Perhaps the only thing worse than getting the ax is wielding the ax … over your own head. Call it professional suicide, career masochism, or a gentleman’s code of honor. Seven months ago, Chris Doyle called it a foregone conclusion. So during a make-it-or-break-it era for the company he helped develop, the vice president of public relations signed his own walking papers — voluntarily and without spite.
Last fall, Altrec.com was fighting against strong odds and discouraging analyst predictions for its place in the crowded and highly competitive outdoor-gear and adventure market. Altrec’s venture capitalists had balked, the economy had collapsed, and the competition looked more daunting than ever. Doyle questioned whether Altrec could keep its head above water after the crucial holiday-shopping season without scoring new funding or cutting its staff.
In a last-ditch effort to salvage a good thing, Doyle surrendered his job so that Altrec could fight on. He insisted on his own departure primarily because he feared that his colleagues wouldn’t. Altrec’s close-knit corporate culture valued personal relationships above almost all else. But Doyle didn’t want Altrec to protect its employees from layoffs only to sabotage the company in the process, so he downsized his own job. And he wasn’t the only one.
Thanks in part to two rounds of layoffs in late 2000, Altrec is the only pure-play outdoor-gear retailer left standing in a market now dominated by brick-and-mortar stalwarts REI, Eastern Mountain Sports, and L.L. Bean. The story of Chris Doyle and Altrec.com is one of loyalty, truth, and self-preservation. And, by God, it ain’t over yet.
Before the Fall
“I’d never taken a professional risk that large before,” Doyle says of his decision to join the Bellevue, Washington startup in 1998. “When Altrec first approached me, I asked, ‘What are you doing to ensure your success when the market crashes?’ I was a nervous Nellie while everyone else was euphoric.”
Still, Altrec’s potential and leadership lured Doyle to the company months before its site debuted online. He was immediately swept up in the exhilaration of launching a dotcom in an economy drunk on its own success. As vice president of PR, Doyle began transforming Altrec.com from a quirky little hiking site into a household name. He was a man on a mission, and he would stop at nothing less than market domination.
“At the time, 5 to 20 players were jumping into every market niche,” says Shannon Stowell, vice president of business development for Altrec. “We believed that Altrec needed to build a big brand to become a category killer. We engaged in some massive overbuilding, all in an effort to become the next Amazon.”
Then came April 14, 2000, and the earth shifted beneath Altrec’s Gore-Tex trail runners. Just weeks before finalizing a deal to buy GreatOutdoors.com and land an investment from Cox Interactive Media — all to the tune of $10.5 million — Altrec had to start defending its every move. The same investors who had insisted on massive, persistent branding just weeks before began questioning every dotcom’s burn rate. CEO Mike Morford hunkered down to concentrate on raising capital and merging Altrec with GreatOutdoors.com. Meanwhile, competing site MVP.com was launching a $50 million marketing plan starring John Elway, Michael Jordan, and Wayne Gretzky.
The Long Haul
In the calm before the crash, Morford huddled with his senior management team to assess the damage. The diagnosis was bleak, but not hopeless. Early in 2000, Altrec signed a major deal with a network of travel agencies, called Virtuoso, and partnered with National Geographic to create an interactive tour of the nation’s hiking trails, called On the American Trail. Traffic was climbing, and more people than ever were buying merchandise on the site. It looked as if Bellevue’s spunkiest little startup just might make it through the Web war unscathed.
Then again, maybe not.
“In August, a new reign of nervousness settled in,” Doyle says. “There was the promise and hope of new venture capital, but we never saw any term sheets.”
Morford says that an overly cautious funding environment prevented Altrec from capitalizing on its relationship with Cox and from landing any additional partnerships or investments during the summer of 2000. And then MVP.com announced a deal to buy PlanetOutdoors.com, and it appeared that Altrec had been shut out of the marketplace.
“At the time, MVP was very well funded with some stellar venture capitalists and big-name celebrities,” Morford says. “We never even considered the possibility that MVP would not get future funding. We knew then that we were up against a big, big challenge, and our primary goal was survival.”
That is when Doyle and Erick Soderstrom, vice president of marketing, told the rest of the management group that, given the drought of money, partners, and potential buyers, Altrec must plan for layoffs. And they volunteered to be the first to go.
Morford refused the offer. He insisted that a company built on solidarity, trust, and communication could fight its way out of any hole. The dogmatic CEO ordered his 40-odd employees to charge ahead at full speed. “The customers loved us, and more sales were coming in every day,” Morford says. “There was a disconnect between our own skyrocketing numbers and the media reports about the death of the Internet. I hoped that, with a little more time, we could communicate our internal success to the outside world and bring in more funding. I didn’t want to reduce the staff size at all.
“Unlike many other dotcoms, we didn’t just hire résumés or use an expensive recruiter. We went through an intense level of scrutiny when putting together our team. And I knew that it would be incredibly hard to replicate or reproduce such a combination of talent ever again. I wanted to make absolutely sure that we explored all other options before going down the layoff path.”
Despite the risk of losing valuable team members, Morford made the severity of the situation clear to the Altrec staff. He opened the books, calculated the stark reality, and laid down a deadline: late September. If money wasn’t rolling in by then, about half the staff members could expect a pink slip.
“We were willing to take that risk because we wanted to respect people’s personal lives and what they were dealing with outside the company,” Morford says. “This way, everyone in the company knew the issues facing Altrec and began working together to tackle them, rather than competing and engaging in political infighting during our toughest hour.”
