Scale Venture Partners

The Startup Tapes #020

Founding for Engineers

with Cliff Moon (Opsee, Boundary)

What do you do when you’ve been an engineer all your life, then become a founder? Is technical work still the #1 thing you can do to help your company succeed, or must your contribution change overnight? Cliff Moon is a highly respected software engineer, who became the founding CTO of Boundary then founding CEO of Opsee. He welcomes us in his backyard to share his successes and failures in that transition. (Warning: the video contains some cursing & drinking.)

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Tim Anglade, Executive in Residence at Scale Venture Partners: So yeah, we said we’d talk maybe about what it’s like to be a founder, like especially coming from an engineering standpoint. Then I realized, it’s kinda dumb, ‘cause if you look at most founders, most founders are engineers, right? Most founders I feel like, especially in the Silicon Valley culture, it’s like young kid, goes into YC, you know, two engineering founders try to build a company, so I feel like it’s a common pattern. But yet, I think, it’s very rare to see people actually do that well. And so you’re on your second company being a co-founder. When I met you the first time, before fast_ip, it was called then, Boundary eventually, you’d just been an engineer all your life, right? You’d been an engineer in Delaware, you’d moved over, you’d done the processing, and this was kind of your first entry into being on the business side, so to speak, is that correct? And so, it seems to me like over the years you’re learning to much, right? There’s a lot of stuff to learn from but you have to learn a lot about it so I figure we could talk about that a little bit and whatever advice or insight you have about what you should do when all your life all you’ve done is engineering and all of a sudden you have to really think about more than that.

Cliff Moon, Co-founder of Opsee & Boundary: Yeah, yeah. So, one point in your premise that I would actually take exception to. I would say has changed, maybe in the last five years, is that, you’re right, maybe like five years ago, even up to like three years ago, it was a very common pattern to have an engineering founding team and people coming from very technical backgrounds starting a company. I think that that has changed a lot now. I’m seeing, you know, I mean obviously I’m not an investor but just from what I can see, there are a lot of companies now that have completely non-technical founders that are outsourcing the entire tech side, and there’s whole companies now, whole consulting companies, that all they do is like, you know, “We’ll build your project. We’re a CTO for rent” type of thing.

Tim: Wow, and do you feel that’s related to the whole Wall Street thing, where Wall Street was the place that the smart, top of the class kids, you know, would go after college but now they come to Silicon Valley. Do you feel like that’s intertwined?

Cliff: Yeah, there’s definitely aspects of that, but I mean, you look at what’s going on in the rest of the country. We’re very insulated here. This is one of the few places where job growth has been very strong. I look at my classmates in high school, people still back in Delaware, they’ve not felt the recovery. It has been sort of the siren call of, yeah, go start a company, and I think you’re seeing not just the demographic change but the expectations as well.

Tim: There’s still a lot of companies, you know, that are founded by engineers, exclusively engineers, that’s still a pattern, but you’re right. It’s not as much noise as it was maybe ten years ago where that was the YC recipe for success, so to speak.

Cliff: Right, right, exactly. It changes the company too, ‘cause now the opportunities are more, if you look at the opportunities now, a lot of them are more along the lines of this is actually just regular business that now has tech marketing, you know, like the technology is an ancillary. It might not even be the driving force of the company.

Tim: Right, and I feel like that’s really tied to the fact that there’s been this lean startup movement, and it got leaner and leaner and leaner right? Clean energy and biotech and all that stuff, and then hardware really went out the window, with a few exceptions, and then, you know, software. Everyone was in software. People stopped from trying to reinvent fullstacks into big software plays to just, “We’ll do gamification for retail commerce” they were doing very, very small incremental plays, and so you’re right, a lot of the engineering values become seen as lesser, less of a point of emphasis. You still have, very interestingly there’s a lot of the same profiles, the kids coming in here, you know, not to feel old, but the people coming here out of college or soon after college still have the same profiles, still have really, really big ideas and still have to deal with responsibilities bigger than maybe what they studied for, right?

Cliff: Yeah, I mean I’ve got one of those folks on my staff. I think that, it changes a whole bunch of dynamics, but yeah, you definitely do have that influx of people coming in and hopefully they end up somewhere that’s not terrible, that’s not gonna grind their youthful enthusiasm into dirt.

