A multi-million dollar outcome from a stagnant SaaS company
Duration of engagement: 10 months
A startup offered an API as a service with a SaaS business model. They had achieved a certain scale, where their biggest customer was paying six figures. They had achieved this while being capital-efficient, with only a few engineers.
Unfortunately, but were unable to go beyond. After struggling for a while, the founder brought me on to help. He gave me the following brief: there are frequent multi-hour outages. Important customers are dissatisfied, and will churn unless their problems are addressed. The company has made commitments to customers and failed to deliver. The sales team has lost confidence in the tech, so they stopped acquiring new customers. Deliveries are slow, and there are a lot of bugs. The startup doesn't have confidence in their ability to address these.
This is how I approached this problem:
Step 1: Understand goals
The first step in the engagement was to understand the goals. I also understand non-goals, which draws a boundary around the goals. We're often in a rush so we start executing without clarity on goals, but that's like getting in your car and driving without knowing where you're going:
Step 2: Root-cause the problems
Once I understood the goals, I took a two-pronged approach: I started working with the engineers to try to fix their day to day problems:
Software Engineer #1
“I was introduced to Kartick when he was hired to act as a Consulting CTO to a team of 10 mid level developers.
Kartick was able to take the role of a consultant and mentor immediately. He practically guided me by hand to write industry-level API documentation.
Our SDK was old and had repeated, bug-ridden logic that took twice as much time to work with. Kartick helped us do multiple runs of refactoring and rewriting. It made the code less prone to bugs and crashes and onboarding new developers into the code base less time consuming.
Reducing mobile network chattiness and decreasing DB query time in our mobile app were strategic and well planned improvements by him that made the UI smoother, run faster and overall make the user experience better.
When I was stuck, I’d ask Kartick or refer to his Youtube videos, and I was able to make progress again.”
Software Engineer #2
“Kartick streamlined lots of processes which unburdened me and channeled my energy towards the right things.
I learnt from Kartick to think about any problem from the customers' standpoint before addressing it on the technical front, which has helped me build solutions that work better for customers. And to think through a solution before just implementing it, which is letting me come up with better solutions.
Thanks to Kartick I'm a more effective engineer than before.”
In parallel, I root-caused the problems. To do this, I first asked the founder why he's facing the problems he's facing. He said it's all because of bad tech. I asked him if other areas like project management might have contributed to the problem, and he said, "It's all a tech problem."
I nevertheless independently investigated the tech, talked to people (founder, engineers, sales, support, two customers) and observed team meetings. Based on this investigation, I concluded that every part of the startup is broken: tech, management, culture, not just tech as the founder assessed.
I then asked why again: Why is everything broken? I then identified the root causes:
The company had a tech problem all right, but tech problems are caused by management problems. Trying to fix (say) the backend at that superficial level without understanding root causes is bound to fail. This deep analysis is my main value add.
Step 3: Propose and reach agreement
Once I've root-caused the problems, I made a proposal to turn the startup around:
The founder pressured me to do it faster and cheaper, and I told him that's not possible. If it were, I'd have proposed a lower time and budget in the first place. I'm not a yes-man, and so don't agree with something that would satisfy the client in that instant but ultimately not achieve the goals the client said he wanted.
The founder said that the market is racing to the bottom, so such an investment won't produce sufficient returns. He again asked me if we can do it sooner, and I told that if he wanted to achieve just one of the goals we started out with, rather than all of them, we could do it quicker. For example, if we focused only on scalability, we'd be able to achieve it in 2 quarters rather than 2 years.
Ultimately, the founder and I agreed on getting the startup acquired:
Step 4: Execute
I spoke to a couple of acquirers, engaging with senior engineering leaders on their level:
Step 5: Results
The acquisition closed, resulting in a multi-million dollar outcome from a stagnant startup.