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.

The 83b Episode

… or me and my six-figure mistake.

3boysblocks1You start a company with a couple of guys and it’s really hard to picture it turning into anything more than an excuse to work together for awhile before you go out and get real jobs.  Sure you start a real company but ‘exits’ happen to other people.  You’ll be happy to build something cool, have some fun and not go broke.

So when we first issued the restricted stock for this particular venture it didn’t feel like a big deal. As always, it was an article of faith that this one, like most startups would amount to nothing. I had to assume that to retain my sanity. It’s easier to tell yourself and everyone else that you’re a psycho who works like a madman because you like it, than to admit that you’re betting a shitload of sweat equity on a super long-shot.

No surprise then, that when it was time to file the 83b election form I prioritized it appropriately. The 83b election is the IRS form you file to get any appreciation on the stock treated as capital gains rather than personal income.  And when I say appropriately, I mean I put it at the bottom of the task pile, below laundry and beard trimming.  The problem with that approach to the 83b is that you have 30 days from receipt of stock to file it or it doesn’t work.  So one day I was driving along and realized that the 83b was laying on the passenger seat next to me, unfiled, and it’d been a lonnnnngggggg time since I’d signed it. An icy chill shot through me. I stopped at the nearest post office and, without actually doing the calendar math, fired it off to the feds (and the state?!), return receipt requested.

Fast forward several years and lo and behold, we’ve done something right and someone wants to buy the company. Suddenly the 83b takes on incredible significance. If I did it right, I pay 15% capital gains on the money. If I screwed it up, I pay 35% personal income tax on it. A difference of 20% – or as we used to say back in Inman Square, six fucking figures.

Now I’m not the most organized guy in the world.  If it’s not in source control  or my pants pocket (what has it got in its pocketses?), I have no idea where it might be.  And the company was not the most organized operation so the paperwork I had was crappy and scattered all over the place. But what I HAD retained in a nice neat little box in my brain was that spear of icy fear that I’d screwed it up – I’d missed the deadline. I was convinced of it.

Worse, I would have to turn the house upside down to find the paperwork and all that effort would merely prove that I was an idiot. And having realized this in the middle of the week, there was nothing I could do about it until I had the time to go through every piece of paper in my office.  A sloppy mistake I made years ago cost the family six figures. We didn’t have six figures to give away.

Mrs Pointy-Hair found me sitting at the kitchen table that first day. I told her I was worried. Mrs. PH and I have been together for a long time, through our share of ups and downs, and that’s the first time I ever said that to her. I’m not a worrier.

That Saturday I sat for seven hours sorting through 10 years of tax returns and every loose piece of paper in my office. The 83b showed up right after lunch, dated September 21st. Then a few hours later, a return receipt signed by the nice man at the IRS office. October 19th. 28 days. Sloppiness had nearly cost me six figures.  I’d done a shit job getting the 83b in on time, and I’d paid no attention to the return receipt, just threw it in a file and forgot it.  How close I skated to the edge of that abyss is appalling.

But you don’t come here just to see me confess the occasional sin and shred startup CEOs and glibertarian developers.  Come for the entertainment, but stay for the education.  So without further ado, the several lessons to be drawn from this sordid episode:

  • Memory sucks, mine more than most. I can draw up the network map of a data center I haven’t seen in ten years but I remembered the formation of the company, the transfer of stock and much of the action at the company wrong – completely wrong.  In one case, I was looking in the wrong boxes because my recollection of an event was off by two years.  As I sifted through the paperwork it was clear that stuff I thought had happened one way really hadn’t.  It was like reading about someone else’s life.
  • Being generally correct is better than precisely incorrect, but being precisely correct is even better. Who knows, if I’d prioritized 83b ahead of something else that might have started a chain reaction and we might have missed a contract milestone and lost the business right off the bat.   Right.  Measured precisely, it was still higher priority.  And if I’d read up on 83b at the time I would have filed away the “nailed it” feeling when the return receipts showed up.
  • Here’s one for the ladies: Don’t marry a guy who makes up convoluted rationalizations for not sweating the details.
  • Sloppiness kills.  If I’d had one more layer of crappe on top of it on the passenger seat, I wouldn’t have seen the 83b in time.  If I hadn’t been driving by a post office (those things are EVERYWHERE!) I might have put it off again.
  • Whatever it is, do it now.  Really, how fucking hard is it to go to the post office?

