CTO to CEO: Lessons on Fundraising & Crisis from a

Andrew Brown sold his first company, an identity-verification startup, to Google. Now he’s raised $119 million from Stripe, Index Ventures, and others for his second venture, Check, a payroll infrastructure company. This isn't a coincidence. Second-time founders often raise massive rounds because they operate with a different playbook.

They’ve learned painful lessons and replaced hope with process. Based on the challenges Andrew faced, from making the leap from CTO to CEO to navigating existential crises, we’ve distilled the playbook into four core lessons you can apply to your own startup.

Lesson 1: Build Investor Trust Systematically, Not Chaotically

Founders think fundraising is about a great pitch deck. Experienced founders know it’s about building trust. Trust isn’t built in a 30-minute meeting; it’s built over months through consistent, transparent communication. After raising $119M, it's clear Brown and his team know how to do this.

The Pre-Fundraising Update: Your Secret Weapon

The single best way to build trust is to share your progress before you need anything. Identify 10-15 "dream VCs" you’d love to work with one day. Once a month, send them a concise email update. Don’t ask for a meeting. Don’t ask for money. Just share your progress.

Subject: Quick Update from [Your Company Name] - [Month] [Year]

Signed up our first 3 pilot customers in the [specific industry] space. · Increased weekly active users by 25% (from 80 to 100). · Shipped our new to address customer feedback about [problem].

Next month, our goal is to convert 2 of the 3 pilots to paid contracts.

This does two things: it starts the clock on your relationship, and it proves you can execute. When you do decide to raise, these investors will already feel like part of the journey.

The Common Mistake: Hiding Bad News

The fastest way to destroy trust is to hide or downplay risks. Investors know nothing goes perfectly. They want to back founders who are clear-eyed about challenges, not cheerleaders who ignore reality. If you miss a target, state it plainly. More importantly, explain what you learned and what you’re doing about it.

Weak communication: "We didn't quite hit our user growth target."

Strong communication: "We projected 500 new users but only hit 350. Our paid channel CPA was 40% higher than expected, making it inefficient. We're pausing that channel and reallocating the budget to content marketing, which is driving signups at 1/3 the cost."

Lesson 2: Survive Crises With a Playbook, Not Ad-Hoc Panic

Every startup faces existential threats: a key employee quits, a competitor raises a huge round, a product launch fails, the market turns. Inexperienced founders react emotionally. Experienced founders run a playbook.

Your "In Case of Emergency" Checklist

You can’t predict the crisis, but you can have a process for managing it. When a potential crisis hits, run through this list before you do anything else.

Triage: Is this a fire, a flood, or a fender-bender? A fender-bender is a bug or a lost deal. A fire is a critical server outage. A flood is a macro-economic shift that threatens your runway. Quantify the impact: does this threaten our team, our product, or our cash? · Assemble the War Room: Who needs to be involved in this decision? For a technical crisis, it’s the engineering lead. For a financial one, it’s your finance lead or co-founder. Keep the group small and designate a clear decision-owner. · Communicate Internally First: Your team must hear from you before they read about it on Twitter. Be direct, explain the situation, the plan, and what it means for them. Don’t sugarcoat, but project calm competence. · Draft External Comms: Once the internal team is aligned, decide what to communicate to customers, investors, and the public. Often, the answer is nothing. But if it’s a public issue, a single, clear, factual message is key.

The Common Mistake: The "Slow Cut"

The most painful crises often involve runway. When you realize you have to cut costs, the biggest mistake is not cutting deep enough. A 10% layoff feels less brutal, but if it doesn't extend your runway to a meaningful milestone, you’ll just have to do another layoff in 6 months. This destroys morale. If you must do a layoff, the rule is "measure twice, cut once." Make the single, deep cut that gives you 18-24 months of runway, then communicate a renewed, focused plan to the remaining team.

Lesson 3: From Technical Founder to Strategic CEO

The transition from CTO to CEO is one of the hardest in startups. It’s a complete identity shift. Andrew Brown made this leap, and it’s a journey from solving problems with code to solving problems with people and capital.

Your Calendar Is Your Real Job Description

You can't just "decide" to be a CEO. You have to change how you spend your time, hour by hour. Your calendar is the most honest indicator of your priorities.

As a CTO, your calendar was likely: 70% code, 20% managing engineers, 10% strategy. · As a CEO, your calendar must become: 40% hiring and people management, 30% sales and customer-facing activities, 20% strategy and fundraising, 10% everything else. Maybe 0% code.

This is painful. You got into this because you love building the product. But now, your job is to build the company that builds the product. You have to fire yourself from your old job. The first step is to hire your replacement—a VP of Engineering who is better at managing the technical team than you are.

Common Mistakes for First-Time CEOs

Retreating into your comfort zone: When stressed, you’ll be tempted to jump into a Figma file or a code review. You must resist this. Your job is to handle the stressful sales call or the difficult investor conversation. · Underinvesting in hiring: You think you don't have time to recruit. But making a B-quality hire will cost you 10x more time in the long run. The CEO must be the chief recruiting officer. · Avoiding sales: Technical founders often think a good product sells itself. It doesn’t. You have to get out of the building and talk to customers, understand their objections, and learn to close deals. Your first 100 sales conversations will teach you more than any market research report.

Lesson 4: A Second-Time Founder's Advice for Launching

First-time founders focus on building. Second-time founders focus on validating. They know the biggest risk isn't a technical bug; it’s building something nobody wants.

The "First 100 Days" Checklist

Instead of rushing to code, a seasoned founder treats the first few months as a systematic search for a painful problem.

Weeks 1-4: Problem Discovery. Don’t talk about your solution. Conduct 20-30 interviews with your target customer. Your only goal is to understand their biggest pain points. Use the "5 Whys" to get to the root of the problem. What are they using now to solve it? How much would they pay for a better solution? · Weeks 5-8: "Paper" MVP. Before writing a line of code, create a mockup, a slide deck, or even a simple document outlining your proposed solution. Go back to the 10 people who had the most acute pain. Ask them: "If I built this, would you use it? Would you pay for it?" Get pre-commitments. · Weeks 9-12: The "Concierge" Test. Can you deliver the value of your product manually? For Check, this might have meant manually processing payroll for a single, friendly client. This is the ultimate test of value. If clients won’t let you solve their problem manually, they won’t use your software either.

The Common Mistake: Premature Scaling

The most dangerous thing you can do is pour marketing spend or a huge engineering effort onto an unvalidated product. It’s like trying to push a car with square wheels faster. It doesn’t work; it just breaks. Don’t hire a sales team until you’ve sold the first 10 deals yourself. Don’t spend on marketing until you have a clear, repeatable customer acquisition channel. Nail it, then scale it.

How to Apply This This Week

You don’t need to have sold a company to Google to start acting like a seasoned founder. Here are a few things you can do right now:

Draft your first investor update. Even if you aren’t raising. Send it to your co-founder and a trusted advisor for feedback. Get in the habit. · Audit your calendar. Look at last week. How much time did you spend on People, Sales, and Strategy vs. everything else? Block off 3 hours next week for recruiting or customer calls. · Identify the biggest risk in your business. Now, write down how you would explain it to an investor. Getting comfortable with this conversation is a superpower. · Schedule one customer discovery call. Not a sales pitch. A pure discovery call where your only goal is to listen.

Building a company is a craft. By applying these lessons, you’re not just building a product; you’re building your skill as a founder.