Butts in Seats: Part Duh

Several eons ago (i.e. December 2019), I wrote a post called Butts in Seats that made the astounding claim that the whole business of having people come in to a shared office five days a week for at least 9 consecutive hours (don’t give me this 8-hour day bullshit) was over. Done. Finito. Old news. In fact, I called myself a dinosaur for having a residual fondness for the butts in seats concept. Well ..

Technical co-founder looking ahead to the future of work in the Cretaceous Era.

From: Rex, T.
To: Civilization Steering Committee, Ranking Member/Theropods
Re: Our way of life

With respect to some of the recent environmental changes, some of the other theropods and I think that learning to live in holes in the ground might be a good idea. It’s clear from the KPIs that business is down slightly. With searing hot glass particles raining from the sky, tsunamis wiping out the coasts and wildfires sweeping the earth it’s become much more difficult to carry out our daily, keep-the-lights-on business out here in the open never mind starting any new lines of business.

Some ideas we already came up with – we could make shelters out of the deadly, searing hot glass particles. We could work by the light of the wildfires. Not ideal, obviously, but on the plus side, there’s lots of attractive new oceanfront property to build on.

We propose forming a committee to look into it. Might take a few millennia to get a good start on it, we’d have to do a pilot project, gather some metrics. We’ll need representation from all departments, yes even the sauropods. I know they’re slow but what are we going to eat if we don’t bring the sauropods, right? We acknowledge that selling this to the pterosaurs and icthyosaurs will also be problematic. It will take some time.

Let me know what you think. No rush. We’ve ruled the earth doing things this way for 150 million years and that’s not likely to change anytime soon.

T. Rex

Butts in Seats

I’ve always been a big fan of face-time. Not the Apple messaging app but the concept that people who speak face-to-face are exponentially more productive than people who message in “other ways”. The idea that a group of people working on the same product should be in the same room most of the time. Whiteboarding, non-verbal communication, hallway conversation. In other words – Butts in Seats.

Engineering manager ca 1995

Having said that, I’m also a big fan of Tyrannosaurus Rex, and they’re extinct. Butts in Seats is not yet as extinct as Sue the Dinosaur, but the writing is on the wall. Face to face collaboration can no longer be an expectation.

I do a lot of hiring, and the people I’m recruiting know all this. They know that old people like me want Butts in Seats. They also know that recruiting and retention are two of my biggest problems. So they bullshit me.

“It won’t be a problem” they say, and it isn’t … until it is and then having hired them it’s my problem, not theirs. I had one guy go so far as to ‘forget’ to tell me until after we hired him that he already had plans to move from a 5 minute commute to an hour plus commute. That caused plenty of grief and, as the defender of Butts in Seats, I ended up eating every bit of it myself.

So you hire someone for whom the commute “won’t be a problem”, but they need to do 10:30 once in a while. Of course, 10:30 once in a while becomes 11:00 three times a week which turns into “I need to wfh”. Pretty quickly a job that can often be fun (mine) has this daily corrosive edge to it where you drive in wondering who’s going to be pushing the Butts in Seats Boundary today and how far.

Seriously, what kind of a dick busts somebody for showing up a half hour late when we expect people to be available via Slack from 8AM to 10PM whether they’re in the office or not? Only the kind of dick who believes that a deal is a deal, and who has the support from his boss to enforce it. And let me tell you from experience, since everyone in a startup is a single point of failure, any support you think you have for enforcing Butts in Seats will disappear the minute it threatens retention. Your Jedi Manager skills should paper over the contradiction there.

In November of 2019, in the Boston market for technical talent, there is no graceful way of managing someone who isn’t meeting the Butts in Seats requirement (also known as the agreed upon and totally reasonable shared crossover in-office time of 10AM to 4PM).

What to do about it?  I’m damned if I know.  The tradeoff that seems to resonate with people is availability for flexibility.  If your off-hours time are available to the company, then your butt shouldn’t have to occupy a dedicated space at the company for a company-defined eight hour stretch.

Sure – availability for flexibility – fine. But that solution to one problem – availability – spawns a host of others, accountability, predictability, communication and the ever-popular productivity.

The real problem with Butts in Seats is its primacy – the idea that remote work is a perk that’s doled out to those who aren’t on the naughty list. I’ve managed groups where wfh was a perk, and it worked, but that moment in history has passed.

Butts in Seats is a luxury that startups can’t afford.

If the primacy of Butts in Seats is the problem, Remote First is the solution. Remote First is the organizational notion that online, non-face-to-face collaboration is the norm and face-to-face is the exception. You employ people wherever they are, and ‘figure out’ how to collaborate.

I don’t know how to do Remote First. I’m not even very good at Remote Second or Remote Third, or Remote Only In Emergencies. I hate managing remotes.** But I hate being non-competitive even more so it’s time to figure out Remote First.

