Amp It Up

13Stay Scrappy as You Scale Up

The Paradox of Scaling Up

One trap that leaders often fall into is failing to adjust to the natural life cycle of a company as it grows and evolves. If you try to run a mature, 500‐person company like a 10‐person start‐up, you will almost certainly fail. But, paradoxically, if you lose all the scrappiness of a 10‐person start‐up, your mature company may never reach its full potential.

Let's look at the three main phases of a company's development and what's demanded of leadership at each stage.

The Embryonic Company

In the embryonic stage of a start‐up, seed capital is applied to assess the feasibility of an idea, followed by subsequent rounds of funding to build the initial product. The team is usually a small, close‐knit group who are laser‐focused on building that first product. It has always amazed me how much can be accomplished with a founding team of fewer than a dozen people, often only a half dozen. You will never revisit those levels of productivity again.

At this point, the CEO job is more or less a part‐time position for someone who is also the leader of a key function, such as technology or operations. Everyone is working, not managing. It's also not uncommon to see part‐time outside CEOs, such as venture capital firm partners, because the demands on leadership aren't massive yet. At Data Domain, for instance, our principal founder, Dr. Kai Li, was the leader while the team was building the product, but he never even bothered to ...