I only owe taxes if I sell vested options?

My understanding here is that you wouldn't owe taxes if you sold exercised options (at loss or even) because you would make no gains. You may even be able to write off some taxes?

I'm not exactly sure what happened with people who go bust. My guess is they could have had the type of options where you don't pay taxes up front, and then they weren't able to pay when it was finally time.

Like you, I would love to hear more about this.

Unlike the normal situation where you pay taxes when you sell an asset, with options when you acquire them any difference between the strike price and their value at acquisition is a taxable amount. If your acquisition occurs when you cannot sell because the shares are not publicly tradeable or because you are subject to a rule not allowing sales then in the time between when you acquire and when you could sell the stock can become worthless. This worthlessness has no effect on your tax bill which is finalized at the point of acquisition.

Yes, this is my understanding as well. You owe a lot of taxes initially (that you to pay to even exercise) and then you wouldn't pay AGAIN if the company goes bust.

That would, of course, suck, but you wouldn't "owe more" if the company goes bust. It would just be what you already paid now being worth less than what you paid for it.

I guess I don't understand the point being made with that in mind. If you took out a loan to exercise the options (don't do that), then that would be a big problem.

Honestly speak to an accountant - there are so many different ways you can get shafted on Tax for Options / Employee stock grants / Capital Gains.

If you exercised at market price then there's no tax liability. The shares are yours now; your exercise price is your cost basis, and you pay capital gains taxes when you sell on the difference between sale price and exercise price.

The situation that caught lots of employees in the dot-com bubble is that they exercised stock options where the market price at time of exercise was a lot more than the strike price (which means an income tax liability for the difference), but then there was a lockup and they weren't able to sell the stock until after it had dropped significantly. As a result, they had tax bills that were higher than the market value of the stocks they owned.

I had several friends and coworkers end up in this situation. Lucky for me, I started late enough that my options were underwater before my first year cliff and stayed that way...

I thought I understood this but the lockup that everyone in this discussion is alluding to has surprised me. Should the tax man not count the price of the security on the day the lockup ends as the strike price? Otherwise, any time you get discounted options with a lockup, it appears you should assume the options will go to zero and budget the tax accordingly. Or am I missing something?

The tax code counts the price at the time of exercise, not at the time the lockup ends. (A lockup is a contractual obligation not to sell the shares: you still own them, you just can't sell them.) The logic, I guess, is that there are other types of property (eg. real estate, private company shares, collectibles) that you may not be able to sell on a liquid market, but they are still items of value that you've received, and you should still be taxed on them at the time of receipt.

You could argue about the morality and rationality of this decision: some people would say it's both wrong and somewhat unfeasible to levy taxes that people have no way of paying. But that's the law for now. There are other scenarios that can get people into this situation as well: cryptocurrency transactions, property taxes, wealth taxes in general. Indeed, one reason we have Prop 13 in California is because seniors were being forced out of their homes because they couldn't pay the taxes, but that brought with it a whole bunch of other undesirable economic distortions.

From the employee POV, your best options are usually to either a.) file an 83(b) election as soon as you receive the stock options, indicating that you'd like to be taxed on their current fair market value (which is usually zero at the time you receive them, because most strike prices are set at the current market price) and have all future gains taxed as capital gains with a cost basis set at the time of the 83(b) election, or b.) don't exercise your shares until you're ready to sell them.

> I have all exercised options, but not all vested, been here about 2 years, so half vested. Didn't pay taxes at exercise because there was no difference between exercise price and market price.

Early exercise with a 83b election?

You will be fine.

The tax problem happens like this:

1. Your option strike price is $0.01/sh

2. The current price as set by the board (or the stock market if public) is $10/sh

3. You exercise 2000000 shares

4. You write a check to your company 2000000 sh * $0.01/sh = $20000

The fair market value (as determined in step #2) is 2,000,000 sh * $10/sh = $20,000,000

The IRS says "wait a minute you only paid $20,000 for something that is worth $20,000,000".

The difference $20,000,000 - $20,000 = $19,980,000 was a 'gift' that requires taxes to be paid.

Now lets do the 83b election with early exercise. In that case the FMV == the strike price on the options. The difference is $0 You are paying FMV and there is no 'gift'.

Thank you! The 83b situation is the one I'm in. Appreciate it, sorry for the late response.

You only pay tax on the profit of exercised options

Did you file 83b election when exercising at market price? If yes, you already paid the taxes (which were $0). If not, there may be taxable income at vesting periods. Talk to tax professional. I'm certainly not one.

An 83b election is to be issued at the time of grant, not the time of exercise.

I was laid off in 2001. In the second of 4 waves. Prior to the first wave one of the co-founders flew over on Concorde to tell us that each of us could save $5/day there would be no layoffs!

I got a reasonable package, 3 months salary, and 2 weeks later joined a new startup (which a few years later was acquired). I actually saw an increase in salary. Those two factors compensated somewhat for the layoff trauma.

People who had solid skills like C++ were fine, generally. It was those with only HTML who had made good money in the 90s and never upgraded to real programming that suffered the most.

2002 - I was about to start university studying comp-sci, meanwhile, I was working as a security guard in Toronto at HQ of one of the largest banks in Canada. The majority of guards were laid off software developers that couldn't find a developer position. Some were actively trying to move to trades.

Was sent out to visit a customer- a .com startup.

The week before it had been a buzzing vibrant exciting place. They were using something “new” called XP, extreme programming where you put two programmers side by side for an hour or two and then keep switching the combinations throughout the day.

There were unlimited free snacks and a free wheeling fun atmosphere. A really exciting place.

That day when i turned up, the doors were locked and the building was empty.

I rang up my boss to say the client was shut today. We found out after that their funding had been withdrawn and they’d shut without notice.

Echoing a bunch of common responses: a lot of the crash and burns were reality catching up with wild expectations — we had business with pets.com and there were times where they had a room full of “technical” staff who had no idea how the web worked but were more or less openly counting down the days until they became rich. If you’re working somewhere where there isn’t a realistic plan for the numbers to work, that’s a good cue to reconsider your risk exposure.

That didn’t mean that people who were good didn’t also get hit, so there are two other points I’d consider: lots of the dotcom bubble workers spent money as quickly as they made it, often locking in fixed commitments like car payments or mortgages so they had only a short period of solvency if their income changed dramatically. Having reserves is a great peace of mind measure, as is knowing which expenses you could cut quickly if needed – especially if, say, you went from $$$ at a cool sexy company to $$ at a boring but stable job.

The other thing is considering correlated failures: if everyone around you works in the same industry, you’re going to be competing with them for jobs and unable to sell a house at a good price if the market sours broadly. That doesn't mean you should flee SV but you would want to be prepared to stay put for awhile with large reserves. Similarly, focusing your investments in the same field can end badly — here I’m thinking of a trend-following sales guy who got laid off and had to explain to his wife that he’d also put most of their savings into dotcom stocks which all tanked at the same time.

Life is what you make it. I chose to remain independent for my career. Both 2000 and 2007 came and went and unless someone told me, I wouldn't know we were in a recession or stock market crash.

Perhaps I missed out on a few opportunities but I never really wanted to trade my freedom for the chance of money.

If you have a good network and do quality work, you will be in demand regardless of the market. There will never be a shortage of people that need good, quality work done and are willing to pay for it.

How to you make a transition to this way of working? Is it all about networking?

Here's ALL you need to know about your company stock options: ask yourself - if I had ($PRICE_PER_SHARE * $NUMBER_OF_SHARES) in cash sitting in my checking account RIGHT NOW, would I dump ALL of it into my company's stock? If the answer is yes - hold onto those options and simply DO NOT exercise them. If the answer is NO - FUCKING SELL THEM NOW! Take the tax hit, diversify into other investments, take a cruse, waste it on strippers & blow in Las Vegas - whatever. At NO point hold actual SHARES of your company stock. Options are compensation lottery tickets. That's exactly how executives view them, that's exactly how you should view them. Trust the guy who "held on" to about $100,000.00 USD worth of options as the stock crashed into the ground between February 2000 and October 2000. I could have paid off $40k worth of my wife's & my student loans, $20K worth of auto loans and still had money in the bank after taxes, but I believe the bullshit & hype. I regret it to this day and I'll probably never get type of stock option shot again.

It's a simple question: if I had the value of my company stock in cold, hard ca$h today - would I dump it ALL into a brokerage account to buy said company stock?

ADDENDUM: This decision is if you're like me & my wife: born into a middle to lower-middle class family. Have made it to where you are in life via hard work & dumb luck. Have no "glass floor" below you. Have no family member who could have even begun to tell you what to do with stock options. If you're "born on 3rd base thinking you've hit a triple" (e.g. mom & dad have money and will make sure you never end up homeless and sleeping in your car) just ask your family lawyer and/or CPA. I'm sure they have contacts to help you out.

But ... doesn't the tax come due only if you exercise the options?

As a regular dev on the east coast, working for a company with large corporate clients in conservative industries, the crash had basically no impact at all.

People looking for new jobs might have had a little more trouble. And the dotcom boom brought a lot of devs with minimal skills, just because it was impossible to find good devs; some of those who hadn't leveled up in time for the crash got shaken out. But anyone who really could write code did fine, in my town.

> working for a company with large corporate clients in conservative industries, the crash had basically no impact at all.

Exactly, if there is a new crash it'll affect BS startups. aka: if your company is working on a BS service, isn't profitable after X years and is only able to survive due to investors initial $$$ you're in a bad place, including companies with a proper product but an oversized engineering team. If you're working on a real/profitable product in a healthy company/market you'won't feel a thing.

uber, snapchat, wework &c.

I was working at Microsoft at the time. All the smart cool people left to go do startups, money was easy to get. This was 5 years in to my first job. I encouraged my friends not to sell their Microsoft stock because it was going up for a long time still (some are even still my friends). The market crashed but Microsoft kept on going. I didn't really notice a change. Many of my friends came back to the mother ship. I recognize I was lucky.

That's great. I was one who left Redmond, but never made it back. I still have "some" regrets about leaving, but have gained a lot of great experiences. (I'd have no doubt been better off financially staying there, though.)

I had my H1B visa and ready to work in USA. Resigned my job. My US employer asked me not to board the flight since the job situation was very bad. That was beginning of 2001. I tried for other jobs and got a UK work permit by mid 2001. But that also went bust very shortly due to UK dot com crash. I must have been the only person with two countries work permits and without a job. Local companies refused to hire me once they saw my passport.

So how did you manage to stay afloat in your home country? Could you live with your parents or something?

I'm from India. I was living off my savings and my parents.

> what to expect if such a thing were to happen again

Expect to be unemployed. If don't think there will be a stretch of time in your future where you won't be unemployed for a while, think again. Have a backup plan. Have savings. Move in with the parents and bus tables, try a different field you have a little experience in, keep in touch with people. It's a lot less scary if you're prepared than if you wait and see.

Imagine all the hype. But few average citizens online. Little to no e-commerce from consumers. No smartphones within mobile data that was fast.

The majority of people around the web were either techies, or speculators who didn’t understand it and wanted to cash in.

Average devs were largely devs because they grew up with a passion for tech before it being a profession. The fact that it child be a profession was a bonus. Today some would say you find more devs who choose it as a profession first but not a childhood passion.

When the crash happened there were fewer tech jobs. For the speculation and hype based businesses. I switched to tech in the b2b space because it paid.. with a goal of to become as recession proof and crash proof with my skills because I believed in what software could accomplish that much.

