Monthly Archives: October 2024

Kindness and Techcrunch Disrupt

Asides

Back in June I recorded an episode with Jaclyn Lindsey on the Why Kindness podcast, for their awesome non-profit kindness.org. You can listen to it through Pocket Casts here:

This is kind of funny because I’m obviously in the midst of the big battle with Silver Lake and WP Engine. I am a huge proponent of kindness, but sometimes you have to stand up for what’s right if someone is taking advantage of you.

I’m continuing to do some select press, and will be appearing in a conversation with Techcrunch’s Editor-in-Chief, Connie Loizos, at 10:30AM on Wednesday in San Francisco at their Disrupt conference. It’s an amazing conference! Over 10k people from all over the world, just started today. I’m glad they were able to work me into the schedule, I think it will be a timely conversation. We may even have an announcement to make. 🙂

My Freedom of Speech

Asides

WP Engine has filed hundreds pages of legal documents seeking an injunction against me and Automattic. They say this is about community or some nonsense, but if you look at the core, what they’re trying to do is ask a judge to curtail my First Amendment rights.

The First Amendment is the basis of our democracy. It is inconvenient and important. It’s also short, so I’m going to quote the First Amendment in its entirety:

Congress shall make no law respecting an establishment of religion, or prohibiting the free exercise thereof; or abridging the freedom of speech, or of the press; or the right of the people peaceably to assemble, and to petition the Government for a redress of grievances.

This means that, with rare exceptions, the government cannot tell you not to say something.

Freedom of Speech is not Freedom of Reach

The First Amendment says I should be able to state facts and my opinions about WP Engine. However, the New York Times is not required or compelled to publish them in their newspaper and distribute them to their subscribers.

WP Engine is free to publish whatever GPL code they want to the world. WordPress.org should not be compelled to distribute it or provide it free hosting.

Quiet For A While

After this post, I will refrain from personally commenting on the WP Engine case until a judge rules on the injunction. I will continue to exercise my First Amendment rights to promote others’ speech. However, I hope others speak up on our battle with WP Engine, and I will boost their speech wherever I can.

There are two great Cloudflare-related stories published this weekend.

The first is Steven Levy’s incredible story about Tim Jenkin, who created a secure communication protocol for the African National Congress to overthrow the apartheid regime in South Africa. Cloudflare’s CTO, John Graham-Cumming, later helped break past the cryptography system’s lost password, which he blogged about with some technical detail here.

Second, my dear friend Om Malik published a great conversation with Cloudflare CEO Matthew Prince in his new newsletter Crazy Stupid Tech. Matthew and Om are influential thinkers to listen to, and their discussion contains a lot of interesting nuance about networks, censorship, and sovereignty.

Those Other Lawsuits

Personal

It’s a heavy day, and I’m sad to write this. Not sure where to start.

In 2022, a lawyer recruited two people who took care of my Mom—an assistant and one of her dozen nurses—to resign and demand a million dollars each, or they would publish horrible things about her in a lawsuit. I refused. The lawsuits were filed. Luckily, the accusations are so sick, twisted, and outrageous that they refute themselves. There’s some weird sex stuff, and also claims that my Mom is racist. I am sad for whatever mind could even imagine such things.

I won’t link or quote them because they don’t deserve that, but the lawsuits have been part of the public record and available to anyone with a web browser since 2022. The lawyer sent them to every major media publication and gossip rag. You’re just hearing about them now because any journalist who spent five minutes calling around easily saw how spurious the claims are and didn’t run with the story. They’ve been dredged up as part of the smear campaign against me in my battle with Silver Lake and WP Engine.

My advice for any other founder: As you gain wealth this may happen to you with household staff as well. Never settle. It just creates an incentive for more people to make stuff up. Even if it’s messy, fight the claims in court as I am doing. It’s the only way to deter people trying to make a quick buck. These cases are common, and the media is used to them.

Now for some good news! I’m happy to report that since these two people left, my Mom has had no errors in her medication (previously, she had to be hospitalized twice and almost died because of medication errors). She’s back to the weight she was in her 30s and isn’t in a wheelchair all the time anymore. She’s just moved into a new home we’ve been remodeling together for the past 5 years. She still has 24/7 RNs, but the new nurses have been fantastic and feel like an extension of our family. We’re looking forward to celebrating the holidays together with my sister, lifelong family friends like the Ornelas family, Mom’s four dogs, and some of my fifteen godchildren who live in the area.

I may be wrong or dumb about many other things, but I sincerely believe in the sanctity and beauty of every human life, regardless of any background. We are all God’s creation. My Mother taught me these values, and I have done my best to uphold them in my life’s work building open source, WordPress, and Automattic. It’s part of why I give so much back.