** Updated 1/19 – struck through the hate managing remotes line so I can apply for jobs managing remotes.

You Don’t Need a Technical Cofounder



A ferret.

It’s standard practice these days to have a weird, bearded man in your startup.  A guy you can cite when someone says something innocuous like “Everyone likes kittens!”, and you say “Well, except for Jason ….”.  Everyone nods.  Yeah, he makes the code magic, but what’s the deal with Jason and the pet ferret?

But do you really need Jason?  Or put more precisely, is the value of a bearded man worth the price you pay to buy him?  I’m going to make the case today that it isn’t.  This flies in the face of the advice you’ll get from angels, VCs, accelerators and of course bearded men everywhere, so I’m tilting at a windmill that will continue to turn no matter what I say.  Left to their own devices, that’s what bearded men tend to do.


A bearded man.

Let’s say you’re a non-technical founder – an MBA or Subject Matter Expert.  You have a product idea.  The standard route to MVP is that you recruit a technical co-founder, give him half the company and he makes it happen. I enjoy this state of affairs.  As a bearded man, I need people like you to need people like me because in a just capitalist world, a guy like me who couldn’t sell fire to the Eskimos and doesn’t play well with others would starve.

To you, the non-technical cofounder, the benefit of having the bearded man on-board is that you can go deep on customer development and shallow on product development because, theoretically, your bearded man has that covered.  You do what you like, and are good at, Jason does what he likes and is good at … your path to IPO is clear.

But consider this … the base salary for guys like Jason at jobs that he can do blindfolded is 150k-250k.  The entire time he’s working for you, recruiters will be knocking on his LinkedIn reminding him of this.  And he can land those gigs without trying.  True story: I once showed up late for a job interview wearing torn jeans and a black Jack Daniels sweatshirt with the sleeves hacked off,  rocking an epic unkempt biker beard and got the job.  You have to overpay to get a bearded man and even if you do that’s no guarantee that you can keep him because it’s so easy and profitable to leave.

Consider also that really hard technical work comes in fits and starts at many raw startups.  When the MVP ships and your critical path to survival is sales and bizdev, not product development, a huge chunk of your equity, cash and mindshare may be tied up doing non-critical-path make-work because “Jason doesn’t sell”.  The more stereotypically technical Jason is, the uglier that period of time is going to be for you and the more bad decisions you’re going to make just to “keep Jason’s head in the game” or to serve his misconception that product development is the be-all, end-all.

And finally, think about how hard it really is to build the thing you want to build.  I’ve talked to dozens of non-technical co-founders over the last decade or so, and 90% of them are pitching pure execution plays – no new science involved.  Everything is work, but not everything is hard work.

You’re pitching yourself to investors as a scalable CEO – someone who can figure out when, and how much, to pay up for the things you need and when to find another way to get it done.  If you start your venture by overpaying for a technical cofounder, you’re not a scalable CEO.

What’s that “other way”?  That’s your problem.  Remember, I’m the bearded man.  I like things the way they are.  But I have seen a few different approaches that work.

Be creative.  One non-technical cofounder I know took his idea to undergrad CS classes, more than once, and had them work up versions for him.  Is this textbook, ideal-world product development?  No.  Did he enjoy it?  No.  Did it work?  Yes – he made it work.  Remember your Lean Canvas (and you have done your Lean Canvas, right?)?  What’s your unfair advantage?  If you have a way of making this happen without overpaying a bearded man, that’s an unfair advantage.

Find actual volunteers.  Non-technical co-founders scam free work from friends and randos all the time.  As a bearded man I find this annoying and, in another mood will tell you “Don’t be that guy”, but today I’m here to actually help you.  So yes, sometimes you need to be that guy asking people to do stuff for you for free.  You will be rejected a lot.

Find equity volunteers.  Face it, paying people with equity is the equivalent of not paying them at all.  That said, there are way more equity volunteers out there than you think.  And there are reputable, proven contract houses that will work for equity if they believe in the founder and the business.  The trick is in finding them and making them believe.

Pay up.  Find a contractor at someplace like toptal and pay them to do the work.  This is actually harder to manage than actual volunteers or equity volunteers.  It’s also, in my experience, least likely to succeed.  The more I think about it, the less I like this option.  I take it back.  Don’t do this.

And now, having wasted a lot of your time delivering you something you almost certainly didn’t want and can’t use, I will say what every true bearded man says when he does something like that:

You’re welcome.




How To Be A Startup CEO: Part 37

I’ve been droning on about Scrum (or hiding in my cubicle at athena) and haven’t handed out any righteous startup-CEO wisdom in a while so, based on a Quora query, here’s some advice for all you business types as you leap from the walled garden of corporate life into the wild world of startups.

manwithlaptopOnce you leave the corporate world for startup land you quickly discover all the things that corporate did for you that you now have to do for yourself.  Like “personal IT” i.e. the services you use and the devices you carry.  Here, from careful observation of several startup CEOs, I offer some distilled best practices when it comes to handling your own IT.

