‘Dot-Com’ Wealth Comes at High Price

Envious every time you hear of those Internet millionaires and billionaires? Sick of reading another gushing story about that 25-year-old starting his second Web company? And buying his third house?

For those of us who feel stuck in the “old economy” with our old-economy salaries, daydreaming of becoming a fast-moving “dot-com” entrepreneur, here’s a small warning: Living the dot-life is some vida loca.

Like all pioneers, those foraging for riches in the “new economy” pay a price. For many, that cost is delaying or even forgoing the things that humans once thought mattered most in life: a partner, children, friends and leisure time. All that is often jettisoned for a chance to be a player in the new economy and reap millions, perhaps billions of dollars.

Workdays turn into nights as the personal life disappears into the professional. Many say they are putting off marriage, family, children and fun until their 40s, when they hope to enjoy personal life in high financial style.

But for many, it may be too late. After spending decades focusing on work and self, it is often hard for people to switch gears in their 40s and learn the skills needed to be a good friend, spouse or parent.

“They have no life other than those connections bound to the company,” said Jon Goodman, head of EC2, a business incubator at USC.

Goodman recently counseled an Internet entrepreneur in his 30s who told her of his plans to quit the Internet business because “I have a 2-year-old and an 11-year-old, and I don’t want to put the 2-year-old through what the 11-year-old went through,” he said.

Goodman says many of the entrepreneurs she sees are on the verge of serious burnout because of the intense focus on work that is required at start-up companies.

“The rabid pursuit of money, that’s what’s going on here for many,” she said. “And having money only exacerbates any unhappiness you already had.”

Jay Haynes, 32, founder of Santa Monica-based MValue, which helps Web users control their personal data, knows all too well the sacrifices.

“You pretty much have to be obsessed,” said Haynes, who says he works every weekend. “I’ve given up anything in my life that has to do with social events. It’s the crazy Internet life.”

MValue has already raised more than $6 million from venture capital firms and has dreams of going public.

“We have a market opportunity now that’s probably 12 to 18 months,” he said. “It’s not like we have three years to get things up and running.”

Haynes, a Washington native, admits that he sometimes sleeps in his office (on a couch from Ikea) and just had his first date in six months. He has been living in a friend’s guest room for half a year because he hasn’t had time to look for an apartment.

Haynes is planning his first vacation in two years: a three-day weekend to see the jazz festival in New Orleans. According to Haynes, friends are the most important thing in life, although he doesn’t see them for months at a time. Most of them are understanding, he says, because they are in the Internet business as well.

Management consultant Greg Pettenon, with Boston-based consulting firm Drake Beam Morin, says Haynes’ pattern is becoming common.

“It’s a new lifestyle,” Pettenon said. “It’s around the clock and requires everything they have.”

Still, Pettenon says he has started to see some of the dot-coms making room for “gray hairs” who have industry knowledge and contacts to add strategic direction to their firms.

“They are going to have to increase benefits and make room for work styles that will retain these people,” he said. “As people get older, money isn’t the most important thing anymore. You start thinking about life outside of work more.”

But Al Ali, 27, is focused on his mission: his company, More Online. He lives at the Westlake Village warehouse that houses his Internet firm, sleeping each night on a futon just a few feet away from his desk.

He installed a shower in the warehouse, where there is no need for separate restrooms because all of his employees (about 10) are men. Ali says he hasn’t had a day off, which he describes as a day working less than eight hours, in more than two years.

“Sometimes we sleep a few hours during the day, if we’re really tired,” he said.

Ali says he had a girlfriend before he started his company, but broke it off because he didn’t think she would understand his new commitment.

“There’s no way I could do this if I was married,” he said. “One day I hope to have all that.”

Still, Ali says the 100-plus-hour workweeks he puts in now are easier than when he was an investment banker at Van Kasper & Co. in Los Angeles. Then, he had to commute, travel and wear a suit every day.

“That took a lot of energy,” he said.

Indeed, for more and more people, the dot-com life is an attractive option despite its drawbacks. The entrepreneurial field draws some of the best and the brightest from graduate school and old-economy giants.

“Like the Wild West, people in the new economy are seeking various things, from fortune to adventure,” said Steve Pollock, president and co-founder of WetFeet.com, a San Francisco Web site providing inside information to job seekers in the Internet economy.

“And they are willing to work really hard to get it. There’s a lot of people who work just as hard in the old economy,” he said, “and [without] the possibility of wealth.”