Growing Your Tech Startup? Here's How to Scale Your Team Like a Pro
The golden dream for many startups is to grow fast and become the next unicorn to take over an specific market. Typically to grow this fast many teams scale up and recruit new team members at a very high pace. This has some pros, but is a complex process difficult to manage.
So why companies what to scale up, and do it fast? Typically the companies that undergo this kind of hypergrowth are startups that may have found product-market fit, leading to a big demand, companies that receive a strong back up from investors, in the form of a funding round, or stablished companies with big profit margins. This typically puts the company in a high demand for rapid growth in terms of teams and customer base.
But how can you grow a team of say less than 100 people, to a company of hundreds or thousands of people in a short time? There are many challenges that the company will face when doing this:
Finding the right candidate is a big challenge for HR organizations, when they have a structure to cope with the current company size, and might need to 10x the company size in a matter of a year.
Finding very skilled candidates, hiring them, but not having a role for them. Which can lead to frustration and confusion.
Keep company culture, ways of working, and innovation, these factors have most likely contributed heavily to the company being successful. When you have many new teams, people, and a high pace, will make keeping those ways of working very challenging.
Building a hierarchical structure, is very easy when scaling up creating layers of managers in the company to manage new teams or divisions, but this usually will lead to a stiff structure, that slows down decisions and development.
Keep the teams empowered, if the company has promoted empowered teams that can own parts of a product or process this can easily disappear when scaling up. More layers of management and review processes might take away that ownership. This can lead to unmotivated or frustrated teams.
Lack of productivity, it takes months to get newcomers to be productive in tech companies, when you mix this with many new teams, most likely the company productivity will suffer a big impact for months if not years until the new organization is “settled”.
Scaling operations, you are probably running in a very lean environment, this environment might be not feasible or difficult to maintain when your team grows.
How to scale up your business
Have a scaling plan. This might sound very obvious, but often skipped. You need to develop a plan that will help you move through the process: how are you going to bring in new teams, how are you going to use the budget along the process, which teams are going to be affected, and how the resources are going to be brought in to support the growth. Having a proper plan will mean that teams are coordinated, and you don’t end up hiring 20 tech leads for 30 software engineers.
Keep the focus, on what has brought you to be successful, on your value proposition, and on the vision of your product. In a moment like this, having the clarity of being able to explain to anyone joining what is the vision of the company and how they will contribute to it is extremely important.
Have a clear strategy, if for whatever reason you have not worked on your strategy, do this before starting any scaling process! Having a strategy will help clarify to anyone joining what are the most important aspects for the success of your business, and will help them prioritize the work to achieve those goals, versus them having to try to figure out this independently.
Build-measure-learn, Eric Ries developed this framework which is one of the most useful and easier ones to implement, if you haven’t read his books, go ahead and do so before starting this process. This framework promotes a close collaboration in building your product with your customers, validating assumptions via prototypes, mockups or MVPs, that will help you measure the success of different initiatives and learn if they contribute to solving the customers' problems and creating a successful business.
Build teams, don’t just bring people into the company. When you are growing your personnel focus on creating teams that are functional and can have ownership of parts of the product, instead of just bringing in people without a clear plan and having understaffed teams that can’t really achieve their goals. This will help teams get up to speed faster. Think about the team composition, are they going to be a mix of existing and new members or will you keep the new members just for new teams? This also has its pros and cons, and might deserve a separate article.
Bringing in an operations team can help you keep processes under control, but be careful and don’t do a process overkill that might hurt innovation and empowerment.
Do you really need to grow that fast?
Ok, so now we’ve talked a bit about the challenges and how to address them, but the reality is that the challenge is still pretty humongous. So what about rethinking our approach?
Given all the challenges and that most likely scaling up this fast won’t lead to comparable growth in the company, no matter if this is measured in customers, revenue, market cap, or whatnot.
In my opinion, a better strategy might be to rethink the scaling approach and create plans to grow/create teams that will be empowered, own their work and product from the get-go. Teams that will be able to be productive from the earlier stages, typically by forming new teams with existing and new members. But concentrating on a handful of teams at a time, that can learn to work together, where you can actually manage the growth process.
If you take this approach it would be easier to maintain the growth of the company, by having teams that can:
Deliver real value to customers
Keep culture and empower teams
Maintain the focus
Have time to find the right candidates and scale operations
