August 25, 2016

OrionCKB CEO on Scaling Up, Falling Down, & Lessons Learned Along the Way

Working in tech startups, most of us are no strangers to high growth and the aches and pains that come with it. Scaling quickly is not without its challenges — think process- (or lack thereof), management- and people-related problems.

Carlos Cashman, CEO of OrionCKB and a multi-time founder whose track record kicked off smack dab in the middle of the dot com boom, has survived all this and more. The founder of Opus360 — a workforce management company that was acquired by Artemis International Solutions Corporation by way of a reverse merger in 2001 — has scaled his share of companies and witnessed first-hand the growing pains that come with it.

I recently caught up with Cashman to hear more about his experience scaling tech companies, the challenges he faced along the way, and his advice to today’s high growth startups and the entrepreneurs behind them. Read more in the interview below.

Kaite Rosa: How’d you get your start in the industry? What brought you to where you are today?

Carlos Cashman: It’s kind of funny, actually. I grew up reading Businessweek from when I was 8 years old and on. One of the first things my dad taught me was to read the stock pages. I started developing in fourth grade. But in school, I never thought of that as a career thing.

I moved to New York to create movies. I wasn’t going to be a waiter, but you kind of want to have something that gives you time to work on movies on the side. So I found a job at a startup. A few years into that, I realized that part of my career was taking off more than the movies.

I spent a few years at that startup in New York. Then, I built an interactive group in 1995, where we were doing some of the top websites. I built that group up to 130 people. Then I started a networking consulting company, where I was co-CIO. We grew that company to about 150 people in a year.

In 1997, Opus360 was the poster child for the first dot com boom. We raised $10M off the bat and another $40M after that. We had a couple hundred employees and wanted to change the way the world worked. We took the company public in April of 2000 — we were the last company out before the [dot com] window slammed shut.

The week of our offering, it was cancelled three times because the market was so crazy. That Monday, the NASDAQ dropped 700 points. By Tuesday it was back up. On Friday, it was a game time call, and we ended up going public. A few years later, we merged. I didn’t make any money. But you learn as you go.

KR: And what were some of those lessons you learned?

CC: You learn about hiring, about company culture. I learned to be cynical about fundraising. I always felt weird about that — about companies having celebratory dinners for raising tons of money, when they’re not actually making money. There’s a whole section of the entrepreneurial world out that thinks that’s how to be successful — that you just get out there and raise money.

It’s a weird thing. A lot of companies get ruined by raising too much money. In the late 90s, it was a game … People raised money and tried to take things to the next level with cash. Now, I’m averse to capitalizing businesses. I have seen some of my investments screwed up by the same thing. I’d say I’m anti-capital at this stage.

After Opus, I was burned out. I left New York on a motorcycle. I took a trip cross-country and didn’t plan on doing business again. That was a strange period, but it was a lot of fun.

KR: But obviously you did end up doing business again…

CC: Sometimes, you’ve got to come to terms with what you like, versus what you’re good at. You end up falling into the things you’re good at.

I ended up starting another company in New Mexico—a small software company—and decided I did like doing business. I tried to raise money, but no one was giving companies in New Mexico money. I’m still chairman of that company, but put a friend in charge of it.

KR: What would you say is the secret to growth?

CC: Growing fast isn’t all it’s cracked up to be … Growing revenue and profit — I consider that to be real success. Hiring a lot of employees isn’t a measure of success and when I hear that, it’s not success to me. People get focused on that and think that it’s actually very dangerous.

Taking a company and trying to hire 100 people in a year is really frickin’ hard to do. It takes an enormous amount of time. If you’re doubling or tripling your site in a year, you’re going to have messes.

You have to be diligent and have real, dedicated processes. It’s hard to manage and integrate people and really have something for all those people to do. You see that happen more often with VC-backed companies. If they hire 100 people, then probably 40 percent of those people aren’t fully utilized. It’s a challenge.

At Opus, we got to a couple hundred people in 12 months. It’s a little crazy, but the trick — if there is one — is understanding process, process process. Most importantly make sure the business really justifies it. You don’t want to hire engineers to build software that you hope someone wants. If it’s flying off the shelves, then you hire..

At OrionCKB, we’re doubling and tripling our numbers every couple of years. But we’re only 30 people and have been able to grow in a manageable way. We can hold onto the culture well that way, too.

KR: What’s your advice for holding onto culture through growth?

CC: Don’t go too fast. A company is very different at 10 people, and at 30 people, and at 50 people. When you get big, when you get to 75 people, you need very different managers than when you were smaller. A lot of people can’t scale their skills. It’s very tough.

I didn’t know how to manage 25 engineers — much less 150. A lot of people miss that management is a discipline in its own right, just like coding or like design is …. A lot of people miss that, especially in the startup world. A lot of people think they can do it, but management is more complex than people think.

Management is critical to growing a company, especially when you do it fast. You get a lot of people who are good leaders, good contributors, but don’t make good managers. It can suck. You lose the nimbleness. These big companies have specific ways of doing things because they have to.

KR: Alright, let’s talk failure. Tell me about a time when you failed or faced a major obstacle. What happened? How did you overcome it?

CC: I’ve failed so many times — geez. There’s nothing to overcome if you don’t tie your self worth to it.

I think entrepreneurs have trouble when they tie their self worth to their companies. Maybe I’m cynical... I don’t sweat it. You’ve gotta realize that you are not the reason it failed. And if you are, f**k it! Try again. You gotta try stuff. You’re gonna fail.

With Opus, I hopped on a motorcycle and drove around the country. That was the response to failure. I considered Opus a failure. But you know, you live and you learn.


Kaite Rosa is Director of Content & Marketing at VentureFizz. Follow her on Twitter: @KaiteRosa