Is faster growth rate always better for a startup, or can slower sustained growth be preferable?

Kyle Harrison · published Oct 21, 2022

Companies that reach truly massive scale almost never do it via explosive nonlinear paths; they get to roughly 40% growth and compound for a long time

Looking at the companies that actually defied gravity, even Snowflake's hyper-growth eventually tapered and the question became whether they had built an effective compounding engine

Scope: some companies genuinely are massive scalers

36:02 20VC: Why 75% of Active Investors Will Disappear in the Next Few Years, The Death of "So So" Venture Firms is Coming, The Rise of Blackstone of Venture Firms and What That Does To Venture Returns, How the World of LPs is Broken and more with Kyle Harrison

Alex Bouaziz · published Feb 1, 2023

Growing too fast breaks the business — customer experience and operations can't scale with it — so growth must be calculated and balanced against operational capacity.

Deel needs lawyers, HR and payroll managers in every country plus operations and automations built per market; if growth outpaces that, the customer experience suffers.

Scope: Specific to businesses with heavy per-country operations; Not to be misunderstood as it being okay not to grow — you always need to be growing; Deel's own 2021–2022 jumps were budgeted for

13:25 20VC: From $57M in ARR to $297M in Just 12 Months; Why Speed of Execution is the Most Important Factor to Success, Hiring 2,000 People in 3 Years Remotely & Secondaries; Why, When and How Much To Take Out with Alex Bouaziz, Co-Founder & CEO @ Deel

Alex Bouaziz · published Feb 1, 2023

If a candidate looks perfect on paper and everyone tells you to hire them, but you don't sense the right DNA for the company in conversation, you should not hire them.

He learned this from personally interviewing the first 400–500 hires at Deel.

14:24 Growth must be throttled to match operational capacity

Paul Graham · published Mar 2005

Startups should deliberately grow slowly and burn funding slowly, to buy time to learn their users.

Making something users love requires understanding them, and the bigger you are the harder that is; slower burn means more time to learn.

source Grow and burn slowly on purpose to buy time to learn users