Comment by Simon_O_Rourke | Hacker News Reader

Comment by Simon_O_Rourke | Hacker News Reader

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I know of a guy, but his scenario was quite unique. I was working for an energy company who shall remain nameless, but who's internal IT was a tangle of external consultants milking the place for millions, and ineffective/underserved full time staff who couldn't run a query on a database without a change control committee of consultants milking them for yet more cash.

Anyway, this guy was the go to guy for gas customers, and knew the database inside and out. So he created his own company, resigned as a full time employee, waited until the panic had set in properly.

Then he offered consulting services back to the energy company saying he'd take care of any database processing costs, or cloud migration costs or whatever, and moved the customer data for gas customers to his own system. Then he created an API, waited a while more and said he was going away again.... Or he could stay supporting this setup if the energy company agreed to a monthly fee and API usage. Then, as far as I know, he sat back and just watched the money roll in while he automated everything else about the job.

> moved the customer data for gas customers to his own system

That sounds highly illegal.

IT services companies / MSPs aren't illegal. I'm sure this was all detailed in a contract looked over by lawyers.

I assume “customers” means internal customers, i.e. business units at the energy company who had come to rely on this guy’s ability to navigate the insane I.T. and actually get things done for them.

aka he joined the squad of consultants. Just with better and more automated process

Sounds like extortion with extra steps? Maybe there’s a more charitable way to tell the story.

It sounds like the employee is actually getting what they are worth. Lots of huge organizations require a single key person in order to function, and most of the time those key people are not compensated accordingly.

The company could have called the bluff and passed on the consulting services.

Extortion or price discovery?

> Maybe there’s a more charitable way to tell the story.

Yeah, management didn’t give the guy a raise so he quit and he could say no when they came begging.

If there’s anything that went wrong here it was management asking ‘what if we pay him more’ but not asking ‘what if we don’t’.

Without debating whether it’s ethical, it doesn’t sound like extortion. It sounds like taking advantage of dysfunctional decision making in an organization.

I assume he built his system and then onboarded the company as a client to it. Possible issue here is the degree of separation. If he ever worked on the system before he resigned, or re-used some concepts of it, then I’m sure company would sue him and take the system for free.

I’ve considered doing similar for one corp I’ve once worked with. The corp used an obscure hybrid cloud solution, unfortunately, the cloud provider didn’t really understand the corps needs (governance,devex,monitoring) making it impossible to do anything basic without manual action from an administrator. Pretty solvable with a couple of APIs and a few dashboards

Sounds like the guy just got tired of being on salary in a place that was badly run.

Yes he did, I think he saw the weakness in the org and exploited it properly.

>> resigned as a full time employee, waited until the panic had set in properly

The company couldn't even function without that person. Calling that an extortion is quite a leap.

>Sounds like extortion with extra steps? Maybe there’s a more charitable way to tell the story.

How? The original company could have hired another employee to replace him, instead they entered into a b2b relationship with his company.

I've often considered something similar. I used to support a bunch of apps, where I thought "I could build most of these from scratch and they'd be better than what I'm supporting." Even if my employer didn't find value in them, and hired someone else to support the old junk, other companies would probably buy the new ones.

If the thing you're threatening a business with is "I'll stop working for you", how is that extortion?

If the employee deliberately made the IT infrastructure worse, then maybe that would be fraud, but it sounds like he was the main person who was improving it.

Is this legal? How frequently do people with unique knowledge in a company pull things like this off?

All the time. The company is usually begrudgingly okay with it too because they'd rather a former employee sell their expertise back to them instead of a competitor.

I guess check your employment contracts and whatnot, but it's very common for people to leave a company and start consulting and/or freelancing in the expertise they gained at that company. And it's not too uncommon for former employers to be one of their first clients or get your first clients from relationships associated with your former employer.

All of this assumes you don't burn bridges and have the interpersonal skills, in-demand expertise, luck, timing, and interest in building out a small service-based business.

If he’s successfully replacing the millions in external consultants, it might even be what the business folks call “a win/win”…

win/win/lose. The consultants have lost revenue.

>The consultants have lost revenue.

We don't care about them though.

Legal? Are you implying that having knowledge in a company (like, the result of doing a good job?) somehow should legally obligate you to never stop working there?

What am I missing? Can you spell out some boundaries for what you're implying because I must be wildly missing it.

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