Portfolio Allocation Framework

Portfolio Allocation Framework

Scaling Yourself: The LEGO Principle

**Core Principle:** If you want to grow as fast as your company, give away your job every 3-6 months.

The LEGO Analogy

You're Building Alone

┌─────────────────┐
│  ████████████   │ Too many LEGOs!
│  ████████████   │ Can't build it all
│  ████████████   │ You're the bottleneck
└─────────────────┘

**Sign it's time to hire:** You're the critical path for everything

After You Hire

┌─────────────────┐
│ Your LEGOs →    │
│         New hire│
│                 │
│ New tower ← You │
└─────────────────┘

**The secret:** Give away your LEGOs, find bigger ones

When to Hire: Bottleneck Detection

✅ Hire When You See These Signs

• [ ] **You're the blocker:** Team waiting on you for decisions/reviews
• [ ] **Reactive mode:** No time for strategic work
• [ ] **Opportunity cost:** Saying "no" to high-impact projects
• [ ] **Quality suffering:** Cutting corners due to time pressure
• [ ] **Burnout risk:** Working nights/weekends consistently

❌ Don't Hire Yet If

• [ ] **You can automate it:** Build the tool instead
• [ ] **It's temporary:** Project-based spike in work
• [ ] **You haven't documented it:** Can't hand off what isn't written
• [ ] **No budget/revenue:** Can't support the salary
• [ ] **Role unclear:** Don't know what they'd do day 1

The Handoff Framework

1. Document Everything (Week 1-2)

**Before hiring, make the role hireable:**

• [ ] **Runbooks:** Step-by-step procedures
• [ ] **Decision trees:** How to handle edge cases
• [ ] **Access/permissions:** What they'll need
• [ ] **Success metrics:** How to measure their impact
• [ ] **Why it matters:** Context for the work

**Platform parallel:** Your infrastructure-as-code before scaling

2. Contract-to-Hire (Week 1-4)

**Staging environment for humans:**

• [ ] **Trial project:** 4-week paid contract
• [ ] **Real work:** Not fake interview problems
• [ ] **Working relationship:** Do you collaborate well?
• [ ] **Decision criteria:** Clear hire/no-hire reasons
• [ ] **Exit plan:** How to end respectfully if not a fit

**Why it works:** See them under real pressure before committing

3. Gradual Handoff (Week 1-12)

**Don't drop everything at once:**

• **Week 1-2:** Shadow you, learn the ropes
• **Week 3-4:** Paired work (you + them)
• **Week 5-8:** They lead, you review
• **Week 9-12:** They own it, you're consulted

**Platform parallel:** Blue-green deployment for human responsibilities

4. Find Bigger LEGOs (Ongoing)

**What's your next level:**

• [ ] **Strategic thinking:** Quarterly planning vs. daily execution
• [ ] **Team building:** Hire the next 3 people
• [ ] **Fundraising:** Talk to investors
• [ ] **Partnerships:** Business development
• [ ] **Product vision:** Where are we going?

Hiring Evaluation Framework

Technical Bar (Table Stakes)

• [ ] **Can they do the work?** Demonstrated skill
• [ ] **How do they learn?** Adapt to new situations
• [ ] **Code quality:** See their actual work
• [ ] **Communication:** Can they explain complexity?

Cultural Fit (What Matters More)

• [ ] **Values alignment:** Do they match your MVV?
• [ ] **Working style:** Async vs. sync, deep work vs. meetings
• [ ] **Conflict resolution:** How do they disagree?
• [ ] **Autonomy level:** Need guidance vs. self-directed
• [ ] **Growth mindset:** Fixed vs. learning orientation

Interview Test: "Explain This Complex Thing"

**Best single question:**

• "Explain [complex topic in your domain] to me like I'm a new engineer."

**What you're testing:**

• **Clarity:** Can they break down complexity?
• **Patience:** Do they rush or teach well?
• **Depth:** Do they actually understand it?
• **Empathy:** Do they meet the learner where they are?

First 90 Days: New Hire Onboarding

Week 1-2: Context & Culture

• [ ] **Mission/Vision/Values:** Why we exist
• [ ] **Product deep dive:** What we build, who we serve
• [ ] **Codebase tour:** Architecture, key systems
• [ ] **Meet the team:** 1:1s with everyone
• [ ] **Quick win:** Ship something small week 1

Week 3-4: Ramp-Up

• [ ] **Paired programming:** Work together daily
• [ ] **On-call shadow:** Learn systems under pressure
• [ ] **Customer calls:** Hear pain directly
• [ ] **Retrospective:** What's working, what's not?

