CEO Ryan Cohen revealed that GameStop went from over 1,400 corporate employees to just 400, yet became more productive. He argues large corporate teams create bloat, perverse incentives, and delegation of work. The radical downsizing improved focus and business results.
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After 18+ months in the AI era, software companies that haven't re-accelerated growth have a team execution problem, not a market timing one. The capital and opportunities are too vast to miss. This failure to ship a relevant product and capture new revenue warrants drastic measures, including replacing a significant portion of the team.
After nearly failing, OpenGov adopted a frugal culture and discovered it grew faster. Less spending reduces system noise and inefficiency. A leaner, more focused sales team, for instance, can become more motivated and effective, leading to better results.
OnlyFans achieves extreme capital efficiency by hiring only senior and junior talent, removing the "squidgy layer of middle management." This structure values individual contributors over managerial empire-building, ensuring everyone stays close to the business and makes decisions quickly, with a team of just 42 full-time employees.
By strictly limiting team size, a company is forced to hire only the “best in the world” for each role. This avoids the dilution of talent and communication overhead that plagues growing organizations, aiming to perpetually maintain the high-productivity “mind meld” of a founding team.
Contradicting the common startup goal of scaling headcount, the founders now actively question how small they can keep their team. They see a direct link between adding people, increasing process, and slowing down, leveraging a small, elite team as a core part of their high-velocity strategy.
Gamma's CEO resists the pressure to scale headcount aggressively, arguing that doubling the team size does not guarantee double the speed. He believes a smaller, more agile team can change direction faster, which is more valuable than raw speed in a rapidly evolving market.
As companies grow from 30 to 200 people, they naturally become slower. A CEO's critical role is to rebuild the company's operating model, deliberately balancing bottom-up culture with top-down strategic planning to regain speed and ensure everyone is aligned.
Drawing from experience at big tech, Surge AI's founder believes large organizations slow down top performers with distractions. By building a super-small, elite team, companies can achieve more with less overhead, a principle proven by Surge's own success.
The public example of X operating with 85% fewer staff created a powerful meta-narrative influencing founders to build leaner. As a result, the median Series A company team size has dropped from 25 employees in 2021 to a projected 15, a significant shift toward capital efficiency over hiring.
Gamma scaled to a $2B valuation with only 50 people by innovating on org design, not just product. They prioritize hiring generalists over specialists and use a 'player-coach' model instead of a traditional management layer. This keeps the team lean, agile, and close to the actual work.
