Rediff Logo News Find/Feedback/Site Index
December 31, 1999


Search Rediff

My Secret Weapons: Hackers and Surfers

E-Mail this business report to a friend

Vivek Wadhwa

Vivek Wadhwa with his sons Tarun and Vineet As the CEO of a fast growing software company, I am often asked for advice by fledgling entrepreneurs and venture capitalists on their Internet startups, or asked by the media to comment on topics as diverse as the Y2K problem in Russia, the impact of e-commerce on the Brick and Mortars, Internet shopping, or even Cyber-Terrorism.

It usually surprises me that I am able to help out or comment on these topics. For most of my career, I have worked in the Enterprise Software arena, either as an IT executive for large corporations, or developing software and marketing it to these. I could probably still debug Assembler language code for an IBM Mainframe.

But understanding what makes a hacker click, why the Internet is the next Industrial Revolution, or the Infrastructure problems of the dot-coms, is a different issue.

Yet to be able to lead a company that is transitioning the software of the Brick and Mortars to e-commerce, I need to understand the new world of computing as well as the old world. What is my secret? My children.

I have probably learnt more by watching my sons Vineet, 16, and Tarun, 12 in action with computer technology than from any other source of information.

Whether it is about shopping on the Internet, setting up home networking, hacking Windows NT security, setting up websites, understanding the uses of the Palm Pilot, digital photography, or even knowing what computer games are really cool, they seem to be on top of things.

Before I started reading about the MP3 phenomenon, my children had converted all of their CD's into MP3 format and wanted me to buy them a larger disk drive for their PCs.

Vineet first used a computer at the age of 4. He would play games, learn reading, mathematics and draw pictures. His little brother, Tarun also became comfortable with the home PC at the age of 2. For many years, their fights were about "computer time" -- who would get access when I wasn't using it.

When they "were good" they could get computer time, when they weren't, they would lose it. "Computer time" became a currency in our household.

Interesting things started happening when we first got a modem in 1994, and Vineet could connect to bulletin boards and "shareware" download sites. All of this started off fine, but before I knew it, he was downloading all sorts of software and joining discussion groups. Some of this software wasn't exactly Shareware, and the groups weren't discussing homework.

When he showed me what he was able to download, I was amazed. Almost any software program on the market was available on bulletin boards. I had to teach him the difference between legal software (shareware, freeware) and pirated software, and tell him to stay out of certain places. It was hard, but we made him understand that we had to pay for any software we used, and buy legal copies even though we could download it for free.

The introduction of the Internet in our household in 1995 was an enlightening experience.

I installed Netscape on my home machine, and signed up with an ISP, and before I knew it, Vineet was writing HTML, creating websites, surfing on sites across the world, making friends all over the place, and downloading graphics and software of every kind.

Watching him, I realized that that this would be the next revolution in computing. This is probably what inspired me to leave my job as Chief Technology Officer of Seer Technologies, a company that I had co-founded, and bet our life savings on starting my own company. I had to be part of this revolution.

Even more interesting things happened after I got Vineet and Tarun their own computers (now we had more "computer time" to allocate) and signed Vineet up for his own AOL account as he had requested.

I had just started my company Relativity Technologies in Cary, North Carolina, and worked 18 hours a day for many months in getting this venture off the ground.

I didn't pay attention to what was going on with the other computer until I received a phone call from AOL security telling me that Vineet had violated the "terms of service", and obtained access to restricted areas of AOL. When I looked into it, he was on a mailing list of a hackers group that spent their lives trying to break AOL security, and distributed illegal software programs.

He showed me the "warez" chat groups and "server" rooms where there was an amazing amount of software piracy going on. I was shocked to see the type of information available -- everything from electronically stolen credit cards to code for creating viruses.

Fortunately, he was just a curious bystander in all this, and did not participate in distributing any software or doing anything other than watching, and was proud to show me all he had learnt.

Under the threat of losing his computer, he readily agreed to stay away from these areas and get back to doing constructive things like learning Visual Basic programming.

We got Vineet a Palm Pilot for his 14th birthday and it became his daily companion for everything from taking notes in class to reading stories he would download. He began to scour the net for interesting software (games, utilities and fun applications). Last year, he also learned about Internet Relay Chat (IRC) channels, and started downloading different types of software from different IRC locations.

He asked me if it was ok to download programs for his Palm Pilot. I couldn't see what the downside was, so I told him to go ahead. He made a friend in Moscow who would write new software for him, or modify almost any program he would give him.

One day last year, I was discussing with my wife the difficulty we were having at Relativity in recruiting people with the right technical skills.

