Frank Rotman, co-founder of QED Investors and an early architect of Capital One, discusses the mistakes he made that almost cost him his job and company.
Frank Rotman, co-founder of QED Investors and an early architect of Capital One, discusses the mistakes he made that almost cost him his job and company. He shares insights on overcoming hurdles during hypergrowth, adapting to change, and achieving "Founder Market Fit."
I actually almost did get fired a couple times. Um and it was for mistakes that were gigantic mistakes that affected the company. Um I didn't do them on purpose. I mean they these were things were moving very quickly and you were making judgment calls. And when you're in charge, if you make a poor judgment call, bad things can happen. So, I happened to have been in charge of a particular business unit that was delivering basically 100% of the company's earnings at the time. And I remember making a judgment call that ended up backfiring in a very big way and almost blew up the company. Um of all things that it ended up that uh I ended up putting a solicitation out that turned a business that was growing at about, you know, 30,000 accounts a month, 40,000 accounts a month in a good month, to 750,000 accounts in a single month. And to go from originating 40,000 of [snorts] uh you know,
onboarding 40,000 customers in a month to onboarding 750,000 customers in a month, the infrastructure wasn't ready for it. And when the customers started pouring in, we were on the verge of breaking. And it's not like today where you can just add infrastructure by snapping your fingers and, you know, getting more cloud capacity. We had to actually process applications. We had to actually ship plastics to people and there were compliance concerns with how quickly you can do it and how accurately you can do it. So, when all this volume came pouring in, um I literally almost broke the company. And we ended up having to have a third shift and a fourth shift of people working overnight in order to process open up envelopes and actually scan things and data enter them and figure out how to call in favors with vendors to get plastics, you know, coming in. And we were on the verge of, you know,
being out of compliance. Um so, these are the type of things that happen when you make some poor judgment calls. It was all for the right reasons. I saw the opportunity, wanted to basically uh take advantage of a market opportunity that I saw. But the infrastructure wasn't ready for it and we almost blew up. company