My Role as a Founder-Cto: Year 8
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VCs aren’t interested in a lifestyle business throwing them maybe a small dividend and a miniscule number of companies go public. Look at YC, they have invested in thousands of companies and only around 20 have gone public and only 3 have had positive returns since going public
https://medium.com/@Arakunrin/the-post-ipo-performance-of-y-...
Once you take outside funding, you really have no choice but an acquisition or go public. VCs don’t want to get tiny dividend checks. Even public shareholders will insist on a sale at the right price
> Even public shareholders will insist on a sale at the right price
All you find is stuff, presented as super valuable, and people very very keen to sell it to you. They’ll do whatever you want. It attracts a certain kind of person. The people who have the means for this lifestyle seem mostly disappointed.
It’s not the situation this guy has created for himself. His life has meaning, he’s of value to his employees and customers and partners.
Not everthing bought with money is superficial. Certainly a lot is less superficial than dedicating your life to “in app payments made easy”.
Similarly, I don't understand why the CxOs in my current (BigTech) company still work. You're done. You can do anything you want and yet you voluntarily continue to amass more?
Has it occurred to you that perhaps what they want is to be the CxO of a big tech company?
Also, companies are not the only kind of group someone can join (for money or not) with the goal of improving the world.
Things happen. Expensive things. The security to be able to afford expansive cancer care without worry, to pay for therapy and specialized schooling for your child… these are huge, huge things and they happen to you no matter what you do or don’t do. This isn’t just about being happy to be frugal.
That’s just a perspective on hardship, it’s not the only way. People deal with hardships with many many tools. My favorite tools are ‘dignity’ and ‘courage’ and ‘personal strength’. ‘Money’ is another tool too, yes.
Your hypotheticals simply aren't relevant here.
I would pull it back by saying let’s not even talk about the money of the potential exit and put it this way:
I think OP’s life experience on display here is this kind of odd and pervasive founder/hustler/C-suite philosophy and lifestyle that puts work satisfaction and accomplishment over family, friends, and personal health.
If this was all about money OP would have taken the exit and retired forever. But even the spouse basically insisted that this “baby” (the product) is so important that it’s worth the stress and sacrificed time versus the prospect of never needing to depend on work as a concept ever again.
Imagine like you’re watching Star Trek where they make individual human emotions and tendencies into alien races. This is like the founder product focused C-suite race: their society’s happiness and accomplishment measures are based on building products and doing all the corporate stuff that this blog post describes. Just like a Ferengi who rejects profit, this alien race would shudder at the thought of the “boredom” of minimizing work per dollar earned.
The Federation is the viewer’s baseline, and because they are the logical viewer-relatable society. They’ve used their technological prowess to literally eliminate capitalism and spend all their time prioritizing exploring the galaxy, their friends, and their family.
This is like what I would do if I was offered a 9 figure exit. But then again, I’d never found a company in the first place because I know it’s a fool’s errand compared to my present status where I barely work 30 hours a week doing IC work with an average of 0.3 meetings per day on my calendar.
To your point, instilling work ethic in your kids doesn’t mean instilling a sense that work is the most important thing in their lives.
So this thread y’all have started is really thinking about the issue the wrong way. This isn’t about exit versus not exit, generational wealth versus not, it’s really a reflection of the alien nature of the mentality of the C-suite product founder alien race that just sort of lives with these warped priorities that don’t really make sense to most people.
[0] https://web.archive.org/web/20190422235813/https://www.theat...
Sure, but I’m pretty sure if you asked those parents if they’d rather lose all their money to make parenting easier their answer would be a resounding “no”.
See perhaps Nick Maggiulli's post "The Ideal Level of Wealth":
> Financial Independence (28.6x Your Annual Spending): $3.5M. Assuming you never wanted to work again, you would need about 28.6x your annual spending to cover your costs indefinitely [$120,000 28.6 ~ $3,500,000]. This 28.6 comes from the Kitces research[1] showing that the 3.5% Rule[2] is the safe withdrawal rate for a 40-year time horizon and beyond. This research suggests that if you can make it 40 years while withdrawing 3.5% per year, then you’ll likely make it 50 years (or more).*
[…]
> Whether your goal is Coast FIRE or full financial independence, the ideal level of wealth in the U.S. is in the low-to-mid range of Level 4 ($1M-$10M), or $2M-$5M. I know this is a lot of money and many people will never reach it, but that’s why it’s an ideal. It’s something to strive for. It’s enough where you don’t have to worry about money anymore, but not so much that it becomes a burden or warps your identity.
