Meetings: December '82, January '83

This document chronicles the period when Autodesk turned the corner. Before we went to COMDEX in 1982, we were a group of idealistic programmers with a dream. We returned from COMDEX with a product that we knew to have demonstrated its potential to be a mega-hit. The problem then was how to best deploy our meager resources to best exploit the opportunity our work had created. In the December and January meetings we began to grope our way toward approaches to the challenges that faced us.

This is a quick summary, long after the fact, of the general meetings of December, 1982, and January, 1983. The keeping of proper minutes, which was abandoned for months because of the lack of anyone to do it, will be resumed as of the February meeting.

December Meeting

The December meeting was held on Sunday, December 5, at Jack Stuppin's house. The major topic of discussion was COMDEX, which had been held the previous Monday through Thursday.

Our booth at COMDEX had AutoCAD on the Z80, Victor 9000, and IBM PC. We were also passing out brochures on Autoscreen, but made no real effort to demonstrate it, as an editor doesn't make a very gripping demo.

AutoCAD was on display in a total of four booths: Sierra Data Systems, SunFlex, and Victor, in addition to our own. With the aid of all this exposure, our obscure booth in the back of the show was almost continuously full of people—to the extent that Steve Ciarcia couldn't find his way in. Win a few, lose a few.

It was apparent that AutoCAD was a hot product. At the biggest show in the industry, it had the field to itself, with no direct competition at all. The main problem before the meeting was how to cope with success.

Mike Ford pointed out that exploiting the large number of leads we brought back would be a full-time job. Being unable to work full time for any extended period with no pay, he suggested that Autodesk pay him a 10% commission on sales, up to some reasonable amount, for a few months. There was much discussion of the advisability of paying someone at this point, of whether we should pay ourselves commissions, and of the relation between taking a cut on sales and taking a piece of the company's growth by means of stock options.

There was a consensus that paying Mike would be a good investment, and that the commission arrangement would amount to paying him a salary with him taking all the risk in case we didn't get enough income. The following arrangement was approved by unanimous vote:

Starting immediately, Mike gets a 10% commission, to a maximum of $6,000 a month (a figure intended to compensate for the risk that he'd get very little, and corresponding to nearly 3/4 of a million a year in sales). The arrangement runs for three months, and can be renewed by the directors month by month. When it runs out, the commission drops to 8% for a month, then 6%, and on down to zero. The idea behind the gradual decrease was that some deals, including the most profitable ones, give delayed yields.

January Meeting

The meeting on Saturday, January 8, was the normal general meeting with the annual shareholders' meeting and board of directors' meeting sandwiched in.

The shareholders' meeting elected an almost unchanged slate of directors: Dan Drake, Mike Ford, Keith Marcelius, and John Walker. Jack Stuppin declined to continue to serve on the board because of problems with stock exchange regulations, but will work unofficially with the board.

The board in its turn confirmed the corporate officers:

  John Walker          President
  Daniel Drake         Vice President, Secretary
  Keith B. Marcelius   Treasurer, Assistant Secretary
  Robert R. Tufts      Assistant Secretary
  Roxie Walker         Assistant Treasurer

The reason for all the funny assistants is that the signatures of one or more officers are required on many formal documents, including the application for a California resale permit. With an assistant treasurer in Marin and assistant secretaries in the Eastbay and at the law office, we save a good deal of time and hassle.

John Walker presented the financial report, the crux of which is that our liquid capital is down to about $17,000.

We have two sources of additional capital. Marinchip has warrants to buy 40,000 shares at $1.00 a share; it bought warrants because it lacked the cash to buy in for that much last spring, Marinchip now has enough cash to exercise part or all of the warrants. Also, the original capitalization plan included 20,000 options for John Walker; by oversight, these haven't been awarded yet, but the board intends to approve them as soon as it can print the paperwork.

