When a startup hits growth stage, a new gear is unlocked. The raises are bigger, the targets higher and the focus shifts from future-gazing to delivery.
For the CEO, the realities of the operation you oversee fundamentally change. As this transition takes place, the opportunities to succumb to what I call “big tech energy” are bountiful.
Big tech energy is a call for flashy, ego-led “scaleup” decisions that whisper in founders’ ears as soon as the ink on the Series B term sheet has dried. The media, and now Hollywood, is awash with cautionary tales of entrepreneurs who succumbed to these siren calls.
The falls from grace in recent years have swung from the outlandishly criminal, such as Elizabeth Holmes, to the “went too big, too fast, too expensively” examples, which include Pollen, Hopin and Babylon.
In these more measured economic times, being able to “scale smart” is paramount. And that goes far beyond the obvious advice to avoid spending unnecessary amounts of money on fancy offices or diamond-encrusted swag.
The creep of big tech energy can be much more subtle. Here’s how to avoid it.
Resist organisational complications
One of the reasons startups can go from 0 to 60 so quickly is the agility and flexibility in their structures, with roles and responsibilities constantly adapting to suit the needs of the business.
We found ourselves creating new managerial layers and more complex operating systems. It was taking oxygen out of the organisation
At the beginning of Patchwork Health’s journey, my cofounder Jing and I wore so many hats — whatever was needed to get the job done. As you develop into a scaleup and your team grows, it’s essential to create more structure and introduce some process, lest you risk centring too much decision-making around founders — creating both a bottleneck and a recipe for burnout.
However, many startups succumb to the “we’re a big company now” anxieties and take this too far. New hires come in (often from bigger businesses or corporate backgrounds) and new teams are established to support growth, such as HR, finance and operations.
Without realising it, you can slip into a reality of overly complicated systems and processes that result in the loss of the agile startup atmosphere.
As you scale, you must resist those changes that stifle innovation. Overly complex or burdensome structures are the antithesis to good ideas. Shape your growth so you don’t lose the magic. In the process of growing from a team of just 3 to 100+, we found ourselves sliding into this reality. New managerial layers and more complex operating systems crept in, almost inadvertently. But we realised pretty quickly that it was taking oxygen out of the organisation. We caught ourselves and regrouped.
We’ve since prioritised creating a flatter structure with minimal hierarchies to ensure our team is able to work together productively whilst maintaining flexibility. By creating thoughtful systems of measurement, mentoring and feedback, we’ve been able ensure this flatness doesn’t feel unwieldy or unclear, but empowering and transparent. Sometimes less is more.
Don’t let go of everything
There’s a smorgasbord of advice out there for CEOs, telling them they need to learn to let go and delegate as their company expands. And that’s right. You can’t keep wearing all the hats.
But some startup CEOs work too hard on the big tech “make yourself redundant” mantra. Trying to expedite yourself into obsolescence is a surefire way for a company to lose direction, focus and employee faith.
In particular, it’s vital that scaling CEOs don’t let go of product vision and growth strategy. That’s your value-add. You’ve seen the product and the business emerge from infancy into teenhood — the nuance of having been there throughout this process is invaluable in helping guide its next phase, helping product and purpose stay true to the original vision whilst ensuring the strategy evolves alongside customer needs and market dynamics.
Don’t let Silicon Valley stereotypes mislead you into taking a heavy-handed “big tech energy” approach to growth
Likewise, staying connected to what’s happening on the frontlines of the business will help CEOs better understand what their teams and their customers need. Becoming out of touch with the everyday realities of your operations is a classic big tech energy red flag.
You’re never too big or too important to truly listen to colleagues and customers; make sure you don’t scale to heights that make those stakeholders hard to hear.
Avoid poor “values fit” hires
Even if you’re expanding rapidly, you need to continue being as selective regarding recruitment as you were with your very first hire.
Having the VC capital behind you to make important hires is a wonderful opportunity, but where scaleups can slip up is prioritising candidates with the shiniest CVs over those who align with the values of the organisation you’ve built to date.
No one wants a homogenous culture, and as the company scales, it is imperative to welcome new talent who have the credibility and experience needed for the next stage. But new hires need to gel with the colleagues who’ve been there since the early days, especially if they’re coming in at a more senior level.
Suddenly handing control of a team or a department to a new face, without being mindful of the transition or taking time to answer questions or quell anxieties from colleagues, can be a recipe for resentment and even resignations.
Likewise, ensuring new hires are given the space to truly understand the business and its customers is vital. Resist the temptation to stack your ranks with people who look great on paper but don’t sync in practice.
When you do find the right hires, make sure you’re creating opportunities to build bridges between the old guard and the new. It’s vital to put time into making the transition a fun one.
Don’t let Silicon Valley stereotypes mislead you into taking a heavy-handed “big tech energy” approach to growth. Instead of focusing on what you’ll need to do differently, first figure out what you want to protect. What makes the business magic? Identify that. Then protect it at all costs.
