From Clubhouse to Company

From BFFs to a business. It’s hard transition. As a founder, moving from that family vibe in the early stages to a scaling business, can bring about emotional and cultural challenges.

As you move from 10 to 25 and 25 to 50 employees, the natural flow, unspoken understanding, and organic chemistry that you had starts to evolve and devolve.  

Who’s in the Club? 

I was listening to a podcast with guest Heather Anderson, the founder of NY Pilates. She was talking about her early challenges scaling and she explained that she struggled to be honest – what!!! She struggled to be honest with herself that the needs of the business were changing and with her team members that their skills were no longer adequate but that was not a reflection of their value as a person.  From the very beginning, they had been close, working alongside each other, and hanging out socially. Now she had to be the boss, not the best friend.

The feelings of displacement, resentment, and fear that arise are shared by many employees as you scale to 50.

As you move from needing generalists to specialists, adding a layer of management in, and organizing by functional roles, your initial squad might get a little pissy.

“Is that person taking my job?” “Why are we hiring him or her?” “I can do it better because I know how it’s done.” “Do we really need someone to do that?” Listen to the questions and explain why it elevates the whole team.

As you get closer to 40 or 50, the bad behavior starts to bubble up. No longer is everyone working for the good of the team.  People may start to hoard their tasks rather than letting others take over so they can move on to different tasks.  They struggle to adapt, redesigning their role or seeing opportunity in new projects and newfound focus in one area.

As you move past 25, you can see the cliques form – the old guard and the newbies coming in with their ideas on how to do it better. Maybe senior executives are coming from corporate experiences and don’t get the rhythm of a startup. You see some positioning and angling.

It’s time for you to put your big girl pants (big boy pants) on and have the tough conversations. With yourself and with your team.

It’s helps to acknowledge that this is going to take some getting used to and shifting around but that the goal is for everyone to be doing challenging work, to be able to focus on their role specifically, and to be asked to take on new tasks and projects.

Culture Critical

Around 25 being intentional about your culture and what you envision for your company and its core values, is important.

Of course, you may still want that clubhouse feel, and, in its best form, there are benefits. Early on, everyone attends meetings; they know what is going on; they know what each other is working on, what their accomplishments and challenges are; they can find ways to help each other out; they can see the big picture and how they fit in; and they can see connection points that allows them to be more innovative across the organization and more efficient in getting their work done.

Then it becomes unsustainable. The on-demand access to you. A knowledge gap arises. Communication breaks down.

Transparency becomes essential – no, not everything has to be shared, but you do need to understand that now the team feels like they don’t know why certain decisions are being made. The feel excluded. Be as transparent as makes sense. Listen to their questions and respond.

Now, it’s time to write down your core values, your mission statement, create some rules, guidelines, and FAQs. Conduct post-mortems. Seek feedback from your team, maybe 2x a year, on how things are working, continue to develop new initiatives that make your company a great place to work. (Right now you need to keep your best talent and attract new talent). Ask about personal goals too so you can see where people might fit best or where you can move and shift team members.

With a new layer of management, reporting lines become important so there continues to be a flow of information and issues that need to bubble up, do. The idea of a flat organization must die! Seriously.

It’s time to make that transition from founder (execution mode, in the weeds, working alongside your team), to CEO (a leader and manager responsible for creating culture, defining roles and demanding accountability, putting in place processes and systems, prioritizing and protecting your time, having tough conversations, and the list goes on!!) It’s a big job. It’s a different job. You must accept that and step into it powerfully.