How I Made it: Sean O’Toole
The gig: Sean O’Toole, 43, founded website ForeclosureRadar in 2006, just as the real estate bubble was getting ready to pop. His company tracks foreclosure auctions in California, Nevada, Arizona, Oregon and Washington.
An early technophile: “My parents bought my first computer for me when I was 10. It was the first Apple II, and that really defines my life thereafter. By the age of 12, I could program in three programming languages, and I dropped out of college at 18 to form my first software company.”
Like father, like son: “I was always very entrepreneurial. My dad was a logic professor but was always starting companies on the side because professors have lots of free time. I was always helping him, and I just kind of kept that entrepreneurial thing going.
“He made accessories for sailboats, he had a business selling the first wireless alarm systems, one printing and producing promotional materials, and he had a seminar and promotional support company, where he would build marketing material and presentations and other things for folks who did seminars. He was also a builder of spec homes. … So I learned to swing the hammer pretty young.”
Lessons from the old man: “Perseverance is probably as big a part of it as any … quite a few of the businesses didn’t take off, and it was nice that he was a professor and he always had that to fall back on, but he just kept trying.”
The first bust: “I was at a company where I was the first employee; two friends of mine started it, and it grew to 320 people and we were working on our S-1 filing to go public in March 2000 when the dot-com crashed happened.
“At first we all thought it was temporary and the market would come back. It didn’t. The company was sold for 10 cents on the dollar [after] it had raised nearly $120 million. It was called Icarin. It was a software service company for workforce management.
“When the company was named, there was some concern that Icarin might be associated with the story of Icarus, who flew too close to the sun. Of course, we came very close to the sun — raising $120 million and being very close to [an] IPO — when the market crashed.”
Rice and beans: “The company was backed by venture capital, some of the best in the business, and it was all about growth. There was a lot of waste in that. You are trying to hire and grow so quickly to meet financial milestones and you are not necessarily building a strong, robust business that will survive.
“Venture capital is less important now than it was 10 years ago. Folks are figuring out that it is worthwhile to eat rice and beans for a while to have a shot at your dreams and that there is something satisfactory about building a company from nothing than from a $5-million investment.”
From tech to real estate: “I wanted a little bit of a change of pace and was still thinking about starting another software company, but wasn’t sure what the next step was and ended up being introduced to someone who had been buying foreclosures for quite a few years. He basically agreed to teach me the foreclosure business. We bought 150 foreclosures together between 2002 and 2005, at which point I became very concerned about the real estate market and wanted out.
“I was collecting data on foreclosures throughout California and had this really interesting data set that I was a little bit addicted to because it gave me all kinds of information about what was going on in the world of real estate that just wasn’t available anywhere else.”
A little help from a friend: “One of the founders of Netscape, a guy named Bill Foss, basically kicked me in the butt and said, ‘Sean, you have been helping other people start software companies for a long time, and you know this business cold, you know software cold, you can do a better job than any of these guys out there. You know, it’s your turn — go for it.’ And that was the launch of ForeclosureRadar.”
A company born out of recession: “When I go look at the great companies that are built, most are built out of recession. When you are in the good times, it is hard to hire, it is hard to keep focus, people aren’t as motivated. So I think most good companies come out of recessions, and I think most good ideas and the growth that will ultimately fix the economy today will come out of folks being backed into a corner.”
