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2 Biggest Mistakes in Scaling a Company

Posted By admin / May 10, 2016 / articles / 0 Comments

I recently had a chance to sit down with StyleSeat CEO Melody McCloskey to ask her about a wide range of subjects. We inevitably ended up focusing on how difficult it is to build a business and how many things have to go right in order for you to build a successful startup. While StyleSeat is still a work in progress, it is by far the largest company in its space (a massive and growing market). Here is what Melody had to say when asked about the two mistakes entrepreneurs make when scaling a burgeoning startup:

1. Compromising when hiring

“The first and most frequent mistake I see entrepreneurs make when building a business is compromising on hiring,” said McCloskey. I dug in and asked for more specifics, and she provided some additional information:

“You know you’ve compromised on a hire when they check all of your boxes, but you still get an uneasy feeling after you’ve closed them. Any red flags you have about that hire during the interview process only become magnified when they actually join the company. If you feel like they were not detail oriented enough with your questions, they will end up not being detail-oriented on the job. If you feel like they are technically amazing but not quite a culture fit, then joining the team can put stress on them and the rest of your employees, and drive churn of team members who do fit in. Never compromise no matter how badly you need to fill a position because it will just end up costing you time and money to replace them, and mental cycles from your team.”

As an ex-CEO myself, I can attest that what Melody is saying is absolutely true. If you bring someone into the culture that isn’t a fit and isn’t up to your standards, it weakens the whole team.

2. Not understanding the importance of the office environment

On the subject of the importance of using office space wisely, McCloskey provided some unique insights that I have not heard from a lot of other CEOs:

“There is a lot of negative press about the Valley in general, and how you have a bunch of 20-somethings running around in Segways with too many perks in general. I’m not saying your office needs to be fancy or decked out, but people forget that the office creates the first impression and sets the tone for potential candidates, customers, and press. Not to mention it’s one of the biggest ways you can set the vibe for your team. You have to create an office environment that’s reflective of your values. When you are early, you need to keep things lean and your office should reflect that – no frills. But when your business becomes more mature, your office should reflect your brand and the feeling you want employees to have every day. Putting the team in an inspiring space that is open, promotes collaboration and is comfortable promotes productivity, creative ideas and team happiness. This is so vital to building a thriving, innovative product.”

What McCloskey is saying is exactly right — you don’t need to go over the top, but as your company grows every nuance about your company needs to project success. It will improve morale, and help you grow your team and culture.

I will be sitting down with several other CEOs and venture capitalists over the next several weeks to hear their perspective on various issues tech companies are faced with. Thanks for following along.

By SUNIL RAJARAMAN for Inc.com

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