How appropriate is the number of early start-up companies?

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Article | Yang Xuan

When I ask about projects that come to me to talk about financing, and what to do with the money, 100% will have a reason to recruit and increase the number.

This reason is understandable, the company to develop, the staff will have to increase. But it may take a very serious look at how many people you can manage at each stage.

Look at one of Gavin's tweets:

"Many entrepreneurs will spend 50% to 80% of their fundraising in the first year, and then spend the rest of their money the next year," he said. When they raise money, they will do three big things: 1 expansion of the office or a 2 pay rise in the luxury office, and a huge 3 increase in marketing costs. After that, they have no money and are on the verge of life and death. Many entrepreneurs, because they have spent too quickly regret!

In fact, it is very reasonable that the reasons for the failure of entrepreneurship thousands, but the company took the investment and failed most of the companies have gone this way.

The question of how many people a start-up company needs at each stage is complicated and needs to be discussed in case-by-case, but the salt tech columnist feels that a few tiantiao are applicable to most startups, and are welcome to explore:

1. Co-founder not more than 3 (unless starting is a big star project, similar to millet).

2. In the absence of investment, if there is a profitable business, the number of people not more than 10, if no profit business, the number of people not more than 5.

3. After the first investment, no more than 5 million yuan, such as no customer service and a large number of sales staff, the number should not exceed 15.

EoE's Shan wrote a passage for your reference:

As for the number of start-up companies, I always discuss with a gang of entrepreneurs, and I was very puzzled as to why a company would need dozens of people to do such a thing. Why does a CEO cut a person, the number of people inside the company cut half? Even the receptionist, HR, do it all by yourself. It became clear later that the number was not the necessary condition for success, and that the number was inversely proportional to the success of the start-up company. A friend of mine, very interesting, he said, Shan, I summed up a start-up company to increase the efficiency of 3 times times the formula, I listened to, I feel quite so. At least very interesting, understand the person can refer to, do not understand people can win a smile.

3 times times efficiency experience formula for start-up companies:

1, assuming that the company has 50 people, inefficient, always feel that the staff is not enough. The bosses of every department are always clamoring for hire.

2, send away 1/3 unsuitable, including the Department boss. Efficiency increased 1 time times immediately.

3, Interval of 1-2 months, resolutely cut off the core of the business, so that the company focused on a core thing, the efficiency of one more times.

4, after a period of time, some people can not keep pace with the development of the company, and then sent 1/3 left behind, the efficiency is increased 1 time times. 33 persons * (1-1/3) = 22 persons.

At this point, the dominant salary is unchanged, the number from 50 to 22 people. Efficiency increased to 400%.

A lot of people have a habit, if we do not have 50 people, how can our business succeed? If there is not a large team, how could things be done? Pro, whether it is not a start-up company, no matter where to do things, there will always be endless things. It's about how to do things. If this is not a priority in my subconscious, it means it's not important, and it's not even worthwhile to do it. Then why do you have to arrange a lot of people to do this thing. This is the boss's problem, is leader. The number of employees is not a necessary condition on the road to success.

The number of companies is the first big natural enemy of the start-up company.

A company without efficiency will die.

An inefficient start-up will die in the quickest way.

It is not easy to start a business, the survival rate is simply poor, starting from today to build an efficient start-up company, your company's chances of success will be greatly increased.

Look at some good startups:

1. Sing it.

Chen after leaving Ali once again start doing is the most Amoy, although took millions of dollars of financing, but the number is more than 30 people, the most Amoy did not make, reorganization team began to do we now know sing it. I think we all in some way think that singing is a very simple, but it is very NB products. In the follow-up round to get tens of millions of dollars in investment, I did not think the team not only the number of expansion, and only more than 10 people. It is really an efficient company, there is a reason for success.

2 37signals

This company is a foreign company which I enjoy very much. As anyone who has studied rails knows, Ror is a great web framework that makes web development incredibly efficient, including ror developed by Twitter. and ROR founder Dhh is the founder of 37signals. 37signals, is the 2008 ten most worthy of concern startups; 37Signals in the Web application industry is famous, not only Basecamp, Highrise, Backpack, campfire and other well-known products, It also spawned a Web startup's classic book, Getting Real, and rework, the first in the Amazon bookstore rankings. 37signals currently has only 35 employees (including customer service) operating for more than 13 years, with an estimated annual income of more than million dollars.

3. MailBox

The team has only 13 people, making the best mail client on iOS. Published in less than 11 months was Dropbox to buy.

4. Path

In the release of Path1.0 only 15 people, in the release of stunning Path2.0, the number of employees only 25 people. The current valuation is over 250 million, and the B-round financing has reached 40 million dollars.

5. Instgram

Instagram company is located in San Francisco, founded by Kevin Strom (Kevin Systrom) and Mike Krieger, the product was officially logged into the App Store in October 2010, and then the user grew rapidly, and the Instagram came online in a week with 10 Million registered users. October 25, 2012, Facebook bought Instagram with a total value of $715 million, with only 13 employees.