When you use notifyAll, you should also have a state changed and when you use wait, you should check that state change.
In your case it is likely that notifyAll will be called long before the threads really have time to start. (For a computer, starting a thread takes an eternity, like 10,000,000 clock cycles) This means the notifyAll is lost. (It only notifies threads which are actually waiting right at that moment)