Overcoming Challenges When Scaling Innovative Projects

Scaling from 50 to 100 employees almost killed our company. Until we discovered a simple org structure that unlocked $100M+ in annual revenue. In my 10+ years of experience as a founder, one of the biggest challenges I faced in scaling was bridging the organizational gap between startup and enterprise. We hit that wall at around 100~ employees. What worked beautifully with a small team suddenly became our biggest obstacle to growth. The problem was our functional org structure: Engineers reporting to engineering, product to product, business to business. This created a complex dependency web: • Planning took weeks • No clear ownership  • Business threw Jira tickets over the fence and prayed for them to get completed • Engineers didn’t understand priorities and worked on problems that didn’t align with customer needs That was when I studied Amazon's Single-Threaded Owner (STO) model, in which dedicated GMs run independent business units with their own cross-functional teams and manage P&L It looked great for Amazon's scale but felt impossible for growing companies like ours. These 2 critical barriers made it impractical for our scale: 1. Engineering Squad Requirements: True STO demands complete engineering teams (including managers) reporting to a single owner. At our size, we couldn't justify full engineering squads for each business unit. To make it work, we would have to quadruple our engineering headcount. 2. P&L Owner Complexity: STO leaders need unicorn-level skills: deep business acumen and P&L management experience. Not only are these leaders rare and expensive, but requiring all these skills in one person would have limited our talent pool and slowed our ability to launch new initiatives. What we needed was a model that captured STO's focus and accountability but worked for our size and growth needs. That's when we created Mission-Aligned Teams (MATs), a hybrid model that changed our execution (for good) Key principles: • Each team owns a specific mission (e.g., improving customer service, optimizing payment flow) • Teams are cross-functional and self-sufficient,  • Leaders can be anyone (engineer, PM, marketer) who's good at execution • People still report functionally for career development • Leaders focus on execution, not people management The results exceeded our highest expectations: New MAT leads launched new products, each generating $5-10M in revenue within a year with under 10 person teams. Planning became streamlined. Ownership became clear. But it's NOT for everyone (like STO wasn’t for us) If you're under 50 people, the overhead probably isn't worth it. If you're Amazon-scale, pure STO might be better. MAT works best in the messy middle: when you're too big for everyone to be in one room but too small for a full enterprise structure. image courtesy of Manu Cornet ------ If you liked this, follow me Henry Shi as I share insights from my journey of building and scaling a  $1B/year business.

Execs: "Our teams are experimenting, why aren't we finding new growth?" Me: "Well, you started out strong by organizing teams around ideas, giving them access to customers, providing them with tools and had them start running experiments. The teams are only relying on interviews and surveys and don't know how to find stronger evidence on their own." Execs: "So let's teach them more experiments." Me: "That will certainly help and the teams could use a customized playbook based on your industry. This isn't only a skill issue though, it is a system issue. Even your best trained teams will fail if they don't have the time and support to apply what they've learned. They need coaching help for their experimentation if you are to find new growth. Instead of squeezing this into a few hours a week, they more dedicated time. Think of this like a portfolio, not a series of one off teams or projects experimenting with a few customers." Execs: "OK, we'll make sure all of these systems are in place." Me: "That's a good step, and we'll need to go beyond giving this lip service, because you aren't simply setting up a process, you are building a culture of experimentation. This requires communicating the vision of why you are undertaking this challenge. You'll need sponsors who can make decisions on these ideas based on evidence and alignment to your narrative. You'll need metered funding to invest in the ideas that show promise and retire the ones that don't. You'll need to scout for opportunities to drive new growth. And with all of that, this initiative will stall without an incentive system that rewards teams for working this way." Execs: "This sounds like an overwhelming amount of work." Me: "This is a shift. We don't need to build all of this at once. We just have to start, based on where you are today, and build the support system that will allow innovation to stick."

As a trusted advisor to many InsurTech startup founders, I have been privileged to witness firsthand and help their growth journey from innovation to scaling. Initially, it’s all about innovation, but as startups grow, a tension between innovation and growth emerges. I am often asked if we can have both. Some key challenges include: 1. Maintaining Agility: Early-stage startups are nimble, but as they grow, decision-making processes can slow down. 2. Resource Allocation: Balancing the allocation of resources between innovation and day-to-day operations becomes more complex. 3. Systems and Processes: Scaling requires specialized roles and structured processes, which can limit the initial creativity. 4. Communication: Small teams communicate effortlessly, but expansion requires formal methods to keep everyone aligned especially in today's hybrid or 100% remote workplace 5. Focus: Startups iterate to find product-market fit. Once achieved, the focus shifts to scaling, potentially restricting further innovation. Here are some recommendations for addressing the Innovation/Growth Tradeoff: 1. Anticipate Challenges: Recognize and plan for growth-related challenges. Stay agile and monitor market trends. 2. Foster Communication: Keep innovation a priority with regular updates on market changes and new initiatives. Weekly stand-up meetings can keep teams aligned. 3. Encourage Cross-Functional Teams: Promote collaboration across different departments to foster innovation and maintain a holistic approach to problem-solving. 4. Invest in Talent Development: Continuously up-skill employees to keep pace with industry changes and maintain a culture of innovation. 5. Dedicate Time for Strategy: Ensure strategic thinking isn't overshadowed by operational efficiency. Regularly assess market demands and vulnerabilities to stay ahead. While some loss of innovation is inevitable with growth, it’s not an all-or-nothing situation. By balancing and prioritizing innovation, InsurTech startups can achieve sustainable growth and long-term success, positioning themselves for a successful exit.

Scaling kills more great ideas than failure ever could. Here’s how to prevent yours. Scaling should feel like winning. But most great ideas don’t just stumble as they grow, they collapse. I learned this the hard way: Scaling was supposed to be our big win. Instead, it became our undoing. Costs spiraled, systems broke, and the team burned out. Six months later, we shut everything down. Looking back, the mistakes were obvious. But only after it was too late. Scaling isn’t about doing more. It’s about designing for growth. Here are the 7 traps that kill ideas when they scale—and how to avoid them. 1. False Positives Early wins are seductive. They blind you to hidden risks and fuel overconfidence. ✅ Fix It: Test your idea in multiple scenarios and push for independent validation. 2. Biased Testing Testing the wrong audience is like reading the wrong map. It’s a straight path to failure. ✅ Fix It: Make sure your test group reflects your actual customer base. 3. Unscalable Elements Scaling isn’t about cloning your stars. It’s about creating a system that shines without them. ✅ Fix It: Build scalable systems that work without relying on individuals. 4. Negative Spillovers Scaling isn’t just about growing bigger. It’s about avoiding the cracks that widen as you expand. ✅ Fix It: Plan for unintended consequences and design systems that scale smoothly. 5. Cost Overload Scaling too fast is like pouring gasoline on a fire. It burns bright but won’t last. ✅ Fix It: Plan for economies of scale and focus on cost efficiency. 6. Human Limitations Success tied to irreplaceable people isn’t success. It’s a ticking time bomb. ✅ Fix It: Create training programs and processes that deliver consistent results. 7. Lack of Stress Testing Scaling is where weaknesses stop hiding. Stress-test early—or watch them break everything. ✅ Fix It: Stress-test your idea under diverse, real-world conditions to uncover hidden flaws. Fix these traps early, and your growth won’t just be bigger. It’ll be unstoppable. What’s one scaling trap you’ve seen most? ♻️ Share this to help someone scaling their big idea. Follow Amy for more business strategies like this.