The tally of debt is daunting. The developers of the site are owed $60K USD. The debt to, at least, 3 bloggers tops $20K with one owed $35K USD not including travel expenses. These figures are just the beginning.

Tristan Louis who owns the Blognation domain name may try to relaunch the site under a different corporation that will be free from all debts incurred by Blognation, Ltd.

Turn out the lights; the party’s over.

The irony of timing must be pointed out. Dennis Howlett observed that LeWeb and Sam Sethi controversy must be intertwined. For the Blognation Staff, LeWeb was to be our first team gathering – a chance to meet, a brainstorming session and a face-to-face social event – all courtesy of Blognation Ltd. As LeWeb shuts down today, so does Blognation.

I removed the donate button because it wasn’t working as coded. Please go to this post and click the donate button there. Sorry for the extra step and we’ll sort this out over the next day.

Download audio file (Scamtone5.mp3)

Download Pay Each Other Scamtone^TM

Download audio file (Scamtone6.mp3)

Download Really Big Noise Scamtone^TM

Download audio file (Blognation_ringtone1.mp3)

Download Bloggers Make No Money Scamtone^TM

I’m already a fan of Pat Phelan after meeting him and interviewing him at TechCrunch 40. But now, he’s helped me find another Irishman to love. Paul Walsh Segala’s CEO – love the badge – love you for thinking to do it. Trust the Irish, indeed!

Today’s Bonus Scamtone^TM.

Download audio file (Sam_sethi_ringtone4.mp3)

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I explained we were in the process of raising funding and that we were already in discussions with several Angel and VC’s as far back as July. Each editor was aware they would be paid in full, back dated from when they joined upon closure of the funding. I also said I expected to have closed it at the end September if not sooner.

In addition, a commenter pointed out that the About page at Blognation in FAQs clearly states that, “Blognation is backed by undisclosed venture capital by vendor advertising and through affiliate advertising.”

Also compare his statements this week with those in his own words to a prospective Blognation editor.

So what we’re offering everybody is a base salary, a percentage of the ad revenue based on how much traffic….  So the way the ad revenue works, the more people generate page impressions the more ad revenue we generate and you get a percentage of that revenue.

Pretty simple model really.  And then we offer stock options.  And we do that for everybody. And that just makes life useful.  Because as we said, there’s no point – bloggers make no money and if they make no money their not interested.

Download audio file (Sethi_ringtone3.mp3)

Sam compounds his twisted accounts of Blognation’s funding status by assuring Jemima Kiss of The Guardian that funding is imminent.

He gave me the name of the investor and said money is due to come through on December 10th.

“Anyone raising money knows that it takes time, and it can be a horrible business. It has taken four months to grow this idea to a brand. Every editor has a contract and has the right to sue me, but there are nine editors on the backchannel that are aware of what is happening with the funding.

Let me state the obvious and point out that today is December 11th and there’s been no word from Sethi on the checks he’s written or electronic transfers completed to his beleaguered editors.

Sethi does get one part of his quote to Jemima correct. All of those who joined Blognation have contracts and have the right to sue him.

Download the Scamtone^TM.

1. Sam privately apologizes to Oliver Starr and promises to pay Marc Orchant’s family along with making public apologies to Blognation’s editors especially to Oliver. Sam lied about having fired Oliver from Blognation two months ago as he did about firing me. In what has become expected behavior from Sam, there was no action taken on his promises. Marc’s family has not been paid and no public apologies have been issued. Instead…
2. Sethi has admitted that the Secora term sheet sent to TechCrunch came from his gmail account.
3. Sethi has admitted that he impersonated one of his blog editors to leave a comment on TechCrunch.
4. Sethi has locked out a top performing Blognation editor only because they communicated with Oliver Starr and me.

Blognation under Sethi’s leadership is moving from being a great idea and a strong competitor to the top blog companies like TechCrunch and Read/Write Web to becoming a through-the-looking-glass experience.

Tomorrow we’ll learn whether Blognation’s editors will finally be paid or whether there’s a new dimension to Sethi’s imagination.

Download audio file (Sethi_ringtone2.mp3)

Sam has claimed in his comments following the resignations of Oliver Starr and myself that Blognation editors were aware of Blognation’s funding. We were not when joining as he made declarations similar to the one recorded here to each of us which is a central complaint as expressed in Oliver’s letter. As is documented in the previous post here, I did not join Blognation until October 21, 2007 and was told by Sam on joining that Blognation was funded.

Sam left this statement in comment on Shel Israel’s blog.

A number of facts need to be corrected in your post. Much of what you wrote is blogsphere fiction and gossip. 1.I resigned – Mike never fired me on matter of principal. 2.I never stole any money and Arrington knows that as he claimed it from the sponsors. In fact Mike never paid me and still owes me expenses. 3. All the editors knew coming in that the project was seeking funding and would only be paid once we got the funding.