  • Keep the Windows XP laptop from your last job. Startup CTOs love Windows update.  And it’s okay if the thing crashes every couple of hours and only boots every other try, hard-reboot fixes anything.
  • Insist on leaving it just as it was so you can continue to use all the expensive Windows tools your old company paid for.  That way you can keep trying to domain-login to a network you’re not even on anymore.
  • One word: Outlook.  You MUST have MS Outlook.  Preferably the version that stops working when the .pst gets up to 2G.  Make sure to bring along that 1.99G pst file too.
  • Whatever you do, your laptop and all the programs on it must be entirely different from the laptop and programs that everyone else in the company uses.  This will ensure that your CTO never gets complacent.
  • Virus protection slows the machine down so turn it off whenever you need the machine to go faster.  Remember whatever trouble you get into, your technical cofounder can get you out of it.  After all, he’s a genius/ninja/rockstar.  You said so yourself.  Oh, and McAfee is the best – you can tell because their founder is a psycho.
  • Names are hard, and domain names are REALLY HARD.  So you need a shitload of them.  And you never know when your current startup is going belly-up so you should register all the company domain names in your personal GoDaddy account.  All DNS registrars are the same.  And keep adding domains to your personal account even after the CTO has setup a corporate account somewhere else.  After all transferring domains is easy.

If you’re one of my former cofounders and recognize yourself here, pat yourself on the back, but realize that you are not alone. Every one of these best-practices have been vetted by multiple co-founders.  In some important ways, all startup CEOs are the same.


Some Concrete Things To Think About With Technical Co-Founders

I talk to a fair number of people who are looking for technical co-founders to help them build web-based businesses.  When we get to the point where we decide not to work together, the smart ones always ask me if I have any advice for them moving forward.  And I do.  Here it is.


It’s tempting to think of yourself as the next Steve Jobs and to imagine that the bearded man you’re having coffee with later today is the next Steve Wozniak.  Not happening.  You’re not Steve Jobs and that guy you met on cofounderslab is just an ungroomed jumble of untested technical skills, social awkwardness and unknowable cofounder potential.  The question is – What can he do for you in the next 18 months?

If I were a non-technical cofounder building a web app from scratch I’d have two demands of a technical cofounder, or contract house. First, that they build good stuff – i.e. that the product work and that it looks good.  Duh. Second, that they can create, and from day one deploy to, a continuous integration infrastructure – aka immutable infrastructure.

“CI from day one” means throwing away a little bit of time in the beginning setting it up, and dedicating a little bit of cash burn in the long run. For your purposes, CI is a system that can take a change to a web site as committed to source control, run automated tests against it, raise a flag if the tests fail, or deploy successfully to staging/production if they pass.


Think of your infrastructure as a sort of 3D printer that takes your designs and turns them into real-world objects.  Your business, at heart, is a machine for producing iterations of a web site.  If it can do that quickly, at high quality, it may be worth something someday.

If your business produces iterations of a web site that take days to code trivial changes and those changes fail deployment every single time you go to production then what you’ve built is not a business – it’s a learning experience.

What you will get if you talk to the young and ambitious crowd is a lot of people who:

  • can work within an infrastructure that someone else has set up OR
  • can set up a one-off web site from scratch in the cloud using a bare-naked Linux instance with a bunch of stuff configured on it and can redeploy manually, or via source control (not deployment packaging).

They have no idea how to setup something that multiple people can contribute to, that automates testing, and that deploys correctly every single time.


If you set up immutable infrastructure, the bus-factor for your technical co-founder goes to zero, which is something that you desperately want and that they shouldn’t fear.  But even better, when you have an infrastructure that works, you can profitably employ all those cheap and available people who can only do good work within a working infrastructure – e.g. junior web devs, recent Startup Institute grads …

And if you’re thinking about outsourcing – you must, must, must own your own infrastructure, every little bit of it including DNS.  And think very carefully about the access rights and take continuous backups.  Get a friend to setup the accounts if you have to, but don’t rely on your outsourcer to do it, and don’t have them as administrative owners of any piece of it.  Having your outsourcer provision your infrastructure works great right up until the first time the two of you disagree about money.  Ask me how I know this …

I would also spend some time reading up on the concept of a Scrum Product Owner, even if you don’t intend to ‘do scrum’. As founder you have the ultimate authority over everything, but some of these responsibilities you’ll entrust to people you collaborate with. After all, you don’t want to micro-manage.  That’s fine, but the PO concept defines the set of things that, as “product person”, you need to own and not compromise about.  I’ve found over the years that successful companies, even ones that don’t do Scrum, concentrate the same set of responsibilities within product management that Scrum entrusts to Product Owner.

