Startups vs scale-ups: What changes when you grow from 10 to 100 employees

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Alexander is a TIA Star Contributor and publishes high-value content that serves the Asian tech community. Read more from TIA Star Contributors here.

At a 10-person company, you are a startup. At 100, you are a scale-up.

While the term “startup” is applied to pretty much any company (Uber’s still a startup?), scale-up is more esoteric. But it is worth differentiating them, as they denote two distinct phases of growth.

A startup probably hasn’t figured out their product-market fit (PMF), clients, and pricing yet. But scale-ups have most likely validated their product. Startups are also typically in angel, pre-seed, seed, and series A rounds, while scale-ups start at series B. Finally, a startup is still worth very little and may pivot if someone comes up with a better idea. This isn’t true for scale-ups, as investors expect them to grow by doing what they’re already doing.

How to manage a scale-up vs a startup

Control

At a scale-up, you don’t want to have control anymore, but you need to create systems and bureaucracy.

I’ve scaled a startup to 200+ people in months from a hotel room. I’ve “scaled down” from 300 to 200 people in a week, twice. I’ve also bootstrapped and struggled all the way.

When your mindset is on scaling, you remove yourself emotionally from the notion of control.

Focus on:

• Picking the right people to manage at the stage you’re at (not where you will be in two years).
• Getting them up to speed and inspiring them.
• Tracking their performance.
• Instigating process improvements and remembering you have the “full picture.”
• Lighting a fire under people’s asses so they are never comfortable.
• Replacing people when you need to (always be recruiting so you have a pipeline).

As a startup, you hired people, and they could have systems in place that kind of did the job. It’s fine if it works, customers are buying it, and churn is OK.

When you get big, things get a little more boring. Now, there are branding guidelines, code reviews, and extensive documentation. The team will no longer be 100 percent devoted to shipping. They might be spending 50 percent of their time on implementing processes so that someone else can take over.

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