BUSINESSWEEK ONLINE : FEBRUARY 5, 2001 ISSUE
INFORMATION TECHNOLOGY Crossgain's Collision in Slow Motion CROSSGAIN LAUNCHES Former Microsoft software-developer stars Adam Bosworth and Rod Chavez launch Crossgain in February, 2000. The aim is to develop a service that runs heavy-duty applications over the Web. FIRST BLOOD In response to complaints that Crossgain is poaching employees, its founders agree in June to inform any Microsoft employees seeking a job with them to notify their supervisor. SLEEPING WITH THE ENEMY In September, Crossgain raises $10 million from venture funds, including one run by Microsoft nemesis James Barksdale. BRING ON THE LAWYERS In November, Microsoft accuses 23 ex-Microsoft employees at the startup of violating their noncompete agreements. Microsoft President Steven A. Ballmer rejects appeals from go-betweens to back off. COMPROMISE OFFERED In December, Microsoft offers to overlook the noncompete issue if Crossgain commits to building its service with Microsoft software. It already uses Sun Microsystems products. IMPACT In January, after testing Microsoft software, Crossgain decides not to use it. The company dismisses the 23 ex-Microsofties in an attempt to sidestep the noncompete claims. It plans to rehire those workers when their one-year noncompete periods end. _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ _ BACK TO TOP					RELATED ITEMS Crossgain vs. Microsoft: ``Mooning the Giant'' TABLE: Crossgain's Collision in Slow Motion INTERACT E-Mail to Business Week Online

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