In the News

More than 400 people crammed into the District wine bar in the South of Market on Thursday evening for a chance to work for free at a Silicon Valley startup - or find somebody who would work for free, at least for a few hours a week.

Lured with free drinks provided by the startups, unemployed people spilled out the door onto the sidewalk and were blocked from entering by a security guard when the room got too full. At one point, there were 50 or so people waiting in line, although some gave up and left.

"These are tough times, but we had no idea there would be this kind of response," said organizer Julie Greenberg, a founder of Jobnob, a startup that posts salaries and job listings online.

Ivy League MBAs came, she said, as did engineers trained at MIT and Stanford, "people with impeccable educations. ... We were unprepared (for the crowds), this being the first time."

Working for free in this economy - when it's hard for employees to find jobs and for employers to find money to hire them - is a growing trend, said Max Shapiro, a former talent scout for the NBA who started PeopleConnect, an employment agency based in San Francisco that finds teams of people to staff startups.

After the dot-com bubble burst in 2001, PeopleConnect continued to prosper because of a new program Shapiro devised: Employees Without Paychecks, in which Shapiro's recruits agree to work for options but no cash for about three months while their high-tech or clean-tech employers raise early rounds of funding.

Shapiro said PeopleConnect "will kiss 40 or 50 frogs" and then present the best two or three prospective employers to a client.

If all goes well and the employees can persuade their spouses to let them work for free, they are converted to salaries about three-fourths of the time, Shapiro said.

That's what happened to Glenn Carnahan, who joined Mariah Power - a startup in Reno that creates power from wind - as chief financial officer, at first just for options.

Why did he choose Mariah Power?

It's important to "have a hand in building a better planet" for future generations, he said, "and startups that do it right don't look to pay the big salaries."

PeopleConnect also runs on a shoestring; it's virtual, with recruiters in Seattle and Silicon Valley, an administrator in Birmingham, Ala., an accountant in Orlando and a borrowed meeting room in San Francisco.

Jobnob, meanwhile, plans another happy hour next month, at a bigger place, according to Greenberg.

One attendee, Jarlath O'Carroll, was laid off one month ago but expects three job offers next week.

"I don't know if I want to take them," said O'Carroll, who was at the Jobnob event as a prospective employer. He is also trying to start his own company.

E-mail Deborah Gage at dgage@sfchronicle.com.

This article appeared on page C - 1 of the San Francisco Chronicle