* https://ofdollarsanddata.com/the-ideal-level-of-wealth/
Adjust the $120k annual spend for your own lifestyle and cost of living.
You're not going to fly private, but it will take most of the worry out of life. Morgan Housel, author of the recently release The Art of Spending Money (and previously The Psychology of Money):
> 00:50:16 […] You have the independence to be who you are and wake up every morning and say, I can do whatever I want today. That’s wealth.
* https://ritholtz.com/2025/11/transcript-morgan-housel-spend/
Will accept, I have no idea about his personal situation. Also feel the HN crowd may downvote my comment because it is not phrased correctly.
Regain your own time. As a former CTO who has recently exited, recovering my own time again is more valuable to me than the money (although the money means I can retain my own time going forward).
> His life has meaning, he’s of value to his employees and customers and partners.
Your work is not you and if you think that way, you're gonna be crushed when you come to retire. Even though I loved what I did for a career, it's better to do what you love for yourself, not "employees and customers and partners"
I could fit a solar system in the gap between your two options of a) full time CTO or b) 9 figures to escape it.
Personally I believe you’ve been operating on autopilot, and not designing your life to suit your own needs.
Not that these things are required to “live,” but I certainly am not interested in making these tradeoffs.
So enjoy your situation while the good times roll, no shade, but people have their own reasons to never consider living in an SRO besides mere materialism.
BTW I was originally searching for an SRO but I landed a 'micro-apartment' (I just double-checked terms), it has its own kitchen/bathroom. Had I stopped looking I wouldn't have found this great situation. Good enough that when I won a housing lottery the following month, for a nicer apartment at the same rate, I was content enough to give it up and let someone else take it.
You have no idea about me at all, so please don't insult me by thinking that you do.
Buy freedom to chose what to do with your life. I've never sold a company and netted 9 figures but i have been lucky enough to work for a hedge fund and make enough that I and my family can do what ever we want from the age of 30 onwards.
That is an incredible amount of freedom and one that I wish most people would have.
You seem to think only in materialistic ways.
But having enough money to not have to work again allows you to be a better and more available parent. To be able to provide your kids and nieces and nephews with schooling to put them apart from other kids.
Its not always about owning another home, Just knowing that my kids are set for life before they start their own lives in case something happens to me was enough for me.
Lots of us think of others before ourselves.
Did his life not have meaning before he started this company?
Also: plenty of meaning outside of running a SaaS. Hell, undergraduate research assistants probably contribute more to societal at large.
Your identity is tightly fused with the company -- You speak about the company as your primary source of meaning, energy, and long-term purpose. -- Life outside the company is framed as something that would quickly feel empty or boring for you.
You retain control under the banner of high standards -- The VP of Engineering search stalled because no candidate met a bar that is implicitly shaped by how you think, operate, and decide. -- When leverage through delegation feels risky, responsibility naturally flows back to you.
You are the center of cultural gravity -- Culture, values, language, and priorities are largely authored and reinforced by you personally. -- Much of the organization's shared meaning still routes through your judgment and voice.
You delegate execution, but not full ownership -- Even when you are not directly involved, successes are framed as outcomes of foundations you previously built. -- This keeps you psychologically present in nearly every major win.
You created a parallel structure that still depends on you -- OCTO exists to do zero-to-one work, unblock hard problems, and pursue opportunistic bets. -- By design, it reports directly to you and sits outside normal org constraints, reinforcing dependence on your judgment.
You remain the default DRI for existential issues -- Reliability, support breakdowns, reorgs, executive hiring, culture, and innovation still escalate to you. -- This conflicts with the principle you explicitly endorse: if there is no DRI, don’t expect it to get done.
