While I do admit that I didn't fire people as quickly as I should have, most of our structural problems came from employees simply doing what was best for them and bad for the company, and most of them not even realizing or caring to think about the long-term consequences of their actions. My main lesson was that almost nothing can be delegated except to other founders or some exceptionally rare adults. Success in scaling seems to be actually more in making sure the things you do are simple enough that employees can't mess them up.
From founder reactions I've had when telling this, I think a lot more people have come to internalize similar beliefs, but none will publicly say them since they don't want to risk PR backlash.
There's a weird cognitive dissonance I've run into where career advice from most people on HN boils down to "Companies don't care about you. Optimize your own total comp. Jump ship when opportunities come up. Don't bother with loyalty." And then on the flip side you have founders who expect employees to act like the company is their family, but with zero reason to do so.
I think there must be a better way to get employees, and especially executives, to care about a company's long-term success rather than about quarterly goals and near-term comp. I'm not sure what that is, but I think it might need to be related to shares in a profit-sharing plan rather than traditional equity shares.
Money isn't buying love.
You can hire a prostitute, she will work for you, but she will still not love you.
This is the same with companies.
Someone recently hinted at the opposite angle: Give them a lot of money and their motives would move to safeguarding their jobs, which results in a higher level of corporate politics.
I wasn't expecting them to do something bad for themselves, merely to simply do what I was explicitly asking and paying them for (and we paid above-market salaries). Too often communication was conveniently misinterpreted in obvious bad faith to justify them using some expensive AWS feature, or simply ignore the core message in the request. This was hidden for a lot longer than it should have been since Covid forced us to go remote all of a sudden and people would vouch for one another.
Honestly, I think now that there simply isn't a way to align most employees with you, and that the secret to successful start-ups is only going for the easy to execute things, that don't rely on the qualities of your employees (or you have 100mil raised and your problem is naturally a good challenge for them).
Just gotta keep it up as you scale. At around 200-300 employees your job in leadership is simply telling the same story over and over again to different constituencies in different ways, for years.
That's how you obtain incentive alignment, when you genuinely believe that working hard as possible for the company is in pursuit of something greater.
This is impossible to do for yet another tax/hr/finance/billing startup, and why companies with big missions like SpaceX et al have no problem hiring.
No leader should expect anything different from their people. It is your job to align the incentives so that what is best for the employee is to do those things that are best for the company. If you are relying on people to do what is not best for them out of loyalty to a corporation/startup/vision, you do not have an accurate pulse of the modern work force.
And yes, when a leader or company looks like it is going sour, sometimes employees act in bad faith for their own self-interests. When that happens, question why -- what is it that makes them think bad faith actions are more beneficial than helping the company. Don't just fire and forget... do some self-critique to find out why someone who was smart enough to be hired in the first place lost faith in your leadership. There are likely important lessons there.
There's always something better I could have done as the person in charge, obviously. I've done a lot of reflection and self-critique, please believe me, and I realized I've made a lot of mistakes, from which the situations could have been recovered though.
Putting my faith in employees, expecting them to do maybe 80-90% of what I was doing as an employee 10 years earlier created an almost unrecoverable situation, that burned the entire runway to unscramble. Yet if I say that my biggest lesson was never to put trust in employees, as it's most likely impossible to create a good incentive system for them, most people won't believe me, as I'm sure you won't either.
I've come to think that the burden is no longer on anyone to create incentive systems, it's on society to reintroduce some morality. Only a limited amount of businesses have the luxury of aligned incentives.
Why would I grind at a startup where the best case scenario I am getting a payout I could get at FAANG without any of the risk?
I have been through a successful exit as a SWE and you can be sure that the founders did everything in their power to maximize their own payout and minimize my payout. In a company of 40 the founders got a payout of 100x any other individual at the company, even those who were there early on and stayed until the exit. I got a (taxable) payout of ~300k and the founders got 40mil. The money was life changing for the founders, but for everyone else it was just a nice bonus.
Now I just work at BigCo and make 400k/yr, every year.
But then there are generals who lead soldiers to die so that a war is won. So at least there exists another mode of leadership not covered by your statement.
I've seen this play out a lot as well with management. It's a classic principle/agent problem and one of the best solutions i've seen is flatter orgs where everyone has a primary work responsibility beyond pure management.
+1. I see this over and over.
No surprise there. If you can’t align incentives, then you are going to have trouble getting people to do what you want. Blaming the employees for a company failing is like blaming gravity for a building falling.