Week 5-12: Ownership Transfer

• [ ] **Solo projects:** They lead, you review
• [ ] **On-call rotation:** They're in the rotation
• [ ] **Decision authority:** Define what they can decide
• [ ] **Teaching others:** Can they onboard the next hire?

90-Day Check-In

**Ask:**

1. "What's clearer now vs. day 1?"
2. "What's still confusing?"
3. "What would you change?"
4. "Do you want to stay?"

Red Flags During Trial Period

Performance Red Flags

• [ ] **Can't ship:** Projects stall, no output
• [ ] **Quality issues:** Bugs, tech debt, shortcuts
• [ ] **Not learning:** Same mistakes repeatedly
• [ ] **Scope creep:** Can't finish what they start

Culture Red Flags

• [ ] **Values misalignment:** Actions contradict MVV
• [ ] **Poor communication:** Team doesn't know what they're doing
• [ ] **Conflict avoidance:** Won't speak up about problems
• [ ] **Ego over team:** Credit-seeking, blame-shifting

What to Do

**If 1-2 red flags:** Coach them, give feedback, set clear expectations

**If 3+ red flags:** Part ways respectfully at end of trial

**Key:** Don't hope it gets better. It won't. Trust your gut.

Delegation Matrix

Use this to decide what to keep vs. hand off:

| **Task Type** | **You** | **Delegate** | **Automate** |

| --- | --- | --- | --- |

| **High Impact + You're Best** | ✅ Keep | ❌ | ❌ |

| **High Impact + Others Can Do** | ❌ | ✅ Delegate | ❌ |

| **Low Impact + Repetitive** | ❌ | ❌ | ✅ Automate |

| **Low Impact + One-off** | ❌ | ✅ Delegate | ❌ |

Example: Your Week

**Keep:**

• Fundraising pitch to lead investor (high impact, only you)
• Key customer escalation (high impact, relationship-based)

**Delegate:**

• Code reviews (high impact, team can do)
• Customer support (high impact, others can do)
• Hiring screens (high impact, can train others)

**Automate:**

• Deployment pipeline (low impact, repetitive)
• Metrics dashboards (low impact, repetitive)
• Reporting (low impact, repetitive)

Equity & Compensation

Early Hire Guidelines (Employee #1-10)

• **Cash:** Below-market salary ($80K-$120K for senior roles)
• **Equity:** 0.5%-2% depending on role and timing
• **Vesting:** 4-year vest, 1-year cliff

Equity Calculation Framework

**Factors:**

1. **Risk:** Earlier = more risk = more equity
2. **Impact:** How much value will they create?
3. **Market:** What do they make elsewhere?
4. **Replacement cost:** How hard to replace?

Common Mistakes

• **Too little equity:** They leave for more stable job
• **Too much equity:** Cap table mess for future fundraising
• **No cliff:** They quit at 6 months with equity
• **No docs:** Verbal promises cause lawsuits

**Use a startup lawyer. Worth every penny.**

Firing Well (When It Doesn't Work)

When to Part Ways

• [ ] **Trial period ends:** Red flags not resolved
• [ ] **Culture violation:** Serious MVV misalignment
• [ ] **Performance:** Consistent underperformance despite feedback
• [ ] **Company changes:** Role no longer needed

How to Do It

1. **Quick decision:** Don't drag it out
2. **In person:** Video call minimum, in-person if possible
3. **Clear reason:** No surprises, feedback already given
4. **Generous severance:** 2-4 weeks minimum
5. **References:** Offer to be a reference (if appropriate)
6. **Exit logistics:** Return equipment, offboarding checklist

**Key:** Be kind, be firm, be fast. Don't negotiate the decision.

Resources

• **The Alliance** by Reid Hoffman: Tours of duty framework
• **Who** by Geoff Smart: Hiring methodology
• **Radical Candor** by Kim Scott: Feedback framework
• **‘Give Away Your Legos’ and Other Commandments for Scaling Startups** by Molly Graham

**Download all 12 templates:** [sanscourier.ai/qconsf-2025](http://sanscourier.ai/qconsf-2025)

*From the QCon SF 2025 talk: "From Staff Platform Engineer to a16z Founder: What I Wish I'd Known" by Gonzalo (Glo) Maldonado*