After that there was Napster.. Friendster.. hi5 that built up to the next internet generation.. Around 2005 Facebook became the first thing that average people did online, followed by 2009 and the iPad arriving where there was a shift from people becoming primarily consumers instead of creators with tech.

I'm seeing a surprising number of comments describing catastrophic tax outcomes due to exercising options with a large spread and holding the stock long enough for it to tank before selling, while still being stuck with a massive tax bill.

This situation is easily avoided by filing your 83b and early exercising your options immediately, or at least before a subsequent funding round/term sheet valuation cycle.

None of the comments describing those outcomes mention this. For those reading and new to the startup game, read up on the 83b. When you're an early employee at a startup, the cost of early-exercising even a substantial number of shares is often not cost-prohibitive. And should you leave the company before it all vests, you get a check for the unvested remains. It's a NO-BRAINER when the exercise cost is small.

https://blog.wealthfront.com/always-file-your-83b/

I guess I was an 'average dev' at that time. I was developing applications for a company that sold software to banks. Around 2000 I was into client/server computing, working with VB, C++ and Tuxedo for a transaction monitor.

I never really felt the bubble burst. Maybe raises were slower for a while, but I don't remember it. Mostly a non-event.

The current environment is nothing like the dot-com boom. The dot-com boom/bust was driven by public markets, whereas now the public markets are the ones who are filtering out the wild valuations now before it gets out of hand and throws the country into a recession like it did last time.

I suspect that a lot of people here would be surprised at how many people have never even heard of a lot of the tech (or "tech") companies that are so prominent in industry's awareness.

One example. I saw a stat a month or so ago that something like 63% of Americans had never taken an Uber. I'm sure the vast majority have never heard of WeWork.

Yes, some of these companies are now public. But this isn't a matter of a whole industry having a major downturn. It's mostly companies that are well-known in some circles but are pretty inconsequential in the scheme of things.

It felt bad because our dot com hopes were dashed, but life for a regular programmer wasn't too bad. I was about 4 years out of college then and it just meant I had to take boring jobs at big companies like Home Depot writing database front ends. I was still able to pay the bills though.

A week after college (or uni, Sweden is a little weird), I didn't know what to do, but I got scooped up by the local combined "hey we make websites, run courses in Internet-y things and programming, and we are also the largest local Internet Service Provider". I worked there for a while for a way too low salary (but I thought I had struck gold) for a couple of years, then switched employer to one of the companies I was consulting for. I was sent overseas to attend a one week cours in "Vision 4GL", which was the language we were using at the time. Everything was very expensive, yet money flowed. They also had to pay a hefty penalty to my original employer so they could hire me. There I was doing logistics software for an airport. Each package back then had in total, 17 paper copies being pushed around. Then the twin towers were hit. We had a "live feed" of logistics messages. (IATA and EDIFACT messages.) Suddenly, a lot of "cancel" messages started dropping in. Planes bound for the US were turning around.

We didn't have a TV at the cramped, jet exhaust stinking office at the airport. We listened to the radio but there was almost nothing of substance. We turned to news on web sites, most papers had a web presence, but it was only one in Sweden which held up to the pressure of so many suddenly looking for information. They did it but cutting out images and serving only text content on their front page.

A couple of months later (IIRC) I was laid off. It was hard finding a job. Since I was this hotshot newly hatched programmer on the market, I hadn't bothered paying "unemployment insurance" and I didn't have any savings either. All the big companies like Ericsson were in starve mode, and the ecosystem of consulting companies around the big industry were dying or laying off or both. I started a ltd liability company and found a gig through that for a year or so. I had to cut rates something fierce and move to another city but it was a living. A year later or so I found a "real" job and promptly decided running my own business was not for me. Been on the salary treadmill ever since. (But at various smaller and larger companies.)

Edit: insert all sorts of personal life shenanigans affected by all this, too.

We knew it was the beginning of the end when the price on the snack vending machine went from 10 cents to 25 cents.

I wasn't out of college long, but I managed to survive two layoffs where I worked. We had almost no turnover in developers for a year or two because basically no one was hiring, normal for that job at that time was probably around 20% per year if not higher. There were no jobs to have, some of the people that were laid off didn't get jobs for upwards of a year, and some of those I know that did, ended up moving to get a job (I am not in one of the top 3 cities for it). They also really didn't give raises or promotions during that time either.

When I was in school, the comp sci program was so full it was hard to get into classes, hard to find a computer free in a lab to do the assignments/projects. The same college a few years later didn't have that problem from people I talked to. I never looked up the numbers, but I would imagine the number of people going into it dropped quite a bit, at least if the anecdotal stories I heard are to be believed.

Where I worked had nothing to do with experimental tech or anything, we lived on selling somewhat specialized, expensive software and hardware. The problem was, no one wanted to spend money.

It was somewhat demoralizing, as the second round of layoffs really hurt and it wasn't a fun job anymore, but I couldn't do anything about that for awhile.

I also know people who invested poorly that had all of their savings evaporated. Some people were paid partially in stock that pretty much went to 0 very quickly. It wasn't the best time.

I was in CS seeing friends gets 10-12 job offers in the late 90s. Graduated in May of '02 and it took me a year to find an entry level software job and the pay was shit.

I was working at a startup that had SF and Mountain View offices at the time of 9/11. SF offices for tech companies were somewhat unusual then, though a lot were under construction. Most companies still had their main HQ somewhere on the peninsula. Although the tech decline had started before 9/11, it really seemed to pick up speed after that. I remember one of the company execs talking about the next round of funding and basically saying investors were "holed up in their bunkers" - that is, not funding anything. I did know (talented!) programmers that lost their jobs - one even collected unemployment for a time. In early 2002, the company I was at closed the SF office, and then I was also unemployed.

After a few months, I found a replacement job at a non-startup in South San Francisco. The pay was OK but work was a bit dull. After a couple of years I moved out and haven't been been back except to visit. Spent a total of 6 years living in SF and working around the area, from 1998 to 2004. While there, I saved very little money and also never made anything from stock options. When I left I had about about 30K in my 401K account and 20K in savings. Hopefully startup compensation is better today. I know the rents are still insane.

I'd say from a programmer perspective the 2000 bubble bursting was bad but not catastrophic. If we are now in a new bubble, I hope it won't be too bad if it bursts. But the industry employs way more people now and is much more fundamental to the overall economy. So there is cause for concern...if suddenly 10s of thousands of programmers are out looking for work, that ain't gonna be pretty.

I basically missed the whole thing.

Partially because of my location (Phoenix isn't exactly a hub of tech startups - while there is more activity now somewhat, back then it was much different), and partially because I stuck with my employer at the time and didn't participate outside of that.

I was working for a long established software company that developed an insurance claims management system using a variant of COBOL. I didn't participate in that side of things, though - I was involved on a different team for development of an internally used application which was written in VB6 with an Access DB backend MDB file (ugh).

I basically worked there for about 6 years doing that, and completely missed the whole "dot-com" thing. Might have been a bad career decision, but then again, maybe staying in Phoenix was also one. But the pay has been steady, it has kept a roof over my head and the electricity on.

Since then, I have moved on to other jobs and continued with my career. I haven't become rich, and at my age I don't expect to ever hit a unicorn and be on the bottom floor of a startup and retire early. I am expecting to work until I die, whatever form "work" takes. Currently, it is still coding as an SWE and hopefully that will remain the way it is for a while.

I was affected by the bubble in a positive way.

I'm mid 30s, I got my first job in a junior role in 2001 doing web graphics (before I became a proper programmer).

I was hired because our CEO knew he couldn't hire people who had it good in the boom because they expected too much money.

So they specifically looked for people who had skills but limited or no job history, and paid them close to minimum wage.

It worked out well for me in the end as it was a foot in the door when loads of people were looking for work.

It was wild.

Around 1999, I interviewed for my first proper tech job. I had no commercial experience. For the interview I had to drink vodka with the guy interviewing me and shoot some shit. The interview ended when he fell off the chair. I got the job: decent salary, stock options, really nice office.

Hardly anyone there knew what they were doing. That was good for me because I got to pick whatever tech I wanted (open source over the in-house Microsoft stuff). The software and our management processes were a mess. But that didn't matter, because the company was a dotcom darling. I think we charged one large client $1m to make an online store. It sold about 10 products, if I remember correctly. Most of our websites didn't really work very well, though they tended to look pretty nice.

There was plenty of daytime drinking, and drugs and parties. Not long before the crash, several thousand employees were flown to Vegas from all over the world. Lots of partying, cocktails in the pool, mixed in with some bizarre team-building workshops. For the finale, a specially-built circular auditorium with techno music pumping and spotlights whirling, into which the CEO himself drove on an electric scooter to the wild cheers of the crowd, pumping his fist and going round and round in circles.

I found it utterly demotivating to be involved in doing such a bad job of making such overpriced websites, all to the sound track of masturbatory, content-free self-promotion. I left shortly afterwards. It is interesting to me that a number of alumni have gone on to successfully make their millions in their own startups.

P.S. Before my stock options vested they were worth well over $100k. By the time they vested I got $7k.

As a mid-20s Windows sysadmin focussed on automation for web hosting, getting laid off in '01 really kicked my ass.

Want someone who knows how to reliably and "securely" (by 2001 standards) host hundreds of ASP sites on Windows 2000? Only a few people know how to do that and I was part of the team who figured it out first. Want to turn a hundred freshly racked servers into Windows hosts in a couple hours? I'd just finished building a system to do that.

Nobody was hiring for those skills. For years. Web hosters were struggling to stay alive and automation wasn't on their radar. Enterprises were building servers as pets, not cattle. Virtualization hadn't really arrived yet.

I'd get interviews because my resume was interesting but in a buyer's market smart and gets shit done is less valuable than particular experience. It was two years before a local hoster was hiring for technical roles, and took another two to claw my way back to the type of work I enjoyed.

As the broader IT market started catching up to my specialty, I took a couple year detour into our IT department so I wouldn't risk being caught out again without more broadly-applicable experience. Better to be easily employable than maximize my earnings...

---

Something I don't see mentioned in the comments here is that the 2000-2001 apocalypse launched the bootstrapped startup economy (and YC). Talented people couldn't land full-time W2 jobs, so many of them launched startups on a shoestring financed with their savings or by consulting. They'd gain some traction and become a "lifestyle business", or more, or be acquired by one of the big DotCom survivors.

I'll offer a story a little different from most here.

I was newly graduated and working at Accenture, erm, Andersen Consulting at the time. They had an incredible deal in light of the recession, where you could take up to a year unpaid leave (I can't remember how benefits worked out, was too young to care) and be guaranteed a job upon your return. I took the entire year to travel.

There was always the worry that they'd go back on their word, but they didn't, for me or for anyone else I've heard from. And when I came back I was at my same client as prior (eBay) and had a few years of low rent and light traffic in San Jose, after which I bailed for less congested pastures. (Actually I don't remember rent going down too much. But traffic definitely got lighter.)

I don't know how to arrange things so that it works out that well in your favor, but maybe try planting some seeds in your manager's head if it looks like the next downturn might be temporary (they always are). And don't own too much stuff, so you can take off at will. (I literally packed all my belongings in the trunk of my Jetta and left it in storage).

Sounds like a terrible existence for a family man with kids.

I think the only thing that saved my career was dropping out of college 2 years early in 2000. I immediately started working in a print shop doing data processing work and earning my chops and programming experience through self-directed automation and process improvements. My friends in retail earned more than me, but I learned far more in 4 years there than college would have made possible. Leveraging my Linux and general programming experience I moved on to web development work in 2004 at a tiny consulting company based in the upstairs living room of my boss. We did "lean" and "agile" right and survived through the bust by wearing all of the hats and working hard. We could provide high quality solutions for half the cost quoted by large competitors. The pay was simply ok (but my colleagues and employer were amazing). Later, with a baby on the way I had to move on for better pay. Leaving was hard, but finding a position wasn't with all the experience I earned at a cut rate.