Tim: You seem to have held up pretty well. You still have that spark in your eye and everything so I mean, what’s something to look out for, something you didn’t expect? How much did you know about what you would have to do the first time you went into founding a company?

Cliff: Almost nothing.

Tim: In retrospect, right?

Cliff: In retrospect, I knew nothing.

Tim: Do you feel like you could have done anything to prepare? Classes or advice?

Cliff: Oh God.

Tim: Or is this really something you have to learn on the job?

Cliff: Well, I think the nature of the job, or the nature of the personality that you need to do the job, means that you have to be so arrogant in order to actually say, “Well, I’m gonna go take on–” you know, you’ve gotta be so arrogant and so ignorant of not just the odds, but just the landscape. When we started Boundary, I didn’t know what the monitoring space was. I didn’t know people had been doing this for 30, 40 years. I didn’t know about BMC and CA and all that crap. I didn’t know any of that stuff. All I knew was, you know, this looks like a cool challenge, I can build a bunch of this stuff, and I can build a team, so that was literally my thought process.

Tim: And you were a CTO of that company right from the start, and so you still had this very technical outlook, I guess, of your responsibilities, but within that sphere, I assume you had to take on a lot of things about management, and fundraising, and board management, and all that other stuff, right? In retrospect, do you feel like you allocated your time properly on everything? Or, I’ve seen a lot of founders do this, and I wasn’t there, so I don’t know, but a lot of founders do this thing where they’re like, “I’m a CTO, I’m just gonna code.”

Cliff: No, that’s no good. When we did the CEO change at Boundary, I started spending a lot more time managing the team because there was a period there where I was sort of linchpin keeping everything together. After that point, I would split up my time between code and technical roadmap, and you know, coaching the team, and then of course the evangelism as well, going out to talks and yada yada.

Tim: The linchpin thing is very interesting, ‘cause I felt that a lot, it’s weird, it think it changes from people to people. I don’t personally feel that way about but I know a lot of my colleagues do where they, just from the title, it’s not that there’s mystique or whatever to it, but there’s an expectation, right, that you’re gonna keep the company together, and you’re gonna be representative of the entire company’s interests and you’re gonna take care of employees. That assumption, I think, sneaks up on a lot of founders. They don’t really expect it, they’re just guys. They just showed up for work.

Cliff: Oh yeah, that’s a pretty sacred one, right? I take that very seriously, and if you don’t, you’re not playing the game honorably, I think. One of the central, whenever I’ve hired someone, one of the central pieces to my pitch is, “Hey, look. Let’s be real about this. “This could be great, or this could fail. “Let’s be very real about it, “but I promise you, you will learn a lot. “I’m gonna throw you into the deep end of the pool. “You’re gonna sink or swim, and we’ll provide support “for you as much as we can, but like a small company, “you’re gonna have to do a lot of stuff. “But, if you’re the right kind of person, “and I think you are ‘cause you’re making an offer, “you’re gonna learn a lot and you’re gonna come out of here “with an accelerated career.” The way that I look at it is that it’s not just this company, right? We’re all on a path and the people that I hire in one place, you know, we’re all gonna be banging around the same ecosystem for a long time, so burning people out, pissing people off, you know, to be clear, I’ve pissed people off.

-We all have.

Tim: I try not to though, and I’ve learned from those mistakes. Essentially, you need to look at it from the long perspective of you need to have a lot of people who really like working for you and would look back on the experience at your company and say “This was valuable, and I would work for him again.”

Cliff: Right, and to be clear that goes beyond the usual networking tropes and stuff like that. It’s really crazy but in Silicon Valley, there’s such a clique or a mafia or whatever you wanna do. The PayPal Mafia I feel like is the most famous one. But there is really the sense of people working together over and over again. It is a very, very small world where people know if you fuck somebody over, they will come back to haunt you.

Tim: Yeah.

Cliff: That personal promise that you make as a founder to the people you hire, it’s a very real thing even though it seems tripe.

