WHAT THE HELL?
You have an ASIC undertaking?

On 22 July 1999, I gave the Australian Securities and Investments Commission an enforceable undertaking under section 93AA of the ASIC Act. It is a real public record. It is not a criminal conviction, a court judgment, or a finding that investors had lost money.

In about July 1999, I posted an invitation through internet newsgroups, including aus.aviation, inviting people to invest in a new internet company I proposed to form. ASIC's undertaking says the invitation went to approximately 25,000 email addresses and included the words “buy units now for $100 each”.

The idea was to gather enough interest and support to form an American company capable of investing in the rapidly developing US technology sector. My language—especially “units”—made the message look like an offer for securities. That is the central mistake the document records.

I had become convinced that the internet was about to transform communication, commerce and investment. I used early web-crawling and email-search tools, including WebSnake, and assembled a very large list of addresses. I then sent a proposition to people who might want to participate.

My recollection is that the contribution was intended as support for the next step—forming a company—not as a completed purchase of shares. The official document understandably treated the wording and the request for $100 as an invitation to invest. Both things can be true: I may have intended a preliminary contribution, and the message may nevertheless have operated legally as a securities invitation.

Facebook was not around in 1999. The companies and possibilities in view would have been the earlier generation of internet and technology businesses: companies such as Amazon, Yahoo, eBay, Microsoft, Apple, Intel and—by then—Google, which had been incorporated in 1998 but was not yet publicly listed. Any claim about what would have been bought, and how much it might now be worth, remains counterfactual.

Possibly. That is the honest form of the claim—not “we would have become millionaires”, because nobody can know that. If the project had proceeded lawfully, if the right people had participated, if the company had bought the right technology companies at the right time, and if it had survived all the ordinary hazards of investment, the result could have been extraordinary.

In my view, the administrative barrier stopped an idea at the moment when it was trying to become an institution. The point is not that ASIC should have ignored investor protection. The point is that a system designed to prevent exploitation can also stop inexperienced people from attempting something genuinely imaginative—especially when the person has no lawyer, no capital and no established company around them.

The undertaking ended the experiment. It did not prove that the underlying intuition was worthless. It proved that the proposed route was not legally available in the form I used.

The undertaking was accepted in 1999. It required me to withdraw the invitation and set out repayment and reporting steps. My recollection is that no money was received. The document I found records the obligations, but does not state an amount received or repaid or independently document each follow-up step. The public record, however, did not disappear.

Years later, anyone searching my name could encounter the entry without the surrounding explanation. A line identifying an ASIC undertaking can look like a shorthand accusation: “What did he do?” The answer is more specific. I used the wrong legal form and the wrong language for an early attempt to organise participation in the internet economy. The undertaking required me to stop and the public record remained attached to my name.

In my view, that search result also affected what I felt able to do next. I wanted to form companies and raise funds, but the old event made the whole area feel dangerous and closed. It cut me off at the knees—not because the underlying idea had been tested and failed, but because an early administrative intervention became a permanent piece of public context.

This is my interpretation of the long-term consequence, not a claim that ASIC intended to prevent every future venture. Investor protection was the stated purpose. The unintended consequence, for me, was a lasting reputational and psychological barrier to raising capital.

This episode has made me think about a much wider pattern. People often remember a seemingly minor administrative action that produced an inordinate consequence: a form not accepted, a classification applied, a deadline missed, a licence withheld, a sentence interpreted literally, or a person’s explanation reduced to the wrong category.

Researchers call part of this administrative burden: the learning, compliance and psychological costs people experience in dealing with public institutions. Michael Lipsky’s idea of street-level bureaucracy examines how frontline officials exercise discretion while applying general rules to individual lives. The OECD has also documented how poorly designed or outdated red tape can impede innovation, entry and investment, with small businesses carrying disproportionate costs.

David Graeber’s The Utopia of Rules gives the issue a more personal and cultural vocabulary: the feeling that systems built to serve human purposes can quietly become purposes in themselves.

None of this means every rule is pointless, or every official is malicious. Investor protection mattered. But a humane administrative system should be able to distinguish fraud from clumsy experimentation, recover from a misunderstanding, and prevent a single early mistake from becoming a person’s permanent public identity.