In short: I grew, barely survived financially, and made excellent connections.

Startups had unbelievable burn rates, sales and marketing teams overpromised technology, and greedy executives, who should never have been in charge of money, sought to invest millions in building the appearance of an empire rather than grow organically. Eyeballs, not earnings, was the focus. Many such companies would go bankrupt overnight. I was out of a job for six months. It was the most humbling part of my career. We almost lost everything. For a short time, we were on food stamps. I knew some scripting languages, Oracle, and systems engineering at the time and was doing mostly web based development, DBA, and server infrastructure buildout work - yet we couldn’t afford to pay for baby formula. During that six months, I taught myself C, discovered machine learning, and picked up other skills that would later open doors I never imagined would be possible for me. Hard times brought perseverance, humility, and an appreciation for the value of a dollar. I learned some of the most foundation skills and life lessons during the dot bomb.

Weirdly, it had very little impact on me. I got my first dev job in December of 1998 and was let go in early 2000. Then I did contract work for O'Reilly (yes, that O'Reilly). We ported a pretty horrendous forum web app (WebBoard) written in VB to Perl on Unix. In early 2001, just as we were finishing, they announced that they were shutting down their software division.

Around early 2001 I started at a new startup in Minneapolis. It lasted less than a year, but they let us know when they were running out of money a few months out, which I appreciated. No severance though (they were really _out_ of money, I believe).

I ended up doing contract work for them after I was let go (they stayed alive for another year or so with just 3 people, down from 12). I also had some other contract work I found through a friend I'd worked with at my first position.

Eventually I joined another startup in 2004, which also went nowhere but took several years to do it. I left before they sold for a pittance because it was deeply dysfunctional.

I never felt like the crash severely impacted me. I never had any major downtime and while I didn't do contract work 40 hours a week when I was doing it, that was as much my disinterest in work as it was the work being available.

I think I was lucky enough to have the right contacts and a good rep in the Perl community, which combined to let me find a reasonable amount of work to last out the crash time.

Also, I was living in Minneapolis the entire time, which was (and is) _way_ cheaper than the bay area or NYC or any other hot tech area. I think my wife and I paid something like $1,200 a month for half of a large 3 story house (the entire first floor with 3 rooms + 2 rooms upstairs) back in 2001. I think in SF that would've gotten us a closet, maybe two.

I was also in Minneapolis.... I didn't work for a dot-com, just the USPS data center in the area, and then for a medical device company.

About the only effect of the bust I saw was that the job market went south with all the temporarily embarrassed "software engineers" seeking positions like mine (I was/am a system admin and developer among many other things).

Kept the job until the market improved somewhat, cashed in my 401k at the time (dumb) to put a down payment on a house just before the 2008 bust. Then I went to work for a University for 10 years.

The major impact of the various busts on me has been a lack of mobility (both career wise and ability to move to a new house). Other than that, not much.

I credit this to my choice of jobs (building a career) and focus in the industry, plus the fact that I've lived the role since college. I didn't become an IT guy because it was a way to get and keep good jobs... I was already one college, and I've been lucky that what I am happens to pay well.

Cory Doctorow's short story "0wnz0red", about Silicon Valley geekery (not to spoil anything), was published in 2002.

Apart from some technological touch stones, it's impressive how it still feels culturally current.

https://www.salon.com/2002/08/28/0wnz0red/

I really recommend the 2000 documentary Code Rush[1] about Netscape's open sourcing of the browser and acquisition by AOL. It doesn't give any major insights into the industry, but does give a glimpse of what the culture was like back then.

[1] https://www.youtube.com/watch?v=4Q7FTjhvZ7Y

We launched right at the beginning of the end, although we didn’t know it at the time.

Everyone thought they were making tons of money, based on valuations that were only on paper. Kind of like losing $5B and still thinking it’s a valuable company.

I first noticed problems when we repeatedly had potential client me be dark when we showed up for meetings. They were just gone, and no one bothered to Let you know. They had other things to worry about.

We didn’t get to the point where we could exercise options, but some people were badly burned at time time. If you exercised a million dollars worth of options and hold them past the end of they year, you owed taxes. If the shares were now worth zero, you still owed the taxes. This bit the rank and file, who thought they were getting rich, and ended up poorer than before. (IIRC you could carry forward the loss, but that’s no good if that was the only stock you ever got)

We got bought, and had dead end jobs for a while, before they laid us off. Was not too hard to find a job again.

I recommend reading about tulip mania. It’s amazing how similar that was.

I went to law school, which was a huge mistake. It was fun, but working as a lawyer sucks - depressing situations plus no matter how good a job you do, some random judge can ruin your client's life. Went back into tech and I do a tiny bit of law on the side. Still paying for it. Oh and now I make about half what I was making before the crash and pay much more in taxes.

I was working for a biotech when the hammer fell. Got “laid off” though to be honest, I slacked and I was certainly at the top of the list of guys to get rid of.

I spent the next 8 months trying to get a job, I applied to hundreds of jobs, maybe in that time I had 6 interviews. Mostly smaller shops without much money or interesting work.

Finally one day I got a phone interview with a company in New York, I was in Austin at the time. Shockingly they offered me a job after just that phone call, I think I lucked out with knowing some weird parts of c++.

I told myself i would never get fired or laid off again and worked my ass off. First in and last to leave, picked up extra projects. I was a rising star, until that company ran out of money. After surviving 3 rounds of layoffs an old friend called and asked if I wanted to move back to Austin making 30% less, I took it as they were at least not actively going out of business.

Since then my career has grown and I’ve been fine, but that long spell without a job or a future was scary as hell. I hope I never have to go through it again.

From my observations during the time, what your experience as a dev was depended entirely on what sort of company you were working for. If you were working for one of the SV hotshots, then the odds were that you had a rough time of it.

However, most of the devs I knew (including myself) were not, and that set of devs were no more affected by the bubble burst than society at large was.

I read this “how was life for a regular div” and I was hoping for a first person fictional account of an element ahead of its time...

I was working in Lisbon straight out of college in a consulting company, and we were 300 people occupying 3 floors in one of the city's major office areas.

Things were already going downhill, but then 9/11 came, we had a building evacuation etc. and then in the space of 3 months we had downsized to less than 100 people and a single floor, the other two floors where closed.

A lot of people were sent back to their home offices (Spain, Poland and all over Europe) and then laid off there, as major support contracts were not renewed.

The salaries back then and even before in the late '90s were actually about the same as they are now in 2019. The same goes for the consulting rates, they have remained largely unchanged in the past 20 years or so.

If you add up 20 years of inflation, you will see that back then being a software developer was a very interesting option and a job much in demand.

A lot of people went from development into testing, production support, sys admin, business analysis, etc.

Was lucky at a web-based training company that had enough paying corporate customers to keep me on until 2005.

So many things got cheaper in the Valley. Whole companies started just to sell off all the Aeron chairs and other leftovers.

Rent actually went down. Got a place for 40% less than the previous tenant in 2003. I remember our CEO renegotiating every major expense.

In bad times, the correlation of bad things rises a lot, just like so many fund managers have discovered the hard way.

In 2001, seeing what was coming, I left a Linux distro startup and went back to a previous and seemingly secure IT job. I even had plans to take aircraft lessons...

Then, the owner sold the company. The buyers were actually "locusts" - people that offer to buy struggling businesses just to hollow out the assets and then hand the company back ("we saw too many problems, so we are no longer interested").

Back to a market that was fully depressed, had to take a project involving gambling machines (I think they are called "one-armed bandits" in English). It was a technically interesting project, but the people involved in this business are unbearable. After some months into it, I trembled every time the phone rang. After I finally quit, it took 6 years to fully recover from anxiety and depression.

I was wondering: "oh, I know a lot of stories of people working for Linux distro startups back then"...

then I recognized the nickname :)

I had a good internship every summer through school and was about a year out of school working for a multinational media company when the layoffs came. It was clear an adjustment was on the way so I'd thankfully secured a gig in health care where I hung out for the next two and a half years until I could make another move. Those brick-and-mortar companies were flush with talent as they were less impacted and benefitted from formerly hard to hire tech workers. It was at least into 2005 before things started to pick up again in the Seattle area such that you felt that you had any real latitude. Things are different today - many more robust tech employers in the Seattle area, especially in the city itself. Same rules apply though - just because you are minting money doesn't mean you should increase your spending, as what goes up always goes back down eventually.

It was tough to get my first job in 2001, but it wasn't end of the world tough. I am not sure if it was the market of my inexperience at interviewing. Probably a bit of both. The big name graduate recruiting companies of the time were hiring a lot less, so there was a lot of demand for jobs. I took what I could get.

I'm surprised to be reading so many 9/11 related stories. In my memory the dotcom bust was earlier than that.

For a long time after 9/11 there was a huge pullback on consumer spending felt like a mini-recession.

throwaway I was hired as the first software developer for an eCommerce company in the late 90's. Little could I know at the time that writing secure server software would become so lucrative. While I was not directly impacted by the bust given my founding role and creative importance in value to the organization never-the-less the bust did hit the business. Having been the sole architect and first to create many of the founding technologies in payments used everywhere today our company was being utilized by Paypal for several years before they created this functionality themselves in house. The bust was a cycle of economics unavoidable but looking at database records in realtime for Ebay and therefore PayPal purchases of famous people was a way to pass the time. And yes, I still create critical realtime systems.

Business with no real plan for making money failed. Business who depended on the clients being able to pay ridiculous prices with the VC money failed.

Basically, if it didn't provide critical and provable value to a business, its money sources dried up, and it failed. Tons of people were laid off. They stopped paying devs stupid high salaries, and competition for jobs was _fierce_.

My advice, find your way to a company that saves other companies lots of money (and makes that clear to them), that makes something other companies can't live without, or is so tightly integrated with the functioning of its clients that they can't get rid of it even if they want to.

Also, live frugally, and save money for the coming storm because there's a good chance you'll get laid off. It doesn't matter how skilled you are or how invaluable you think you are.

I was stupid and took a major risk. I had a nice secure job in the defence sector writing embedded software. This was a suddenly ramp up in work after 9/11. But i had some ethical issues continuing in this space. I also developed in internal web based asset tracking system and thought that was more interesting. So I decided right in the middle of the crash to bail out into a 6 person design agency start up. Fortunately they were vastly more competent than their immediate competitors and vacuumed up the rest of their work in no time at all.

For me, my salary doubled overnight, stress levels down, no bureaucracy, no horrid tools to use, much better place to work. Best decision ever! But boy was it a risk. Not everyone lost. There was a grand consolidation and if you were in the right place it was a win.

I worked for a pretty "boring" company; we were never over-valued because of the dot-com bubble, and as such we didn't take a big hit during the dot-com burst.

The people that got taken to the cleaners were the ones who made websites selling belly button rings for poodles and stuff like that. Everyone thought adding "on the internet!" was worth a hundred million dollars back then, and a lot of people wound up employed doing work that honestly didn't need to be done.

But if you were in one of those boring companies, doing banking or whatever, you were probably fine.

It was harder to switch jobs for a while, since there were a lot of people on the market and not as many jobs, but I never saw the Reduction in Force scythe swinging through my department.

I came out of college in 1999 and went to work at Cisco. Cisco was pretty terrible and I went to work at a startup in 2001 that was working on a GPRS switch system.. (predecessor to 3G for mobiles.) . I was working on management software.