And, from day one, implement the concept of the sprint demo. You will find, talking with devs, that you’ll ask the question “Is it done?” and they’ll say “Yup, X, Y and Z are all set.” Only later will you discover that “it” and “X, Y and Z” are different things. If it’s done, prove it, and if you can’t show it, it ain’t done. This is HUGELY important with outsourcers.  The sprint demo is about quality and accountability.  Live it.

Notice that I haven’t said anything about stack.  Frankly I mostly don’t care about the stack and you shouldn’t either. RoR with some javascript framework seems to be a standard thing, and well-known among the offshores, but there’s a dozen good ways to write a web app these days.  In any case, whatever stack I recommended today would be wrong tomorrow.  Immutable infrastructure, on the other hand, is a sine qua non from this point forward.

In a nutshell, here’s my advice:

  • Immutable infrastructure
  • Own your own infrastructure
  • Be a Product Owner
  • Enforce the Sprint Demo

And remember, easy for YOU to do is easy for ME to say.  Ahh, the joy of blogging.

Please Wait – How It’s Your Friends Not Your Enemies Who’ll Get You In The End

dinosaur-02Like most developers, I have a couple of non-profits that I’ve supported for many years (see here, and here). When I first met these folks,  Kip and Fran, dinosaurs roamed the earth and their professional home was paying tens of thousands of dollars annually in maintenance contracts for their Wang word processors. That’s how long ago it was – Wang was a thing. The progression of that relationship, and how it compares to my paid work has taught me a lot.

One of the things I learned is that, it’s not your enemies that will get you, it’s your friends. I spent the first few years bemoaning the performance, or lack thereof, of some of the volunteers Fran roped into helping her. I was in the process of evolving into a Scrum fanatic and the behavior of volunteers drove me straight up a tree. They delivered, they half-delivered, they showed up … or not – crazy-making stuff.

duhThen it was my turn. I committed to a task (now forgotten – I wonder how that happened?) and dropped it completely. I’m sure I had an excuse and it may not even have been lame. But the job was on my plate, they waited for me, and it went undone. When I realized what had happened it struck me almost instantly that for Fran at least, her friends were way more dangerous than her enemies. I’m sure Fran was thinking “Duh – volunteers.” but to me it was light dawning over Marblehead.

At the same time that particular light dawned over Marblehead, I was coaching, forming and scrum-mastering a number of Scrum teams. At standups, over and over again I’d have this little exchange with one or more team members:

Team member: I’m waiting for X

Me: Why?

Team member: Ummmm

I started looking closely at the “waiting” phenomenon and realized that the waiting impediment always fell into one of these buckets:

  • Waiting for someone to do something
  • Waiting for a purchase
  • Waiting for an external deliverable

I also realized that the waiting was 99% bullshit.  I started asking people “why didn’t you do it yourself?”. Magically, half those impediments disappeared without my doing anything more than arching an eyebrow and asking a simple question.  The Scrum principle being served is

Incentivize cross-training, de-incentivize specialization/siloing.

mi-ch438_amex_j_20150121164942Waiting for a purchase? Buy it.  Put it on the company credit card and fight with accounting later. What are they going to do, fire you? Many times, I bought stuff on my own nickel just to “not wait”. Abusing the corporate credit card became a foundational principle of the group and I got most of those personal nickels back in the end too.

Waiting for an external deliverable? Split the story, finish the half that can be done and put the dependent half on the product backlog.  That makes it the Product Owner’s problem, not yours. And that means it’ll go away because the PO has way more juice than you do, and his ass gets fired if the product doesn’t happen not yours.

People realized quickly that reporting a status of “waiting for X” would lead to an awkward standup moment, so they got proactive and started bringing them to me asynchronously.  And the group went faster.

Eventually I just told people,

Don’t wait for anyone or anything.

It was that simple. If you’re building stuff for me, you don’t wait for anything.  Call it Rodley’s First Law of Getting Stuff Done.

As I worked with more and more concept-stage entrepreneurs I realized that they needed the First Law of GSD even more than I did as Scrum Master of a team of builders.  Waiting is death for startups.

When you wait, you’re wasting the only resource that you can’t replenish – time.  Mark Suster addresses this indirectly here when he says

In a startup market the biggest competition is inertia

Waiting is inertia.  Stop it.



First Impressions Matter

I started a company once with some awesome people who had lots of virtues.  But … at one point early on, one of them introduced me to an outsider as “the developer”.  Those of you who know me from the real world (hi Ed!), can imagine how I reacted to that.  Why is an introduction like that a problem?  After all, I was the developer. It’s a problem because for that particular outsider, I am now, and forever “the developer”.  Not CTO … “developer”.  I won’t get that intro back.  It made me feel bad.

despicable-me-2-gru-minions-pp33118_zpsdcda23f2My feelings, of course, don’t matter much because a lot more than my feelings were going to be hurt by the time that ride was over. There’s nothing anyone could do about that.  And you can’t be super-sensitive in this business blah, blah, blah.  But there are good reasons for even a heartless CEO who disdains, even hates his subordinates to be careful about intros – good self-serving reasons.

