I’ve been ringing round the Exbiblio team looking for reaction to the news of the retrenchment and staff cut-back. Not everyone has been at their desks, but this is what I’ve been told so far.

Brydie Ragan, who has been just five days into her job as Exbiblio’s “hardware evangelist”, says that she was still learning about Exbiblio, its people, and its projects. Even so, she wasn’t bowled over, as she’s worked on startups before, including one of her own, and “there are always surprises”. She adds that it’s just part of “life’s great adventure.”

Engineer, Brendan McNichols, tells me: “In a sense, I’m not surprised because it’s a startup and we’ve been spending a lot of money on a piece of hardware that was ridiculously expensive to bring to market. Where the surprise comes in, is that just a week previous, things had been seeming to be going okay. We’ve been getting software stuff on track, and then we’ve been hiring , and usually that’s a sign that things are going well.”

Ian MacDuff, the engineer who has been co-ordinating the relationship with contractors Synapse, tells me that he has been discussing with Exbiblio’s management how to wrap-up the hardware project. He suggested that they should document the oPen’s architecture and explain how it works. However, he adds, “I’m not feeling hyper-motivated. I would like to be, but I’m pretty disappointed about the whole thing.”

(update) Lauren Summers tells me: “I was surprised at the announcement last week because it was very sudden, and am sad to break up from this team of people. I do hope Exbiblio can figure out a way to make it work. The growing idea of the (working) device over the past months, and seeing each new development, makes the idea of not using it soon feel like a loss.”

Adam Behringer will be writing shortly about his own impressions.

Speaking to a couple of others off-the-record, I get the impression that there is not a huge deal of surprise about the event itself – these things happen in startups – but the timing and suddenness was unexpected. There is some bafflement about why the management appeared not to know about potential problems – even to the extent that they were hiring recently.

The morale at Exbiblio is noticeably higher than when I was there a month ago – and yet everyone is far more aware of all the numerous tasks that still need to be done to get a functioning prototype in their hands. It’s a strange conundrum. They know better than ever that they are on a long hard road, and yet they feel more satisfaction from their daily work.

Ian MacDuff, who looks like a much happier engineer than last time I saw him, tells me that it comes down to good process starting to be implemented. There is now a list of tasks and milestones. As these get ticked off, people feel they are making progress. What he warns against is the “death march” which describes a project where you continually think that you are almost done, and constantly disappointed to find that you aren’t. It seems never ending, largely because you can’t see how far you have come down the road, or indeed where the road finishes.

Ian believes that good process begets more good process, because as people understand its value, they start to demand more of it. Information empowers, even if it tells you what you don’t always want to hear. There’s a motto pasted on the window of his office: “The truth will set you free, but first it will piss you off.” (Perhaps those words could apply to transparent blogging).

Ed Mahlum – for the management – also sees a discernible improvement: “I don’t think we were doing as good a job as we could in the way we were managing our work. We are now very specifically tracking all the work we are doing. Everything is much more concrete. This is bread and butter project management stuff.”

So why was Exbiblio not doing this before? I don’t think it’s because the management were naive or inexperienced, but it was a deliberate attempt to foster creativity and experimentation. Ed still says “the presumption of not knowing everything is a very good presumption”, but he now thinks that the creative / development process was too loose, and perhaps there should have been a better defined box to play in.

Ed believes that the improvement in morale is also due to better communication of Exbiblio’s environmental project, Compendia, which is starting to take shape.

“It’s always been there in word, but no one has been working on it, aside from a few conversations here and there. It makes it real to put effort in there and for people to see it.”

A meeting that I’ve just attended (with a presentation by Adam) really boiled down to this question: should Exbiblio start by doing a small number of things incredibly well, and to clearly communicate those things to a well-defined first-user group? Or should it be more feature-rich, and even have an open platform to develop third party applications?

It boils down partly to practicality – what can be achieved given time and money – and partly to the best way to market it. Exbiblio, and in particular Martin, keeps coming back to the notion that you have to put the product in users hands, and see what they do with it, and only then can you reach a decision. It means that the feature list will be finally decided on rather late in the day.

I’ve been away from Exbiblio for about three weeks, and I’ve come back to find what seems like a different company. It’s organised, and focused, and people meet frequently in person and know what each other are doing. I am, quite frankly, amazed.

While I’ve been away, I get the feeling that there has been a bit of a mini-crisis. There have been more little things wrong with the first prototype of the scanner pen than had been expected. This crisis seems to have been a shot in the arm.

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Let me remind you of one of the supposed “Geek Business Myths” that I referred to recently.

If you build, they will come (i.e. customers).

This is Exbiblio’s position.

If you build a product that creates real value in the world, then you can’t go far wrong.

But still, I wonder, how is Exbiblio going to sell that product? Here are the main points of the marketing “plan” that I know about.

• The first “target market” will almost certainly be students.
• The primary method for spreading the word will be “viral” – i.e. those who try it will love it and tell their friends.
• Beta testing the product among 1000 people early next year will create buzz.
• The main selling point will be the Exbiblio website.
• Independent bookshops fit in well with Exbiblio’s values, and could help sell its oPen.
• Online bookshops are also potential partners for selling the oPen. They will see the value in linking the paper world to the online world, and so stimulating online book sales.
• There are some publishers who have online versions of their books, and similarly, they will see the value in linking paper with digital, and help sell the oPen.

