For roughly a decade, many CTOs have managed their engineering budget as a single number: headcount. That made sense while people were most of the cost.
Token spend has changed it. Tokens are now a significant line that moves with usage, month by month, and an annual headcount figure can't contain them, as Uber found when it used its 2026 AI coding budget in about four months.
In this solo episode, Adam Horner starts from a coaching conversation with a CTO who told his leads to think big and leave affordability for later, and asks who really pays for the builder.
The episode closes with a five-step playbook, unwrapping the CTO budget, for CTOs who want to control the budget their teams now depend on.
In this episode, Adam explains:
■ 𝗣𝗮𝗶𝗱 𝗶𝗻 𝗛𝗲𝗮𝗱𝗰𝗼𝘂𝗻𝘁: Why so many CTO budgets were reduced to a single headcount number, and why token spend breaks that arrangement.
■ 𝗙𝗼𝗿𝗲𝗰𝗮𝘀𝘁 𝗟𝗶𝗸𝗲 𝗮 𝗥𝗼𝗮𝗱𝗺𝗮𝗽: How to forecast the budget with the same flexibility we already give the roadmap.
■ 𝗧𝗵𝗲 𝗖𝗮𝗽𝗘𝘅 𝗮𝗻𝗱 𝗢𝗽𝗘𝘅 𝗧𝗿𝗮𝗽: What capital and operating expenditure mean for token spend, and the conversation to have with the CFO.
■ 𝗛𝗲𝗮𝗱𝘀 𝗼𝗿 𝗧𝗼𝗸𝗲𝗻𝘀: Why heads versus tokens is a decision we keep remaking, and how the two differ in speed and reversibility.
■ 𝗧𝗵𝗲 𝗥𝗲𝘀𝘁 𝗼𝗳 𝘁𝗵𝗲 𝗕𝗶𝗹𝗹: The running costs a headcount budget hides, including the cost of running the builder.
Build your own CTO Playbook at www.theCTOplaybook.com, the leadership platform built for the full CTO journey. Coaching, podcast, and community to help you lead with clarity, confidence, and strategic impact.
You'll Learn:
[0:00] Kicking the Can Down the Road
[2:39] Where We Left Off: Building the Builder
[3:39] The Great Simplification
[5:09] The Pitch I Lost
[6:26] People, Cloud, and Tokens
[8:03] A Question to Pause On
[8:37] Forecast It Like a Roadmap
[9:38] A Year's Budget in Four Months
[11:29] CapEx and OpEx, in Plain Terms
[14:35] Heads or Tokens
[17:29] The Rest of the Bill
[19:21] The Playbook: Unwrapping the CTO Budget
[22:07] A Warning
[22:46] Recap
The CTO Playbook:
■ Build your own CTO Playbook at https://www.thectoplaybook.com, the leadership platform built for the full CTO journey, with coaching, podcast, and community to help you lead with clarity, confidence, and strategic impact.
■ Follow Adam: https://www.linkedin.com/in/adamhorner/
■ YouTube: https://www.youtube.com/@TheCTOplaybook
■ Prefer listening? Catch the podcast: https://bit.ly/thectoplaybook