We basically ran out of money as the bust happened. Alcatel had their eye on buying us.. what they did is wait till the company was running out of money and had laid everyone off in waves. Once the company was a skeleton they bought it for a song. They had to hire a few of the principal engineers back as consultants but not 24 year olds like me! There was some bad behavior along the way from management, they were hiding the true financial situation from the employees.

The other aspect of the bust I remember is a Morgan Stanley "financial adviser" trying to take me for everything I was worth when I was leaving Cisco. The Cisco stock was like $150/share or something when I was leaving. I didn't have enough money to buy the shares. Morgan Stanley had some kind of deal with Cisco where they assigned us financial advisers. The adviser was trying to get me to take out a near six-figures loan to buy options on margin. "You can just keep it for a year and then sell it and make a pretty penny after paying off the loan!" I declined and within a month or two of my leaving the bust hit and my shares would have been underwater by > $100 a share. It would have seriously messed up my financial future in a major way. That guy was such a crook.

The actual layoff in the bust wasn't that bad but it still set me back a bit. I was out of work for about 2 months, I lived with my parents for a bit but found a contract that I kept for 2 years. Taking the contracting work was pretty lucrative but not that smart in the long term. After that 2 year stint things were still pretty bad as that was the era of "outsourcing overseas is the future!" and I had another 2 years of sideways work that wasn't great for my career. Things started looking up in 2006 and were vastly better by 2010. The "great recession" had 0 effect on me.

I was totally delusional in my early to mid 20s about how easy it was going to be to work at a startup and be successful. It was also a super different era in terms of office and overall culture. You were a near social pariah as soon as anyone found out you were a software engineer, it was 100% not cool to be a tech worker. Women would immediately lose interest in you and practically run away as soon as they heard the word engineer. We were all still 100% considered nerds, not cool in any way. Also there were NO young people in the office. In my 20s there was almost no job I ever had were there was anyone else in the office under 20.

Other aspects I remember.. almost no perks in the office, way more crunch time, much longer hours at the startups. In the last 10 years I worked at 3 startups, one had the long hours like a 1990s-early 2000s startup, but the others are/were so incredibly cushy that it felt like no work was getting done. People yelled a lot more in the office. Stuff that was regularly done then would be considered abusive today and would generate lots of reports to HR.

AFAICT around 2010 when everyone started saying "Millenials" a lot things really, really changed in our industry. Mostly for the better.

In 2002 when I got layed off (Boston area) it was pretty grim. The war in Iraq had not started. So there was an absolute army of highly qualified highly experienced engineers that had been laid off by the defense contractors. Career fairs were scary scenes. Obviously they all went back to defense as soon as the Iraq war started... so the rest of us who weren't interested in the defense path didn't have to compete with them. But it was real scary going to career fairs.

A lot of job postings at that time in the bust had ridiculous/fake requirements. You'd see things like "10 years of experience in J2EE". J2EE was new and hot. But it was like 2-3 years old at that point! The postings were mostly about companies trying to fake that they were doing well... put up the fake job postings to make it look like you were growing when in actuality they were barely hanging on.

I took a 5% pay cut at an incredibly boring bank. But I wasn't unemployed at all. My dotcom job was nothing amazing. They teased an IPO but never got within a mile of it. My salary ($65k?) felt like a fortune at 22 years old but wasn't astronomical.

I moved to the US in 2000 with a Ph.D. in computer science to join a startup that was supposed to become the new Cisco. I had no kid at the time and had an H1B visa so i stayed on for the first paycut, the second paycut, the office downsizing and the third paycut. Had a rough few months when the investors finally pulled the plug and i had to find someone who would transfer my visa in 2005, but by then things were on the rebound.

A lot of the american guys who left around 2003 got in real estate and house remodeling, setting themselves up for another burst. The immigrants went to take on boring jobs maintaining legacy code or installing Oracle solutions for a few years before things warmed up.

Fear, that's what it was. You never really know how well your company is doing till the shake down time.

Companies you thought were doing well go out of business. Companies you had as a backup to maybe apply if you lose your job go out of business before yours. So many unemployed developers fighting for the few jobs out there. Hiring freeze in most places. Whatever job you have even if it's tethering on the edge becomes the most secure job.

Layoffs were brutal, I saw someone got laid off on their start date! Those that worked for 3 months before layoff were lucky.

What can you do about it? Nothing! It's like being in the middle of a war zone, you can only pray you don't get hit by shrapnel.

Many jobs in those days were paid for to a high degree in stock options. Since valuations were so inflated everyone in the game was mega-rich on paper.

When the bubble burst, this created a bifurcation. Those who's options vested in the months pre-crash did become wealthy and didn't need to work ever again. Those that just missed that window even by just a month not only did not become multimillionaire, they even had lost years in normal capital buildup as the non-option wages had ofc not been that high.

This left a profound imprint on a generation. It was so abundantly clear that there was no relation between work and wealth. Two devs that had sat side by side working on the same code for years, one now had a Lambo in the drive on his mansion in the hills and spent the rest of his days playing ceo/cto/cio in ventures in which he bought a chair just for fun. The other looking for a job that paid money to buy rent and food for the month. The only difference between them that the former was hired one month earlier by the dotcom.

These devs were seldom born into money. Their parents had taught them that working hard paid. Those words rang very hollow in this new age of casino capitalism.

I went skiing in New Zealand. Then I went skiing in Chile. Then I went skiing in Austria.

I worked at a large web incubator, we build web sites and applications and helped out clients find funding and tried to support them in other ways. Round after round of layoffs. People were on edge. We had offices around the globe, maybe a dozen or more. The final straw was 9/11, as our largest client was revamping their national hotel chain website. Their occupancy went down to 4% and the whole multi-months-long web site development project was mothballed. I was one of the chosen few to stick around and work in the last office of the company that ended up splitting off into its own company.

I lasted until a third round of layoffs. I got lucky in that a friend had a lead on a job in the mortgage industry, writing loan origination document software. Within a week, I was riding the next catastrophic bubble.

I had been a freelance consultant for about ten years, working through headhunters and by word of mouth.

Around April 2002 my contract was not renewed and I spent four months unable to find one. The freelance contract market seemed to dry up.

I had to go work as a full time employee for less than half the pay in Montréal (I live in Toronto). I commuted five hours by train each weekend for a year.

Ironically, the crappy company that hired me referred to me as a 'consultant'.

My hours went towards implementing KYC regulation for a big American bank.

The upside is that I got to live and work in French among my people for a while (I am French Canadian).

If you had a job, you had a job. But if you lost the job, it could be really hard to find a new one. I lost my job and spent a year unemployed. And then the slump was over and I suddenly had 3 jobs to choose from.

Simple enough answer but true for many folks. Lots of jobs were kept and you'd just go about your business.

9/11 truly tanked the economy. Business stopped for a month after that terrible day and it took years to recover. Seeing friends lose their jobs never get easy no matter how many times you say your goodbyes.

9/11 happened in the middle of the recession. It wasn't the cause.

The dotcom bust started in March 2000, almost 18 months before 9/11. 9/11 didn't cause it - but it did destroy the last lingering hopes of a dotcom rebound anytime soon.

For me, it was pretty good. I was working at a medical devices company on a new product. Upper management was all too aware of what was happening out in the .com world. They didn't want to risk losing the core developers to .com riches, so a few of us got "shhh, don't tell anyone else" retention bonuses to make it less likely that we'd quit.

It was nice getting free money with no strings attached for a few years while still doing a job I loved. Kinda sucked when the gravy train stopped, though.

This could be a book but I'll do the tldr for this thread. We were a small scrappy startup with our own video compression and streaming tech. We had just gone public and raised 15 million dollars, and were pivoting to being a content company (because tech sucks and content is king if you are in the year 1999).

Our lead investor was great. He told me again and again that we were in a bubble, and to focus on the core technology as a backstop in case the bubble burst.

After the crash, our $40 stock went down to $0.06. I went from being a multi-millionaire on paper to being broke-ass for real. The CEO and I had to fire 110 people, cutting the staff down to about 25. We jettisoned the content portal and refocused on the core IP.

In the end amazingly, the company survived and was eventually acquired by Google.

It was tough letting people go but the alternative was for the company to go bankrupt and everybody to lose everything.

My story is that I survived the first round of redundancies at an internet startup, but was made redundant in the second round.

It hit me hard, and there were so many people looking for programming jobs that I found it impossible to find a new job. I didn't handle things very well, and ended up doing jobs like washing-up and putting up marquees.

The story ends happily though, I found a good software job fairly soon, and those other jobs I did in between gave me a bit of experience of life, a bit of perspective.

I was at a dotcom that busted (after going public). Developers were laid off left and right. But the internet economy hadnt taken hold yet and the tech companies were mainly still old school shrink wrapped software.

i started my own company at that time and there were a ton of developers desperate for work.

Because of the huge internet companies that are voraciously hiring and that have huge warchests, I think it will be different next time around.

I can see IT at non tech companies getting laid off and having trouble finding work.

Was working for a web agency during the dotcom bust, I was one of the few devs not laid off cos I volunteered to work part time (2.5 days a week) so I could spend time on my band. Did that for a year and a half, then freelanced for a couple of years until I got taken on by a client ... and then 2008 hit. Employer laid a couple of people off, paid us late one month, but it wasn't nearly as bad as the dotcom bust and I found other work without any trouble

I had around 10 years' experience by then. Found a dream job in London but they imploded two days after I started.

Took me six months to find something else. And that turned out to be an OK job with EDS, but at half what I was earning before. By 2004 when things had started to recover they seemed to get a fright because I suddenly got 3 raises in 4 months which almost tripled my salary. Was too late though, because during that time I was interviewing at Microsoft.

Crazy times.

I was an undergrad in CS as the bubble burst (graduated Dec. 2002). I was planning to attend graduate school in CS when I graduated but the market was flooded with people laid of from their dotcom jobs going back to school. I went abroad and was a volunteer teacher for a few years, then came home and found a nice entry-level web development job. Very happy that I got to see the world before I settled into a career.

I was director of research for a live video over the internet startup. This being pre-Flash video, it was quite a bit of engineering. We had live events, interactive sessions with popular bands, and game shows. Then in about a month, it all disappeared. I returned to the video game industry, which I'd been trying to leave for some time... After a stint doing a PS2 game for Pandemic, I went into visual effects.

I switched jobs in 1998, and was at a biggish, stable company in the Atlanta area, feeling lucky as I heard about stories like this out in California.

When it happens again, I don't think it will be as bad. In addition to learning from the lessons of the past, remember that everyone had to buy hardware, servers, big-ass monitors, all that. Now personal laptops are cheaper plus everything's on AWS now, you scale up or down.

What are AWS to do if their demand suddenly falls and they have enormous amounts of idle hardware?

Flip it on Amazon

I had just taken a consulting job and had been at the company for about 2 weeks when 9/11 happened. One week later we got laid off. Turns out I was lucky to get laid off early. Managed to get a job at a bank before the big consulting companies started their purges. Sat through the dotcom bust in a bank and then moved on in 2003 when times had improved again and there were more opportunities.

I was told I would not be hired during an interview:

"...you are more of a client-server programmer. We are looking for more of a mainframe programmer..."

Close to impossible to find a job as a new graduate.

