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Stepping Through God’s Doors

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Stepping Through God’s Doors

Many other Christian executives are fighting for the survival of their firms, however, and some will lose. Katherine Leary, a New York transplant in Silicon Valley and the top executive with the distance-learning start-up Pensare, recently tried to merge her firm with another in a desperate attempt at financial viability.

Pensare started out with great buzz in 1997. There were the legendary founders like Dean Hovey, an entrepreneur sought by Steve Jobs for advice on designing the look for Apple Computer’s Macintosh line. There were the education superstars like Harvard Business School, which adopted Pensare’s system of delivering a high-quality graduate education and advice to corporate executives via the Internet. In January Mother Jones magazine featured Pensare as one of the two important shapers of a new high-tech style of long-distance learning. But inside the company there were round-the-clock meetings on how to survive.

“As a Christian, there is a huge opportunity when you are running a company to help find a road map through the confusion that goes on when you are going under, having a takeover, or layoffs, We have burned $37 million in four years and only have $1.5 million revenue to show for it,” Leary says.

In spring 2000, the company was diving hard after three years of happy chaos. The CEO was a great foosball (table soccer) player, and one cofounder claimed to be the best foosball player in the Valley. While executives huddled in the back game room, creditors pounded at the front door.

Leary had resolved to quit, even though she originally had believed Pensare was a closed door that God had opened. Leary had played it safe in New York’s corporate world for years, but she had a sense that she was more afraid of change than standing for Christ. Eventually she embraced change, taking a position at Pensare. After three difficult years, she went to the CEO and resigned.

“You can’t resign because I am quitting first,” he told a stunned Leary. She stumbled home in a daze. “I prayed, ‘God, I thought we were really clear on this!’” The same day she intended to resign, Leary took over the CEO’s job. “I believe that God put me in these circumstances for one reason or another. He cares as much about the job I do here as what I do in church.”

But in March, the curtain on Pensare came down quickly. Leary was having lunch when she took a call from a Philadelphia executive, whose firm decided not to buy out Pensare. Within days, the first of 80 Pensare workers were laid off without severance pay. Within weeks, Pensare filed for bankruptcy and an auctioneer sold off its physical assets and products.

In late June, Leary, told CT, “We tried to be as noble as we could in shutting down Pensare.” Workers gave her and another executive a standing ovation minutes after the layoffs were announced.

Leary said she has struggled with guilt since the firm closed, trying to determine what she could have done differently. “If there is a little personal hell, that is what it is. You go over every single move you made.”

Leary told CT that her pastor pointed out to her that Peter didn’t walk on water until he got “out of the boat.” For Leary, getting out of the boat means leaving the corporate world for a job at Menlo Park Presbyterian. Leary will focus on the field of business leadership. “There is little relevant stuff about how to work, how to balance, break new ground.”

Jumping off a Cliff

In Silicon Valley, financial risk-taking is a premier sport. Milo Medin, head of technology at ExciteAtHome, a leading broadband Internet service provider, once said the company could succeed only by investors’ throwing themselves off a cliff. He had few volunteers.

But Medin’s coworkers at ExciteAtHome understand: an emblem of the firm’s whimsical risk-taking culture is a slide that allows workers to move between floors at their headquarters.

“Two years ago, our network put on a lot of users,” Medin told Christianity Today in an interview. “We needed a new backbone structure unlike anything anyone had built before.”

He needed investors badly, and he told venture capitalists that they needed to bet the company on his new high-speed Internet structure. Even for ExciteAtHome, the risk was unnerving. “It was not a conservative bet,” Medin says.

Much of Medin’s credibility comes from his success in advocating TCP/IP (a computer protocol for the Internet) while he worked at NASA’s Ames Research Center. “He’s evangelical in his approach,” recalls Christine Falsetti, project manager for NASA’s research and education network. “Milo marshaled the fight to make TCP/IP the de facto standard.”

ExciteAtHome is a joint venture of two companies: Excite—which hosts the world’s fourth-largest Internet portal after AOL, Yahoo, and MSN—and At Home, a broadband Internet service. At Home’s broadband system is Medin’s brainchild. The reason he’s about to bet the company on his plan is because of his faith in Christ. “Christians can be more aggressive risk-takers in the Valley,” Medin says. “Our values are not wrapped up in business and career.”

Before getting the go ahead, he asked himself, “What if nobody will do it the way we want?” He checked his engineering and he checked himself. “My answer was that God has put me here and led me along this path, so it will work out how he wants.”

ExciteAtHome has taken Medin’s bet, and Medin’s souped-up network may rescue the company from other woes. As a Bank of America analyst puts it, Medin’s network is a hidden jewel that will become the crown jewel. If it does, the execution of the business will fall largely on the shoulders of fellow Christian Byron Smith, the head of the consumer broadband unit.

Having managed consumer brands like Downy fabric softener and Mr. Clean for Procter & Gamble, and created the One Rate plan for AT&T, Smith came to ExciteAtHome a year ago to help the company market Medin’s system.

Smith and Medin faced some hard questions when they proposed restrictions against pornography and adult chat rooms (called “clubs” at Excite). “The people here are incredibly libertarian, but at the same time, they are very ethical about their work, and to the stockholders.” Smith and Medin were able to join forces to rein in the smut on the Excite Web site. They had to convince libertarian-minded executives that some boundaries are good. “I tried to draw some lines,” Smith recalls. He appealed to the libertarian ethic and the good of the company. “There is some frankly illegal stuff going on, but it is very hard to control,” he says. Smith also argued that the pornographic chat rooms were growing so fast that it was costing the company too much to carry them. “The bad stuff takes over.”

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