Choose Wisely

choosewiselyThe most important lesson of all though is choose wisely – in this case choosing your partner.  That came with Mrs. Pointy Hair’s reaction to the (incorrect) news that I’d pissed away a house or two by not going to the post office on time.  She listened patiently to my confession and simply said:

Well, it’s still a lot of money.

And she was right. Capital gain or personal income, it WAS a lot of money. And I love her for realizing that when it mattered, not years later when it wouldn’t.

The Startup Religion

A long time ago, a very green boss of mine had the bright idea that he would help his people self-improve.  And when I say help, I mean use his authority to force us to self-improve.  It was frustrating to him that we were not improving as fast as he was, so one can hardly blame him.  He was improving so fast that by now he’s probably gone through perfect and come back around to being kind of a jackass.  I think you see the problem here.

robbinsBereft of social skills, his first foray into other-improvement was to hand us each a book and say “read this and do what it says”.  It was a self-help thing, pretty standard issue for those days with a heavy dose of self-hypnosis.  A quick glance made clear that this book was not about helping us in our work.  This Tony Robbins wannabe and his disciple were trying to tell us how to live.

I had no intention of reading the damned thing.  Twelve years of Catholic schools earned me a permanent pass on that stuff.  If you want to tell me how to live, you need to take a number and stand in line behind dozens of nuns, priests, brothers and of course The Holy Father himself who seems to have increasingly weird ideas about life.  Still, this guy was the boss and that made it a problem.  Fortunately for me, another guy publicly blew a gasket about it before I even got back from lunch and the self-help book club died “aborning in the cradle” as they used to say.  We, his troops, remained the sandpaper that smoothed this guy’s rough edges.

The surprisingly short-tempered colleague who spiked the whole thing, it turned out years later, was, unbeknownst to any of us, a member of a secretive religion small enough and weird enough that most of us would call it a cult, as the national press eventually did, and it all turned out badly for him in the end.  He could have used a new religion at that moment.  For my part, I was (and remain) a horrible employee and probably could have used some self-help.  But that’s really, really, really not the point.  Work and life are different things.  There is a line between them.

I read lots of startup blogs, mostly the VCs but also some of the entrepreneurs and occasionally hacks like myself.   I read these things for the war stories, and maybe a bit of insight on how to score me some of that sweet, sweet exit payout – Facebook style please.  There’s a trend in these things, especially among the entrepreneurs and hacks to tell people how to live.  “Work hard, play hard” and all that bullshit.  Admirably, 90+% of these bloggers have done something, and beyond that they usually simply say things like “this is how I do it” or “this is how I’ve seen other people do it”.

And then there are the others.  I flashed back to that long ago episode reading a blog post by a guy (no I won’t give the link) who is obviously very ambitious, probably very bright and achingly startup-y.  If you’ve read this far you’d probably like him.  But he’s also literally unaccomplished.  He hasn’t done anything yet beyond figuring out how to use WordPress.  I looked him up, and he has no business telling anyone how to tie their shoes, let alone how to live.  But that didn’t stop him from throwing a post out there telling his readers how to live. And that pisses me off.

Startups are not a religion, you are not a priest and we are not initiates in a transcendent new meritocracy.  There’s a damned good chance this whole thing is nothing more than a replay of the auto industry from the early 1900’s – that it, and we ourselves, will all turn out to have been nothing special.  No more special than the foam on top of a big wave.

So even if you’re part of a weird and secretive cult, I’ll try not to tell you how to live but here and now I will tell you what to say if I ever do.  “Fuck off”.

