What Etsy’s former CTO is bringing to his new startup

John Allspaw talks about Adaptive Capacity Labs and what he learned from the Great Etsy Shakeup of 2017.

John Allspaw speaking at the Velocity 2011 conference.

(Image via YouTube)

On May 2 Etsy fired its CEO, CTO and about 80 workers, as the company’s leadership was overcome by an aggressive wing of shareholders, including two private equity firms. Later in the summer the company fired another 140 workers and canceled its internship program. Worker-friendly CEO Chad Dickerson was replaced by board member Josh Silverman.

The New York Times published a report Sunday delving into the crisis at the company, “Inside the Revolution at Etsy,” which included some juicy material. “The house was burning and nobody was paying attention,” famed VC, and early Etsy investor, Fred Wilson told the Times.

John Allspaw was Etsy’s CTO. All at once, he was out of work and the place he’d been at since 2009 was pivoting away from the company culture he’d helped build over the previous eight years.

“I think, in the end, there are varying tolerances for taking a long-term view over a short-term view,” he told Technical.ly by phone last week, before the New York Times story was published. “I think we found ourselves in a situation where there were contrasting views on that. That’s basically all I can really tell you.”

Now Allspaw is back with a new company, called Adaptive Capacity Labs. Working out of a shared office in a coworking space in Gowanus or at the New York Public Library, his situation is a bit different from the catered meals of Etsy’s $40-million Dumbo office, to say nothing of the $470,000 he made in compensation last year. But he doesn’t seem to mind.


“The Rose Reading Room is about as close to work bliss as I can come to,” he said.

His new company

The new gig is basically a consultancy that helps companies improve their IT systems not only by learning from their systems’ incidents, but also by understanding what they’re doing right and why.

“The main gist here is that I’ve been trying to … bring human factors and cognitive systems to software after I’d seen that it was really absent,” he explained.

Allspaw has two cofounders in the company, both academics from the Ohio State University’s Department of Integrated Systems Engineering. Richard Cook is a research scientist there and David Woods is a professor. The men got together more than a year ago as part of a group of IT experts working on the problems of systems and engineering performance. It was called the SNAFUcatchers Consortium and the group released a 44-page report of its findings in March called Coping with Complexity.

Allspaw said that the report was well received and people from industry wanted to engage the group in helping evaluate their systems and do workshops for their engineers. The demand was there, but an actual firm to contract with was not. “So that was the impetus,” he said. And Adaptive Capacity Labs was born.

Lessons learned

One of the lessons Allspaw said he learned from running Etsy’s engineering department was an appreciation for how, well, complicated complicated things really are.

“There’s always a difference between how we imagine things work in product roadmaps and grand design and the way things actually work, especially in software,” he said. “I think the key to the success of the company is being able to reconsider how they’re being successful.”

Not all the lessons he took were technical, though. Clearly there were disagreements over how Etsy was being run. We asked Allspaw if he had any advice he would tell his younger self.

“My scope should’ve been bigger,” he said. “Having that constant sense of unease should include dynamics on the board, dynamics with investors, it should include the company as a whole. There’s so much more, even in companies that are internet native and are engineering driven, and it’s really easy to think engineering is the center of the universe. There are a number of things that happened at Etsy that just sort of reminded me that there were things that were only part of what should have been in my landscape of concerns that should have been.”

He had the same thought, not just for himself but also for getting a broader perspective for his engineers.

“You can have the most incredibly technically competent team and still build the wrong thing,” Allspaw said. “You’ll build it great, but it’s the wrong thing.”

It’s a lesson that would seem applicable beyond just the world of engineering.

Companies: Etsy
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