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September 10th, 2018 – „Loyalty Better than Skills?“ (by Ondrej Fryc)

I just finished reading of this article and I find it disgusting. That manager says he works for Elon Musk, but in fact he works against him. Anonymous well poisoner.

Tesla is in war time, billions of dollars are working against its success. War generals must have 100% loyalty of their men and must sacrifice all those who work against them. Moreover, what a general! This one is not hidden in insulated headquarters, he fights right in the middle of the battlefield. He works long hours with his men and sleeps at the factory, if need be. In his 46 years, wow. He also does mistakes. The image of him puffing pot was a mistake. But who does not do mistakes? Only he, who does nothing. Are the critics vowing for the prototype of the grey-hair CEO, only seen in boardrooms with mouthful of nicely rehearsed but empty phrases? He, who is so afraid of making a mistake, that he makes nothing?

A CEO who is focused on winning the war, must build his team on people he can trust. Who are loyal to him and are not bravo soldiers who would trade him in if they see it worth. Of course – building a management upon people whose only qualification would be worshiping their leader wouldn’t work. However, still better than having frenemies there – people, that work against their leader.

Did we put our money where our mouth is? Oh yes. More than €3 million worth of confidence in Elon Musk and the leadership style he represents.

September 3rd, 2018 – „We Are the Hot Girl in Town“ (by Ondrej Fryc)

Your investor is your partner in good and in bad times. You need to get along well with him – similarly that you need to align values with your partner for life.  And that requires some picking, right? Are you selecting your life partner by sending an unsolicited email to all the girls you were able to get the contact to? Showing off your refined muscles, time of your last Iron Man race, a carefully selected picture of your striking BMW and inviting them to tender offers?

Yet many startups are doing exactly that. They download an extensive database of investors somewhere. The more, the better – they do not care about the profiles. They send out an unsolicited bulk pitch … and hurry up, you stupid investors, we are the hot girl in town, so send us your proposal by August 12, 12:00 PST. As little diligence they put into selection of the investors, the pitch itself is almost inadequately rehearsed. The best colors, photographs, charts, buzzwords, the right CAGR of 60% and 30% EBITDA … and skillfully hidden “projected numbers” disclaimer :-).

This behavior is unfortunately endorsed by many investment boutique advisers, who only care about their commissions. The higher the valuation gets, the higher fee they charge. Nothing else matters – a contract with a devil with higher fee is better than a contract with a real partner. Who gives a fuck?

We at Reflex Capital do not believe in partnerships that are only based on money values. We do not need a superpitch. On the contrary, our bullshit detectors start flashing when we get one. We need to see your desire to have us as your partner. And then, maybe, the desire will be mutual and we’ll create a partnership that lasts.

August 28th, 2018 – “Two Dimensions of Tech Scalability” (by Michal Taborsky)

Every investor, and we are not an exception, is interested in the scalability of business. And because many companies are built on technology, it involves scalability of technology. In conferences, you hear about systems scalability – how to build a website to handle millions of visitors; how to store petabytes of data and search them; how to pass a hundred thousand messages per second thru your Kafka cluster.

These topics are sexy for geeks, me included. And they are necessary from a certain point. But that’s just one dimension of scalability and I dare say the easier one to handle. That’s because it’s already fairly well established field and there is a ton of material and tools to help you. Cloud platforms removed the necessity to build datacenters. Thanks to tools like Kubernetes it’s easier than ever to run auto-scaling apps. Traditional relational databases are able to handle unbelievable workloads these days.

Don’t get me wrong. I’m not saying these things are easy, but it’s easier to tackle than the second dimension of scalability and that is scalability of your tech team.

It’s great that your product was developed by your genius of a co-founder and it’s the most efficient piece of code on the planet. But how about when you actually do get that investment and you’ll need to hire ten more developers to work on it? Suddenly, things other than your search algorithm being 10 milliseconds faster than your competition begin to matter more.

Is your code understandable and readable? How long does it take for a newcomer to deploy their first task to production? Is your system divided into logical modules or microservices, so more people can work on it? Do you have a fully automated build and deploy process? Does the build include a test run? Do you monitor and measure all important business and technical metrics so you can immediately react when deployment goes wrong?

These are the questions we consider when evaluating scalability of technology. It’s not just about those thousands of requests.