Mistakes … I’ve Made A Few


… but then again, too few to mention.  Ah yes, I’m dating myself with that reference but if I don’t, who will?

I spend a lot of time slagging the business guys and believe me, they’ve earned it.  That said, even when the business guys weren’t in the building, mistakes were made, and if you looked at them a certain way, you might even attribute a scintilla of responsibility for some of these missteps to me.

So without further ado, here are the autopsy results from a few of the ones I think I understand and am willing to admit to.  Believe me, there are a few that are worth their very own post, and there are a few I’m taking to the grave with me.

Waiting too long to fire underperformers

lucyshowTrue story: I inherited this guy from another manager, and he was useless – “hello world” useless.  Not only that, but he had no shame about dragging other people in to get him out of whatever hole he’d coded himself into.  I watched for a couple of days and saw, in action, one of the fixed axioms of software: there is no upper limit to the amount of damage a low-performer can do.  Watching three people try to debug “Hello wo$#%@%^!” for this knucklehead proved that.  But, one of the few professionals we employed at the time was our HR person who told me how firing was done:

  • written warnings
  • improvement plan
  • constant monitoring and feedback
  • deadline for improvement

This was before I knew what an “at will” employee was.  So … a month later, after wasting countless hours on this guy and on a day when he brought in food for the entire team, I fired him.

That was a lack-of-aggression mistake.  I had the juice to just deal with it, but I asked for guidance and got timidity instead.  It still grates.  We were in a “hot” space and had great IP.  Deals and very important people were swirling around us.  We were running out of runway.  And I wasted a month firing an at-will employee who would never be more than a bad coder.  This episode and the fact that we went Chapter 7 are probably unrelated.  Probably.

Quick and dirty coding

flappingEven if you’re God’s gift to technology, you’re gonna commit crimes against computer science on your way to the promised land.  If you’re a huge dumbass you’re gonna commit lots of those crimes and for terrible reasons.  Let me illustrate:

  • In the early days of one venture, I wrote some C++ Win32 code that I wasn’t particularly proud of – lots of global variables, timing hacks, failsafe graphic refreshes – stuff I knew would need a rewrite.
  • In the later days of another venture, I wrote a pile of equally dreadful C# Web Services. Not thread-safe, non-transactional SQL, duplicate code everywhere …

In the first case, I was alone, literally doing the best I could and had to hit deadlines or we’d lose a contract.  In the latter case, I was bored and wanted to write code, but I had plenty of help and was just too lazy to do it right.  Equivalent crimes, but motive matters. You could also consider the latter a case of taking too long to fire a low performer – myself.

Bad Leases

leaseMy last venture launched when my kids were 20 months and 1 month old respectively.  If you can work in a small house with two children under two years old, you’re a better man than I.  That’s focus.  Me, I have noise cancelling headphones and a nice home office with a door that locks and I still couldn’t do it.  For awhile I was a nomad, I worked everywhere, Starbucks (g*d****d fruit flies!), the bar at Chilis, the commuter boat .. even the lobby of the Boston Harbor Hotel. I still have their guest wireless access code that we paid 10$ for back in 2005.  But all that’s barely better than working with a one year old in your lap.

So we sublet space at a lawyers office and that early space was key, not a mistake at all because some of us needed it, and some of us needed to be together  But space takes on a life of its own.  There came a moment when we had more people than the lawyers office could hold, but we weren’t in a position to make a decent deal for space anywhere tolerable.  People started piling up.  We weren’t happy.  The lawyers weren’t happy.  There were people (yours truly) making demands about location.  The pressure mounted.

