Seven Steps for Surviving a Startup’s Second Founding

I’m a big fan of revisiting old ideas and iterating on them. Its always fascinating using an old concept or framework on a new problem and seeing how well it stands up. Recently, I’ve been noticing the company I’ve been working at, Cloudflare, is slowly re-inventing itself from within and passing through what I’ve taken to calling it’s Second Founding, a term I recently picked up from the book “The Startup Way“.

“… second founding –when companies know they’ll make it and settle in for the long haul, typically shedding their “startup DNA” in the process.” – Eric Ries, The Startup Way

This transition can be as awkward as puberty for team members that have been with the company since it was a scrappy startup. Politics begin to flare across the company. Gangly, uneven growth spurts are common, and there’s a sudden new attraction for process and accountability. All in all, just like being a teenager, things start to get weird sometimes.

To help work through the changes, I’ve listed seven steps that could help people adapt, survive and succeed in this dynamic shift within their startup.

 

1. Overdocument Everything, AgainOld School

The Problem

The problem is the same as it always was: fast-moving and nimble companies are notoriously under-documented. The process, procedure and customer changes are still dynamic, but they are starting to slow during a Second Founding.  This slight slow down means there is room for some codification, best practices, and the creation of high water marks. Over-communication during this phase is even more important than ever. If you don’t set the high water mark early, you may be fighting with poor quality output for the next few cycles.

Documentation becomes vital as policies and best practices get created. While a scrappy startup, you may find the person writing the material would be better off improving the product than detailing how it works. However, during a Second Founding, you may have just enough resources to concentrate on documentation.

The Solution

So, as someone who has been with the company for a bit, you are very well-positioned to solve this problem. You’ve seen a few incidents and fires already and may have even used some semblance of best practices. As a  lead or experienced team member, part of your actual daily responsibilities could be as a force-multiplier for your team or department which includes helping others understand the system as quickly as possible.  This puts you in the perfect spot to over-document everything to codify best practices.

Here at Cloudflare, I’ve always been a fan of over-documentation. For many problems, I’ve tried to leave behind not just the solution, but my path to the solution. I’ve enjoyed writing wiki pages, how-to guides, interview guidelines, and duct-tape diaries on how certain customers have been implemented and scaled. These notes and wiki pages have always served a few goals. It allows me to cover-my-ass and point to an audit trail of my actions. It allows new employees to track my learning and catch up quickly, and it provides a version one of best practices for people to refine, build on, and improve on later.

The Result

In my personal opinion, companies that document things well in this time frame will reap the dividends as team members ramp up more quickly, quality is enforced across the customer experience, and many solutions or workarounds become less bespoke. Common problems can reduce their learning curves, and best practices can be codified and more easily shared across the team and company. Sure, some things may be still changing so rapidly that documentation is quickly outdated, but even deprecated notes are better than nothing.

 

2. Give Away Your Legos

The Problem

“The best metaphor I have for scaling is building one of those huge, complex towers out of Legos. At first, everyone’s excited. Scaling a team is a privilege. Being inside a company that’s a rocket ship is really cool. There are so many Legos! You could build anything. At the beginning, as you start to scale, everyone has so many Legos to choose from — they’re doing 10 jobs — and they’re all part of building something important.” –  Molly Graham, Give Away Your Legos…

The lego metaphor is an amazing description to describe the movement from a large, scrappy, immature startup filled with problems to a larger, less-scrappy, more mature startup still filled with even more problems. Problems are everywhere and always will be everywhere. As the company grows, these problems need to be consistently re-distributed. In order to scale effectively, a problem really should not be stagnating on a single person for too long. Otherwise, there can be negative impacts on the development of the individual, the quality of the solution or product, and the likely the team as a whole.

The Solution

“If you personally want to grow as fast as your company, you have to give away your job every couple months.” – Molly Graham, Give Away Your Legos…

Give away your legos – simple as that.

Plan for obsolesce. Constantly let others replace you (i.e. empower them). Consider every responsibility just a Version 1.0 that will ultimately be improved upon by someone else. Give your darlings up for adoption, and try not to worry. They’ll be okay, and ultimately better off, in the long run.

