Need someone to lead product management at your software company? I build high-craft software and the teams that build it. I'm looking for my next opportunity. Check out my resume and get in touch.

This is the blog of Adam Kalsey. Unusual depth and complexity. Rich, full body with a hint of nutty earthiness.

Milestone payments

That hiring post of Frank Demmler’s drifts into some discussion about milestone-based funding. An entrepreneur agrees to funding terms that in order to get the next round, certain milestones must be met. Hire a VP of sales by Q3. Land 40 advertisers by December 15th.

Frank says...

In the beginning of my career working with early stage businesses, I believed in milestones and tying investments to their achievement. Conventional wisdom was (is?) that milestones help to keep the management of early stage ventures focused.

That assumes that the milestones agreed to at the closing remain the company’s priorities.

In my experience, though, that’s rarely the case.

Things change. Priorities shift. In some cases, strict adherence to the milestones may hurt the company. The conflict between the specifics of the milestones and the company’s needs are often difficult to resolve.

If you’re a first-time entrepreneur, all you know is that getting the next round of funding depends on hitting the milestones. The fact that things have changed is troubling, but you can’t tell your investor that you were wrong (even if the changes had absolutely nothing to do with anything you said or did). You fear that if you try to change the milestones, it will be seen as a sign of weakness. Instead of admitting and addressing the important issues, you play ostrich and forge ahead with meeting the milestones.

Twice I’ve agreed to milestones and been burned. The priorities did indeed change and we moved along with the changes. We shifted our efforts to meet the new realities of the business, but when it came time to collect the money, we had some problems. The milestones hadn’t been met. The contracts all pointed to hitting milestones.

We eventually worked it out, but it was a tense time and caused a lot of distrust between the parties. In one case, it nearly ruined the business.

Recently Written

VC’s Future Lies In Building Winners
Jun 21: AI and megafunds are about to kill the traditional venture model, forcing smaller VCs to stop hunting for hidden gems and start rolling up their sleeves to fix broken companies instead.
Should individual people have OKRs?
May 14: A good OKR describes and measures an outcome, but it can be challenging to create an outcome-focused OKR for an individual.
10 OKR traps and how to avoid them
May 8: I’ve helped lots of teams implement OKRs or fix a broken OKR process. Here are the 10 most common problems I see, and what to do instead.
AI is Smart, But Wisdom Requires Judgement
May 3: AI can process data at lightning speed, but wisdom comes from human judgment—picking the best imperfect option when facts alone don’t point the way.
Decoding Product Leadership Titles
Mar 18: Not all product leadership titles mean what they sound like. ‘Head of Product’ can mean anything from a senior PM to a true VP. Here’s how to tell the difference.
What branding can teach about culture
Jan 8: Culture is your company’s point of view in action—a framework guiding behavior, even in the unknown. You can’t copy it; it must reflect your unique perspective.
Think Systems, not Symptoms
Dec 15: Piecemeal process creation frustrates teams and slows work. Stop patching problems and start solving systems. Adopting a systems thinking approach helps you design processes that are efficient, aligned with goals, and truly add value.
Your Policies Aren’t Your Culture
Dec 13: Policies guide behavior, but culture is the lived norms and values of your team. Policies reflect culture -- they don’t define it. Netflix’s parental leave shift didn’t change its culture of freedom and responsibility. It clarified how to live it.

Older...

What I'm Reading