The Dream: How I Learned the Risks and Rewards of Entrepreneurship and Made Millions (17 page)

The lawsuit didn’t go away, however, and the Chicago investors were moving forward very quickly. I liked this—I like to make things happen, and the faster they happen the more I like it—but with no settlement in sight I decided it was time to tell them. I walked them through the whole miserable situation, and they listened politely, but it was clear that our little dalliance was over. “We don’t play that game,” they said. “It complicates everything.”

This only made me more determined to succeed. The lesson here is simple: Don’t lose your moral barometer. Lies and obfuscation might give you short-term success, but they make for very unstable relationships.

That summer I finally settled my legal problems with ValueClick and got back to the business of business. I could have stayed and fought the suit, and my lawyers felt I could have won, but they didn’t think it would have been worth it. So I withdrew my suit accusing them of securities fraud, and they withdrew their suit against me, and neither of us acknowledged any wrongdoing. It was a wash.

The guys in Belarus, meanwhile, were still working on my new program. It wasn’t there yet, but it showed promise. With Click Agents, I had been running a basic, pay-per-click operation, but with BlueLithium I was going to take things to a whole new level. I was still dealing with the same three constituencies—advertiser, site owner, and consumer—but I was getting better acquainted with the consumer. And it wasn’t that much of a challenge. People reveal their likes and dislikes as they make their way through the Internet, moving from site to site, and it had become possible to follow them around. We didn’t know the consumer’s name, we didn’t know his age, we didn’t know where he lived—and none of that meant anything to us. What we did know, for example, is that he or she
had shown interest in the Four Seasons hotel chain, and we could then “tag” that person with a “cookie” and follow him around the Web, enticing him with more ads for the Four Seasons or with ads that appealed to Four Seasons’ kind of people.

In effect, BlueLithium was poised to disrupt the Internet advertising model. We were saying “I can find you on the Internet based on your behavior.” It didn’t matter whether you were on CNN.com or MySpace or visiting
The New York Times
online, we were able to find you because we had behavioral data that told us where you’d been and where you might be going. And when we found you, we would entice you with all the right ads. (That was the idea, anyway.)

At this point, even before we’d launched the new technology, our revenues had exceeded our wildest expectations, and I began to think that I should give the venture capital route another try. I didn’t need the money at the time, but I knew that BlueLithium was going to be much larger than Click Agents, and I wanted to have the funds in place when it came time to make expensive decisions.

I made a few calls, exploring the possibilities, and the next thing I knew I heard from a reporter at
VentureWire. VentureWire
is part of the Dow Jones financial information service, and it is read by just about everyone in the investor
community, and usually it gets things right—but not this time. “I hear you’re about to finalize a $10 million round of funding,” the reporter said. No, I said, correcting him. I was in the
process
of raising $10 million, and things were moving in that direction, but nothing had been finalized.

As soon as this nonnews hit the wires, my phone started ringing, and every single venture capital guy was asking me the same question: “Can we jump in?” There was a tremendous sense of urgency—they all wanted a piece of BlueLithium—and all because they thought they had competition.

As a result, I was able to take my pick from a number of viable investors, and I narrowed it down to two candidates: Walden VC and 3i.

Generally, you have a lead investor and a co-lead, because few of these VC guys want to go it alone. It’s all about spreading the risk. After careful consideration, I decided on Walden as my lead, and I told them to take a close look at 3i. “I like them because they have experience in Europe, and I’m looking
to expand overseas,” I said. “Let me know if you think it’ll be a good fit.”

It turned out to be a perfect fit. In February 2005, we closed a deal for $11.5 million in funding. The next step was to put a board together. When you raise money, you have to create a governing board that the investors approve of. In this case, in order to secure the funding, I let the investors handpick two of the board members. The third one came from within the industry, and we picked him together, and the fourth was an outsider, a guy I picked myself. I was the fifth and final board member as well as the company chairman.

I liked all the guys except one, who turned out to be the self-appointed bulldog. If I told you we had a tumultuous relationship from the start, I’d be understating the case. Almost from the very first day, he made no secret of the fact that he thought I was too young to be running such a large company, and he was determined to remove me as CEO. He never stopped to consider that this wasn’t my first company or that BlueLithium existed only because I had created it.

For the next year, he kept trying to replace me, despite the fact that the company was humming along, growing by leaps and bounds,
under my leadership and direction.
I remember one night in particular: The board met at my place, in Santana Row, with a view toward going to dinner together
right after the meeting. When everyone was settled in, I started my PowerPoint presentation, and the first slide came up: “Presented by Gurbaksh Chahal / CEO and Chairman.”

Suddenly the bulldog stopped me, wanting to know when I’d become chairman. I looked over at him, incredulous. The guy had been on the board since almost the beginning, and just about every packet that got sent out listed me as CEO and chairman. Then I realized he had done this deliberately, that he was engaging in a form of psychological warfare.

I suspect he wanted me to behave erratically in front of the other board members because he was still determined to find some way of replacing me. I took a deep breath and smiled tightly. “Let’s get this show on the road, okay?” I said. “I’m hungry.”

He sat through the presentation without saying another word, and he said nothing to me during dinner, but on our way out of the restaurant he couldn’t resist a little dig: “You know, G, BlueLithium is growing faster than you are. You’re going to need some help. Maybe you should think about hiring some senior people.”

I didn’t respond immediately. I knew what he was after. He was looking for me to hire someone who might eventually replace me. The other guys on the board didn’t seem as eager to push me aside, and I liked them well enough. They were smart, accomplished men, slow to make decisions at times,
and certainly a little old-fashioned about business, but otherwise I couldn’t complain. And the fact is, if you looked at it from their point of view, maybe I
was
the problem. I was impatient. I liked getting my way. And I was quick to show my displeasure. I began to long for the old days, when I ran the show as I saw fit. I missed being a dictator.