Response to DHH

Automattic, WordPress

I’ve taken this post down. I’ve been attacked so much the past few days; the most vicious, personal, hateful words poisoned my brain, and the original version of this post was mean. I am so sorry. I shouldn’t let this stuff get to me, but it clearly did, and I took it out on DHH, who, while I disagree with him on several points, isn’t the actual villain in this story: it’s WP Engine and Silver Lake.

A few bullets to his core points:

  • The headline “Automattic is doing open source dirty” is not fair.
  • Automattic did not work on a deal with WP Engine for 18+ months because of the GPL, or them using “WP” in their name, it was because of their abuse of the WordPress and WooCommerce trademarks. Trademarks must be protected, as evidenced by Rails trademark policy.
  • Our C&D is about public trademark abuse; theirs is about censorship, and doxxes private messages. They have since filed a kitchen sink lawsuit that embroils all of WordPress.org.
  • Updating ACF to Secure Custom Fields in our directory was to provide users of our plugin directory the best, safest, most secure code. It included a security update that still has not been merged by the ACF team.
  • We will merge any improvements ACF makes to their GPL code going forward and will also include enhanced functionality in the coming days to provide a secure and free drop-in replacement for ACF. If WP Engine didn’t want this to happen, they should not have published their code under the GPL or distributed it through WordPress.org’s directory.
  • I think it’s fantastic when businesses are built on open source, the WordPress ecosystem is at least 10B+ a year; Automattic and WP Engine are less than 5% of that.

Everyone’s An Owner

Automattic

Last Friday we said goodbye to 159 colleagues as part of our alignment offer. It was a tough day, there are a lot of close relationships within Automattic, and goodbyes are always hard.

On Monday, I got to be Oprah for a few minutes. We had scheduled a town hall for leaders around the company to speak to everyone, and our Woo team had ~350 people in person at a meetup in Tulum. I had five minutes to talk, and over the weekend, I had been brainstorming with finance and HR for something nice we could do for everyone who stayed. We couldn’t give them all a six-month bonus, which would have cost ~$126M, but we did take how much we spent on severance for the 159 people, rounded up a bit, and granted everyone at Automattic 200 shares of A12 stock, so about a $12M bonus for the employees.

What’s A12 stock? This is probably the first time you’re hearing about it, we haven’t had a chance to talk about this publicly much before.

Usually, options or common stock in a private company is fairly illiquid, with rare opportunities to sell or lots of restrictions like what Uber had; it’s not an efficient or predictable market. Options are “nice” because they can defer taxes, but you still have to exercise them, and they can go underwater. Also, as a fully distributed company, we have people in 91 countries, so security and tax laws around options make them not worth it in most places outside of the US.

When thinking about a stock plan for Automatticians, we thought, our most sophisticated investors have nice protections like a 1x liquidation preference, what if we gave that to employees, too? So to summarize, A12 is a special class of stock available only to buy if you’re a current Automattician with these characteristics:

  • There are twice-a-year windows to buy. You have to hold for 1 year, but then there are quarterly windows to sell, which is very predictable.
  • Automattic maintains the internal market, and provides a backstop so you can always sell the shares at what you paid for them or more, like a 1x liquidation preference.
  • Current employees can buy, but former employees are eligible for every selling window, there’s no politics like can happen with tender offers. It’s reliable and predictable.
  • Unlike options, A12 stock never expires. Once you own it, you own it.
  • Initially we only allowed $25k/year of A12 to be purchased, but as our business has scaled we now allow up to $1M/yr of A12 stock to be purchased. (Remember, the company has to backstop the purchase price.)
  • A12 is just economic rights, it doesn’t have any voting rights.
  • A12 stock can be transferred to a trust.
  • The price is set by an external firm, just like our 409a. Because that process discounts us so much for being private, it’s a pretty good deal compared to what investors would pay for a share.
  • We’ve mostly moved away from options, which really only work for already wealthy, sophisticated hires. We pay very generous base salary (which banks love, makes it easier to get a mortgage) and then people can make a personal decision whether the characteristics of A12 fits with their financial planning alongside index funds, stocks, and bonds.

We’ve been running this program since 2016. The main downside risk for A12 holders, which isn’t that different from common stock, is that we go out of business and can’t keep our commitments. But that’s true of any stock investment, and we have a pretty solid track record.

We want everyone to have an owner mentality, so we’ve also now started granting 1 share of A12 stock to every new hire.

Our legal team has their hands full right now with the Silver Lake / WP Engine stuff, but we’d like to open source our docs around this so other companies can offer the same thing easily, I’ll see if we can make time for that in the next few weeks.

