Games VCs play

No CEO enjoys being called before an incensed board of directors. But what we really dread is facing an outraged human resources department, especially when the topic of discussion is our Web-surfing habits.

"The logs show that you've been visiting some pretty racy sites," said my 12-year-old son Vermel, as Trixie Pixel, Ammonia Blossom and Jai Pegue glared at me in silent disapprobation.

"Our keystroke sniffer indicates that you've been typing four-letter words into the address bar," Vermel went on. "For instance, just last week you logged 18 visits to (deleted)."

"Watch it, Vermel," I warned. "I don't care if you are conducting this probe. One more four-letter word out of your mouth and your DSL connection shuts down for a week."

Besides, I reasoned, any questionable sites I may have visited, I looked at for the sake of this column. It turns out the site that had the Rumor Mill HR department's boxers in a bunch wasn't a sex site after all; it was the "dot-com deadpool" with the unprintable domain name. It wasn't too hard to defend myself to my inquisitors, as it turns out that the site Vermel is not allowed to pronounce is the hottest thing in Silicon Valley since profitability came into vogue a few months ago.

Barely six weeks old, it has become de rigueur surfing for venture capitalists, who visit the site with a combination of dread and schadenfreude, hoping their companies aren't among its growing list of doomed and dying dot-coms--and that their competitors' companies are.

Turns out some VCs aren't happy to be just voyeurs, though. They're stoking the furnace, playing its cutthroat competition--where points are awarded for tips on layoffs and other hard knocks--with a vengeance.

"I went to a dinner the other night with a bunch of colleagues from various VC firms, and everyone was talking about it," one VC associate breathlessly told us. "A surprising number of people were participating in the site. One of them was actively looking for information in order to bump up his score."

This corporate bloodlust extends beyond the VC community to the musty halls of academe and even, some imagine, to the gloomy cubicles of the companies in question.

"Bragging rights for being in first place on (the site) go a long way," said one academic type writing a law review article on the morbid subject of Internet companies' longevity. "There have even been jokes about employees sabotaging their companies just to get ahead in the competition."

At the center of this Silicon Valley virtual Coliseum, rife with bloodied gladiators and bloodthirsty fans, is the 24-year-old Philip J. Kaplan, aka "Pud" and president of PK Interactive, a boutique Web shop in Manhattan. Pud reports about 250,000 to 300,000 impressions daily on his dot-com deadpool and some familial embarrassment about the project. (I can relate.)

"My grandmother wants to tell her friends about it, but she can't bring herself to use the f-word," Pud said with a sigh.

So does Pud consider himself some kind of sicko, taking pleasure in other people's misfortunes?

"Do you also think the scoreboard at the ball game is evil when your team loses?" Pud responds philosophically. "I'm just a scoreboard with color commentary. Or something."

While some play the site for sport, VCs and other industry insiders consider the site a font of basically sound information.

"A surprising amount of the information there is spot-on and corroborates our other sources," said the associate VC. "So we look at it as not exactly perfect but generally reliable. We've come up with a lot of information about our companies' competitors."

Competition isn't everything--just ask Jim Clark, whose brainchild Netscape Communications seems perpetually in the process of being buried alive by Microsoft.

According to ear-witnesses at The Industry Standard's recent gabfest, Clark bears no ill will toward the Redmond menace. Au contraire! When asked about the government's plan to apply its antitrust buzz saw to the software behemoth, Clark is said to have declared that he "loved" Microsoft. He then proceeded to reveal that he was a shareholder.

"How many shares do you own?" demanded one audience member.

One million, Clark answered without hesitation. It's like the old adage: If you can't beat 'em, buy some.

Competition isn't everything, part deux: The other night someone tried to get me to believe the outrageous rumor that CNET Networks (my boss) was buying longtime rival and fellow San Franciscan ZDNet--but I wasn't that gullible. I needed proof, which came in the form of this document passed along from ZD sources, who have been distributing this via the company intranet:

Top 10 reasons CNET buying ZDNet is good
10. Actually seeing commercials with your company name on it
9. Getting into the Builder.com conference free
8. Leaving 650 Townsend
7. Letsgossip.com will finally get some news
6. No more gestapo building security
5. Instead of trying to hack CNET, they'll just give us logins
4. 50 Francisco St., nuff said
3. No more Malathion spills
2. Stock options vest

And the No. 1 reason CNET buying ZDNet is good...
1. We'll win the drinking contest this year

Hacking, security guards, alcoholism and Malathion aside, the Rumor Mill extends a warm welcome to our new corporate brothers and sisters, with the caveat that I will truly miss the good old days.

Meanwhile, who says Silicon Valley is no longer the land of opportunity? Remember that slew of women's magazine articles about eligible Silicon Valley bachelors, all that shoddy journalism that conveniently pretended I didn't exist? Now it looks like the geek lonely-hearts club is heading for the silver screen.

"A Hollywood movie producer bought the rights to the Elle magazine article about dating five Silicon Valley bachelors in five days!" whispered one of our favorite Silicon Valley members of the fair sex. The producers are expected at the Monday night launch party of Tellme, whose Eric Alexander was one of the geeks dated, along with bachelors at Epinions, Vividence and VA Linux.

Today we close with the long-dormant public service section of the Rumor Mill, in which we answer selected letters from you, our readers.

"Hi!" writes Rachel. "I'm having trouble with the game Toonstruck and wondered if you could give me any tips. I'm up to the bit where you meet the wolf, and he won't let you past until you get him the wine. Where and how do you get the wine from?"
Thanx
Rachel

We queried our PC gaming expert, Grandma DuBaud, who's a big fan of this $6 million game.

"It's patently obvious," Grandma DuBaud said from the remote office she occupies overlooking her cranberry bog in Quebec. "You have to shoot your way into the wine store, blow up the vault, and vanquish the 87 bone-demons that are liquored up inside, avoiding every third black tile square, which triggers deadly laser beams. Then climb up through the smoking rafters to clear the blockage in the '87 Mondavi tap, which is the only one that fits over the nozzle on your wine flask."

My grandmother sniffed audibly over the phone. "Mon Dieu! What are the kids coming to that they can't figure that out, hein?" What do I know about kids these days? Meanwhile, I don't need $6 million worth of cartoons, or a million Microsoft shares, or even a date with a Tellme executive. All I need are your rumors.