I worked for a guy once who consistently put his people down when introducing them to outsiders.  His Director of Engineering became “the software guy”, his Project Manager became “my assistant”, his CFO became “the accountant”.  He did it, I’m certain, because he was deeply insecure about his own chops and didn’t trust us not to show him up with outsiders.  So in any meeting, right from the intros, he was “The CEO” and the rest of us were minions.

I remember watching people’s faces as he did this, and I could see their loyalty to this guy draining away.  It was sad.  Nobody wanted to travel with him.  In meetings we all sat there quietly, having been appropriately down-titled during the introductions.   We felt bad, but those are just feelings which don’t count, right?  They did count because when hard times hit, they hit us hard, and it all came back to him.  He’d throw something out in a meeting and be met by dead silence.  He’d look around the room and say “doesn’t anybody have anything?”.  And nobody did.  After all, we were just minions.

rumbleOn the flip side, I worked for another guy who consistently oversold his team, myself included.  When he introduced me to outsiders I was not just whatever title I had at the time, I was also a genius, rockstar, ninja – any of the ridiculous things Silicon Valley CEOs call their tech guys.  I actually asked him at one point to tone it down – I’m nobody’s idea of a rock star and it was a little unnerving.  But he was more right than wrong in doing that.

The basketball analogy I used back here works well for this.  The overselling CEO was actually “making space for himself”.   He could say objectively-stupid shit and get away with it because he had peers who could laugh and correct him.  By working introductions the way he did, he put the rest of his team in the game.  Any one of us could jump in if he got in trouble.  And because he was surrounded with ninjas and rock-stars he got called on stupid shit much less than he would have otherwise.  After all, if I were actually a ninja I might jump in and kick your ass if you put my CEO in a bad spot.  I could see people thinking about that when Mr. Uptitler went off the rails in a meeting.

That didn’t sound right. Should I jump on it? Or do his guys know more than I do and they’re just sitting there waiting for me to stick my neck out … Meh, it’s not that important, I’ll let it run and see where this all leads.

Imagine this scenario. You’re meeting with a VC and you’ve introduced your CFO as “the accountant”. You’ve started the meeting by insulting her, or worse, refighting a battle you already lost about her title.  Is she going to be willing to jump into the conversation and help you past a rough spot?  Will anyone even listen if she does? Or will she be dismissed out of hand?  And this is not even addressing the question of why you would bring an “accountant”, “developer” or “assistant” to an important meeting.  When Mr. Uptitler said something stupid, we fixed it and moved on.  All it meant was that he’d misspoke.  When Mr. Downtitler said something stupid, it meant the company was stupid because no one on his side had the juice to fix it.  “Accountants”, “assistants” and “developers” don’t correct the CEO in a meeting. They don’t even speak.

Next post, we’ll tackle the sensitive topic of startup titles from the CEO’s perspective, and everyone else’s.

Consultants Aren’t People, and Other Fallacies

A long time ago, in a suburb far, far away, I was a solo consultant, making my way in the world doing fun technical stuff. It wasn’t an easy life, but it had its attractions, and few dangers or so I thought. The solo consultant’s only natural predators are other consultants and CFOs who are always looking to stretch payment and cut headcount.

In this long-gone time, I was sitting pretty having just completed a two month contract. All I needed was the check. After farting around for far too long, I’d finally gotten my invoice in the queue and I wasn’t worried. Until I got a call from the friend who’d sold me into the contract. The company was in trouble. Deep trouble. If I wanted to get paid, I needed to get up there.

When I got there, I met the friend, and the new CFO who I realized had been brought in to wind down the company. This guy, who owed me nothing, pulled a check from the bottom of a big pile and handed it to me.

This will clear, if you can get the CEO’s signature on it.

I took a deep breath.  I am not a leg breaker but I really like getting paid.  Thirty minutes later, a very surprised CEO got a call.


I’m sitting in a car outside your house. I have the check you guys wrote me but there’s no signature on it. Could you come outside and sign this for me?

Not knowing that I have a peaceful nature and all the muscle tone of a jellyfish, he hurried out and sheepishly signed my check. I ran to the bank and cashed it.  “Yes, I’ll take that all in cash please”.  Two days later, the sheriff padlocked the doors as the company went Chapter 7. A week later, I used that money to buy a new car for cash.

As I said, the new CFO owed me nothing. But he looked at the mess this company had become, saw that I was going to lose almost 20% of my annual gross out of it and he took care of me. I’ve never gotten to repay that favor and probably never will, but I also never forgot it.