The September deadline came and went. Doyle inquired about the layoffs. He received no answer. The notion of a perfect company culture went out the window as stress and despair replaced trust and communication. Doyle says that a “nominal paralysis” overcame employees as they lamented, braced themselves, and waited.
“Sales were climbing, and new deals were being struck, but I knew we weren’t clear of trouble. That made me nervous, because I didn’t want anything candy-coated for me or my team,” he says. “I became conflicted as I prepared mentally to leave Altrec, but worked tirelessly to keep the business alive. I felt as if I were pushing back the ocean.”
The Last Stop
Doyle calls it the “Come-to-Jesus meeting” — the final supper for Altrec’s leaders when he and Soderstrom once again offered to sacrifice their own jobs for the good of the company. This time, they weren’t refused.
“Basically, anyone who wasn’t serving the customer directly or facilitating the supply-and-demand chain was gone,” Doyle says. During its first round of layoffs, Altrec cut about 16 jobs in its content, business-development, marketing, and public-relations departments — nearly half its staff. Certainly, it would be difficult to trudge on without press releases, media coverage, and fresh content like Crown of Africa, the stunning multimedia presentation that earned Altrec industry acclaim, but decisions had to made. In the end, Altrec let a number of senior managers go, including Soderstrom, senior content producer Cathryn Buchanan, and director of human resources Jim Helmich.
“It was one of the most difficult things that I’ve ever done,” Morford says. “I had to let some personal friends go for reasons totally unrelated to their performance. I was incredibly humbled by people’s responses to the situation. Those responses proved to me that Altrec’s culture was just as strong as we guessed it to be.”
Remarkably, eight downsized or spared employees, ranging from vice presidents to junior staffers, offered to work for free or for a reduced salary. Morford kindly declined their offers. Instead, he gave each downsized staffer at least two weeks’ notice. They were welcome to leave immediately or stay for a few weeks to help with the company’s transition. In addition, they were welcome to use Altrec’s phones, faxes, and computers to help them find new jobs. Most of the people laid off in October and November stayed on the job until the end, and some even returned for a few days of unpaid consulting.
“You can’t pull off that camaraderie at the last minute,” Stowell says. “A level of trust was built very early on that helped us make it through the horrible experience and emerge on the other side as friends.”
Altrec headed into the holiday season with a skeleton crew, and Doyle was among the former employees who stuck around as a consultant and adviser. “Our papers were already signed, but we were helping the company,” Doyle says. As media inquiries regarding the layoffs streamed in, Doyle’s continuing assistance proved vital to maintaining Altrec’s public image as it weathered its internal storm.
Happily Ever After?
Are the folks in Washington drinking water contaminated with a Pollyanna virus? Are they always so gosh-darn nice? Doyle doesn’t think his behavior was all that nice — just smart. “I don’t burn bridges with anyone ever,” he says. Good move. Following a short sabbatical with his wife and young son, Doyle began work at a major multinational public-relations firm in January 2001. Four months later, he was downsized once again.
“On April 23, two individuals entered my office at 10 AM, talked to me for 60 seconds, and removed my computer access instantly. I was dumbfounded,” Doyle says of the sudden layoff. “So, on April 24, I secured my business license and started Doyle Public Relations.”
One of the first clients to sign on was Altrec.com, which is, ironically enough, hiring. The majority of Doyle’s clients are young entrepreneurs looking for startup savvy in addition to PR expertise. Twice bitten, Doyle is only too eager to jump back into the fight. Only this time, he’s brandishing a few new tricks.
“I have a much stronger business strategist’s mind now,” he says. “I understand tactics, tough decisions, and the importance of dealing straight with people. Of the five RFPs I submitted after forming Doyle Public Relations, three were accepted. I think that’s because I’ve learned to focus on the fundamentals — the sound business solutions. If you cut to the chase, you will succeed.”
Meanwhile, Altrec is emerging from beneath the rubble to find that the sun can still shine for dotcoms in 2001. Since November 2000, at least three of Altrec’s major competitors — Gear.com, MVP.com, and Fogdog.com — have slashed jobs, sold out, and all but disappeared from the landscape. Major competition remains, but Altrec continues to pursue and bag meaningful deals and investments. Earlier this month, Altrec announced a partnership with Outward Bound that will make it the exclusive online retailer for the American wilderness school.
“The two people who brought that relationship home were involved in last year’s layoffs,” Stowell says. “They called Outward Bound before their departures to reassure the school that it should do the deal with Altrec regardless. That integrity really blew me away.”
Altrec closed a round of funding totaling $1.5 million late last month, and Morford says that the company is on track to hit profitability by the end of 2001. He says that the company’s sales have risen 260% since last year and that its traffic has more than doubled. And perhaps more tellingly, current employees and alums of Altrec who spent Memorial Day weekend hiking and mountain biking together are planning a river-rafting event for late June. Maybe they just really are that nice.
All of this camaraderie doesn’t mean Altrec’s wild ride hasn’t caused some pain. But former employees like Doyle seem to believe that whatever doesn’t kill you makes you stronger — or, at least, more masochistic.
“However painful, frustrating, and unnerving, I wouldn’t trade my experience with Altrec.com for anything,” Doyle says. “Pain is a good learning tool. In essence, I got my MBA from the university of life during a social uprising.”
Anni Layne (firstname.lastname@example.org) is the Fast Company senior Web editor. Learn more about Altrec and Doyle Public Relations. Contact Shannon Stowell (email@example.com) and Chris Doyle (firstname.lastname@example.org) via email.