You have not made yourself truly replaceable -- There is no clear path for a future CTO with comparable scope, authority, and trust. -- The role, as it exists today, is inseparable from you.
Your personal fulfillment shapes strategic decisions -- The decision not to sell is framed largely through your motivation, energy, and desire to keep building. -- The company functions as a long-term vehicle for self-actualization now that financial stress is gone.
If this remains unchanged, the long-term risks are predictable: -- Senior leaders will eventually hit a ceiling. -- Innovation will bottleneck on your bandwidth. -- Strong leaders may leave quietly in search of real ownership. -- Succession becomes a deferred crisis rather than a designed transition.
Anonymous text on the internet, especially from accounts made after 2022/2023, are like steel post nuclear tests. Everything on the planet is tainted and the only things that can be relatively trusted are steel/text created prior to the tainting event
It is like these people are hell bound to the work culture, diehard workaholics. They don't know anything else outside of a computer screen.
Honestly disgracefully.
This is a founder/CTO. You don't get to be a founder or C-level without making work a lot more of your life than just a 9-5.
As much as people complain about the C-suite not doing anything and spending all their time golfing, they're basically on work mode 24/7. I've never worked with a C-level who didn't check emails on the weekend, wasn't willing to travel at a moment's notice to close a deal, not willing to work to resolve business or tech emergencies at 1am, etc.
On top of that they always represent the company, even in their off time. Stuff that wouldn't matter for a regular employee might lead to termination or forced resignation. For example, kissing a woman who isn't your wife at a concert.[0]
This is all true even outside of tech. Ever talk to someone who owns a restaurant? They spend weekends and nights talking to suppliers, figuring out staffing, etc...
This doesn't represent typical non-executive jobs in the software industry. Most are largely 9-5. The ones with oncall expectations tend to pay more.
[0] https://www.cnn.com/2025/07/19/business/andy-byron-astronome...
Even with such a golden ticket ride to the heavens? You could do anything, focus on your family and build your little castle or depersonalize even, change countries, change your identity, make new connections, live a completely different life...
Some people like working a stable but boring 9-5. Some people like working a challenging job, even for longer hours and lower pay. Some people like building things; some people like coordinating teams and managing people; some people like maximizing financial returns and seeing numbers go up.
As to why this specific person didn't take a 9-figure cashout (assuming it's true); I would imagine it's at least partly because this person thinks it could be worth more in the future. Crazy as it sounds, he may not be wrong. Remember that Larry and Sergey tried to sell their "Google" research project to Yahoo for a life-changing amount of $1 million (in 1998, they could have each bought a house!). Or a million-dollar sale that did happen, Roy Raymond selling Victoria's Secret for a million in 1982. (Multiple houses!)
Obviously 9 figures is a lot different than 7, especially in 2025. But he's also the CTO and has access to financials and company strategy. Who's to say that the $100,000,000 he would get won't be $250,000,000 in an acquisition next year? Even "just" a 25% bump in a year would be an extra $25 million, which in itself is life-changing. It's obviously a risk, but saying "this guy is crazy and/or an idiot for not taking a 9 figure cashout" isn't fair unless you can peer into the future.
Different adventures, different life obsessions...
There is a real mentality in many of the teams I've worked with that the "grind", "sacrifice", as the pound of flesh that must be offered up for success.
In reality it's far different. We need to make something of value and charge fairly for that value.
Teams can do this without the grind, and still be wildly successful. Teams can do the grind only and are typically not.
It's a false idol, and a lot of folks in the industry only have this to look up to so they don't know better.
It's because those of us doing the opposite, getting there with balance, aren't writing career focused articles around the holidays. Virtue signaling our work ethic. We're spending time with ourselves, our families, quietly succeeding.
I’m not the single DRI for culture at all. We have many strong culture carriers, which has made scaling to 100 people much easier than scaling to 20. That said, culture is still one of the core responsibilities of founders, in my opinion.
Also, OCTO isn’t about me wanting to innovate. It’s about giving certain engineers permission to not be tied to a roadmap and to stay fluid.