What should we have done at that moment?  Gone virtual, at least partly.  Would it have been a pain in the ass to manage?  Yup, but lots of worthwhile things are a pain in the ass.  What did we do instead?  We made a deal for more space than we actually needed or could use.  Dreadful space.  No build-out, horrible floor plan, nasty carpet, 8 thermostats none of which controlled the temperature, lighting better suited to a Turkish prison and as a bonus we got the landlord as a shareholder.  When our exit came, we were still in the same shitty space because part of the shitty deal was a lock-in.  Maybe I didn’t make the deal, but I made it all but inevitable that a deal like that had to be made.

What kind of mistake was this? Failure to look at the big picture maybe, but actually more just inexperience. I didn’t know the space bit until I’d lived in it for awhile.

Shooting from the hip

cf-yulBrynnerWestworldIf you have any success with your startup – last a few years, hire a few people, get some traction – you get pretty good at shooting from the hip.  The first technology that pops into your head does the job, the first algorithm you think of is “good enough”, your first take on an interviewee proves out.  You’re a bright guy and it never takes you more than 90 seconds to figure anything out.

Trouble is, with all that shooting from the hip, you forget how to do it right – the take-a-deep-breath-aim-and-fire method.

Guy comes into my office with a code problem.  He lays it out, I get impatient and my mind starts to wander, eyes start to glaze over and as he gets toward the end I lose patience and blurt out “Just do X” where X is something plausible, but probably quick and dirty.  Usually, my saying “Just do X” ends the conversation but this time the guy doesn’t move.  He just stands there because, first of all he likes to do things right, and second, X isn’t plausible, in fact it’s stupid, and proves that I wasn’t listening and just want him out of my office.  I realize in a flash that I’ve been doing this to this poor guy for months.  What I kidded myself was decisive and incisive, was actually glib and dismissive.  I tell him “okay, sit down and start over” and force myself to focus patiently on the problem.  And whenever he comes back to my office, I take a deep breath and do it all over again. Leading sucks sometimes.

You can file this one under “scaling with the organization” I guess. It took me awhile but eventually I learned to stop looking at my own navel long enough to actually manage my crew.

So there are some of my mistakes. Got any good ones you’d like to share?

Networking for Dummies

When you’re in the swirling cauldron of a seed stage startup you pull out all the stops.  No hour of the day goes unworked, no dirty coding trick goes uncoded, no rock remains unturned.  Just Do It is a reflex, not a tactic.  JFDI is dangerous and fun and “living on the edge” and that’s why we do it.  There is one area of startup life though where I wish that I had Just Not Done It and that’s handing over connections to non-technical co-founders to help the business.

I have had some version of the following happen at nearly every startup I’ve worked at, with at least two striking examples that still sting years later.

tree

Me: Hey Mr. CEO, I talked to my buddy, Mr. X and his good friend, Mr. Y is a VP of BizDev at <major player in our industry>.  I told him what we’re doing (without including the fact that we’re out of money and missing payroll), he told Mr. Y about us and he’s really interested.  Here’s his number, he’s expecting your call.

Mr. CEO: Great. Thanks.

Two weeks later.

Me: Hey – did you talk to Mr. Y?

Mr. CEO: Who?

Congratulations!  You just burned a whole branch of your network.  And I say you did it, not your CEO because, guess what, your network is your responsibility not his.

Sometimes it’s even worse when they do make the call.  I’ve actually had a connection ping me back after meeting my CEO and say, literally “Hey, good luck to you guys, but oh my god you’re going to need it.”  My guy might’ve worn the wrong color tie, or he might have peed on the rug like an overexcited shih tzu.  I never found out because I wasn’t there.

This is the downside to what is usually A Good Thing for a CEO – the lack of a conscience. I use that term conscience in both the usual Webster’s sense of not taking other’s feelings into account, and in the sports-metaphor sense of a basketball point guard who can throw up a string of airballs and still keep shooting as if he were God’s gift to the sport.  Think about Jack Dorsey and Square.  When Square launched he gave three consecutive interviews where he told different stories about what the Square business model was.  Each time, he stepped up and told a new story as if the previous interview had never happened.  That’s “no conscience”.  For you old-timers out there, think Andrew Toney.