Tim: Yeah, especially in 2015, 2016. You’re literally luring them away from ridiculous amounts of money, like stock option grants.

Cliff: What’s the most ridiculous offer you’ve ever heard by the way, while we’re on the topic, just a quick thing. The most ridiculous I’ve heard is for an engineer, C++ engineer, I’ve heard $300,000 salary, this was a few years ago, with $100,000 signing bonus.

Tim: Wow.

Cliff: Have you heard weirder than that?

Tim: Um, yeah, but not cash wise. Mainly stock wise. I’ve had people ask for things like that, and I’m just kind of like, “Okay.”

Cliff: Most startups can’t pay that, right?

Tim: Yeah, I’m not gonna do that.

Cliff: It’s a weird play.

Tim: One of our engineers turned down something, a huge stock component to it obviously, but something that was valued on paper at like 1.5 million.

Cliff: Now with Google and Facebook now being public, a lot of those stock validations are actual, you know, they’re fairly liquid, right? They’re stuff that you can actually count on.

Tim: This offer wasn’t, but yeah.

Cliff: Right. It makes sense, right? You know, you can’t match on salary and you can always have a good technical challenge but a lot of the big places also have a good technical challenge, so really that personality is where you can shine.

Tim: Yeah, exactly, you need to be able to demonstrate that, you know, the things that have worked for us, to demonstrate, you’re gonna have ownership. I’m not getting up in your face about stuff, which is always a tough one, right? Especially if you go to work for someone very technical. The question in your mind’s gonna be, well, is this guy or gal gonna be telling me how to build stuff? You need to be very clear and say, “Look. You can have ownership. “You can be the first one or the second one. “You can build this and make the decisions “and I’ll let you make your mistakes. “I’ll just pull you back when the mistake is a fatal one.”

Cliff: It’s interesting, yeah, it goes pretty far. I’ve met CEOs, you know, we even see that the role of founder or CTO never really breaks that ownership. Even if you come and bring in the stupidest fucking idea ever, they’d let you do it and that’s kind of the best thing you can do as a founder which is a very interesting kind of paternal version, not paternalistic, but paternal version of looking at it. “You’re gonna learn, and I can’t teach you “everything myself, or you might actually be right “in something I feel you’re wrong, “and all I can do is make sure don’t die.”

Tim: Right, just make sure you don’t make a mistake that’s gonna screw the company terribly. I feel like I’ve really tried to do that. My team has almost rewritten everything that I started with. They’re like “Ah, no more closure. “We’re gonna write “everything in Go now.”

Cliff: You’re still on that closure train

Tim: I love writing that. Now all my metrics, when I pull my metrics from the database I use closure for that, so it’s fine.

Cliff: It’s still a new corner. It is very kinda a dad-like thing, and I don’t mean closure, but I mean that general outlook on building a company. Do you feel that’s a similar thing? Or is that too cliche?

Tim: I don’t know, I feel like–

Cliff: Because you’re a dad. I’m neither, I’m neither a founder nor a dad.

Tim: I feel like it’s a little cliche. I would call it more like it’s just a good principle of leadership in general. People respond positively to being given ownership, essentially, and everything that that entails.

Cliff: That makes sense, that makes sense. So, you went from being CTO to now, your new company, you’re a CEO, right? Founding CEO. What’s that transition like? Do you feel like that’s a drastic shift again? What’s changing from one side to the other, from being the technical cofounder to nominally a business cofounder.

Tim: The tempo, the pace, is very different. It’s funny too, because I’ve seen a number of CEOs and worked with a number of CEOs now. Everyone kinda has their own bass or the way that they’re wired. The guy we brought in at Boundary, he was a very sales-oriented CEO because he had a sales background. Fantastic salesman. One of the things about him was missing a quarter was something that, he couldn’t get it through his head. Like, “No, we can’t miss a quarter.” And that’s just the way sales people are wired. Missing a quarter’s verboten. Whereas for an engineering CEO, having a broken product, having engineering issues, et cetera, that could be your thing that you can’t do, or that you won’t allow happen. Especially, I feel like, when you’re sort of pushed against the wall, when the chips are down, et cetera, you will fall back on those behaviors or the things that you’re most comfortable with. It always ends up being specific to the company. Is that gonna be detrimental or beneficial, your instincts at that point? It really depends on the company and the stage you’re at. A sales CEO might have terrible instincts if you don’t have product market fit ‘cause you might go chase shiny things and then end up with a technical backlog and everything’s terrible

Cliff: Right, I know what you mean. Fighting your instinct is good way to put it. You have to know what you don’t know and you have to think outside of your comfort zone. Is that pretty much a good summary of having to be CEO? You have to constantly be outside of your comfort zone. You have to constantly think about stuff that you’re

Tim: Oh, yeah.