The Result

“Don’t be irreplaceable; if you can’t be replaced, you can’t be promoted” — Anonymous

I learned the above quote in my high school algebra class, and it always stuck with me. I never wanted to be the single point of failure and always try to make sure everyone can follow my work and path. (Oddly enough, that algebra teacher always had to harp on me for not showing my work and always just skipping to the correct answer.)

The result of giving away your legos, your role, and your responsibilities is that the company can continue to grow and scale. You as an individual can take on newer problems, and begin the cycle anew. You never really want to become a single point of failure where problems just languor and stagnant. That is ultimately how technical debts remain unpaid within a rapidly growing startup.

“We can’t solve problems by using the same kind of thinking we used when we created them.” – Albert Einstein

As a specific example, I’ve finally become free to hand off a good amount of legos in the past few months. I gave away the last vestige of maintenance on a Python script to the Sales Operations team.  I gave away the recruiting pipeline for our team to another lead that quickly took steps to make an awesome Version 3.0. And I continue to give away high-value, challenging accounts and documentation maintenance duties to make room for the next round of problems. Giving away old problems and solutions is your best path to empowering others and yourself.

3. Respect the new political landscape

The Problem

Everyone is getting new legos. New people are getting empowered, promoted and new politics are at play. The social dynamics are changing as those politics flare up across the company like acne. This means egos are sometimes dialing up as people feel more responsible for certain aspects of the company. It is perfectly understandable to take this responsibility and try to run with it. These same individuals may even feel under-empowered for the new responsibilities they are taking on. These changes can be uncomfortable for everyone and a nice source of bitterness for individual employees, the team, and the company.

The Solution

“To err is human. To blame it on someone else is politics. ” – Hubert H. Humphrey

Respect other people’s new legos. Simple as that.

Everyone should be given the benefit of the doubt that they’ll continue to make awesome things with their newest legos. If you have questions, ask them, but keep in mind the new configuration for how problems are being solved. People ultimately need to feel heard and empowered, and respecting other people’s new legos is a crucial part to this as the company grows and matures.

The Result

The end result that you can adapt to the new political structure of the company with as little bitterness and jealousy as possible. Ideally, you can even help those that are getting new legos by considering the burden of the responsibilities that they now have. Keep in mind that there are still plenty of legos.  There are still plenty of problems to be solved and opportunities for advancement. Overall, respecting the changing power dynamics can provide a much healthier atmosphere between you, the team, and the company.

As a specific example, I long felt responsible for the operational success of the entire Solutions team. As the second oldest member on the team, I had helped with process development, recruiting, and training for multiple years. This sense of responsibility for the team made it personally difficult for me to completely let them go to others. I’d often start to bump up against new lego-builders as they were trying to start building something new, and ultimately better.

4. Fix Something

The Problem

Everyone at a start up is busy keeping the lights on, the engine running, and everything afloat. (The mixed metaphor is perfectly valid.) This means there is likely to be duct-tape, workarounds, and technical debt somewhere, which you likely created. As you give away your legos, you should take caution that you are not giving someone a steaming pile of solution. Without improvements, documentation, or anything, you are simply setting your replacement up for failure.

The Solution

Document unto others as you would have them document unto you. — The Golden Rule of Documentation

Go fix one of your old problems, especially before handing it off to someone.

If you are giving away some of your legos, you should have some extra time to tweak that documentation, add comments to that script, or create a runbook for your process. Anything that can help your replacement lego builder will be much appreciated by the newest team member and future employees. Ideally, you are leaving things better than you found them. This should mean your work-arounds should be robust and you are not just leaving a trap for the next unwary lego builder.

The Result

The result is that you’ve now documented something annoying or paid off some technical debt. This will go a long way for your replacement to be able to expand on what you’ve built and improve things with a solid Version Two. Specifically, as I was handing off strategic accounts, I made a point to turn sloppy bullet point notes into more detailed runbooks. I went and made sure all my code was updated in our repos. I ran training sessions where we walked through account structures and pain points.  Overall, I tried making the transition of ownership as easy and seamless as possible.

5. Expand your internal network

The Problem

The company is getting bigger and more rigid as it goes through a Second Founding. Alice has been replaced by an algorithm; Bob is becoming the entire Bob department. Communication is getting a little more difficult. Interactions are becoming more focused and scoped. It can be very difficult during this phase to understand how these changes will impact the entire company.

