Experts advise: look for' red flags'
If you’re considering jumping to a dot-com job from your current position as a hot-shot studio exec, TV line producer or Java programmer, the experts have one piece of advice: Think like an investor.
With only a handful of dot-coms actually showing a profit, it’s important, they say, to act like a venture capitalist before relocating to a cubicle with stock options. After all, what good’s a new gig if the company you’re moving to is showing signs it may be out of business in six months?
“You’re making a huge investment,” said Mark Ein, a venture capitalist at Venturehouse Group, in a late-summer interview in the Wall Street Journal. “People looking (for a job) should ask questions like ‘How much capital do you have? What’s your burn rate (the rate at which a company spends its cash as it awaits profits)?’ Ask for a business plan. Make some calls.”
And before leaping into the cyberbiz, take a second look at your current employer. There may have been changes you missed in all the new-media stock-option excitement.
“A lot of blue-chip companies are not only revamping their corporate images in the face of dot-com competition,” says Bruce Babashan of DHR Intl., “they’re changing their internal culture.” And that doesn’t just mean casual Fridays at the Disney Corp., but the way the so-called old-media corps let employees get their work done.
“(Older companies) know that they’re no longer the automatic choice for business school grads,” Babashan continues.
Old-media compensation packages are changing, too, reports Steven Spector, co-owner of the Robinson Co., a boutique exec placement firm in Santa Monica, Calif.
At least one major entertainment industry client has created a fund of company common stock that can be used at the discretion of the human resources department to attract new hires or keep older ones.
At any rate, the first stop on any fact-finding quest on any dot-com job offer is, ironically, the Internet. If a potential new employer is a publicly traded company (one that sells shares in the stock and bond markets) or about to become a public company, then a lot can be learned by logging on to http://www.sec.gov, the Web site of the federal Securities & Exchange Commission. In required annual SEC 10K filings, quarterly 10Q reports and proxy statements, potential workers can find valuable information on company revenues, cash flow and net profits.
Of particular interest are “red flags” often found in 10K footnotes, according to the summer 2000 edition of Mutual Advice, published by the Fenimore Asset Management group of mutual funds. In the footnotes, job seekers can find info regarding pending lawsuits, bad debt and whether or not one customer accounts for the majority of revenue.
Venture-capital guys and gals, and stock pickers also spend a great deal of time reading magazine and newspaper articles on target companies, something that has been made easier to do using the on-line databases of established pubs such as the New York Times, Variety and the Washington Post. Among other anecdotal information regarding the entertainment dot-com and traditional entertainment job markets:
- Despite the carnage on Wall Street, there is evidence of good salaries to be had in certain Internet jobs. Base salaries for junior-level Java programmers, for example, have jumped 20% to 30% in the last 121 months from a base of $50,000 a year to $65,000-plus, reports Julie Scott at L.A.-based Profiler, a staffing agency specializing in digital media careers.
- When it comes to getting a job at an entertainment site, such as Icebox.com or Romp.com, pickings are slim. With $17 million in private funds behind it, at 100 employees, Icebox is fully staffed. And, says Juliet Lee, manager of human resources: “We don’t anticipate a lot of open positions in the near future.” About 60% of Icebox’s staff is on the production side of the biz — animators, producers and designers. For their part, producers earn between $40,000-$60,000 (plus stock options and benefits) to start. Lee declined to give specific figures for other job categories.
Romp is also fully staffed, save for one open position — general manager of the ‘Net site. That person who lands the job as Romp’s Web czar can expect to pull in $100,000-plus a year depending on experience. Company co-founder Bruce Forman says he and his partner Eric Eisner have learned from the mistakes of the spectacular entertainment-com flame-outs. “Increasingly we’re going to outsource our work,” Forman says. “That’s where DEN messed up. They hired all these people and then when programming needs changed they didn’t have anything for them to do. One thing I’ve found is that a handful of superstars can make all the difference.”
- For editors and reporters from traditional newspapers and magazines crossing over to other side, things are grim. Among others, Salon.com recently cut its staff by 13, Microsoft-supported Slate.com isn’t hiring and APBNews is up and running but in bankruptcy. Recent layoffs at Creative Planet were “graciously handled,” says former employee Lisa Beth Kovetz, but dot-com journalism isn’t a world she’s keen to re-visit soon. Like many former Web workers, Kovetz says the long hours were an irritant because long days are often an end in themselves. “It’s not that people are working until 10 p.m.,” she says. “They’re just there.”
- If you do find yourself at a dot-com that quickly tanks or just doesn’t live up to expectations, don’t despair. The job market is so inviting right now that chances are you’ll soon land on your feet somewhere else. In fact, rather than being looked on as a mistake, “It’s a badge of honor to have been at a dot-com, even if it was a failure,” says Bill Simon, managing director of the global media entertainment and convergence practice at search firm Korn/Ferry. An informal survey conducted by Korn/Ferry of people who left traditional media and entertainment companies two years ago finds half of them staying in the new-media sector, despite all the shuttering and merging.
- On the traditional media side, meanwhile, hiring execs are more open to candidates with bona fides outside the entertainment biz than they’ve ever been. For marketing, information technology and finance positions, 50% to 60% of companies are partial to candidates with a Proctor & Gamble or Pepsi Co. background as much as a stint at Paramount. “People who’ve worked for established, brand-oriented companies have greater value today in the (entertainment) marketplace than a year ago,” Simon says.
At the USC School of Cinema-Television, the alma mater to some of the biggest names in the film biz, students are interested in dot-com careers, but not fixated on them.
“They’re creative people and they want their work to be seen,” says Bonnie Senter, director of student industry relations, “but their first choice is still to be in the film and TV business.”