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A CTO needs to hire more engineers, and the numbers are working against the argument. Engineering spend has fallen as a share of revenue because the company grew faster than the team, so on paper it looks like efficiency. In practice, one resignation could sink the roadmap. Kevin Goldsmith's advice was to stop arguing from within and examine the organization as an acquirer would.
Kevin has led due diligence as an acquirer at large companies and startups, and he's been examined as a target through acquisitions and investor rounds. From both seats, the same pattern keeps showing up: the organizations that come through well are the ones whose leaders already know where the problems are and have a plan for them. The catch is that the longer a leader has been in an organization, the less its workarounds look like problems.
The framework here is the Outsider's Audit, four questions anyone doing diligence will ask, turned on your own team: Worth, Dependencies, Flow, and Risk. Kevin walks through each one practically, including building spare capacity at the org level so a resignation doesn't cancel a quarter of work, tracing a single ticket to find where work actually stalls, trading audits with a peer, and handling the people side, right up to the moment the team starts wondering if the company is being sold.
The episode is aimed at CTOs and VPs who may face funding or acquisition diligence someday, but the approach works just as well for a director or engineering manager who needs to make the case for their team with evidence rather than instinct.
- Due Diligence in Funding & Acquisition, A CTO's Guide
- Listener Survey: https://forms.gle/JVeKHsHJKhEM3dvK6
- The book: It Depends: Writing on Technology 2012-2022 (https://itdependsbook.net)
- Your host: Kevin Goldsmith (https://kevingoldsmith.com)
- The theme song artist: Answers to April
