Wartime Company Reset
When a platform shift threatens your core business, declare wartime and go all-in rather than hedge.
- Difficulty
- Expert
- Time to result
- ~months to results
- Steps
- 4
- Confidence
- 90%
When a technology shift (like AI) threatens to disrupt an incumbent business, McCabe argues you must reframe the company as being at war for survival and commit fully — reallocating capital, killing side-projects, and betting the company on the new thing. Half-measures ("sprinkle a little AI") lose to focused startups. The decision is deliberately made unilaterally and fast, before the disruption forces you out.
Origin
Eoghan McCabe, founder/CEO of Intercom, on returning in 2022 to a business with five straight quarters of declining net-new ARR, weeks before ChatGPT launched; his co-founder Des is writing a book built on the 'you don't have a choice' thesis.
Core principles
- 01A platform shift disrupts every category it touches, aggressively — being absent means being kicked out entirely
- 02Incumbents with 'nothing to lose' can move as boldly as startups; treat a plateauing business as license to bet
- 03Don't half-ass the transition — a thin AI veneer over the old culture will not work
- 04Commit real capital and cut everything that isn't the bet
- 05Speed matters: a working prototype in weeks beats a committee deciding for quarters
How to run it
- 1
Name the existential threat out loud
Explicitly declare the company is in a fight for survival — 'become a wartime company' — so the whole org understands the stakes and that normal comfortable operating mode is suspended.
Pro tip Frame it as disrupting yourself before someone else does, so the energy is offensive not just defensive.
- 2
Reallocate serious capital to the bet
Move real money to the new direction — Intercom committed nearly $100M of its own cash to AI — and simultaneously cut costs aggressively, canning projects and freezing expansions like a new office fit-out.
Watch out Late-stage companies used to being 'rich and wealthy' spend like drunken sailors; frugality will feel alien and must be forced.
- 3
Prototype fast to validate the bet
Stand up a working prototype quickly to prove the disruption is real and buildable — Intercom had a beta of Finn just six weeks after GPT-3.5 launched — rather than debating it in the abstract.
Pro tip Leverage assets incumbents already have: existing AI staff, huge customer base, and billions of data points shorten the path to a prototype.
- 4
Bring in real talent for the new domain
You cannot fake the new capability — hire actual AI scientists and leaders, and empower young builders who use the new tools by default. If you as founder won't roll up your sleeves and work as hard as them, hire someone who will and become chairperson.
Pro tip Younger builders are '50% AI' — they vibe-code, write specs and job descriptions with AI by default; learn from them, don't just manage them.
In the wild
Facing five sequential quarters of declining net-new ARR and about to hit zero (negative growth), McCabe returned, declared a wartime posture, committed ~$100M of Intercom's own cash to AI, cut costs, and shipped Finn.
→ Finn grew from $1M to $12M ARR in year one, is growing north of 300%, is on track to pass $100M ARR in under three quarters, and Intercom moved from low-single-digit to 15th-percentile ARR growth among ~120 public software companies.
Common mistakes
Sprinkling AI on the same old culture
McCabe warns that companies 'saying we do AI' who just add 'a little bit of crappy AI' while keeping the same cultures and comfort will not win — the shift requires full commitment, not a feature.
Deciding by committee while the window closes
Running the 'professional CEO' consensus process — everyone's input on a spreadsheet, group decision — is too slow for a platform shift; someone has to make the call fast even under uncertainty.
Is it for you?
Best for
Founder-CEOs of established/late-stage SaaS or marketplace businesses whose growth is plateauing as a platform shift (AI) threatens their category.
Not ideal for
Businesses not actually under existential threat, or non-founder professional CEOs who lack the mandate to bet the company; McCabe stresses his hand was forced by a business that was 'previously screwed.'
From the transcript
“I said we need to become a wartime company. If we don't fight for this, we are dead.”
“we were only 6 weeks into”
“roll your sleeves up, figure out what's going to disrupt you, have fun with it.”
“announced that we were going to spend nearly $100 million of our own cash on that”
“You see all these companies saying we do AI and they just sprinkle a little bit of crappy AI and they've got the same cultures.…”
From the episode
How Intercom rose from the ashes by betting everything on AI
Eoghan McCabe (founder and CEO)