In the intervening years I’ve had occasion to use contractors and remembering that episode, I’ve always been hard on them in only one respect. Get your invoices in. I don’t have to do it, and various CEOs have wished that I wouldn’t.  But I do and a couple of times along the way it’s paid off in a guy walking away with one or two more weeks of money than he would have gotten otherwise.

It’s the same with permanents as I covered back here. Over the years there have been a handful of employees who have done great work for me and I’ve almost never been able to pay them market rate, so you take care of them in other ways. I take care of everyone who works for me, but the performers – I will do anything for them. That’s kind of the deal, everyone who’s done good work for me has moved my career, and that’s what I owe them.

Your beautiful idea means nothing to me

This one is for all the non-technical co-founders out there and their beautiful ideas.  I won’t sign your NDA.

I’m a technical cofounder looking for a gig.  This is no secret.  I hang out on cofounderslab (Hi Shahab!) and FounderDating and talk to lots of non-technical cofounders.  Great people, I haven’t met one I didn’t like yet. However, a small but energetic minority of these guys insist that I sign an NDA before we talk.  I refuse, but I try to do it nicely. Here’s what I say.

ios-nda1My perspective on NDAs is a lot like Brad Felds.  I talk to a lot of people about a lot of things and literally can’t have an ever-growing paper tail of NDAs (i.e. contractual obligations) dragging behind me for the rest of my life, pretending to restrict what I can and can’t say to people.  Back in 2009 I signed an NDA when I was talking to a web analytics company about a job.  Literally the next five guys I talked to were doing web analytics.  If I took the NDA seriously I couldn’t have had coffee with those guys.  I realized that stupid NDA was working like a non-compete.  I had traded my ability to speak openly about web analytics for a 10% chance of working for this one company.  I’d given something valuable and gotten nothing in return.  It’s the last one I ever signed or ever will, at least in that situation.

If we’ve gotten to the point where you want my JR on an NDA we can do one of two things: skip the NDA and go our separate ways, or have a discussion where the special sauce (i.e. the how) is elided.  I’ve done that with a handful of guys – have the discussion but be really oblique about the special sauce.  The problem for them is that they’re trying to recruit me, but they can’t prove how smart they are, or how wonderful the opportunity is.  And I can’t prove how smart I am because we’re talking around the actual thing.  I wind up underwhelmed and they wind up feeling like they haven’t solved the NDA problem.

unicornNot long ago I was trying to recruit a data scientist and wonder of wonders I found one.  An honest to God, freshly minted PhD in Stats.   He’s standing just out of the picture to the right of the unicorn.  I cropped him out so you won’t steal him.  Anyways … how many shots at a good data scientist am I going to get?  If I scare this one away by demanding an NDA will I see another any time soon?  No.  I need him more than he needs me.  Once I get going and people are coming to me for jobs?  Shoe’s on the other foot brother and you’re signing a reception desk NDA or my hot receptionist is calling security.  Bet on it.  But at that point in time, Mr. Data held all the cards,we both knew it and there was no point arguing about it.

But by far the best reason not to NDA or to play the guessing game with guys like Mr. Data is one that none of you business guys are willing to hear, so close your ears now.  Get over yourself, your idea’s not that great.  There’s zero chance Mr. Data is going to steal it.  That doesn’t mean it won’t make money, just that the money will come from you and Mr. Data working your butts off, not from the inherent beauty of the idea itself.

Bottom line? Be careful about what you say and who you say it to, but you have to take risks.  Do what you have to, use the idea as leverage when you need it, use your other leverage to protect the idea when you can.  Just be firm and consistent in discussions with any one person and don’t throw it open for discussion.  If you’ve decided not to expose special sauce in this discussion with this guy, then don’t do it, and don’t get into a big discussion about why you should or shouldn’t because he won’t be convinced and you’ll look like a dope.  If you change your mind in the middle, schedule a followup.  Waffling makes you look like an amateur.

Take a look at VC blogs like fred wilson brad feld ben horowitz marc andreesenmark suster.  They all say that ideas are like armpits, everyone has two and most of them stink.  Sometimes they’ll analogize a different, singular part of the anatomy.  They also say that they bet on teams, not ideas.  Maybe that’s just self-interested VC bullshit.  Or maybe it’s a fact that most founders overvalue their ideas, overrate their ability to “move the ball” alone and underestimate how much time and effort it takes to execute on an idea.  And guess what?  You are like most founders.  Personally, I’ve stopped thinking I’m a smart guy (no it wasn’t a stretch). If I’m not a smart guy, then any idea I’ve had, someone else has already had it.  If they’ve had it and haven’t made a business of it – it’s either a bad idea or they screwed it up and left an opportunity.