We also announced something else cool for employees on Monday around our Grand Meetup in 2025, but to know that secret you have to work with us. We are one of the most open companies, but we can’t publish everything! ☺️

Rhino Dehorning

Travel

Yesterday in the African bush was great, I saw giraffes, zebras, warthogs, leopard turtles, elephants. Today wasn’t great: I witnessed a rhino shot with a tranquilizer from a helicopter, then it was held down, had its horns cut off, and then shaved down. I have some photos and videos from the event but I’m not going to share them, because I think it’s really tragic. While this was happening I put my hand on the rhino’s belly to try to send it love, because I can’t imagine how confusing and terrifying the experience was.

Let’s back up: Why does anyone care about rhino horns? First, you have to start with how dangerous false ideas and memes can be. Rhino horns are 92-95% keratin, just like your fingernails, the rest is basic stuff like melanin, calcium salts, magnesium, sulfur, nitrogen, amino acids, and phosphorus. There is nothing special or magic about a rhino horn that you couldn’t easily obtain many other ways.

However there is a dangerous infovirus going back thousands of years that rhino horns can cure various ailments, from cancer to fevers, and have aphrodisiac properties. To quote Scientific American:

Some purchase horn chunks or powder for traditional medicinal purposes, to ingest or to give others as an impressive gift. Wealthy buyers bid for antique rhino horn carvings  such as cups or figurines to display or as investments. A modern market for rhino horn necklaces, bracelets and beads has also sprung up. […]

On the bright side, traditional Chinese medicine experts have increasingly joined the fight to reduce the demand for rhino horn. When China officially banned the international trade in 1993, it followed up by removing rhino horn as a medical ingredient in traditional Chinese medicine’s pharmacopeia  and curriculum. […]

“Traditional Chinese medicine has a history of 3,000 years and we have been educating the public for less than 30 years,” Huang notes. “Therefore this is an ongoing education.”

Regardless of the reasons, there is a price for rhino horns. I was told the larger front horn would get about $300,000 on the black market, and rhinos have been poached to near-extinction. Combine that with South Africa’s 33% unemployment rate, some people turn to crime or poaching to make money. It’s cheaper and faster to kill the rhino and take its horn than tranquilize it as the game reserve did.

I don’t want to criticize the people at the game reserve. They clearly cared for the animal quite deeply, and while it was tranquilized, they provided other veterinary help for it, like removing ticks. They also put a tracker on its foot. They say they lock the horns in a vault… why? Burn it, toss it. The thinking is that reserves that are known for de-horning will attract fewer poachers.

This is obviously a middle solution, and I hope ten years from now we’ll look back at this as a point in time we learned from. On the demand side, it seems like aggressive education campaigns could help decrease demand for keratin from rhinos. On the anti-poacher side, I think drones will be able to secure perimeters far more securely than fences currently do. It would be fascinating for an economist like Tyler Cowen to dive into these issues.

Automattic Alignment

Automattic

Winston Churchill said, “Never let a good crisis go to waste.” Since I last blogged here, WP Engine filed a meritless lawsuit and Automattic responded, and there’s been a hurricane of public activity and press. Inside of Automattic, there’s been a parallel debate and process.

Silver Lake and WP Engine’s attacks on me and Automattic, while spurious, have been effective. It became clear a good chunk of my Automattic colleagues disagreed with me and our actions.

So we decided to design the most generous buy-out package possible, we called it an Alignment Offer: if you resigned before 20:00 UTC on Thursday, October 3, 2024, you would receive $30,000 or six months of salary, whichever is higher. But you’d lose access to Automattic that evening, and you wouldn’t be eligible to boomerang (what we call re-hires). HR added some extra details to sweeten the deal; we wanted to make it as enticing as possible.

I’ve been asking people to vote with their wallet a lot recently, and this is another example!

159 people took the offer, 8.4% of the company, the other 91.6% gave up $126M of potential severance to stay! 63.5% were male. 53% were in the US. By division it impacted our Ecosystem / WordPress areas the most: 79.2% of the people who took it were in our Ecosystem businesses, compared to 18.2% from Cosmos (our apps like Pocket Casts, Day One, Tumblr, Cloudup). 18 people made over 200k/yr! 1 person started two days before the deadline. 4 people took it then changed their minds.

It was an emotional roller coaster of a week. The day you hire someone you aren’t expecting them to resign or be fired, you’re hoping for a long and mutually beneficial relationship. Every resignation stings a bit.

However now, I feel much lighter. I’m grateful and thankful for all the people who took the offer, and even more excited to work with those who turned down $126M to stay. As the kids say, LFG!