This might actually bear on why YCombinator suggests startups stay small as long as they can. My impression is there’s basically two phases of play – the stage where you’re building up your high trust network of competent people, and the stage where you scale.
Scale too quickly, and you easily risk not maintaining the networks that keep the Game of Thrones in check, and then the king finds himself beheaded because the werewolves were too competent and his network spread too thin. (In the fictional ’20 competent advisors, 5 districts’ example, probably the best thing to do is aim for 2 competent people per distrinct rather than 1. A Kingdom that naively scales from 5 to 20 will have shortterm advantage but probably stretch itself too thin and fail in the long game.)
There is also overhead to scaling and difficulty aligning goals that they want to avoid. (As above, I think my Ribbonfarm post makes this clear.) Once you get bigger, the only way to ensure alignment is to monitor—trust, but verify. And verification is a large part of why management is so costly—it takes time away from actually doing work, it is pure overhead for the manager, and even then, it’s not foolproof.
When you’re small, on the other hand, high-trust is almost unnecessary, because the entire org is legible, and you can see that everyone is (or isn’t) buying in to the goals. In typical startups, they are also well aligned because they all have similar levels of payoff if things go really well.
This might actually bear on why YCombinator suggests startups stay small as long as they can. My impression is there’s basically two phases of play – the stage where you’re building up your high trust network of competent people, and the stage where you scale.
Scale too quickly, and you easily risk not maintaining the networks that keep the Game of Thrones in check, and then the king finds himself beheaded because the werewolves were too competent and his network spread too thin. (In the fictional ’20 competent advisors, 5 districts’ example, probably the best thing to do is aim for 2 competent people per distrinct rather than 1. A Kingdom that naively scales from 5 to 20 will have shortterm advantage but probably stretch itself too thin and fail in the long game.)
There is also overhead to scaling and difficulty aligning goals that they want to avoid. (As above, I think my Ribbonfarm post makes this clear.) Once you get bigger, the only way to ensure alignment is to monitor—trust, but verify. And verification is a large part of why management is so costly—it takes time away from actually doing work, it is pure overhead for the manager, and even then, it’s not foolproof.
When you’re small, on the other hand, high-trust is almost unnecessary, because the entire org is legible, and you can see that everyone is (or isn’t) buying in to the goals. In typical startups, they are also well aligned because they all have similar levels of payoff if things go really well.