Software Company Alumni Remember the Hot Tub Parties of Their Heyday

Tech companies like Google are known for providing luxurious amenities to appease their hard working employees, and software company Santa Cruz Operation, which began in the late 70's, was no exception. 

Employees of SCO enjoyed many perks. The most famous: the legendary redwood hot tub that percolated deep into the night behind their Mission Street office building (where CVS now stands). 

"I don't really know all that went on because I didn't want to, but it became somewhat famous... It certainly instilled a lot of camaraderie and encouraged people to work long nights because they didn't want to miss the party afterwards," said Doug Michels, who started the company with his father, the late Larry Michels back in 1979 on Chestnut Street in Santa Cruz.

"When we started to get successful we ran out of space over there [Chestnut Street] and took over an old holistic health clinic. Before we had rented it had been full of chiropractors and acupuncturists," said Michels. "...and an old redwood hot tub."  

At its peak, and before it was sold in the year 2000, the company employed some 1,500 employees worldwide, and around 1,000 in Santa Cruz, making it the largest employer in Santa Cruz at the time.

Cherrie McCoy worked in the customer service department on Chestnut Street. 

"It was pretty exciting to come to work every day," says McCoy who was known as "The Princess in Purple" around the office. 

"We did a lot of stuff over the phone, so people would picture us in suits and hair back, and we were wearing tie dye and shorts," said McCoy.

Around the time she started working for SCO in 1988, the Santa Cruz Sentinel published an article entitled "SCO Employees Must Wear Clothing."

The headline told the true tale of a new office rule: Clothing required between 8 a.m. and 5 p.m., implemented after a naked hot tubber returned to his desk in the nude during the prime hours for "big wigs" to drop by, said McCoy.

She also remembers the strict implementation of a "no drinking before 4 p.m." rule, which luckily didn't effect the Wednseday evening staff meetings, known for the beer that ran as free as brilliant ideas.

"It made such a difference of people loosening up, really getting stuff done in the meeting instead of going over a boring agenda. Then the trust is there and you can rely on people, so it was a whole different dynamic instead of just shutting down and going home and forgetting about it the people became part of your lives," said McCoy, who was with the company for 14.5 years and now works as a massage therapist in town. 

But it wasn't all tye dye, late night pizza deliveries and beer after 4 p.m.; Michels will attest that SCO employees were brilliant, driven and inspired.

Peggy Dolgenos, co-founder of Cruzio with her husband, Chris, (who also worked at SCO), says SCO was "almost like an incubator in a way." 

"It was really an ideal learning place for those of us who were new to, and interested in technology, young programmers, people coming from UCSC and in some cases, like in my own case, first I worked at SCO and then I went to UCSC. So it wasn't only one way it fed the other way too," said Dolgenos.

"And the culture was very Santa Cruz oriented, it was fun, but also extremely intelligent, very hight tech, very ambitious, very idealistic, those are all things that are very Santa Cruz," Dolgenes said.

It was the primitive messaging system at SCO (the beginnings of e-mail) that inspired her and her husband to start Cruzio.

"My husband and I, we had it because we worked for a big computer company but we just thought 'well everyone would love to have this," Dolgenos said.

Cruzio's recently started the co-working space Cruzioworks was also inspired by the spirit of SCO—a collaborative and open environment, said Dolgenos.

And while the days of SCO are long past, their legacy lives on; SCO was the first company to introduce the Unix operating system to personal computers.

"Today Unix is the base of Apple's Mac OS, and it's sort of the predecessor of Linux. Unix has become a very important part of the computer market place even now. But when we were starting out we were first in that market, nobody used Unix and certainly nobody used it on low cost personal computers," said Michels.

In fact, the first massive platform they introduced Unix to was Steve Job's prized "Apple Lisa" computer, Apple's first personal computer with a graphical user interface.

SCO had close ties with Microsoft as well, and Michels has nothing bad to say about Bill Gates, his former competition and partner, not for lack of digging.

"We had a very long relationship with Microsoft. We were partners, we were competitors, they invested in us, at one point they owned 25% of the company, we licensed technology from them, we had lawsuits with them, we had every type of relationship with Microsoft you can imagine," said Michels, and leaves it at that.

But having such an advanced technology company while the rest of the world was still breaking out of the Internet stone age had its challenges. 

"We were very early with Internet technologies and I think missed some of the Internet excitement because we were actually too early," said Michels.

For instance, SCO had a close relationship with Pizza Hut (they were a major customer), and introduced them to the Internet as a way to take pizza orders over the Internet.

"But the Internet wasn't really as popular, not as widely used as it is today, and so the folks at Pizza Hut, some of the people we worked with were very excited about it, and we got a lot of publicity around it, [The Wall Street Journal picked up the story] but the marketing people at Pizza Hut didn't believe that that was the future of it," said Michels.

Little did they know...

On Saturday, September 22, 2012, Santa Cruz Operation will enjoy a reunion party at the Coconut Grove—the direct result of alumni wanting to get back in touch with each other.

"We had a great team and there was a lot of friendship in the team so it was nice that they wanted to spend time together," said Michels.

All who have ties to SCO are welcome to join the fun on Saturday, which includes a performance by the SCO alumni acting group "the Follies."

For more information on the party, click HERE.