I worked for a large consultancy. The folks who survived were the ones who stayed at clients 100%. It was partially independent of technical skill. (More soft skills and luck). When things got ugly, the 10X developers landed at big tech companies, where most stayed. (Equity gains since have made up for comp drops) The average developers left the Bay Area. Big exodus.

i joined eToys as a developer in the formative days. worked it hard thru the IPO. the S1 sits in a bookshelf. i left when the company still had gas in the tank, but the writing was on the wall. really smart technical people started to leave. i joined them. the bubble had yet to burst.

i cashed out, cut expenses, played golf during the day, coded at night. as the bubble burst, i was already chasing the next thing. never having to witness the layoffs and heartache was a blessing in disguise.

as the bubble burst, startup funding dried up. no one was funding 'an idea' yet it was also a great time to be working on the problems of tomorrow.

having cash on hand was important...it allowed me to relax when others where in a panic

finding work was not hard. having talent always matters.

fast forward to today. its been about a year since i exited a startup that was acquired. outside the bubble again, cash in hand, coding without a worry

i'm already 'dug in' and working on the next thing,

There weren't a lot of jobs.

I was at one place through much of the boom, eventually they folded. I was the last employee, part of my job was winding down and archiving the assets. After that, jobs were a bit scarce.

I didn't mind the break, though it was a bit demoralizing. Much like today, if you can create a name for yourself, it's easier to get hired.

I was at the epicenter of the bust, in London consulting for boo.com, who were at least partially triggering the crash.

After some months on the beach because my company simply couldn't get the ludicrous rates they had previously been getting, I landed up joining the fledgling Shazam.

Sometimes the best time for a startup is in the teeth of a crash...

I see a lot of comments referencing 9/11 as a big cause of the downturn and am curious... why? Given the size and power of the US, the 9/11 attack was just a pinprick. Was it the social and government reaction to 9/11 that actually caused the damage? If so, was any of it deliberately engineered?

9/11 had nothing causal to do with it. I suspect it's just a prominent negative event in history that became associated with all sorts of negative things going on in the same era. Also people's memories aren't exactly perfect, especially when it comes to precisely ordering and absolutely placing the distant past on a timeline.

Not specific to devs, but I do highly recommend the documentary Startup.com – it's a rollercoaster ride of the highs and lows of that era.

Free to view on YouTube: https://www.youtube.com/watch?v=ibuiUXOTE4M

It was psychologically worse than it actually was due to 9/11 and the war buildup which was really, really stranger.

The 'crash' was a very well needed market correction as few startups had figured out how to make money - and a lot of regular stocks were way overvalued.

It was a little rough for devs, but honestly, anyone with decent chops had a decent chance of securing 'something' - either in the Bay or elsewhere.

There was a huge drop off in marketing, biz dev etc. over the span of a few months it went form 'a lot of parties' to almost none!

It recovered somewhat after a few years - Google did an IPO that went really well. Then the Facebook craze started.

The 20008 crisis was much, much worse as it hit the entire American economy in a very powerful way - not just a stock/.com correction.

FYI the 'telecom bubble' was 5x bigger than the '.com' bubble, there were huge investments in optical switch companies you never heard about that went bust.

That said - the buzz since 2012 has been stronger than in .com. During .com all this zany stuff, startups etc. were completely new. So it was completely new math. By 2010-2012 - or say the real establishment of YC, a lot of the zanyiness had been normalised and it metastasised throughout the world in a way. The valuations these days are 10x-100x bigger and the game is significantly more global. In .com companies that did a $500M IPO were 'huge' or whatever. Nowadays, it's almost not going to make the news.

The correction that's coming eventually probably won't be as severe as there's no reason for a real crash. Something will give - probably China slowdown - which will pop a lot of other bubbles. To give you an example - WeWorks' valuation was not actually that crazy - as long as they could continue to raise (and it's not entirely irrational) then they could move ahead. The $50B->$10B drop is not some crazy mis-calculation so much as it is an example of the leverage being applied. A little bit of wind out of the sails and lack of momentum can kill something that might actually be working (and WeWork actually does have some workable metrics, just not at $50B).

So the coming adjustment will affect 'everyone' even if it is really only driven materially by a few things (i.e. China, trade etc.) though probably not severely.

If you do good job and have reasonable skills, I wouldn't worry too much.

Just an aside: it was very popular for dotcom era startups to issue NQSO options instead of ISO options. NQSOs cause tax hits when the options vest, where ISOs do not. So when you read about people getting massive tax bills with options for worthless stock, they were likely NQSO options.

A lot of regular developers were working on Y2K modifications to enterprise programs. That was a person intensive effort and was very successful. In a lot of cases it wasn't very easy. I get the feeling that 32-bit gates in embedded control devices will not be taken as seriously.

I was working at a dotcom, a geocities knockoff, that had recently gone public and had climbed up to around $30/share. I had options that I had already exercised as I was being clever thinking I'd sell them after holding them for a year. But I was still locked out as an employee, and we all watched as the the price dropped over a period of weeks. After a while it was under my exercise price so I lost money. All told it wasn't a lot of options and not a lot of money I lost either. A couple of decades later I sold the position to take the loss and offset other stock gains.

The layoffs happened in two rounds - the first round the severance packages were rumored to be generous. The second round, my round, we got two weeks pay.

This was spring of 2001. People had trouble finding a job, but they were still out there. I got another one for summer of 2001 but they laid me off after three months, and then 9/11 happened ten days later.

After that it was brutal. Up here in Portland, no one was hiring at all. One time a job opening came up and all the applicants were taken to a large conference room where we all took a silent written exam together, with applicant names anonymized to protect against discrimination. I got that offer and rejected it, which completely freaked out the agency recruiter that was representing me. Nike and Intel would occasionally advertise programming contracts for $12/hour - php, perl - and they would be swarmed with applicants. I'd talk to agency recruiters but they kept getting laid off, so it'd be a different one every couple of weeks.

I was taking unemployment, I toyed with a business idea, and I eventually thought I'd try out contracting - I cold-called a prospective client that had a small company, and he brought me on for $25/hour, usually working at his condo with him and ordering pizza together. A few months later - Feb. of 2002 I believe, I got my first more official-ish contract for $55/hour, and I've been in business as a backend architectural contractor/consultant ever since.

Over that period of tim, I found that consulting is kind of a leading indicator of the economy. When times are bad, maybe you can get good gigs at employers that need help but are reluctant to commit to an employee. But if times are just starting to go bad, non-employees can be let go quicker.

Anyways, remember that the dotcom crash got mixed up with the post-9/11 chaos, so the next crash probably won't have the same impact. Also, remember that recessions are cyclical. It gets better by definition. I still believe that 2001 and 2007 were Weird in a way that recessions usually aren't. And a recession might even be good for the younger generation since they tend to clear away people that have jobs but shouldn't, leaving more future openings for the folks that are still hustling and learning.

This is what it was like.[1]

[1] https://web.archive.org/web/20010302130953/http://www.sfgirl...

I was in my last year of university when it crashed. 'Entry level' job openings were getting high level applicants with 10+ years experience. Of the 37 people in my year, something like 30 stayed on to do PhDs due to the impossibility of landing a job.

My company was 12 minutes from going public, and it got pulled. That’s a fun story to reflect on.

I was a junior enterprise dev at the time, and was largely shielded from any fallout. Felt lucky to have work, but safe.

Now, I’m highly exposed to startup economy, older and spend more time managing than coding, so...... feeling a little shaky right now.

As a college student, I can remember my school's engineering job fair in 1999 taking up three floors of the student union building. In 2000 (2001?) it was down to one floor and nothing but companies like HP, IBM, and Microsoft.

I wasn't there but I heard it was great : You could swipe your ass with stocks bundled in paper roll.

https://m.youtube.com/watch?v=arENYYkYBts

Swipe or wipe?

Started a company with some friends in May 1999. Company was acquired (with stocks) in February 2000. Everything crashed in March. Lost basically all the money during the coming year. Stock is still 99% down from peak. Crazy days.

Almost a non event for me, I was working for a small, but not a startup anymore, successful company that was lucky enough to not get severely hit by the bubble.

Salary raises were lower, and bonuses more modest but overall we continued as usual.

From the end of 2000 to the start of 2002 I did a stint at a web agency right out of high school in order to save up some money for college. Roughly a month or so after 9/11 150 out of the 300 employees were laid off.

I was in college at the time but I distinctly remember buying a few shares of Amazon for around $9 each with my remaining savings. I sold them 10 years after graduating which in retrospect was too soon.

I graduated the year it popped... nobody was hiring, especially people with no experience. Out of about 200 compsci my year, I doubt 10 got a job that year doing anything computer related. It was brutal.

2001 - out of work for a year and sending resumes everywhere. I'd call and ask "Did you get my resume"? The reply - "Yes, your resume and a thousand others".

This is the most useful thread in HN in years.

As someone who started his engineering career after the burst, is good to hear the experiences (good ones and bad ones) before the next one burst.

This bust will be very different than the first tech bubble. The first tech bubble laid off a lot of folks working for small (<50 people) startups. This next one is going to hammer the giants. It's going to really hurt.

Most of the valuation of big tech companies came from their terminal value (which was unknown for a long time because the business models haven't been proven). That value is now better known, but valuations haven't come down to earth because there has been so much foreign money flowing in to the US because investors just have nowhere else to put it.

The other unknown in all of this is the student debt bubble. I have a feeling the next recession is going to trigger a wave of bankruptcies as the knowledge workers that will get laid off will no longer be making payments on their student debt.

You can't bankrupt out of student debts in the USA.

As someone who was a dev for small but established company that wasn't purely internet facing, I didn't even notice. (Not being snarky, just saying for balance).

I was the last person left at my company in 2008. It was a one person company, after I fired my best friend so he could go to India and drive tuck-tucks.

I moved my operations to a organic farm in the east bay. My wife and I were shoveling horse shit one afternoon with some community volunteers that just happened to be the Comcast Ethernet sales team. That is how we got the fiber.

I pulled a 40' "high cube" shipping container into one of the greenhouses <lots of illegal stuff deleted> and now operate on some dirt that will be flooded in 50 years. Elevation 4ft above sealevel.

I'm surrounded by homeless transients on 4 sides. My wife left me this year and she killed all the plants. I'm really happy because of the drugs, and sunshine.

Y'all should get out more -- dig in the dirt, make food and write code in a non-toxic environment.

Pretty much the same for me (east coast.) I moved from a startup to a more stable software company for a few years. My startup stock options were worth nothing.

In threads discussing career paths there seems to be an implicit assumption that everyone has agency and the ability to make their own decisions and results are simply a matter of choosing the right advice to listen to and doing the work you need to do at each step of the way. If we were discussing career paths in the context of wealth the assumption would be that nobody has agency and everyone is just a product of the environment they were born into and what you do is predetermined.

So which is is guys? Can we actually choose are own career paths or are we just pissing in the wind here?

here's an inside story from a developper in a DotCom era web company:

https://www.shamusyoung.com/twentysidedtale/?p=35194

He's also explaining a lot of entrepreneur/technical details, since most of his usual audience is not familiar with those, unlike HN.

I worked at large stable companies and only knew there was a dot com bust because I read the news. Business as usual.

Fear mongers will fear monger. Dire predictions are rarely accurate, especially at the macro economic level.

I was a software engineer through that time period, and for me it was a non event. If you’re working at a profitable business and not some negative billion dollar growth company, you’ll be fine. Software engineers are going to be in demand for a while yet.

If you were a regular dev - one of the majority of software engineers - you probably didn't notice it beyond news articles or the like. You were working for some company that hadn't been part of the dot com bubble and wasn't reliant on dot com bubble companies as customers.

Joined a tech company in summer of 2000 after the dotcom bubble had already burst, but many people still thought tech market would bounce back. The company was able to raise around 60 million just after I joined. Located to Silicon Valley few months later. (This was already part of the deal when I joined.)