1. We aren’t going to sell
2. Confiding with your spouse that all this stress (which is relatively bad for your health) and hard work has “paid off” so far, totally worth it! (:sweat-smile:)
3. We can resolve a lot of the sustainability problems by (among other things) raising another funding round.
But…isn’t that just inviting more stress, more pressure from investors, more expectation to grow and exit?
I find it hard to relate to this C-suite life and logic, it seems so hyper-capitalist and backwards.
I almost feel like you should know my life story as a contrast: I’m an individual contributor.
I cannot remember the last time I worked more than a serious 30 hours per week.
I cannot remember the last year where I took fewer than 25 PTO days off.
My meeting calendar averages less than one meeting per day.
I usually blow a solid 1-3 hours per workday during business hours on straight up leisure activities. Whatever I feel like that day: gaming with friends, cleaning the house, working out, you name it.
I’m not telling you this to brag, I’m just telling you this to make you aware that it is an option.
I’m not saying you should have taken the 9 figures but I struggle with whether I respect you more or less for refusing the payout.
The argument for “more” is that you’re being better than the average greedy bastard.
The argument for “less” is that it’s obviously illogical to pass up an payout like that and the most logical thing for you to do is never perform obligated full time work again and live the rest of your life with zero work-induced stress.
This is the disconnect to me. This phrase has tech industry cult vibes to me.
I see “building” as something I’m obligated to do to pay my bills. I do it because it’s preferable to other forms of labor. As soon as I have the financial means to stop doing it, I’m out.
This motivation is like a strange curiosity to me. This pursuit of product is so foreign to me, and from the outside it doesn’t seem healthy. But I guess if the Klingon like going into glorious battles to the death better than chilling at home with their family, who am I to question their motivation?
I build stuff at work because it’s a financial obligation, because it’s better than cleaning bathrooms or waiting tables for a living. If I had some kind of better option for paying my bills with less labor involved I’d take it in a heartbeat.
Year ten, my partner turned around and stuck a knife in my back, and I found myself railroaded out and battered into submission by lawyers. Exited with token equity, and a small cash payment to get me to fuck off so they could gut the company.
Retrospectively, I should have quit while I was ahead, and I should have realised that while I cared about the company, it did not care about me.
Also, cofounders… you never find out who they actually are until one night you hear the click of the hammer of the gun against your head cocking.
The author talks about himself and his co-founder Jacob and they went back and forth on whether to sell or not.
I am very interested in what the other 118 employees thought. Did they want the co-founders to sell? What was their equity in the company? What kind of deal would they get? Accelerated vesting? Much larger than normal RSU stock grant at the acquiring company compared to a normal new hire there? Nothing?
I post this link in many threads about startups about how the normal employees often get nothing. The author says "So we decided to raise another round" and I wonder if the co-founders share the liquidation preferences and captables with the other 118 employees.
https://www.reddit.com/r/startups/comments/a8f6xz/why_didnt_...
I posted this comment in a different startup related thread last month but I really wish the CEOs of both startups would have accepted these lower offers.
I don't know what the captable was at the first startup but at the second I would have got around $300K. This would have been a large amount of money for me but the founders wanted more so they rejected the offer.
Almost every "normal" level employee thought we should have taken the deal and then we would have also gotten jobs with normal RSU grants and bonuses at the acquiring company which was a well established company.
It made me decide to never work at a startup again. I don't want a single person to be able to control my financial situation that much. I'd rather have the relatively guaranteed yearly raise, bonus, and RSU grant, and not have to drink the Kool-Aid of the founders.
> I worked at 2 startups. Both failed.
> The first had been around for about 4 years when I joined and had products that made money. They were trying to get acquired. They had partnered with 2 companies making products specifically for them. One of them offered to buy the company for $30 million but the founders thought their company was worth $300 million. They said no and then money started to run out and people started leaving. In the end the assets were sold for $2 million.
> The second startup was created by former coworkers and I joined after it had existed for 4 months. We worked like crazy for the first year and got our prototype out. We had a lot of interest but it took me a while to realize that the 3 founders already had net worths from $5 million to billionaire level. When I heard about offers in the $30 million range they just weren't interested in selling for so little. I left after 3 years and the company floundered another 2 years until they shut it down as people left.