So tell me your idea and let’s see if there’s a deal to be made.  Or not.  That’s cool too.  Just leave the NDA out of it.

The Worst That Can Happen Is Actually Pretty Bad

If you’re looking for inspiration, skip this post.  It’s incredibly long and the startup dies in the end.

Founding a startup requires facing, and overcoming self-doubt.  Toward that end,  people in the startup-advice business often take their audience through a face-your-fears exercise.  They’ll say:

“… after all, what’s the worst that could happen?  Your startup could fail, so what?”

and they’ll shrug their shoulders as if that were the emotional equivalent of losing your glasses.  See here, here and here. It didn’t really click with me how much I hate that bit of advice until I heard the estimable **Fred Destin (@fdestin) give it yesterday at the wonderful “Built in Boston” meetup.  And Fred’s not alone.  Here’s the equally estimable Dharmesh Shah saying basically the same thing.

Maybe it was the coincidence of this tragedy only weeks before, but I pictured the bright young things behind me all imagining their own particular future failure as an Instagram slide show.

  • Slide 1: <black and white>The lights fading over the foosball table
  • Slide 2: <black and white> The door, with company logo, closing for the last time
  • Slide 3:<sepia tone>The team, beaten but unbowed, sitting round the table at the local bar for the final post-mortem

All very romantic in a first world, 21st century sort of way.  A bit sad, but in the end you buy a new pair of glasses and move on.  Nobody gets hurt.

ImageWell take it from me, I’ve been at 3 failed startups, and I’ve lost dozens of pairs of eyeglasses and as Samuel L. Jackson might say

they’re not the same ballpark, they’re not even the same fucking sport  

Here’s how a startup fails:

Halfway through your seed round money, you get a really clear idea of when it’s going to run out.  You were supposed to know that before you took the seed, but it doesn’t really hit home until now.  Now there’s a clear date and you are closer to the end of the runway than the beginning.  Spending is accelerating, so rather than being halfway through, you’re closer to two thirds of the way through.  You’ve been out trying to raise Series A – if you’re not on a plane, you’re on the phone, sometimes both – but VCs don’t ‘get’ the business and the low-hanging fruit is all gone.  You’re working the edges of your network now, cold calling.  

You have a dozen people on the team now, probably have a working space, and your little family is starting to take shape.  People know each other’s strengths and quirks.  They’re “your guys”.  Trouble is, almost all of “your guys” actually need this job.  Two weeks, a month, two months of unemployment will have real-world consequences for them.  The experienced ones are starting to worry.  Pro Tip: This is why you don’t hire experienced people – they know too much.

wherein you divorce the board …

Your angels are aggravated with you, but you’re aggravated with them too so that’s kind of a draw.  They were never exactly on the same page with you anyway.  They keep harping on that pitch meeting with Bessemer where you blew your nose on your coat sleeve and forgot your CTO’s last name.  Now they’re cranking up the pressure, criticizing the pitch, the product, your team, your haircut, drilling in on your business in a way they never did before, when it might have helped.  The only thing they’re not doing is forking over more money.  You need a money commitment soon and the board and management team know this.  You call back every investor who’s already said no so they can humiliate you again.

… and the team …

You’re in the office less and less, out raising money.  Without an authority figure present there are suddenly soap operas going on all over the place.  There’s some product issue and two people aren’t talking to each other.  The dev you couldn’t afford but hired anyway just adopted a cat and needs two weeks off.  Your CTO is “working from home” and nobody can reach him.  Everybody is upset about something.  The team that looked like a well-oiled machine a month ago now acts like a middle school class on a museum outing.  You stop going out with them and start really disliking them.

… and become a deadbeat …

You start outright stiffing vendors to stretch payroll.  Truth be told, you’ve always been a problem account for at least half your vendors.  Now relations with the half-dozen vendors that still like you start to go south.  You try to trade (more) equity for services and maybe one of them bites but the others start talking about shutting you off.  Even your lawyer, awaiting payment, stops returning your calls.  You tell yourself that stiffing vendors is not really unethical, it’s just the way the game is played.  You stop answering the phone and spend every waking hour dreading the call from someone at the office saying the electricity, phone, internet service is out.

That network consultant who put your data center together?  You put him off too.  The signed contract says “net-15”?  That really means “net-forever”.  After all, consultants aren’t people, they’re just vendors and stiffing vendors isn’t unethical.  Well, at least it’s not illegal.

Your CFO resigns to spend more time with his family.

… and a liar …

bluesbrothers4You start lying to people.  Maybe they’re small, noble lies like “everything’s fine”.  Maybe they’re big lies like “we have six months of money in the bank”.  Maybe they’re casual business lies like “check’s in the mail” or “we’re about to ship V2 and expect a big bump in all our KPIs” or “the Board is fully behind our current strategy”.  They’re not really lies they’re … bullshit.  But, even with a strong rationalization in hand, you find yourself avoiding people so you won’t have to bullshit them.  You start disliking yourself.