The product we were making was quite solid and also quite generic, but the management/investors decided to concentrate on dotcom related markets which ultimately went bust later. Our core development team did not suffer that much, but around us there were so many layoffs I lost count. I personally survived at least five layoffs.

It was actually quite interesting time to live in Silicon Valley. My coworkers all still believed in dotcoms although those companies had lost much of their market value. I had just taken some introductory finance classes and knew that fundamentally all this was unsound -- and had some interesting chats explaining to coworkers that diversifying means more than investing in few different dotcom stocks.

I continued to work there as the work was interesting, pay was good and it was interesting to see Silicon Valley through the disillusionment phase as it is part of the history.

Since I was working only for one company I did not have very wide vision, but it seemed to me Silicon Valley was full of gold diggers at the time. It was quite something to see several minutes of job ads before movies, for example.

The company did very crazy decisions. Their goal was to get listed in NASDAQ, and for this all the graphs had to show exponential growth no matter whether it was unsustainable. This meant stupid hiring, offices in all continents etc.

By stupid hiring I mean that some people were clearly hired just for the head count, not to provide any real valuable service. But our core development was kind of inner ring that was protected and continued doing interesting work throughout all the craziness around.

I was once traveling with the CEO and he told me that he had just come off from meeting with the investors -- they had demanded that the expenses should be raised to $1M per month.

The company burned through the money in the three years I was there, basically on offices, stupid hiring and travel. After I traveled in economy class in overseas flights, I was told that everybody else was traveling business class. The chairman of the board insisted on traveling first class. There was actually one BOFH who insisted on first class travel too (he had to set up the infra for the offices), and I think they accepted it too.

In 2002 I had enough, so I relocated back where to I came from. One year later I quit the company. The constant layoffs impacted the mood of the company so much I did not want to work there anymore.

I took a sabbatical year, finished my second master's degree and spent three months doing volunteer work. After the sabbatical I joined the company where I had left before I went to work in Silicon Valley.

I was not unemployed (against my own will) for one single day throughout all this. I think what saved me was that I had saved so much that I could be independent for a year, that I worked with smart people who recognized my talents although I was still quite young developer. But mostly it was luck, I guess.

I would not trade away the experience.

I had a job until oct 2001. Then laid off. Traffic got a lot better too.

TLDR - your going to be fine.

I lived thru it, I did OK, a few of my friends left the industry some struggled most where ok if they had real software chops. The people that really took the hit where network / sys-admins / corp PC repair-support they where gutted as there was a glut of MCSE/A+/whatever get a cert in 4 weeks make 100k.

That being said, this time it is structurally different, in that period, we where trying to eat the world with software today software has eaten the world. Development has always been and always will be an understaffed profession as it competes for the top half of the intellect spectrum along with Doctors, Lawyers, Engineers etc.

It's easy to assume that you have to be at least smarter than half the population to write software. From there you have the slackers that take themselves out of the pool e.g guy could be Einstein but he would rather smoke pot and work at 7-11. Might not be a significant portion of the population but it takes a bite.

Then the person actually has to want, desire and be interested in being a developer over some other intellect based career. Then a portion of us just burn out and leave.

Anyways there are a lot of factors that lead to a serious shortage in available developers and as best as I can reason it is systemic and incurable until AI gets to the point where it can turn a persons thoughts into software.

I would armchair guess that the pool of potential good developers worldwide is 10% of the population. Those that actually pursue it and stay with it is certainly far less.

Tangential, but that is what I love about these younger companies and their age discrimination and asinine interview processes. They lack the experience to know that their perceived cool factor actually holds no currency and the real currency is in attracting and retaining good development talent. They build so many self defeating filters to them accomplishing that goal.

I went to work as a corporate drone. It was spirit crushing.

"youngish" & "28"

With 27 I feel like a fossil that will die alone and in poverty if it won't make manager or architect within a year.

Lots of MOPs - Millionaires On Paper.

Probably you should check zoho way

The biggest thing about history is that we know how it ends. Nothing really captures the uncertainty of the moment. By 2000 everyone knew there was going to be a big correction. Few accurately imagined how big. It was like going to the doctors because you knew something was 'a little off' and finding out that you were going to die in three months. Then talking to all your friends and realizing that everyone you knew had the same disease.

Initially many thought it would be similar to the early 90s recession. I.E. A few layoffs with everyone getting hired back again two years later. It wasn't until 2002 that people realized that springtime wasn't coming back.

It wasn't just places like pets.com that crashed. You had every single non-tech company simultaneously scaling back IT initiatives. At the time there was still a large cohort of management types who considered the Internet more of a fad than a new paradigm. These types took full advantage of the shifting winds to cut deeply into anything tech related. This broad overcorrection did a massive amount of damage to the industry. It's not just that your project was dead, but no one would even be there to bury it.

The impact crater was still visible years later. Remember the big talent shortages during 2008-2012? That's because you no longer had a cohort of mid career professionals to draw from. Only the thin number of people who survived the collapse and a bunch of novices who were just getting started. Everyone was missing that valuable group of mid career 8-12 years of experience etc... Basically a generation of careers strangled. Which is why you'll often see no sympathy for the 'talent shortage' complaint. Five years after cutting everything and leaving people to starve you have the same cohort of managers demanding to know "where are all the people with five years of recent experience, and why don't they work for peanuts like they used to?"

The silver lining is that the bubble bursting shook off the con-artists and pretenders. The dotcom boom was driven mostly by piles of dumb money chasing anyone who could spell the word 'software'. There was a very specific feeling of dilution during the run up. Dealing with companies and teams that contained no competence of any kind. Just lots of people with grand plans. Remember that this was 5+ years before the 'fizz buzz' test became a thing.

During the boom, being a skilled professional felt like you were a hunted animal rather than a valued team member. Everyone had to get in on this 'internet thing' and they would desperately try to latch on. Imagine working in a company of 500, and only two or three actual programmers. Everyone else has 40hrs a week to hassle you for help with whatever their project is while kissing up to management. Think of a tech conference that is entirely shiny salesmen, business types and politics. Tons of fancy titles with no ability to execute. An impenetrable crowd of people trying to suck up time and gain influence. Those types disappeared first.

A lot of people forget that telecom was a major mover during the dot com boom years. I was in the industry and it was the Wild West with deregulation and new technology being borne every day to try and corner the high speed internet markets.

I worked at several floundering telecom companies out of college and it was all rainbows and unicorns, "We're going to change the world!" VC money was coming in like crazy, but I saw red flags everywhere.

Best example was at the last telecom I worked at. They had managed to get a specific contract with Qwest that gave them enterprise level rates on PBX lines for small companies. Basically the state had given sweetheart rates to the huge corporate players in my home state of MN. 3M, Honeywell, Mayo Clinic and others were paying next to nothing for their lines, but because of the volume, Qwest was still making a ton of money every month. One of the founders was an attorney and told Qwest there was a clause that stated they needed to give that rate to everybody, not just these huge corporations. They actually had public hearings and everybody was asleep at the wheel. The FCC allowed this company a five year contract for the same rates, the only catch was each entity who got the rates had to have a minimum of 10 lines. Then, after five years, the contract would expire and the loophole would be closed.

When I was hired, the CEO told me they wanted to have the highest paid sales staff. He laid out the salary and commission structure and red flags went up (see below). After I was hired, I found out the CEO bought season tickets for all the major sports teams in town (that included the Twins, the Timberwolves, The Wild and the Vikings), two of the teams (Vikings and Wild), he got a suite. The office we were in was already way too big. We had a staff of about a dozen, and it was big enough for a company of about triple that size. No matter, he spent a ton of money to completely remodel the whole office in his vision. They had around $3 million privately invested and he blew through that with his excessive spending and staff payroll in about 4 months.

It was then shit got really interesting (more on that in a bit)

Here was the salary+commission structure:

Salary was $45K/year

Commission structure looked like this:

You were paid per line with a commission structure that ramped up as the number of lines increased.

The math went like this:

- (Less than 20 lines was paid out at $60/line)

- 20 line minimum: $1,000

- 35 lines: $2,000

- 40 lines: $3,000

- 50+ lines: $4,000

Let's say you landed three clients in the same building and you got a 40 line deal. This means you got your base salary for the month which was around $3,700 plus you got commission on every level of your deal so you added another $5K on top of your salary. Once I started working there, I found out the company was only clearing $25/per line, per month in revenue. It doesn't take a genius to see that and start to panic.

If you sold a 40 line deal and the company was paying out $5K in commission, but was only making $25/line in revenue, it would literally take 16 years just to break even. I started asking around, since this wasn't making much sense. I started talking with the engineers, some of who were given stock options in the company. Most wouldn't talk to me, but I got in good with one and he said this whole thing was a scam. The idea was to grow the business rapidly, shed all the VC money and then once it was bought by a larger telecom company, everybody would cash out and start another company. Rinse and repeat as necessary. I suddenly realized I was in a very bad position, but it was already too late.

Once the CEO had torched through most of the money, a war started between the investors. There were six private investors. Apparently they had a meeting to discuss the dire straights of the company. Three of the investors wanted to put in more money and keep it going until the company could grow enough where they could still sell it for a healthy profit. The other three wanted out. One half sued the other half. The other half counter sued. Two days later, I came to the office and a security guard greeted me and told me I wasn't going to work. The doors were locked by way of court order and the company was effectively shut down pending legal cases.

Less than a week later, the bottom fell out of the economy and the dot boom was suddenly the dot com bust

The lessons I learned (if even from the outside) from that experience really helped when I started several of my own companies. I have yet to take VC money. I've been able to bootstrap all of my companies on my own, with minimal investment. I run as close to bare steel as possible. No offices, no hardware, bare minimum for my overhead expenses. Try and do as much with as little as you need. Pick a niche market and address a specific problem and then own that niche. Try to stay away from larger players in already well established markets. And for fucks sake, never, ever, ever pay your employees a kings ransom to work for you.

Sorry for the long ramble, but I love telling this story. It has so many lessons in it for founders and other people in the startup world.

I finished a masters in September 2000, by which time the wave had already started to break: I'm not sure it was a big deal anywhere other than the UK, but boo.com went under in May 2000.

I'd moved back home to Dorset to do my project and thesis as our landlord had sold the flat we were renting in London, and it didn't feel like the best moment to be househunting.

I also had an offer in hand with a b2b eCommerce agency in London, along with a couple of other friends, so my plan had been to move back to the city in the autumn. However, over the summer we received an email from them asking us to defer our join dates by a couple of months, during which time they'd pay us a small weekly stipend.

This was nice because it felt like free money (I was being paid £150/week to do literally nothing), and in the meantime I made a contact through a friend with a guy running a tiny software company in a village a few miles from where I lived and started contracting for him on a telecoms switching system. Together, these pushed my income to about £470/week which, at the time, felt like a ton. In fact it was more than the starting salary I'd been offered with the firm in London.

The guy I was contracting for liked my work and started pushing me to work for him as a full time employee. He dangled matching my London salary in front of me, which obviously would go quite a bit further in sleepy Dorset.

Eventually I caved and gave notice to the company in London. The downside is that I had to give them the stipend back, but I'd been judicious in setting it aside just in case this happened. Still, that £1500 would have come in handy, and I still kick myself for the way this turned out because I should have seen it coming: a few days after I'd given notice and sent them a cheque they let all new starters go. The reason I kick myself is that had they let me go I could have kept the stipend.

