Working on Promise

Michael Martino has resigned his job as CEO of the Seattle designer-enzyme startup Arzeda.  What is interesting is his stated reason.

As reported in Xconomy, Martino wrote, “Paying me a competitive salary would account for a material percentage of the money we’ve been trying to raise. From the company’s perspective, given that the focus over the next twelve-to-eighteen months must be on generating data to demonstrate the technology, the use of scarce and expensive capital to pay my salary is hard to justify.  From my perspective, given that I’ve been working on behalf of the company for over a year without compensation, I simply cannot afford to discount my services.”

This is a rare admission of an all too common situation found in many startup companies these days particularly those in biotech.  Absent a sufficient raise there is an expectation by potential investors that CEOs work for nothing until the company gets their feet on the ground. In many cases this requires an assumption of personal risk that is too high.

I can pretty much guarantee you this has nothing to do with the science of Arzeda.  This has more to do with kids, college and general living in this challenging time.  That and the opportunity cost of working on promise is significantly greater today than it was ten years ago.



About Mike

Mike has been an executive in the biotechnology industry for the past 20 years. Mike is a graduate of University of California, Santa Barbara, earning Bachelors degrees in Business Economics and Geography. Mike also earned his MBA in Finance from California State University, Fresno. Mike is married to the mother of his 3 children and currently lives outside of Boulder, CO. In his spare time Mike enjoys hiking, fishing, skiing, reading and coaching basketball.
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