How does this lack of conscience affect your relationship to Mr. CEO? Well, it means that your feelings, your life outside the shared venture and more pointedly your life after the shared venture mean nothing to him.  On balance, that is A Good Thing.  At worst, it’s Not A Big Deal.  You’re in this for the money.  But on a strictly personal level your connections are not as valuable to him as they are to you. To him, it’s found-money. If he burns that connection it’s no loss to him.

Knowing what I do today, here’s what I’d do differently in those situations:

  • Make the contact myself, alone, in person (i.e. face-to-face or by phone).  Your network is valuable to you, and this person is a valuable part of that network.  Treat him that way.
  • Own the relationship.  Don’t make the intro and then forget about it.  Follow up with both sides and if somebody’s feeling burned, fix it.

The chance to “do business together” even if it’s just a chance for him to help you is an opportunity for you to strengthen your connection to this guy and thus, strengthen your network.  And, in the not-inconceivable event of your CEO treating this connection like dirt, the blowback will be against him, not you.  The worst case you want coming out of this is your connection thinking “Jeez, Jack’s a nice guy, I hope he wakes up and joins a company that doesn’t have a fool for a CEO”.

Personally, I wouldn’t do it at all – hand over bizdev contacts to a non-technical co-founder.   Think about it.  If my connections are the difference between life and death for our venture, we’re fucked.  At the very least, we have the wrong CEO.  And that’s A Bad Thing.

… just don’t call me late for dinner

Naming a company always sounds like a fun idea until you’ve tried it once. Today’s post by Dustin Dolginow reminded me how much I hate the exercise of naming a venture.

Hello, my name is dumbassI’ve lived with some spectacularly ill-monikered ventures, and with the pain of trying to get their names right. At one of my earliest ventures, we held an in-house contest to rename the company. The guy who suggested that and picked his own entry as the winner still has a contract out on his life. At another place, a co-founder was smitten with a name that was almost literally a synonym for invective. At a third, the name sounded like Elmer Fudd trying to describe how mad he gets when Bugs Bunny outsmarts him for the umpteenth time – “I was Wivid!”.

Those were other people’s mistakes. Surely I could do better left to my own devices. No. At my only solo company-naming try, I came up with a bad synonym – Diabola – that was also a lame attempt at cute/clever/inside-joke. Don’t do it.

The name of my last venture, ROAM Data, was our CEO’s idea long before we even started the company. While it’s boring and remotely suggests horrid telco billing it remains at or near the top of the list for best company names I’ve been associated with. Boring works, mostly because it takes the issue off the table.

Remember, you’re going to have to say this 100 times a day for the next five years. Imagine saying “ROAM Data” to 100 people. Do you feel like an idiot? Nope. Did people have trouble with it? Nope, except for the 15% or so who need to know whether it’s ROAM or Rome. 15% spelling errors you can live with. Now imagine saying Wivid, or Diabola to the same 100 people. Do you feel like an idiot? Kinda – you probably apologized and made a joke out of it maybe half the time. The other half of the time you rolled your eyes. Did people have trouble with it? Umm, yes, at least all those who weren’t so distracted by the eye-rolling that they didn’t even try to remember it.

The other thing to remember about the name game (and this is where I disagree a bit with Dustin) is that you’re usually naming two things – the company and the product. The company name you’ll probably keep for a long time, but the product will get renamed, rev’d and replaced by follow-on products each of which gives you the opportunity to do something that isn’t boring. So if you have a boring company name you can live with it forever while your product can get the professional branding treatment it deserves as you can afford it.

Maybe you’ll think on it a bit, have lightning strike and come up with a name that’s short, easy to remember and evocative of the product function like Sonos. And maybe the Pope will stop shitting in the woods. If you’re name-challenged like I am, the choice is between boring and awful, so go with boring and take it off the table. But if you’re determined to get it right the first time, follow Dustin’s roadmap.

What’s the God-awfulest name you’ve had to work for?