Vineet asked if we would hire people in Moscow. My response was that we would hire good people anywhere. He told me about Nikita Sarychev, this really brilliant programmer he met over the IRC, who had just lost his job. Could we hire him?

I talked to Nikita over the IRC, and was very impressed by his background and competence. I had Nikita interviewed over the phone by my head of development, and we ended up hiring Nikita into our Russian operations.

Nikita came to USA for training earlier this year, and has proved to be so brilliant, that we made him an offer to join our US operations.

Vineet joined a new hi-tech school last year, Cary Academy, and came home with stories about how bad Windows NT security was. He learned about the NT security problems from his classmates, and did extensive research on the Internet. Earlier this year, he told me that he wanted to try out some of the utilities that were available, but wasn't sure if that was hacking. He just wanted to test those programs.

I told him that he couldn't do any of this at school. We had installed a complete NT infrastructure at work recently, and I really wanted to understand how bad the problem was, so I gave him permission to try out all these tricks on our office network. Much to my surprise, he came back the first evening with a complete list of passwords for everyone in the company.

The next day, while I was at work, I lost control of the mouse, and was watching it move around the screen, wondering what had gone wrong. Suddenly I received a message: "Hey Dad. It's me. Isn't this neat?" My research department nearly gave me a heart attack.

Operating from home and using Back Orfice, he had taken control of my computer. I had never heard of Back Orfice before this incident.

Soon after this, I authorized our network administrator to purchase a high security firewall, Linux server, and tighten up all processes and procedures.

Since then Vineet has tried a number of utilities, with limited success. One lesson I have learnt is that there is no operating system that is completely secure. You can just make it harder for hackers to break in.

In the last three months, Vineet and Tarun have had me help them install a home network so that all of our PCs (5 machines for a family of 4) can share a common Internet connection, wire the entire house so that the lights and appliances are controlled by a remote control or PC, connect the DVD player of their PC up to a broadcasting device so that we can simultaneously watch movies on any television in the house.

We have also become experts on shopping on the Internet.

In trying to understand e-commerce better, I asked my lovely wife Tavinder to start shopping for everything she could on the Internet. Vineet and Tarun asked to join her. Very soon they figured out that if you know the right way to shop, you can get color printers, MP3 players, cosmetics, almost anything for ridiculous discounts. We have received dozens of packages over the last month and most of these have been at steep discounts and some even free.

Now I know why dot-coms aren't making money and why analysts are predicting a major shakeout.

How can a company make a profit when they're giving their merchandise away? They also have problems with delivery, customer service and are spending huge amounts of money on name recognition and customer acquisition. The premise is that they can achieve customer loyalty and become profitable in the future. Some of them will, but the vast majority of the dot coms will eventually go out of business because of a flawed business model and a lack of backend infrastructure.

I also understand now the competitive edge our customer base -- the Brick and Mortars -- have with their name, branding and most importantly, infrastructure. Clearly the Internet is the future, however.

This afternoon, Tarun is evaluating some software a local entrepreneur has sent me that provides an Internet filing cabinet. He loves the software, but has criticisms of the user interface. On many occasions, I have had the kids evaluate consumer technology for me. The last time around, Tarun's evaluation of the product was expressed in one simple phrase, "what the crap is this."

There is never a dull day in the technology field. With everything changing so rapidly, and new trends developing at Internet speed, any executive has to understand what is going on in all these different worlds of computing. My secret research department (my children) has probably been my edge!

Three-year-old Relativity Technology is based in Cary, North Carolina. It employs 48 people and has hired 50 Russian contractors.

Early in December, the Intel 64 Fund invested undisclosed amount in a third round of financing of Relativity. Wadhwa says the amount exceeded its previous round of $ 6 million.

He says money will help the company develop a version of its RescueWare software for the upcoming Intel 64 processors.

It will also help the expansion of Relativity's efforts to market its software, which transforms old computer data into forms usable in e-commerce, for brick and mortar companies wanting to go online.

The Intel 64 Fund includes Compaq, Dell, Hewlett-Packard, NEC, and SGI as co-investors and focuses on emerging technologies for coming servers and computer workstations that use Intel's advanced IA-64 chips. Its prestigious lineup of other investors, managed by Morgan Stanley Dean Witter, include Bank of America, The Boeing Company, Circuit City, Enron, Ford Motor Company, General Electric and Reuters.

Its RescueWare and other products analyze aging Cobol business systems and identify, extract and transform the data into forms ready to run on leading Internet applications. Wadhwa says the company is "teetering on profitability."

Next: Canada Says Hijacking Could be a Wakeup Call

Tell us what you think of this report