Socialtext Offers Networking Tools to Victims of Layoffs

Article ImageI know what you’re thinking: not another depressing story about layoffs and the economy. This one is different, though, I promise. Ross Mayfield, chairman, president, and co-founder of Socialtext—a provider of Web 2.0 solutions for the enterprise and other organizations—heard the news about massive layoffs at companies across the country. But unlike many of us, he was in a position to help. In light of recession-related layoffs, many of which affected his fellow Silicon Valley companies, Mayfield decided his company could offer its corporate social network solution, at no cost, to former employees of the companies that have laid off 5% or more of their work forces. All the former employees have to do is fill out an application.

"I was watching the news about massive layoffs, like everybody else. … It helped me remember what Steve and the PeopleSoft people had done," says Mayfield. In 2004, Steve Tennant, to whom Mayfield is referring, organized an alumni network when it was clear that Oracle’s acquisition of PeopleSoft was going to result in big layoffs. Tennant and other former PeopleSoft employees were already scattered to the winds. He says, "We were working at the companies that might be the ones to hire [the people being laid-off]." To get everyone organized, he started an alumni network.

The PeopleSoft Corporate Alumni Group quickly outgrew informal Yahoo! and LinkedIn groups. That was when Tennant turned to Mayfield, who offered Socialtext’s services to the group. Back then, Socialtext’s offerings were far more limited than they are today. "There are a lot of free tools out there, but we really had to cobble things together from a bunch of different places. … What [Socialtext] has got now is a full solution," says Tennant.

"In less turbulent times, large employers would invest in hosting Corporate Alumni Networks for sharing connections, knowledge, and expertise. Unfortunately, just when corporate alumni need to leverage these networks … HR departments find such projects stalled," wrote Mayfield in his blog in December 2008. Since then, former employees from companies such as Yahoo!, Merrill Lynch, and DivX have started alumni networks.

"I got laid off in mid [to] late December, and I think I just happened to see an article about what Ross Mayfield was doing," says Bruce Lidl, formerly of DivX. He shot off an email, and before Lidl knew it, he was up and running. With 2–3 dozen members, Lidl says the DivX Corporate Alumni Network is still getting organized.

"It takes a minute to create the Socialtext environment for them and hand over the controls," says Mayfield. Socialtext is also organizing a public wiki to keep track of the networks. What users don’t get is support from Socialtext: "I can’t afford to put support and professional service behind it," says Mayfield. "But they’re getting a pretty decent full experience of Socialtext." It’s up to people like Bruce Lidl to make sure the networks turn out to be truly useful tools. It’s important, Mayfield says, to have a good advocate at the helm of these ships.

"What I’m discovering is that as companies are contracting … or being careful about how they spend their money, [the] companies are more open to hiring people as consultants and freelancers," says Lidl, who worked in PR before being laid off. He says one of the things he hopes will come out of his still-new DivX community is that people will band together to make consulting teams, offering their joint expertise to companies looking for less-expensive alternatives to full-time employees.

If Tennant is a typical example, the alumni network could be a boon for Lidl and others looking for freelance work to get them through this rough time. The owner of his own consulting firm, Tennant says 30%–40% of his revenue comes from leads he gets through the PeopleSoft group.

Of course, familiarizing tech-savvy job seekers with Socialtext’s offerings has benefits of its own. If Mayfield gets lucky, the alumni group users—potentially in the thousands or even the tens of thousands—using alumni networks made possible by his company will pay it forward and think of Socialtext when they secure their next job. In fact, corporate karma may already be paying Mayfield back. He says, "It’s developed a lot of goodwill for Socialtext and strong interest from interested parties. … But we need to be modest in our expectations." Mayfield adds: "If one person gets a new job, or a group of people band together to start a new business—and it’s a great time to do that, by the way—we’ll consider it a success."