Still, I can handle criticism. In fact, I welcome it. I think criticism is the best form of discipline because it makes you look at yourself. At the end of the day, it tests your maturity, your wisdom, and your ability to make the right decisions. But none of this felt like criticism; it felt more like an attack—and there’s nothing constructive about attacks. This wasn’t about my management skills or about helping me become a better version of myself but about pushing my buttons.

By this time, mid-2005, BlueLithium had moved twice, and each office was bigger than the preceding one. Nothing too fancy, though; nothing too expensive. We moved because we were growing and because we needed the space, not because we were trying to impress anyone.

We were also busy opening offices across the country. At that point, we had branches in San Francisco, Los Angeles, Chicago, Atlanta, New York, and Boston, and I had my heart set on opening an office in London. I began to look into the possibility, and I found two or three promising candidates overseas, all of them high-priced rock stars, but that part of it
didn’t bother me at all. As I had learned long ago, you can be cheap about furnishings, but you can never be cheap about people.

In late December, as I was narrowing my search for the right rock star, I heard from ValueClick again. It had filed another lawsuit, this time in the state of New York, claiming that I had hired one of its former salespeople to steal information that would benefit my company. Again, nothing could be further from the truth, but—as I knew from experience—the truth is often the least of it.

Two days later, having given myself time to calm down, I parked myself in front of my computer and wrote an e-mail to everyone on the board, explaining the ValueClick situation. Typically, a board drifts in and out of meetings throughout the year, playing a semi-passive role, but when the shit hits the fan, they’re expected to be there to support their CEO. The lawsuit wasn’t going to make anyone happy, of course, but I had some news that I felt would soften the blow, and I included it in my e-mail: We had had a record month, I wrote. In the space of thirty days, BlueLithium had
tripled
its revenues. This was truly unheard of. If you are part of a company that registers that kind of growth, in that short a time, you have every right to be ecstatic. Amazingly, I didn’t hear back from any of the guys on the board. Not about the lawsuit, and
not about our unparalleled growth. It was as if they were punishing me with their silence.

Finally, shortly after the New Year, I heard from
one
of the board members and I just exploded. “What is going on with you guys? The one time I need you, you’re not there!”

“G—”

“At the very least, this B.S. lawsuit notwithstanding, you can say you appreciate what I’m doing for this company. You invested in it. Every dollar I bring in puts money into the pockets of our investors and shareholders.”

“G, hear me out for a minute!”

“I’m listening!”

“At a time like this, the board has to take a step back to try to figure out exactly what is going on. As soon as the attorneys tell us that you haven’t done anything wrong, we’ll all breathe a little easier.”

“So you won’t even give me the benefit of the doubt?”

“That’s not the point.”

“Yes, it is,” I shot back. “I’m innocent until proven guilty. Last time I looked, that’s the way it works in this country.”

Over the course of the next couple of weeks, the attorneys analyzed everything on my computers and interviewed everyone involved. This internal investigation didn’t worry me, however, because there was nothing to discover—and
nothing
was
discovered. But I was still angry with my board, and a huge wall went up between us. I was on one side, they were on the other.

Still, if I looked at it
objectively,
I saw their point. They needed to be sure that I’d done nothing wrong, and if this is what it took, I would live with it. That was the process. There was nothing to prove. And once it was over, they would realize they should have had my back from the start. When all was said and done, I knew I would come out of this looking better than ever.

Instead of obsessing, however, I tended to business, and later that same month I opened an office in London, hiring one of the top guys in the country. He didn’t come cheap, and the board immediately attacked me for it, so I had to take the time to explain why it was critical to have a rock star on the team. They weren’t convinced, but I refused to back down, and within a year we had become the second largest
ad network in the United Kingdom. Not counting the bulldog, everyone on the board was very pleased—and they actually went out of their way to tell me so. I began to feel that the wall had finally come down and that we were again operating as a team. I was young, and I was impatient, and I had made my share of mistakes, but everything I did was designed to take the company into the stratosphere and I thought they were beginning to see that.

Meanwhile, as the battle with ValueClick continued to rage, I went out and hired a chief financial officer, Bill Lonergan, with whom I connected immediately. We had immense trust and respect for one another. What’s more, despite the fact that he reported to me I genuinely looked up to him as my true right-hand man. And it truly is a small world because he actually knew Sam Paisley, who was part of the brass at ValueClick. I was relying on his knowledge and insight to get us through the mess. “G,” he said, “these guys hate you because you sued them for securities fraud.”

“I thought that was old news,” I said. “I thought that was behind us.”

“No. They want blood. They’ve got you spending serious money in legal fees on a case that has no merit, and at the rate we’re going it’ll be at least a year before we go to trial.”

“We’ll win,” I said.

“At what price?” he said.

I did the math. He had just told me that I was going to waste valuable time, and potentially millions of dollars,
just to get to court.
“What do you suggest?” I asked.

“Let me go down there and see if I can make a deal with these guys. That’s what they really want. They know the case has no merit, and
I
know it has no merit: I did my due diligence before I took this job.”

I went to the board and told them what Bill had suggested, and for once we all actually agreed on something. We settled for a large sum, which I am not at liberty to disclose. In the end, however, it was the right move. I had read Sun Tzu’s
Art of War:
“He who knows when he can fight, and when he cannot, will be victorious.”

In July, eager to get away from all the madness, I decided to take my whole family on a short vacation. We went to Puerto Vallarta, Mexico, hung out on the beach, ate well, and drank too many margaritas. Most important, however, I got to spend time with my nephews and my niece. I wanted them to know me as an uncle, not only as a type A businessman. I tried really hard not to reach for my ever-buzzing BlackBerry, and there were times when I almost succeeded.