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While vision is vital to success, what matters most is execution. Startups can hit many points of failure – people, products, competition, and legal challenges, to call a few. These problems could also be interrelated, which increases the difficulty of overcoming them. Our story is a cautionary tale about key man risks.
After recently going public, we have began preparing for the next stage of growth. As I waited in traffic, returning from a run, my thoughts turned to the upcoming Annual General Meeting (AGM), scheduled for May of the following yr.
It began to rain when Elena broke the silence: “KK, is your phone turned off? Zisis (our COO) calls me.” I looked at her and replied, “No, it should be on, why?” noticing that the raindrops fall a little heavier.
Looking at my phone, I noticed it was on, but in silent mode. I saw a flurry of messages saying, “It’s urgent.” She handed me her phone. Zisis, respiration quite heavily, said, “Hey man, sorry, this can’t wait. We have a serious problem.”
My heart rate increased. As the adrenaline surged for all the wrong reasons, the sky became noticeably dark and the rain turned to hail. He continued: “[Our CTO at the time] he wants $10 million by tomorrow or so, otherwise he will purge the code, the repositories, and publish all internal conversations on the Internet.”
As I processed this, the sounds of the hailstorm intensified. I subconsciously calculated that we could pay him, but it might crush us. “20 minutes; I’ll call you back,” I replied as I drove home, zombie-like and devastated.
As I was getting out of the car, I was caught in a hail storm. When I got to my office, more impulsive thoughts flooded my mind. “Should I go out of court here? Are we embarrassing him to the world?” Unfortunately, calmer heads would prevail as the team and I convened for hours to return up with a plan B.
Negotiating with a metaphorical gun to your head was… sine qua non. Our solution was to tell our stakeholders about the situation and rebuild the code base in Europe. We would take the opportunity to refactor the code and remove technical debt. Finally, a police report will likely be filed and referrals will likely be rejected. No cent will likely be paid under duress. While we were writing our response, we received an unexpected message from the CTO himself. He withdrew his threats and asked for a phone call. Did our silence make him think?
I looked out the window and saw a ray of sunlight breaking through the cloudy sky.
Although I felt relieved, I used to be still confused by his actions. The next day our CTO showed up for the interview and was slightly accommodating. He explained that he was at the end of his rope and just wanted a comfortable exit. A good request, I assumed, considering how hard he was working. I used to be concerned about the finality of his decision. His threats weren’t just a flash in the pan. The reasons for their occurrence have been emerging for years.
After some deeper introspection, here’s what I discovered.
1. Cultivate real relationships
This incident resulted in an accident My war. Every time we had an idea for a latest product, it was as much as our CTO and his loyal team to make it occur. They coded line by line, adhering to deadlines and debugger audits. They silently suffered, hoping that scaling would occur. That didn’t occur – at least not in their timeline. As the years passed, mental fatigue began to set in.
Zisis traveled to the satellite office several times a yr. He spent several days there with the team and worked on business process improvements and problem solving. The more time we spent together as a team, the more I believed our expectations were aligned. But every yr, when our CTO received Zisis at the airport, he must have wondered why I never took the time to satisfy him. Did I not appreciate him enough?
The truth is, I did it. But I didn’t spend time on that relationship, prioritizing putting out fires in other parts of the company.
Nurturing relationships is not just a cliché or buzzword. Your employees are looking for vision and connection, not only compensation.
2. Don’t let closeness – or lack thereof – cause resentment
After the pandemic, going to the office became passé. Sure, some say distant work can bring some productivity gains studies. Other research show that these advantages are not necessarily confirmed by employers.
If you are a startup, having your tech team in one other country is a recipe for disaster. Time zone differences, delayed communication, lack of human contact and cultural differences are just a few points of failure.
If key resources share the same assumptions, problems might be quickly resolved. In our case it was the proverbial death by a thousand cuts; the resentment had been building quietly for many years, but the distance had created cognitive dissonance in my mind. I didn’t see the problems until it was too late.
3. Watch your words
Three months before the threats, I used to be on a Skype call with Zisis regarding a critical code issue that was impacting our users: “What’s the point of our testing process? Just get rid of it [our CTO’s name] next time…”
Call it karmic justice, but this comment was mistakenly delivered to him as a part of a larger “forward” message. I can not imagine the shock and disappointment he felt after reading this.
I learned – the hard way – to eliminate theatrics in electronic communication channels. Second, I have learned not to put in writing anything on any online medium that I would not be comfortable seeing printed on the front page Financial Times..
4. Always have a plan B
When we received the threat, our headquarters in Cyprus was still under construction. Apart from our CTO, we didn’t have any senior technical managers. We never felt the have to do so – a painful miscalculation.
If you possibly can afford it, it is advisable to rent a part-time employee to observe your key technical staff. We currently pay said hire as a source for audits, codebase backups, and interview assistance. This person also steps in in case of emergencies – and boy, have we had our justifiable share since then. However, the system is currently configured to have no single point of failure and is battle tested.
Think of plan B as insurance. Without it, no business works.
5. Invest in soft skills
The relationship is probably not linear, but there is an inverse correlation between coding talent and interpersonal skills. The more time you spend with code slightly than with people, the more emotionally detached you develop into.
In the starting, we hired solely for technical knowledge. Now our recruitment process is more holistic. No person in a tech startup has more theoretical power than the CTO. They encode your dreams, but they will destroy them at any time.
Invest in emotional stability. Key Player Risk is not something you set as an afterthought in the “risk” section of your deck. This is very real. As humans, we are all flawed in other ways. So hope for the best, but strengthen your defenses in case the “bad actor” in all of us rears its ugly head.