Cliff: Probably not trained or experienced to do.

Tim: Yeah, or just even at a more basic level. It’s still very hard for me to think that I’m doing anything productive when I’m not shipping code, you know, because up to this point that has been the way that I’ve measured myself, and now it’s like, no, you need to go write blog posts. You need to have meetings and–

Cliff: To hire people. Find an office.

Tim: Yeah, yeah, yeah, and do all those other things. Especially some of the squishier ones like, okay, we need content marketing, and this, that and the other. Those don’t feel very productive, but these are things that have to happen.

Cliff: Absolutely, yeah.

Tim: It’s a matter of, it just takes you way outside of your comfort zone.

Cliff: Do you feel like that requires a specific awareness, or do you feel like the job will get that out of you? I kind of go back and forth on that. I kind of go back and forth so like, you know, people should really realize what is it they’re taking on and really take it seriously otherwise they’re gonna fuck it up, or that because, you know, one day they’re gonna be faced with that pressure, “Oh, I’ve gotta get users to my website. “How do I do that? “I guess I’ll focus on content marketing for a while.” Do you feel like that’s something that people need to particular awareness of or how much of it does the job drive upon you?

  • If it doesn’t, then you’re probably gonna fail.

-That’s probably a good point.

Tim: If you’ve raised enough money, you can probably hire it in to the company, but if you haven’t then you need to do it yourself. I think it’s a healthy thing to do it yourself for a while. One of the things that I remember quite clearly at Boundary was that there was come roles in the company that I was interviewing people for. I didn’t know what the hell they were supposed to do. I was just like, “So, what do you think the role of, “you know, marketing, you know, marketing head is?” And I’m just hoping that they explain it to me.

Cliff: You have to hire smart people

Tim: Yeah, so if you actually know what the job entails you might actually be able to hire the right person.

Cliff: That’s the kind of experience that does help. Having been in companies–

Tim: Having done it poorly. Even just having done it poorly yourself, just be like, well, do you have better ideas than me?

Cliff: You’re right. I guess work experience is really underrated. I feel like–

Tim: Oh, absolutely.

Cliff: Just having been in jobs and seeing marketing and seeing salespeople really gives you a lot of insight in being a founder, right?

  • That’s one of the things that really bothers me about the cult of Silicon Valley. This cult of the neophyte. You know, you have this brilliant, behooded white man coming from Stanford who’s gonna shake everything up and coming from Tabula Rasa, has no idea.

-By the way I agree that this is kind of the average, typical myth of the founder in Silicon Valley, but now I see a lot VC’s like, “Oh, it’s just another engineering kid from Stanford “who doesn’t know, like, “that company’s not gonna make any money.”

Tim: Sure, there’s the press narrative and then there’s–

Cliff: We’ll still fund that.

Tim: Yeah, yeah, of course. There’s a press narrative and then there’s the reality. I’m a firm believer now that if you’re gonna come from it from that angle of knowing nothing, you’re gonna work really, really hard and do a lot of dumb things and maybe screw it up, maybe not. I think it’s a much better idea to go and get some experience, see some real problems, maybe get some insights that you might not need to kill yourself to make this work.

Cliff: In particular, for engineering founders, I personally, I’d recommend doing some marketing, meeting some marketing people. If you’re in school and you’re thinking about doing a startup after school, something like that, I would say, spend a summer as a marketing intern or a sales intern. I feel like this would be one of the number one valuable skills that I would have liked to catch earlier in my life.