I can not speak to the facts associated with numbers 1 & 2 in Sam’s comment, but I can state unequivocally that #3 is a lie. Sam stated Blognation had funding to cover operations for one year when I agreed to join.

From the current investor’s point of view, if Sam did raise 1 mil GBP, they would likely want to know how that money was used. If Sam didn’t raise the money, then why did he say that he did? Many people would like to know. What say you now Sam?

Update: You can download the mp3 Scamtone^TM for your mobile – click here. More Scamtones^TM will be released here and via twittergram. Perhaps I’ll do a weekly Scamtone^TM release until the Orchant family is paid.

An exchange on Robert Scoble’s blog regarding Blognation continues to demonstrate Sam’s difficulty with speaking the plain truth. Robert was informed by a friend that he was rumored to be joining Blognation as an employee and he reacted quickly to correct the record.

UPDATE: a friend of mine just told me that there’s a rumor going around that I’m joining Blognation as an employee. I can categorically deny that. I never considered working for Blognation and am not considering a job there. Just to clear that up.

 

Sam’s comment on Scoblizer seems to confirm that he and Robert never discussed a position at Blognation.

Finally I will confirm that Robert has never been approached for an role within blognation. Robet and I have spoken in the past and that is all about blognation, podtech.net and other networks.

However, the story Sam told to the Blognation team on November 21, 2007 was quite different. The rumor about Robert’s participation was as an advisor on the Blognation Advisory Board not as an employee, but below is the message shared with the editor team via Skype group chat. The rumor was that Blognation’s investor considered Robert’s participation to be key to the blognetwork’s value.

Sam Sethi
10/21/07 12:14 PM
well confidential robert scoble has asked to join blognation … this is not for public consumption as nothing agreed. I am flying to the valley at end of nov to dicuss
Tris Hussey
10/21/07 12:14 PM
wow!
10/21/07 12:14 PM

leaving PodTech?
Sam Sethi
10/21/07 12:15 PM
also [name omitted as not story critical] is close to sign up
Tris Hussey
10/21/07 12:15 PM
nice
Sam Sethi
10/21/07 12:15 PM
and debi jones has officially joined the team
Tris Hussey
10/21/07 12:15 PM
w00t!
Sam Sethi
10/21/07 12:15 PM
In Feb Robert can leave
Conor O’Neill
10/21/07 12:16 PM
amazing news!
Tris Hussey
10/21/07 12:16 PM
very, very interesting
10/21/07 12:23 PM

thinking about how Scoble wold fit in … great guy, lots of connections
10/21/07 12:27 PM

have flock 1rc3 installed … looks good
Chris Saad
10/21/07 3:23 PM
Looking Tris
10/21/07 3:24 PM

hah cool
10/21/07 3:27 PM

great news about scoble
Robin Wauters
10/21/07 3:28 PM
agree, and also [name omitted]

10/21/07 3:28 PM

2 high-profile additions
Chris Saad
10/21/07 3:28 PM
Not familiar with [name omitted]

Robin Wauters
10/21/07 3:28 PM
she writes [site name omitted]

Robert is traveling and in London today. I spoke with him via phone a short time ago to alert him to this post and ask for his thoughts on the inconsistencies. Robert said, “We never talked about me taking a job at Blognation.”

I shared with Robert that the rumor was his joining as an advisor not as an employee.

“Yes, I was interested in Blognation and I’ve been talking to a lot of people about my career lately.” When I asked about the trip to the San Francisco Bay Area Sam planned to meet with him, Robert responded, “yes, but that trip never happened.”

“This is just another example of his problem with, uh, his, uh, management style. I would never announce in a semi-public area there was a deal until I had a contract.”

Indeed. Which are we to believe? Sam’s comments to the Blognation team or his comments on Robert’s blog? If Sam told me the sky is blue, I’d have to look up.

I’ve learned today that a voice recording exists of Sam telling a prospective Blognation editor on June 6, 2007 that he “has already raised 1 mil GBP” to fund Blognation and pay editors 3K GBP/month. Further, “we are budgeted for 22 editors…”. If you wish to report on this story, leave a comment or contact me directly and those who are agreed by the recording owner can listen to portions or all of this 30 minute recording. Be prepared to pay for the international call before making your request.

Oliver shared in his letter that multiple promises had been made for payment including the manufacture of supposed bank transfers which never materialized. Below is one such document. I’ve blacked out identifying information on the editor involved to protect their privacy. Keep in mind that Sam offered this screenshot to the editor as proof that a transfer was in route. Why was the proof required? Loss of confidence as a result of many failed promises. When no monies arrived after a week of waiting, Sam claimed it was a mistake. Is he that incompetent or a fraud and liar? Tough choice.

Click on the image above to view full size.

Keep in mind that the payment referenced above was not delivered. It’s impossible for reasonable people to comprehend someone going to such lengths as this knowing full well that no payment was made and therefore the lie would be revealed in a matter of days.

I still struggle to understand Sam’s irrational behavior. Stayed tuned.