May 2nd, 2019

Beware the Triplets

The other day I discussed scaling with an entrepreneur who did it many times over in his career. We talked about how things change at very specific points in the lifecycle of a company. The example I always use is Dunbar’s Number: Once you go beyond 150 people, everything seems to be upside down.

Her response was: “Yes. And beware the triplets.”

I must have looked puzzled, so she explained. Hiroshi Mikitani, founder and CEO of Japanese e-commerce giant Rakuten, has a “Rule of Three (and Ten)”. Every time you triple in size, everything breaks. Go from a solo founder to a team of two and all is well. Add one more person and everything breaks. You have to redo your processes to make it work again. Grow to 10 and you find yourself in the same situation. Triple again and it is “redo time” once again. And again - and again.

From all my experience in starting and building companies as well as growing them – this is spot on.

So – beware the triplets! Which doesn’t mean you shouldn’t pursue growth. Quite contrary. Just know that you have do redo your structure and processes regularly.

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