On balance I was much luckier than everybody else though: I still had a job with the company in Dorset, and I was now a salaried employee, so way luckier than everybody who was cut. The worst I had to deal with was emergency tax for months (which I eventually got back) because the company in London couldn't get their act together to give me a P45: I still remember the email they sent telling me it "wasn't a business priority". Well, maybe, I mean when the place is disintegrating around you, but I still need it.

In many ways that first job wasn't great, but it did have some strong upsides: working on lots of different and interesting projects, client contact, 20 minute commute, good salary (for the area), great scenery. It also ranks as the only time in my career when I had my own office: the upper floor of an old thatched cottage.

On the downside there weren't really any other devs in the company: a couple of guys did sysadmin work on the ISP side of the business, and built the odd website in PHP, but nothing full on. My boss was a programmer, and whilst we had some good technical discussions, he could be a bit old skool in the way he did things. I needed more people around who I could learn from. Related to this I learned that I don't really enjoy working substantially alone.

My boss wasn't a bad guy, but our relationship could be fractious, and I could be pretty immature/something of a diva, which didn't really help.

I actually handed in my notice after less than a year because the stress was getting to me, but my boss persuaded me to stay and gave me a 20% salary increase. Like I say, he was a decent guy. I'm also really glad he did that because I probably would have been ed by my naivety otherwise (had no new job lined up).

Still, there was more to my issues with the job than money, so it didn't take long to realise I still wanted to leave.

I began applying for jobs but the problem was there just wasn't much around for people with a year's experience. Plenty if you had 4 years, and obviously there were graduate roles (but these would have been a substantial pay cut and, by this time, I had car payments to make - buying a car on finance as soon as I got my first job definitely not my finest piece of decision-making ever). But I was really struggling. I'd make sure I ticked every box for every requirement when I applied for jobs, and I'd hear nothing back.

Eventually I heard back from a company in Cambridge that I'd applied to months before - never heard back from anyone else. Things were pretty grim at work (the atmosphere was tense and funereal and it went way beyond any issues between the boss and I) so when I walk into this shiny, new refurbished office in Cambridge, with all these friendly people I pretty much instantly decided that regardless of what happened I wanted this job. Fortunately I got it, along with a modest salary increase and relocation expenses - started in June 2002.

Good thing too because the company I was working for in Dorset substantially imploded a few months later leaving only the boss and his wife behind, and the other three employees let go. A sad end really. It could have been awesome, it should have been awesome, but it just wasn't. It was still limping along a decade later but I think is now gone completely.

Ironically I'd picked another company, in the bioinformatics sector, who weren't exactly having a great time. They'd IPO'd, with much brouhaha, in 2000 or 2001 and had raised something like 160M euro, with a share price trading about 100 euro. By the time I arrived the shares were trading at around 3 euros and they'd burned a ton of the cash on a bunch of questionable acquisitions.

There were layoffs before I'd joined, and more whilst I was there, although these left the Cambridge office substantially untouched, I think mostly because we were working on a product that was making sales.

One immediate and massive improvement is that I got on well with my boss, and there were a bunch of great people around. I got to see other peoples' code, and be involved in some design sessions with other devs, which was all new. We also used source control - hurrah! I did lose the direct customer contact, and the variety of work, which I missed a lot from my previous job. There also seemed to be just an unbelievable (to me, at the time) amount of politicking - thinking back that's not really surprising given the state of the company. Sadly, I realised pretty soon (a month or two in) that I needed to find another job, but I had to wait out the first year so I wouldn't have to pay back relocation expenses.

My next job was a contract. I'd seen it advertised and it was paying literally twice what I was on, and it was the only job I'd seen in months that I seemed qualified for. I nailed all the requirements except one: I wasn't Java certified. I phoned up the recruiter anyway and told them I was going to be taking my Java certification within the next month, then I booked the exam, then I spent every evening devouring the certification manuals. Another guy had gone for the position but decided he didn't like one of the people there so, once I had the certification, I went for interview and got the contract (August 2003). I don't know what the people issue was with the other guy but I had a great 9 months there: absolutely loved it, and loved working with a great group of devs.

I mean, of course, the company wasn't in the best shape, and they sold off part of the business - the part I was involved with - to raise some cash. I had the option of following the work to Loughborough, but chose not to. It was good while it lasted but I'd already spoken with Redgate by this point, and they offered me a software engineering role starting in July 2004.

This was one of only two pay cuts in my career (both of which have been contract -> permie transitions), but I liked them and what they were doing, so I took the job, and I stayed there nearly 10 years (that was never the plan, I might add - I'd only intended to stay for 2 or 3).

And that's how I rode out the dotcom crash: overall I'd say I was incredibly fortunate. It set me back, but it didn't floor me. Financially things were quite hard at times, particularly when I first moved to Cambridge, and particularly when I bought my first house a few years after that. I was lucky enough that for the most part my salary went up, but it was never like I was earning outrageous money, and certainly not compared to what I would have had I graduated in, say, 1997, and found work in the City before the crash when everybody was just desperate for developers (which I could have done had I made different choices - long, boring story).

Still, I've always been in work, except when I've chosen not to be myself, which is a very privileged position to be in.

I was working at a large firm (similar to HP), a the changes were gradual, but significant:

- Hubris blow-back: Non-managers with access to HR data within my own organization would query payroll data, and publicly say developers are overpaid. This was a US public firm, not a start-up, and our pay wasn't market leading.

- Domestic hiring froze. Existing offers were rescinded. No new offers made.

- Foreign hiring or visa workers started: The internet wasn't fast enough for outsourcing at first, so new developers were brought to the US Visa from India, getting paid quite a bit less, and living 5-6 guys to an apartment in the woods of New England.

- Terminations/layoffs: The first was a shock, then came the drain of twice a year, every year, eventually becoming the norm. At first, the less technically apt were release (those who learned to program because it was hiring.) Then some really good people, with good ideas and great degrees gone because they couldn't put in the hours or work in the environment, or because they couldn't set aside their pet project.

- Cost management, control, and reduction, everywhere. Need email? billed to your department. Need storage? billed by the MB. Need licensed software? Assemble a business case for a VP, and expect to have 4 tiers of reviews before that. Need a monitor or memory? Buy it yourself, that will never get approved. Have a shadow-IT lab where all your work gets done? Expect auditors to shut it down and claim the assets for the CIO. The correct department expense number is $0.

- Project control: strict waterfall, with systems engineering of everything. Regular metrics reporting with remediation plans to executives. This requires...

- Personnel tracking: hours worked per week were introduced, starting at 1900/year, then ratcheting up. 40 per week became 44, and then it was a whisper. Managers knew, plan your top people at 50-65/week or you would blow your budget. Those top-billers brought in revenue.

- Technical advancement evaporated. Development was for the outsourced teams; if you want to move up, learn how to manage lots of outsourced developers as a "project manager."

- Projects shifted. Latitude to explore new technologies and possibilities went away. Remaining client projects were purely driven by what was needed to keep businesses moving forward, like legal/regulatory requirements.

- Governance. To make sure there's consistency, and no shadow projects, control them through review boards for everything.

Consequences?

It became a grind. The long hours worked during the dot-com era exploring the possible and creating an internet that never existed before became long hours to meet project targets, billable targets, and client deadlines.....

Marriages suffered. People skipped family events for work. People skipped exams or even dropped out of advanced degrees, for work. You could see who was burned out, or was having trouble with depression, or was self medicating in other ways.

Professional lives suffered.

Not a good time.

I graduated with an associate's degree in Chicago in 1999 and went looking for a job right away. My skillset was mostly C/C++, but I was struggling to get responses to any of the resumes I faxed out. The crash was still over the horizon, but I think my lack of experience and lowly AS degree kept a lot of doors closed. The Midwest wasn't like the Valley in that respect.

I finally took a job with a company whose flagship product was a browser front end over a 30 year old Pick database. They hired almost anyone off the street and gave them a two week training course before turning them loose in client code (customizations to the flagship application). They were literally training new hires to program, and I was kind of at a disadvantage because I knew what I was doing and got things done quickly, which is a liability when you bill by the hour.

The twenty year old company re-branded to a dot com and was planning an IPO. We got new business cards and letterhead with the new name and everything. Then the owners saw the writing on the wall. They silently dropped their IPO plans and we got new business cards with the same new name except no ".com" at the end.

With only an associate's degree and with my only professional experience being an outdated database system + programming language, all recruiters wanted to talk to me about was roles with this same outdated system that was apparently running in places all over the world. If I wanted to hitch my wagon to a dying platform, I had a place in France begging for someone like me to one work on site for a couple months.

Even those calls stopped when the bubble burst. I took another job on that outdated platform that paid better and kept sending out resumes. Things eventually got better, but I still couldn't find a role outside Pick systems.

It wasn't until I spent my own cash on a Java certification AND the market improved that I started getting calls again. But then I faced a different challenge, because my Java experience was the wrong KIND. I had worked with Oracle Application Server and their suite, not Websphere or Weblogic. I understand now that a lot of that strict filtering was to prove that nobody local had the skills that offshore developers had. Yep, the early 2000s was all about offshoring!

It's my opinion that starting my career in that time and place set my career back at least five years. That experience is irrelevant now, thankfully, and I'm in a pretty good spot these days managing a devops team.

I don't want to be all "you kids don't know how easy you have it", but it's so easy today to spin up a web application, host it for practically free, and maybe make a business out of it. I would have to fax over code samples, and now you have recruiters and hiring managers cruising GitHub profiles looking for coders to reach out to.

I do worry about the possibility of another bubble. I'd probably be fine, even if I had to do something outside tech for a while. But for young folks outside SV things could get pretty hairy again.

This is how the first dot-com ended for me, including a few jobs prior, because I feel the setup is important.

I out of college I started a company with some friends from high-school, worked that for 6 months, but wasn't making any money, so I got a job at Microsoft in Redmond, WA. I worked there for over a year, but hated suburbia (back then Seattle didn't have many people who lived downtown, and pre-restaurant scene, etc, so I left for a good consulting job on the east coast and proceeded to spend the next 1.5 years traveling a lot, mostly to Chicago, but some NY. It was a fun lifestyle for a young hot-shot C++ guy. Then one of my co-workers quit to start a Startup and I was employee number 4 or so. Back then the stock market was starting to go wild. We competed against (and valued our company) like one called Vertical Net [1], we were exuberant and cocky. My friends were at companies like SilkNet, which got acquired Kana, all my social circle (25 to 26 year oldish) were involved with high-flying startups and we thought we were all going to be so rich. We even started playing the options market, one of our favorites was Nokia and Yahoo options trades. One of my co-workers made so much trading options in a week, that he cashed out and went and bought an Audi S4. We were all making fun of him (but the joke was on those of us who continued to play).

Anyway, after a year at that startup, I moved to another high-flying one across the river in Cambridge, MA. I only a contractor at this one, but the money was insane (it's actually taken me about 15 years to get back to the same money I was making there). Anyway, I think it was November 2000, we suddenly had some lay-offs announced. They didn't get rid of us right away, though, they kept the contractors o until the end of the year. But no biggie, I found another job immediately for a company called ATG. I was going to start at ATG [2] in February 2001 as a sales engineer. So, in the meantime, I took off for Europe for six weeks. And proceeded to have the time of my life, looking forward to my next job. At one point in Paris, I almost bought a Picasso "sketching" for like 10K US, but instead settled for a more modest $700 artist by a Japanese etcher that I liked way more. The next part of the trip, I blew out my ACL skiing in Chamonoix, and then headed back to the US to await starting my new job.