Sales up to January 8: 4 AutoCAD-80; 1 AutoCAD-86; backlog of 2 AutoCAD-80s; 2 AutoScreens. AutoScreen is now part of the Engineering Work Station sold by Jamal Munshi of MOMS Computing.

AutoCAD-80 is running on the Aurora 1000 from Graphic Development Lab, which has sent out 500 of our brochures; the product will be officially released soon. A dimensioning package is being released as an independent add-on for $500 list.

AutoCAD-86 is scheduled for release on both the IBM PC and the Victor/Sirius on January 15. The features included will be those in the preliminary AutoCAD manual, with an upgrade somewhat later. Sun-Flex, the maker of the Touch Pen, will be selling their product with AutoCAD (for the Victor) and is talking of selling 100 in February, gearing up to 300 a month soon.

We have many contacts with companies that are interested in AutoCAD, including Fortune and Houston Instruments (which wants a demo of the things we can do with their plotters).

Jack Stuppin has connections in the educational publishing business, which could lead to some profitable ventures. It is not too early to think about what programs we'll produce after AutoDesk has been released and AutoCAD has stabilized.

Dave Kalish raised the idea of a sort of personal computer software division, built around people in the South Bay who are unable to work on AutoCAD because of conflict of interest and geographical isolation. There was general agreement that this was a good idea. Possible projects include a menu-planning package that Dave is working on with some other people, and the sort of educational programs that Jack's associates might put us onto.

To improve communications in the company, there will be a bi-weekly mailing of interesting items to everyone in the company. Interesting items might be anything from news clippings to suggestions for ADI products to project reports. Announcements and minutes will be in the package if they come out at the right time. Items sent to Roxie at headquarters will be Xeroxed and sent with the next mailing.

There was a strong consensus that we must have minutes of meetings in some form, and an agenda enforced by someone with a mandate to keep meetings from rambling. Dan Drake agreed to resume the minutes and assume the role of enforcer if no one else volunteered, and was elected by a unanimous silence.

Duff Kurland expressed interest in working full time, if some kind of arrangement for pay could be worked out so that he would not be in effect plowing a few thousand a month into the company. This brought up the situation of Greg Lutz, who has been working full time on AutoCAD-86, and Dan Drake, who has given ADI preemptive priority over paying work; with both having to switch into a non-destructive financial operating mode, the project's technical manpower was about to be reduced to one part-time person.

By unanimous vote it was agreed that Greg would get a subsistence of $1,000 a month for the next four months, in return for which he could give AutoCAD-86 his undivided attention. Everyone else was asked to submit a letter to Jack Stuppin, giving the specific conditions under which he would be able to work full time for ADI. With those letters we could plan to take on more full-time people as the cash flow picked up.

Last October or thereabouts there was to have been a special all-day brainstorming meeting on how best to manage the company, but it was bumped by one crisis or another. Dave Kalish pointed out that there was as much need as ever for this meeting, so it was rescheduled for Sunday, February 13, tentatively at Jack Stuppin's house at 11 A.M.

One thing that has become apparent is that we often don't know, or don't agree on, what has been actually decided at a meeting. Here, then, is the first instance of a feature that will appear in all minutes, though perhaps in some prettier form. If you think it's inaccurate, speak now or forever hold your peace.

Summary of Decisions Taken

Mike Ford will temporarily get a commission on sales, described in detail in the DECEMBER section.

Greg Lutz is on the payroll at $1,000 a month, effective January 8.

The board of directors is the same as last year, except that Mike Ford replaces Jack Stuppin. The officers are the same.

There will be minutes and an agenda for the meetings. If you have something that needs to be discussed, inform Dan Drake before Friday night, or be prepared to be gavelled down.

We will meet on Sunday, February 13 to figure out how to run the company. This is to be an all-day session, though we can't start it before 11:00 because of travel time. Bring your specific complaints, your general principles for running things, your specific ideas, and a readiness to volunteer for the grungework of carrying out the ideas.

This was the advertisement announcing COMDEX/FALL 1982 where we introduced AutoCAD.