The Solution

Go grab lunches. Go get coffees. Speak with folks outside your core activities. Go speak with new hires and old hires. Now is a great time to learn about other projects throughout the company (especially if there are interesting legos being handed out).  The company is growing and expanding, and your network should grow with it.

Specifically, I’ve tried to maintain this adage through something I call the Three Lunch Rule. Its pretty easy – its literally three lunches.

  1. Grab lunch with someone in a position higher than you.
  2. Grab lunch with someone in a similar position as you.
  3. Grab lunch with someone with less experience than you.

The Result

There is too much to gain from getting the perspective of those above, below and in your peer group from throughout the company, especially in an informal capacity like a lunch. Learning what problems, issues, and pains arise for others  lets you get a better understanding of the company and the problems that go beyond your current team.  By getting a greater picture of the way things currently work, you can expand your knowledge, company contacts, and ultimately your sphere of understanding.

These lunches can also act as a grounding mechanism for any unchecked ego you may be building from all those fantastic lego creations you’ve built up over the years. You are intentionally speaking to someone more experienced than you (ideally humbling and teaching you), someone that is your peer (ideally giving you some competition and challenge), and someone that has something to learn from you (allowing you to teach your strengths). These interactions can be priceless for understanding where you actually sit as the company evolves.

6. Change Teams

The Problem

You feel like you are stagnating. You’re currently holding too tightly to some legos, and everything is changing around you. You feel like you’ve stopped learning and growing. Every problem around you is some version of one you’ve seen before. The politics having gotten particularly inflamed. It is really easy for employees within a startup to earn a certain level of tunnel vision in keeping things running.  These limited view points can lead to friction points as companies grow and expand through a Second Founding.

The Solution

With everyone giving away responsibilities, there could be a fascinating opportunity on another team within the company. Changing teams is a great way to continue learning and developing. Maybe its a way to trade one set of frustrations for a new, unique set that are slightly less aggravating. Maybe its a way to fix new problems in ways you’ve already mastered.  Overall, a new team and new role is the just another way of finding new legos to build.

The Result

Moving to a new team may be a valid option to keep you learning, your skills fresh, and the company growing into the next phase. Additionally, your background and experience could be indispensable on the new team. Maybe you have new best practices to share. Maybe you’ve seen the problem they are dealing so many times that you can come in with a new perspective that they haven’t considered. Overall, there is a lot to be potentially gained in checking out a new team and role.

Specifically, I recently made the shift to the Success team to kickstart a new Managed Services department. In retrospect, it made perfect sense for the journey I was already on. My customer work had shifted consistently to high-touch post-sales tasks for our largest, strategic partners. I already had a Success mindset more so than a Salesperson’s mindset and had strong motivation to keep people from repeating some of my mistakes with their duct-tape placement. Ultimately, it was a very organic decision that will allow me to continue learning and developing.

7. Change Companies

The Problem

A Second Founding is a massive wave of change within an organization. The more I dwell on it, the more puberty seems like an apt metaphor.  Politics shows up where it didn’t before and can be extremely painful and awkward. There are increased urges for structure. And, at the end of the it all, the company you are part of today is not the same company as it was yesterday. It is going through its Second Founding and will never be the the same innocent startup you remember.

The Solution

Ultimately, as much as you might want to grin and bear through the changes, life is too short. Although there could be things you can continue to learn, you may be better off and happier with a different company that is solving the problems that are most interesting to you in a way that is most conducive to you. You could consider this the act of completely giving away all of your legos and letting the next batch of problem solvers have a chance.

The Result

Ideally, the result of this decision is you find another startup you can break things at, or a another company that lets you continue to grow and stretch. My primary advice is that you don’t burn any bridges and that you leave the company on great terms. In the end, the company will continue to grow, develop, and succeed without you.

As for me, I definitely considered it. I definitely think there is a size where my current company becomes ‘too big’ for me. As more structure gets put in place, and teams become more cohesive, everything starts to feel too padded. It becomes more difficult to find a tribal unit and wear multiple hats. Its more difficult to know everyone and have a basic understanding of where things are going as a company. It is more difficult to get things done because there are now more stakeholders involved. Politics can be both helpful and hurtful. Overall, changing teams gave me a lot of new legos to build with, and I want to see that through before exploring new opportunities elsewhere.

Oh, and if you decide to go find another company, particularly a startup, I may have a few tips for you.

 

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