So, about two days before I was supposed to start the job, I got a call from ATG that they're having lay-offs and that I'm not to show up for work on the following Monday. Crap. No, biggie, I've always found tons of work. So, I put my feeler's out, and even contacted places that had made me offers in December 2000, but no go. Hiring freezes everywhere.

In June, I finally found some contract work at Staples.Com where I worked for about 6 months. 9/11 happened in September, and by December I was no longer at Staples.Com.

I couldn't find work for about 8 months after that. And then I ended up working for the State of MA in the Department of Revenue working on software for collecting child support in the Fall of 2002. I had gone from a high-flying C++ coder making $90/hour+ down to making $33/hour (working with Visual Basic and ASP). Then about two months into the DOR job, the recruiting company called and said they could only pay me $22/hour.

I didn't really get back on my feet fully until I started another job in January 2004 at another consulting company (now as a Java/C# engineer), and it was still for about half of what I made during the dot-com boom. And then from there I slowly crawled my career back.

In the meantime, most of my friends went back to school, because attorneys, eye-doctors (New England College of Optometry), one became a psychologist, the ones who stayed in tech moved into sales-side. There's only two of us who are still practicing engineers (and I'm 90% on the management side this days).

It was a long road back for me, but I always loved technology. Part of that road back was writing and publishing with Wiley a tech book, doing some more consulting, starting a couple businesses, failing a couple businesses, going through a nasty acquisition, and then finding a dream job again.

If you've read this far, I'll sum it with a couple of fun antidotes: remember that company I started with friends out of college? They sold a couple years later to Amazon for about $30M. Remember the guy who bought the Audi S4 with the options profits? The rest of us eventually pissed all our profits away in poor trades as the market was collapsing. He at least got an S4 out of it :). I still have some regrets about leaving Microsoft, I was working on an awesome team there, and financially (if I could have survived the moral of the Balmer days), I'd have been way better off (and I doubt I would be been cut during the grim times). But I've had a lot of good times with my travels and seen a lot more of the world because I left that job.

[1] https://en.wikipedia.org/wiki/VerticalNet [2] https://en.wikipedia.org/wiki/Art_Technology_Group

I finally read some more of the stories around here. It's great to see others with similar stories.

I'd say, I don't think a recession will be so bad for the engineers this time around. Afterall, there's a ton of outsourcing to other countries that happens these days, and a lot of companies seem to have thin engineering teams in the states. I know there's big-tech where this isn't necessarily the case, but I already think that companies and their engineering budgets are much more modest compared to the old days. Also, with the few exceptions for those crushing it on stock options in big tech, I think salaries are a lot lower over all in software engineering, even 18 years later.

I had a little software dev company which sold software components; I made a little website which detailed the components (think of things like news, forum, chat, calendar, contacts, etcetc) and put that online in 1999 (I was writing desktop software and cgi e-commerce for many years by then). I got phone calls (email was on their too but...) very fast which resulted in a large investmenr and a fusion between my small company and one of the more successful web companies in the region (they had a fax machine (yup...) spouting out RFPs all day) but could not deliver as they built everything from scratch; components sped up their work a lot. It also resulted in clients around the world so my bargaining position in that fusion was solid. Ofcourse most clients were startups with investment money, hardly any or incapable people and no real plan. Visiting clients was usually more of a party; limos, booze and food all day, hardly any work. One of our largest clients at the time had everyone partying 3 days and then we did ‘some work’.

As devs we had a really easy compared to now; expectations were low and getting anything working was enough to satisfy their investors. We knocked out things fast with a small team but a large difference before and after at that time was that before actually no-one tested or even looked at everything; they were happy spending the money. Salaries for devs were high and we were rockstars no matter the quality or performance.

When the crash came, most projects for startups instantly halted. Sometimes literally from 1 day to another we got letters from lawyers that their clients were filing for bankruptcy. Meaning a lot of ongoing work was unpaid (not a lot; our CEO did not tolerate late payment, but payment comes after the work, per month, so their were gaps).

The owner of our office (we had 2 floors, they had the rest) went bankrupt a few weeks in so we had to move. All offices around us became empty over the next weeks to months; almost every building was for hire the next year.

I had a lot of dev friends who lost their jobs at startups overnight and who all (I cannot think of any who did not) moved to big corps (not necessarily tech) and have not moved since.

We luckily, because of the worldwide components sales, had attracted some large clients (insurers, banks, unions, political parties) so we were not hit so hard; we had one of our best years 1 year after. We now had the opportunity to pick up very good devs and we did.

The fallout was that we did not acquire new clients for a few years and lived on the current clients (risky but better than the alternative of no clients).

Another thing we really noticed was that people after were really counting money and so they started to really push for performance and quality which put strain on us devs until we figured out how to cope with that (we never had to before).

A lot of devs I know could not find jobs until a couple of years later; companies hired way too many people. The big consultancy outfits at the end of the 90s started hiring and training non-stem grads as devs for instance. They hired whoever wanted to program to satisfy demand; the layoffs were massive. After the crash they noticed they did better work with vastly less people as well; the low focus on quality before the crash made many people kind of perform minimally.

There is some economic downturn coming soonish which always has consequences for jobs etc, but I cannot see it going the same way as it did then. Devs are already ‘applied optimally’ (worked to death) in many places so after the crash they cannot work harder as we were forced to then (financials went down, quality demands went up) but I do think, now that so many people are devs and companies are hiring whatever they can get, globally, that will cause a massive amount of layoffs and probably lower salaries for a while. Good, all round devs with communication skills won’t have issues, nor will talented beginners, but a lot of others will probably be axed.

The 2001 crash did do little in the long run; companies are still invested stupid amounts (far larger than at the time) into for bad/infeasible ideas and companies are again hiring whoever and training them. So mid to longterm (5 years) there is nothing to fear, short-term, depending on what and where you work and how good (and lucky etc) you are, you might get a few years off.

I found though that right after both crashes (2001,2008), it was a good time to create a startup; resources are cheap (people, offices, 2nd hand hardware (we bought a lot of servers and laptops of bankruptcy auctions for next to nothing) etc) so there is silver lining no matter what happens. Make sure to save money though.

The biggest issues were with friends who recently picked up ‘html programming’ and who worked in a (bad) startup and recently had a (too high; money was forever in the boom!) mortgage and kids right before the crash and suddenly everything collapsed. Luckily in my country you won’t die, but they usually had to sell.

I started my own consulting business in 1995. I've thus been through two recessions -- in 2000, and then in 2008.

In 2000, I had just hired five people to work for me, as I expanded my Web consulting agency. For about a year, we had lots of work, from clients all over the world. The phone was ringing off the hook. We were making money. I was learning how to sell work done by other people, not just by myself.

And then the bottom dropped out.

It was very difficult, since I had to pay salaries, office rent, and the like. I was scared. I was upset. I even worried that the debts would force my family to lose our house. (We didn't actually come close to that, but I did worry about it.)

I mean, when I started my own business, I figured that if things didn't work out, I could always get a "real" job, at a real company. But now I was on the hook for other people's salaries.

I ended up firing everyone, and taking no salary for several months. I had enough work for myself, most of the time, and much of that money went toward paying back the bank's line of credit, as well as (to some degree) paying my own salary.

As a result, I promised myself (and my wife) never to have full-time employees again. I did have a bunch of employees whom I hired on an hourly basis, giving them a generous proportion of whatever money they brought in . (Too generous, my accountant consistently told me.) This meant that in bad times, I wasn't on the hook for their salaries. I should note that this arrangement wasn't for everyone -- but I was very straight about it with potential hires, and also told them that it was completely OK for them to be doing other jobs while working for me.

So yeah, this recession really hurt. And it made me much more cautious. There were months when I had literally no work, but that was pretty rare -- again, I was generally able to get enough work for myself to get by. But I was putting out feelers everywhere, looking for whatever development projects I could find.

Fast forward a few years, to recession #2. We were living in Chicago, where I was finishing the coursework and initial research for my PhD. I would walk with my eldest child to her kindergarten, and we would see a growing number of homes for sale. Moreover, we saw that they were for sale for a long time. We had a very clear view of the US housing market turning sour, but it wasn't clear at that point that things were going to be as bad as they were.

We moved back to Israel in the summer of 2008, and it was immediately clear that things were bad, and getting worse. Lots of high-tech companies were laying people off. I was worried that I would get swept up in this, and not be able to find work. And indeed, it was hard (but not impossible) to find projects.

The good news was that I had enough of an established reputation by this point that I managed to find projects. Again, I wasn't filling my calendar 100%, but it was about 75% full, which was much better than other people. I also got into training more heavily, and that turned out not only to fill my calendar pretty consistently, but also showed me how much I enjoyed training and could/should specialize in it.

One of my worries was that lots of people would get laid off, and then start their own consulting businesses, competing with me. My accountant laughed when I said this, telling me that most people who have full-time jobs done then want to go into business for themselves. And he was right.

I do expect a recession -- or if nothing else, a slowdown -- in the coming year, and I'm starting to prepare myself for it. I'm now doing training in Python and data science, and constantly reach out to companies to find out if they're interested in such things. But I also have a large (14k subscriber) free, weekly newsletter about Python that gets my name out. And I'm selling a growing number of online courses to individuals, which will (I expect) cushion any problems I might have with my in-person corporate training.

But each recession is different, and teaches us different lessons -- so I'm hoping that my previous experience will be helpful, but I'm sure that I'll discover all sorts of new problems as the coming year unfolds.

Around 1992, my friend and I started doing desktop database apps as a side gig while we worked at a consulting firm doing IT. We decided to do this full time. With connections in the music industry, we started doing websites and online stores for some big names like Rolling Stones, Aerosmith, Phish, and others. By then there were about 5-6 of us, working out of my friend's house. We weren't real employees, and only got paid when my friend walked into the room and started handing out $50 bills. Our online stores morphed into an award-winning product for small and medium-sized merchants, that you could pick up for $19.99 at Staples, CompUSA, etc. In 1996 we incorporated, and I was hired as the first official employee/lead programmer. I think I was making about $50K by then; we had grown and moved into a real office. A couple of years later, we had the first single-shopping-cart online mall. I was making $85K. We had almost 70 employees. In 2000, a Canadian company bought us for $45M and I was given another raise to almost $110K, but then things fell apart quickly. The last 6-8 months I was basically paid to drink coffee and sit around. By 2001 we were kaput. My 60,000 stock options, when I could finally do anything with them were worth about $1200, down from an initial value of ~1.8M CAD. I had bought a truck, and had put a downpayment on my house, but that was about it. I flailed around for a few years looking for programming work, and then got the job I have now, doing IT at a local University. I'm making about $50K again :/ It was a lot of work, with (mostly) great people, and for a while we were on top of the world. In some ways you could say we were Amazon before Amazon. If we hadn't gone under, Amazon probably would have bought us. Perchance to dream..

Why don't you try to get more high paying work?

In late 1990s I was still in high school but the.com bubble still reached us there at a young age. I was put into a tech training course called CIT 1 & CIT 2 it was 4 years of tech and college courses. Everyday for 4 years I had a computer integrated technology class that taught everything from how to deal with users all the way to networking & computer programming. We worked on as400, the school network and teachers computers at 14 years old we were experimenting with OSPF. This "pioneer program" was scrutinized and hailed as a victory by news broadcasters & newspapers we were interviewed by all kinds of people throughout the program looking to do the same in their schools. This was the fast track once we got out of high school we were college trained and ready to go into the workforce. The burst happened right after I got out I actually went from interviewing at Fortune 500 companies to taking a cable pulling job that was local for minimum wage. I ended up with a construction company that builds smart homes and I've been happy there ever since.

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