Getting PaperG to 50 employees, I’ve come to realize we’ve entered a new stage of the company’s life where the best practices from the last stage no longer apply. Compared to a MBA holder, I have the disadvantage of lacking experience or academic knowledge in running large scale organizations already; however, one benefit that comes from that weakness is I’m learning the purpose behind practices that professional managers take for granted since they generally inherit processes and organizational structures.
We’ve been busy rebuilding processes like hiring, evaluating, and selling which quickly broke down after the founders weren’t always involved. That wasn’t surprising to me, but three things did jump out at me as surprisingly important: (1) financial planning now matters; (2) middle management now matters; and (3) repeated communication now really matters.
All three are things office workers regularly bemoan but I now have new found appreciation for, which I’ll dive into one post at a time.
1. Financial Planning Now Matters
We used to just fly by the seat of our pants when it came to budgeting. We’d have a very high level budget we’d give to the board which would quickly diverge from reality soon after as new expenses we didn’t anticipate came up or hiring didn’t proceed according to plan Your goal as a seed stage startup was to just make money last and you just made purchasing/spending decisions on an ad-hoc basis really based on what comes up to give you flexibility. With mostly founders running the show, someone could always just make a decision on the spot so it felt like it was the fastest process rather than having a budget committee or week long budgeting process.
Once you get to 50, it matters a lot to have a thought out budget cause founders can’t approve every expenditure. Every time you have to wait for an approval, people aren’t doing what it’s supposed to be doing — they’re waiting. Budgeting diffuses decision making out so simple things like conference budgets, travel expenditures, marketing, etc. can be approved by the people it directly impacts. It empowers recruiters and HR to make hires and negotiate salaries, thereby speeding up communication and closing high priority candidates. It empowers office managers to just get the more expensive juices if people really want that and it doesn’t break the bank. Budgets exist for a very good reason apparently!