Working at a hypergrowth startup

A few weeks ago, I suddenly received a text from my manager about wanting to chat with me for five minutes on a Sunday. My manager had never texted me before, so I was a bit anxious about what might be happening.

After hopping on a call with my manager, I found out that I would have a new manager starting the following Monday. My former manager will remain at the company, but he will be taking on other responsibilities instead of managing a team.

What happened to my former manager made me reflect on my experience of working at a hypergrowth company. Although working at a fast-growing company could be very attractive, there are also some harsh realities people will have to face in a hypergrowth startup.

In this post, I would like to share some pros and cons of working at a hypergrowth startup to help people decide whether a hypergrowth startup is a good fit for them.

Definition of a hypergrowth startup

Before getting into the pros & cons, we need to first understand what constitutes a hypergrowth startup. Typically, a hypergrowth startup will have one or more of the attributes below:

• Post-product/market fit: In my previous post, I briefly touched on Marc Andreesen's definition of product/market fit, which is being in a good market with a product that can satisfy that market. Post-product/market fit means the company has found a solution that could solve customers' needs very well.
• Post-series B to pre-IPO funding: A company that raises a post-series B round (>$30M in total funding) usually means the company has found a strong product/market fit. Once a company reaches IPO (>$1B in total funding), the company will usually reach a certain scale and have a slower growth rate.
• Company size typically grows 100% year-over-year: The clearest signal of a hypergrowth company is how fast the number of employees grows year over year. I think a company needs to grow at least 100% or above in a year to be categorized as hypergrowth. My current company grew from ~500 to ~1,500+ employees in 1.5 years.

Some examples of hypergrowth startups are Notion, Loom, Figma, and Miro.

Pros of working at a hypergrowth company

#1 You will get rapid growth and learning opportunities

One of the most valuable things I got at a hypergrowth company was the learning opportunity. Specifically, I got to solve very different problems as the company scaled.

When I joined my current company, our sales development team only had ~15 people and did not have a standardized working process. To help the team hit our sales goal at that time, I only needed to develop a process to improve the team's efficiency. Therefore, I focused on creating a playbook for our sales development team to streamline the team's workflow.

As the sales development team grew from 15 to over 50 people in a year, I realized that simply optimizing the existing process was no longer enough to hit our sales target. I had to work with the marketing department to identify different levers we could pull to fuel the next growth phase of the team.

In addition to tackling challenges in different phases of the company, you could also get promoted in a short time and take on a lot of responsibility.

When the company is growing super fast, the company will create many more positions to support the rapid growth.

I was very fortunate to be promoted within nine months in the company. Being in a new position allowed me to take on bigger responsibilities.

One of the projects I worked on last quarter was to define the roadmap to build out analytics for our Sales and Customer Success teams. Figuring out what analytics we need to serve 500+ people is certainly one of the most complex yet powerful projects I have worked on so far.

Being at a hypergrowth company, I was able to have ownership over impactful projects that could drastically change how we sell our products and service our customers.

#2 Your equity could potentially be worth something one day

In most cases, stock options at a startup are worthless because more than 90% of the startup will fail. However, stock options at a hypergrowth startup have a high chance of yielding some real values.

Joining as a mid-level position and as employee #641, I only received a small number of stock options. Although there's a chance my stock options could be worth something one day, the value of my options will most likely not be anything life-changing.

At best, I think my options could potentially turn into a down payment for a house if my company can continue to do well. However, I believe some of the executives who joined the company a bit earlier than me could have a huge financial upside.

#3 You could significantly increase your optionality

Since being at a hypergrowth startup would expose you to challenges at different stages of the company, you would often pick up skill sets that apply to both small and large companies.

You will have the option to work at almost every stage of the company as your next opportunity. You could easily go work at an early-stage startup, another hypergrowth company, and even a large enterprise.

Since working at my current company, I have noticed an increasing number of recruiters from other companies reaching out to me via LinkedIn.

When working in early-stage startups, I would only get LinkedIn inmails from recruiters in other early-stage startups. However, besides getting inmails from recruiters in early-stage companies, I am now getting inmails from recruiters in other hypergrowth and big tech companies.

Although I am not planning to leave my company any time soon, I am still glad to know that many companies value the experience of working at a hypergrowth startup.

Cons of working at a hypergrowth company

#1 Your job will get very complex very fast

As the company grows, the challenges you face can get exponentially more complex.

Let's take how we design sales territories, which is figuring out which sales teams should sell to which prospective customers, as an example:

When we only have <20 sales reps, we only need a simple territory design, such as separating the teams by geo.

To scale to about 50 sales reps, we separated the teams based on different segments (company size) to crave more territories.

Once we doubled the team and reached 100+ employees, we needed to carve out even more geos and distinguish the regions within each geo.

In addition to carving out more sales territories as the team grew, we also needed to figure out different sales strategies to sell into different geos/regions/segments effectively.

Our sales team went from 20 reps to more than 100+ reps in less than a year, so our sales approach and strategy became very complex in a short period.

As a person who is only six years out of college, I have never worked with sales teams at so many different scales. Therefore, I had no idea how to do my job most of the time. I had to force myself to learn as fast as possible to keep up with the job.

#2 You might get layered if the company outgrew your capability

Since the challenges you face will get very complex quickly, it is tough to learn fast enough to keep up with the change.

As an individual contributor, I have an easier time keeping up with my job because I only need to uplevel my skills to solve more complex challenges.

However, I think people managers have a harder time up-leveling their people management skills to lead a much larger team in a very short time.

Most of the time, the company will hire a more experienced manager on top of the existing people manager to help manage the rapidly growing team. Having someone hired on top of you is what we call being layered.

I got layered once when I first joined the company. I was initially going to report to the Head of Revenue Operations (director-level position), but I ended up reporting to a senior sales operations manager instead.

It's never a great feeling when getting layered, but I tried to put my ego aside to learn as much as possible.

#3 You will feel overwhelmed by people's growing requests

When I started at my current company, I only had to support a team of fifteen sales reps and two sales managers. Since the team was pretty small, I could easily answer any reps' questions or requests directly in Slack.

However, six months into my job, the sales team I was supporting grew to almost fifty sales reps and seven sales managers. My Slack inbox was getting flooded by requests from different sales reps, sales managers, and sales leaders every day.

I was completely overwhelmed because I couldn't respond to every request even if I worked 12+ hours a day. After a while, I realized that not every request was as important and urgent, so I worked with my manager to design a new support intake process to triage all the questions.

At a hypergrowth company, you will get increasing requests from different stakeholders because the company is growing so fast. You will need to prioritize those requests ruthlessly, or else you will be stressed out easily.

Conclusion

Working at a hypergrowth company is very attractive because of the learning opportunity, financial upside, and optionality in future career choices. However, staying at a hypergrowth company is also very difficult due to the amount of challenge and stress you will experience.

Although the challenges get more complex as the company goes through hypergrowth, the people who can solve the increasingly complex problems will also experience tremendous growth in their careers.

If you enjoy solving problems at different scales, pushing yourself to learn rapidly, and being in a high-stress environment, a hypergrowth company could be a perfect fit.

Feel free to share your reflections, thoughts, or feedback with me @themagichen on Instagram or reach me at themagichen@gmail.com.