… and possibly a crook …

Maybe you crack.  A friend of mine tells of an unnamed founder who took his last payroll to a casino and came back with an extra month of runway (it didn’t help).  Or you stop paying payroll or sales tax.  Or you use the same asset as collateral for two different loans.  Maybe you won’t do that, you don’t trust your luck that much, but you will start trying to trade your increasingly worthless equity for salary, or worse, force people to take a straight salary cut.  Everyone does this.  This is when the troops clearly see the fence at the end of the runway.  One of them will inevitably say with a completely straight face “We should bring in another round of funding.”  You’ll resist the urge to strangle him.  You’ll also resist the urge to tell the team the whole ugly truth.  Most of them took less salary than they could really afford just to work here.  Now you’re asking them to take less.

… and finally a joke …

Most of the team feels the heat and works harder.  You certainly do.  You discover that mythical twenty-fifth hour in the day.  But somewhere along the way you made the mistake of telling the whole team the whole truth and suddenly strange things start to happen.  People who’ve marched to your orders religiously start questioning your decisions.  Ideas for crazy, unrelated pivots start popping up at meetings.  Your management team starts bringing in their own potential investors.  None of them actually has any potential but they all eat up your time and rejecting them strains relations even further.  Team lunches (without you because you’re never available) take longer and longer and guess what?  The discussions there invariably revolve around your personal shortcomings.  People come back from lunch a little drunk, giggling irrationally and productivity suffers.   You find people working on stuff that you don’t understand and don’t want but you don’t have the time to straighten it out.  It’s clear that some people are ignoring you.  You feel it coming apart.  These are the longest three months of your life.

… and after all that, you pull the plug anyway …

Pull_PlugAnd then after weeks or months of that bullshit, the day finally comes.  Someone – the board, a vendor, you, your wife – has pulled the plug.  You need to write a check (or two or ten) and there’s not enough money in the account.  Your credit card is maxed, you’ve tapped every possible source of money – maybe the bank is about to own your house.  You gather the management team, probably including people who used to be your best friends.  Maybe voices are raised, but probably not.   Those guys knew it was coming.  You go over some mechanics, rehash some bad decisions and when there’s nothing left to say, you call the all-hands and do it all again.  Half the room stares daggers at you.

Everyone packs up.  Some of them steal stuff, but most don’t.  Inevitably, the intern cries.

… which leads to more pointless thrashing …

But wait! There’s a guy who likes what we’re doing, wants to put some money in, he just needs to talk to his legal/partners and he’ll put three months of runway in our account for only a quarter of the company.  We just need to keep it together for a few weeks.  It’ll all work out if we can just keep it together.  But we can’t make payroll.  Maybe this is the point where you’ll crack and say something stupid like “you can file for unemployment and still keep working on the product, nothing has to change”.  Maybe you’ll just beg, but your people hate you personally by this point, don’t kid yourself on that.  If you run your startup into the ground the people who work there will end up not liking you.  But they love the product – hate the visionary, not the vision.  This sort of denial happens to devs all the time, so some of them go for it.  They keep working on it, but the energy is gone.  They’re looking for other jobs at the same time, and they know in their heart of hearts that it’s over.  Suddenly, watching entire seasons of Battlestar Galactica on Netflix is more important to them than working on the product.  But for weeks you all continue the fiction.

… that continues long after the team has put you in the rearview mirror …

The guy with The Money keeps negotiating worse and worse terms, keeps telling balder and balder lies about why The Money isn’t forthcoming.  You realize he’s either a vulture or a psycho and stop talking to him.  Crazy schemes circulate amongst the crew but they go nowhere.  Vulture investors kick the tires but your cap table’s an irredeemable mess and the code has started to rot such that you can’t even build it anymore.  Your significant other has become significantly cool.  The people you’ve sweated and bled with every day for the past two years are gone, a hole in your life.  You and the investors squabble over the intellectual property.  This goes on for months, if not years.  You slowly realize that having a failed startup on your resume is actually the least important result in all this.  The most important?  That you let everyone down.

… but that’s really all that can happen, so don’t worry.

What’s the worst that can happen?  You can spend years on a project that benefits no one, wrack up huge debt, do things you will not be proud of, and end up with a bunch of people who know you really well and don’t respect you.  You can find out once and for all that you suck.  So don’t kid yourself.  The worst that can happen is actually pretty bad.

** It’s hugely unfair to use Fred Destin as the example here. Lots of VCs use the “what’s the worst that can happen” imagery. I love Fred’s blog and his tweet stream and he does tremendous work in the Boston eco-system.  He’s one of maybe 10 people I read every day.  And at some point soon I’ll be looking for money …