In the initial months, following the launch of the oPen next Spring, the goals for sales will be fairly modest. All Exbiblio wants to do is prove that there is demand in the market. But are these plans concrete enough for this stage?

I trust that this blog is evidence of Exbiblio’s openness. I’d just like to point out that the policy goes even deeper at the company. The design agency JMK told us that usually their clients would insist on complete confidentiality: we couldn’t walk around their office and see their designs-in-progress on the wall. Exbiblio is different. There is no insistence on confidentiality. JMK doesn’t have to cover up any Exbiblio materials for anybody. It seems that people who work with Exbiblio really like that policy. Secrecy can be a burden – and it’s over-rated. After all, imitation is flattery, so why fear it?

Once upon a time (roughly last Spring) Exbiblio was a bright and bushy-tailed young software company. It was also a very democratic place, where decisions were made as the result of lengthy brain-storming sessions. Its ideal was a ‘flat management structure’ without any job titles. In fact, when I read the ‘people page’ on the website as it stands even now, it’s hard to tell what anybody does at Exbiblio. Most seem to grow organic vegetables and ride bicycles to work. You certainly get no idea of who the CEO is (apparently they are still looking for one).

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I left a beautiful sunny autumn’s day on London yesterday and flew out to Seattle for my third trip to Exbiblio. I didn’t bring a coat or an umbrella – an omission considering the rainy weather here this morning.

It’s easy for me to stroll into work early as I’m still on London time and am staying just around the corner near Pioneer Square. I’m able to chat with the office early birds, Spencer and Claes Fredrik. I’ve not met Spencer before, but he helps me find a room in the new “wing” of the expanding office. I’m strategically positioned just near the table with the enticing snacks – fresh berries and tangy sheep’s cheese. Claes Fredrik helps me get my aging laptop plugged into the network. We chat a little bit about some of the technologies that have been showing up on the blog.

While blogging away in London, I’ve been trying to fill in the picture of the universe in which Exbiblio is operating. There seem to be a number of companies working on bridging the divide between paper and digital. They are rather disparate, and I don’t think you can quite call it a movement yet – but there’s a lot going on in this space. This week I’m planning to write more about what Exbiblio’s up to.

On this trip I’m hoping to see the first prototype of the Exbiblio Scanner Pen, code-named Falstaff. I believe there have been some glitches causing delays – which is only to be expected on a project of this nature, but it can be hard to get engineers to talk about glitches.

As Spencer has just been saying to me a minute ago, Exbiblio is a stimulating place to work, both intellectually and on the “values” level of not being overtly hyper profit-driven. It’s striking how recruits say they were attracted by Exbiblio’s values page on its website. However, I am hoping to tease a business / marketing plan out of the more “senior” people in its “flat” management structure. It’s time to write about matters such as useful applications for Exbiblio’s technology, target markets, return on investment – the sort of stuff that business people normally talk about. I haven’t heard a great deal of that ilk on my previous trips. Perhaps I haven’t asked the right questions, but I also get a sense that these matters are not always to the fore, perhaps because the technical challenges are so absorbing for Exbiblio intellects. I’m also going to ask about Exbiblio’s laudable aims to change the world for the better (which I think people will be very glad to talk about) but Exbiblio’s good intentions depend on being a business success first.

Britain’s Prime Minister, Tony Blair, has returned from his trip around California. When he wasn’t hobnobbing with the likes of Arnold Schwarzenegger, he found time to lunch with a group of Silicon Valley leaders, including Steve Jobs of Apple and Jonathan Schwartz of Sun Microsystems. The latter gives and account of the lunch on his blog.

Naturally Mr. Blair was interested in what makes Silicon Valley so successful. One of the answers he received was “education”. He was also told that wage costs do not matter so much, so long as the talent can turn projects around fast.

Coincidently, The Economist Magazine has a different version of why America’s high tech firms succeed (Venturesome Consumption quoting a paper by Amar Bhide). According to this theory, investing in scientific education can be over-done. The “Venturesome Consumption” theory praises consumers, rather than inventors, of technology.

“The most important part of innovation may be the willingness of consumers, whether individuals or firms, to try new products and services.”

I have to say that on my first visit to Exbiblio, I was very struck how the office had adopted all the technological help it could get its hands on, from a wireless network, to AIM instant messaging, a wiki, and internal blogs. Using tools like these seems like second nature, at least in this American company. The same tools are freely available in the UK, but few companies are quite so quick to adopt them.

So Mr. Blair take heed: it might be better to leave great inventions to others, and to let consumers get on with enjoying their gizmos.

There are plenty of books around the Exbiblio offices, including a good selection of classic novels. This is quite natural, as the technology Exbiblio is building has a great deal to do with books. There is also a small selection of business books which seem to have inspired some of the company’s values. One of them is called, The Corporate Mystic. A sentence from near the beginning reads:

“Imagine the power of an organization where everyone was empowered to be a visionary?”

My question is whether this is a recipe for productive and creative chaos, or just chaos?