Modern CTO Podcast
Guest: Derek Johnson
Todays episode of Modern CTO we talk with Derek Johnson. Derek is the CTO and Co Founder of LawLytics, a legal software company. They are absolutely knocking it out of the park. Let me break this down for you. Derek and his co-founder self funded and built a multi million dollar company. Their initial assumption was wrong, but they listened to the market, adjusted and now they’re thriving. So grab a beer, relax and get ready. This episode is overflowing with value. Right here right now on the Modern CTO podcast.
Time Stamped Notes
1:01 Time goes by fast.
Derek went from Developer to the CTO of a multi million dollar company in which he did all that growth without a significant amount of venture funding as a lot of the start up was founder funded with their own capital. Now the company is looking after just under 500 law firms. Joel introduced Derek to Dan, the co-founder of the company LawLytics which is how this idea came to be developed.
2:15 Who listens to Modern CTO anyways?
Joel talks about the different types of CTO’s he’s been in contact with since the pre registrations have opened up from his book. He has reached out to every single person via email. Some of the common messages Joel has been receiving back is whether or not that particular CTO felt that their experiences would be valuable to Joel seeing as they had an “atypical,” experience from being a Developer to a CTO.
The belief around being a CTO is that there is a college education around technology and this is used as the branded education you get. From there, you try to get a job as a C Level Executive in Technology. It’s easy to be a CTO for a 3 person company because you have the knowledge and skills on how to develop anything. Naturally, being a CTO for a company for 500 people, it probably a completely different experience and different path to getting there.
4:48 Is the Developer of a Small Company the best person to be CTO?
Always, unless the progression is very slow and they are riding it out every time. If they are responsible themselves for the growth, then absolutely. If it’s a great marketing and sales department that’s responsible for the growth, things may get out of hand and they may not be fit for managing such a large company with growing technological needs. It’s purely based on the contribution they have had to the growth of the company. When you are a co-founder, you naturally are a CTO if you are developing. If you are bought on as a CTO to an established company, you may only focus on the technology. It’s different when you’re a CTO or a CTO/Co-Founder. If you are contributing to the critical business decisions, these can be more challenging that the actual technological issues.
8:43 Should a CTO be coding full time?
Joel talks about how he has observed a lot of CTO Job Postings online and how the job descriptions have expectations that the CTO be programming full time at the existing company where the size is 20 people. Derek, as a CTO, writes code because he enjoys doing it, however he states that it cannot be his full time job. There are so many other aspects to being a CTO such as quality control, on boarding new developers and making sure the platform is something that the developers actually want to work on. Writing code full time as a CTO seems odd, unless it’s a start up that is relatively knew. Beyond that, there would be some concern.
Two things are happening if that is the case: if a company wants their CTO to code full time, they don’t understand want they need. The first job as CTO should be to build a development team. Another reason could be that they may have a large infrastructure, but they have a single developer with an assistant. That’s a red flag – if you have that cash flow of a large company that you are not reinvesting back into your company. At least 30% of your budget should be investing back into growing your technology.
Engineers are more expensive rather than hiring a support staff member. You can hire a support person to do that task manually to do that over and over which lacks scalability. Or you can hire an engineer who builds that automated way to build that for you. It’s cheaper to hire a support/temp staff to do that which is the bottom line for most companies.
13:35 – We were dead wrong.
18:10 When Did You Start Hiring and Why?
Derek immediately started recruited designers and the websites that the CMS was producing needed to look good. Derek was busy building the product. The two designers didn’t innovate. When they hired their first innovator, it was after two years. Six months after production, they started recruiting people.
The product was released into Beta about a year and a half after development and started the business. Dan, the co-founder, had many contacts and attorneys and he had been mentioning that to them and they wanted to participate in the Beta. There were 10-20 people lined up. This wasn’t a traditional beta, this was an actual website. These people were willing to try it out and it worked out great for them.
22:57 When is it time to hire an Assistant Developer?
For Derek, this was after the company went into production and started receiving non beta customers who were actually paying. When they reached 50 customers, more bugs were discovered and more features were requested, the more pressure Derek felt which was when he started to hire an assistant developer. Derek’s right hand man, Shaun, started as a junior web developer and is currently at the VP status. The thing about hiring is that it’s so hard. You have to sift through a bunch of talent that may not be so good and it’s quite draining and discouraging. They all start out with confidence but at times they aren’t what they say they are. Even if you hire at the lower level, if you find bright people, never let them go. They are the people that have that spark, you grab on and you invest in your people. You grow your company on a solid foundation. You get a B team, you get B results. Hire the experts off the bat. And those who have the qualities, traits and the habits of an expert.
29:13 Your truth is the value
If you want to be a billionaire or have as much impact as you can in life, you have to go and look at the monkeys that are doing that and you have to see what they are doing. Joel took the route of reading the life stories of the billionaires to understand who they are as humans. You need to derive who they are as people and how they think.
30:58 The pro’s and cons for working remotely
Working remotely seemed like such a glamorous thing when Derek started working, Seven years later, it’s not as fun. He’s at the library or Starbucks. There’s something about being around other people. It’s the sense of “I just can’t be at one place.” It ruins your house because you’re coming home from being home. Anyone who feels they are working from home and they don’t like it, find a co-working space, or go to your public library as your taxes are already paying for it. Derek finds remote work very difficult and has been his biggest struggle. It’s basically him and his dog in his home. Another struggle is disagreeing with a Co-Founder which hasn’t happened in a long time. The first three years when you’re getting to know and work with this person, you will have disagreements. Its one of those choose your battle type of things. Is it really worth arguing over. All that kind of disappears. Hopefully you become friends, you want to talk to them and spend time with them. It follows all the same rules of a relationship.
36:46 CTO Audit Check List
Make sure that all repo’s that you’re dependent upon, that you have them inside of the organization’s/company’s account.
Have all Intellectually Property Agreements and Documents in place. Ensure they are backed up and that you, as the CTO, are the only one who has the back end access to it.
All alerts and alarms on all devices are all working properly and are set up.
Back Up Most Prized and Important Intellectual Property Offline
Review all your authentications and monitor who has access
Review all the projects that have become stale