Don’t take it so personally. I did once too.
If the employees think they know better, there’s nothing stopping them from starting their own businesses and destroying their boss.
It isn’t reasonable to expect the founders to do an employee’s bidding when it comes to selling a company, but it is reasonable for the employees to feel emotionally invested.
This is easier said than done.
The founders of many startups are extremely charismatic. They can get you to sacrifice your personal / family life and work long hours by dangling the big pay day in front of you.
The second startup I worked at let the first 8 employees buy into the company for Class A shares. These in theory were worth more than the Class B shares I was given. This later led to some marital issues when one guy invested $100K into the startup based on the founder taking everyone out to dinner and assuring the wives it was a great idea. Then 3 years later they have turned down 2 possible sales, no exit plan in site, and that $100K would have been useful for the children's tuition who are about to go to college.
I write these posts are warnings to people who get excited about the appeal of working for a startup.
So I would really love to hear the author talk about what his employees thought about turning down the deal and how much money they would have got.
Say you have nine figures in your account. Would you push it all into this company to be able to have a fun job? Seems completely insane to me.
F You Money means you can spin up whatever projects you want for the rest of your life. Even if your dream job is worth $100m to you, is the delta between this job and your realistic best alternative really worth that much?
Speaking as a co-founder CTO, I believe there is a very insidious kind of attachment that forms when you’re dancing with burnout, and working on a successful company that you’ve built from the ground up.
“I want to leave a dent in the universe” I told myself. After 3 months in a hammock decompressing, I very quickly realized that there is more to life than work, and it’s really easy to find fulfillment building things if you get bored. But this viewpoint is really hard to hold onto when you’re buried in the day to day excitement of the job.
At least for me, regular financial decision making breaks down once the numbers are above a certain amount.
E.g. You won’t feel 10x better about a $100m windfall vs. a $10m windfall.
The best case scenario for a lot of founders is to do a secondary, cash out / de-risk, and keep on building.
That’s the route I took (and the author). Paired with obsessive focus on work/life balance, I don’t regret taking this route.
A CTO is a common title at medium and larger law firms, and an office of the CTO for that org sounds like a great idea.
What is too much is asking an Engineering Manager to start a completely independent product line that may go nowhere. It’s far more effective to rely on senior, staff+ engineers who don’t need management and have experience taking things from 0 to 1. They can build an MVP quick. Once we see real signals of PMF, we can then build a team around it (or drop it)
The CTO fiddled with greenfield projects that had no path to products while the house burned down.
The best that can be said about it is that inventions outside of the product helped beef up Nokia’s patent portfolio, which played a role in the company surviving the post-phone years and transforming into a pure network company. But they lost a trillion-dollar opportunity and shrunk into an average B2B enterprise.
Android changed all that, all of the sudden all their competitors got a good OS for free. Commoditize your complement, Google took their markets.
I've been the CTO twice in my career, and am in a pure engineering role now and get a lot more satisfaction out of my job.
How so? I think it's possible. Network, linkedin etc. And in startups it's not that bureaucratic in my experience. I think you can achieve that ;)
I mean, you could house, feed or educate people and you chose to...not do that ? To have more ? Is there a endgame you are not sharing with us, a special number that would make it OK to sell ?
1. If you stepped away for six months, what would actually break? not emotionally, but operationally?
2. Which decisions still require your involvement today that should not? and why haven’t you let them go?
3. Is there any executive role at this company you could fully replace yourself in right now? If not, what does that say about how you’ve built the org?
4. Are you rejecting executive candidates because they’re weak or because they would force you to change how you operate?
5. What critical work only exists because it still routes through you?
6. Is OCTO a temporary incubator or a permanent workaround for your inability to decentralize zero-to-one work?
7. How many senior leaders are truly accountable without needing your implicit approval?
8. Are you optimizing this company for scale or for a version of the future where you still feel indispensable?
9. What would have to be true for selling the company to be the responsible decision, not the exciting one?
10. If the company needed you to be less central in order to become great, could you accept that?