Tim: Yeah, or just learn that you goddamn hate it early on so that you could just cross that off the list. Just be like, well, I’m never gonna do that again

Cliff: Do you have other advice? We’re all learning and nobody’s perfect but what are some of the stuff that you’re like, “Oh, I should have known that earlier.”

Tim: This is something that I’ve gotten over, and it might come off a little cliche, but goddamn is it true. For people that are starting companies, get over the firing thing. If you think something bad is happening or someone’s screwing up, or they’re the wrong person, just get over it and be nice about it, right? Give them a decent severance, give them the decent way out, but, you know, you have to do it, because it’s not gonna get better. The first time I had to deal with a situation like that, someone going toxic and being very clear they had to go. We dragged our feet so long on it, and it doesn’t make anything better. It just makes it worse. It seems like a lesson that everyone has to learn on their own and make this mistake.

Cliff: No, it’s crazy, it really is. I’ve been on both sides of this. I’ve been fired and I’ve had to fire people. I was fired first before I really had to fire people on my own, and it still took me way too long to fire my first person. Even having been the offender, it’s really hard to process. I do think it’s something that, it sneaks up on people. It’s a very true thing, especially again if you have no work experience your first time being in a company and building a company, you will tend to do that too late, and that’s some real impact. Let’s talk about it in specifics, otherwise it’s one of those cliches. What are some of the ways that you’ve seen or you think that, you know, letting a firing take too long can really impact your company negatively.

  • Oh yeah, absolutely. I think that ignoring your instincts is a big one. Especially if you’re a founder, a management position, et cetera, you gotta recognize that you see things through sort of a smoked glass. You’re not seeing everything. If the warning bells are going off in your head about something, it’s probably worse than you think it is.

-You probably know less.

Tim: Yeah, you know less than you think you do, and if that’s happening you need to look into it ASAP because it’s not gonna get better.

Cliff: Another one that I’ve seen, we talk about that trust that employees have towards you. I think some people will clearly feel spurned or the trust is kind of misplaced. If they see an obvious problem, they don’t see you react to it.

Tim: Oh yeah, that’s the other thing. By the time you react, it’s obvious to everyone else. No matter how fast you do it, that’s always gonna be true. Just by the time you get the paperwork set up, it’s just gonna be–

Cliff: Right, and I think that’s very important. We begin on that, I think it’s the right thing. That trust, you have to earn it, you have to build it, you have to build your company in your hiring and that’s a responsibility as a founder or cofounder. Taking too long to fire someone who’s clearly toxic or not working out is one of the easiest ways to lose it.

Tim: Yeah, absolutely. I think there’s a another cemental block of thinking that this is the end of the world. Again, our careers go on much longer than this. If you take care of someone on the way out, at least, and give them a decent severance, et cetera, it makes it less, it takes the sting out of it a little bit, hopefully, and it makes it less of a conflict type of thing. Hopefully, hopefully.

Cliff: Yeah, I agree, and I think for me, obviously we’re privileged and all that stuff and we learn on out feet, but for me, getting fired was probably one of the best things that happened to me, at least in the context of that job, but in the moment it was really, really hard to process and it threw me for a loop. But I do like to think, even though it’s a cliche, that sometimes firing somebody can be the best possible thing also for that person.

Tim: Oh yeah.

Cliff: To get them out of a toxic loop, to get them to do something more satisfying with their life. Also, again, not everybody’s as privileged and able to immediately land another job and have that gap on their resume and all that stuff. That can be tricky for some people to recover from.

Tim: Yeah, despite my best efforts, I haven’t been on that side of the table yet One of these days.

Cliff: It’s gonna happen to all of us. Makes sense.

  • Cool.
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The Startup Tapes chronicle the highs & lows of building a startup, through candid, immersive interviews with founders, operators & advisors. Tim Anglade, an Executive-in-Residence at Scale Venture Partners and formerly with Realm, Apigee, and Cloudant leads the project with the goal to de-mystify the process through which startups emerge, grow & succeed. His unfiltered interviews transcribe the conversations we often hear in the boardroom, amongst our portfolio community and with entrepreneurs and partners we engage with every day.

Learn more about Scale Venture Partners at scalevp.com.

For guests suggestions, feedback or questions, email tim@scalevp.com
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