A CTO’s Post-Mortem on Sunk Costs, Strategic Regret, and What It Means for Tech Roadmaps

Introduction: The Emotional Cost of Strategic Trade-offs

As a CTO, I’m constantly balancing business goals with technical realities. But what keeps me up at night isn’t code – it’s the emotional weight of decisions I can’t undo.

We pride ourselves on data-driven choices. Yet time and again, I find myself wrestling with gut feelings. The kind that surface years later when I wonder: “Did we make the right call?”

This hit home recently when I read about collectors selling prized coins. Their stories mirror my own struggles with technology decisions. When we sunset a legacy system or pass on an innovative project due to budget constraints, we’re not just making technical choices. We’re making emotional ones.

Like a collector trading a rare coin for a truck, we often don’t grasp the true cost until it’s too late. This post is my attempt to make sense of those “I wish we’d kept that” moments. And how they shape – or sabotage – a company’s long-term success.

The Emotional Weight of Technical “Sunk Costs”

We all know the sunk cost fallacy: throwing good money after bad. But there’s another side: the reverse sunk cost. The regret over what we gave up, not because it was worthless, but because its real value only became clear later.

Sentimental Capital vs. Financial Capital

Rare coins are more than metal. They carry history, personal meaning, cultural weight. The same is true of our technical investments:

The first engineering team that believed in the impossible. The in-house AI model that outperformed expectations. The open-source tool that became the backbone of our product. These aren’t just systems – they’re our institutional memory, our tech identity, our competitive edge.

When we trade them for short-term gains (funding a new office, making payroll, chasing the next trend), we often sacrifice optionality for liquidity. And regret follows.

“The sentimental and historical value tied to a coin often ends up being worth far more than the money you get when you let it go.” — This applies equally to technology.

Case Study: The “Dahlonega Decision” in Tech

Let me paint a picture. You’re CTO of a startup. For 18 months, you’ve built a custom data pipeline. It’s not flashy. It’s not perfect. But it works. Engineers love it. Documentation is solid. Then funding dries up. Two options:

• Raise another round (slow, uncertain)
• Sell the pipeline’s licensing rights, buy a ready-made SaaS solution

You pick the SaaS. Immediate cash, problem solved. But over time, the costs emerge:

• No control over data flow or schema changes
• Engineers lose pride in ownership
• Scaling becomes a vendor-dependent nightmare
• Future licensing revenue? Gone

Like that collector’s Gold CAC coin, your pipeline was unique. Not because it was the best, but because it was yours. And now it’s someone else’s.

Tech Roadmaps and the “First Build” Principle

Every CTO knows: first builds matter more than we admit. They’re not just code. They’re culture. They’re legacy.

Why First Builds Matter

• Recruitment Magnet: Engineers want to build things that last. The first AI model, the first microservice, the first homegrown database? Those attract talent. Selling them shouts: We don’t value what we create.
• Technical Debt vs. Technical Pride: A quirky in-house tool beats a generic solution with hidden complexity. But we often replace the former for short-term savings, only to pay more later.
• Option Value: A first build is a call option on the future. Own the IP? You can extend, license, or integrate in ways no third-party tool allows.

Actionable Takeaway: The 20% Rule

Try this: build a 20% strategic reserve into your roadmap:

• Never sunset a first-gen core system without a plan to replace its value (not just its function)
• Set aside 20% of engineering budget for preservation: docs, refactoring, IP protection
• Require a strategic review before selling or licensing any tech

Track “legacy value” like this:


{
"system": "CustomDataPipeline_v1",
"type": "first_build",
"sentimental_value": 9.2,
"strategic_optionality": 8.7,
"replacement_cost": "$420k over 3 years",
"disposition": "preserve_with_20pct_budget"
}


Budget Allocation: The “Truck vs. Coin” Dilemma

Every budget cycle asks: short-term utility or long-term value?

The Real Cost of “Practical” Decisions

Like the collector who traded a rare coin for a truck, we justify cuts with:

• “It’s just a tool.”
• “We can rebuild it later.”
• “The savings fund X, Y, Z.”

But the truck (the quick fix) depreciates. The coin (the strategic asset) often appreciates – especially if it’s unique.

CTO Budget Framework: The 3-Layer Model

Instead of across-the-board cuts, try this:

• Layer 1: Sacred (30%) — First builds, core IP, unique systems. Don’t sell.
• Layer 2: Strategic (50%) — Critical but replaceable. Evaluate with 2-year ROI.
• Layer 3: Operational (20%) — Commodity tools, licenses. Optimize freely.

This protects what matters most.

Managing Engineering Teams: Culture Through Preservation

Engineers don’t just build systems. They build meaning. Scrap a beloved tool and you’re not just losing code. You’re losing narrative capital.

The “Dansco Album” Effect

One story stuck with me: a seller cringed when he saw his prized coin in a Dansco album. Its “trophy” status gone. In tech, this is the commodification of engineering pride.

Think about it. Your team builds a custom observability tool. You sell it to a vendor. Two years later, it’s rebranded, watered down, and generic. Engineers see it in an ad: “Powered by [Tool You Built]” – but now it’s just another SaaS option. Pride? Replaced by cynicism.

Actionable: Institutional Memory Programs

• Create tech obituaries – document retired systems, including why they mattered
• Host “First Build” retrospectives – let engineers share their legacy projects
• Include “sentimental value” in post-mortems (yes, it’s subjective – but so is morale)

Strategic Planning: From Regret to Resilience

Regret isn’t failure. Ignoring regret is.

The CTO’s Post-Mortem Ritual

After any major tech sale or decommission, run a strategic regret audit:

1. What unique value did we really lose? (Not just cost, but optionality, culture, IP.)
2. Could we have waited? Funded differently?
3. What would it cost to rebuild in 3–5 years?
4. Does this align with our 5-year vision?

Use this to guide future calls.

Example: The House vs. The Coin

One collector sold his last coin to upgrade his home. Much like selling a core system to fund office space. The house is nice, but he lost the story. For CTOs, this looks like:

• Selling a homegrown LLM to fund an “AI rebrand”
• Licensing a unique algorithm to pay for “digital transformation”
• Decommissioning legacy auth to “simplify”

Always ask: Is the trade worth the narrative loss?

Conclusion: CTOs Must Value What Can’t Be Replaced

As a CTO, your most valuable asset isn’t budget or headcount. It’s strategic optionality. The “coins” you regret selling are often the ones that:

• Marked your first major technical milestone
• Had unique, irreplaceable qualities
• Were tied to team identity and pride
• Offered long-term value (IP, licensing, integration)

Your roadmap isn’t just a feature list. It’s a budget of emotional and strategic equity. Protect the first builds. Keep the unique. And when facing a “truck vs. coin” decision, ask not just “What does this solve?” but “What does this cost in legacy?”

In technology, as in collecting, the things you can’t get back are the ones that truly define your legacy.

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