There isn’t a formal moment where boards or investors stop and ask whether the leadership team is ready for the next stage. When a company closes a Series A, B, or C, the focus immediately shifts to deploying the capital and hitting the next set of milestones.
But the job changes with every funding round.
A few months later, the first signs usually appear. Headcount grows rapidly. Communication becomes less efficient. Decisions take longer. Coordination gets harder.
At first, growth hides most of these problems. New customers are coming in, revenue is growing, and everyone is busy. It’s easy to dismiss the friction as the normal cost of scaling.
It often takes multiple funding rounds - and a few quarters of missing execution targets -before boards and investors stop asking, “What’s slowing us down?” and start asking “Do we have the right leadership team for this stage?”
I think that’s the wrong place to start.
The first question should be whether the role itself has changed. And in almost every case, it has.
Twenty years ago, companies had much more time to grow into the next stage. Organizations like Palantir evolved over two decades. Today, companies like Anthropic have gone from startup to one of the most important AI companies in the world in just a few years.
That changes everything.
Leaders don’t have five years to grow into the next version of their role anymore. Sometimes they have twelve months or even less.
The challenge usually isn’t capability. It’s adaptation.
The challenge usually isn’t capability. It’s adaptation.
The founder who personally made every decision at 20 people often becomes the bottleneck at 300. I’ve worked with founders who still wanted to interview every candidate or approve every important decision at 200 people. At 25, that hands-on approach was the exact reason the company moved so quickly. At 200, it became the exact thing slowing everyone else down.
The engineering leader who architected the core system and hand-picked the first 8 engineers can’t lead the same way at 50. The job shifts from making technical decisions to building an engineering organization, hiring and growing leaders, establishing technical standards, and trusting teams to make architectural decisions without needing direct oversight
The hardest part of scaling is that the behaviors that made someone successful early on are often the very things that slow the organization down later.
That doesn’t make them a poor leader. It means the role changed underneath them.
I’ve seen leaders with exceptional pedigrees struggle through this transition, and I’ve seen first-time executives make it look easy. Experience matters, but adaptability matters more.
What I actually look for
When I assess executives, I spend surprisingly little time looking at titles or pedigree. I’m much more interested in their learning velocity, the speed at which they adapt as the role changes.
Can they let go of work they used to love doing?
Can they hire people who are stronger than they are?
Can they build systems instead of relying on themselves?
Can they create clarity when the team no longer fits into one room?
Can they trust others without feeling the need to stay involved in every decision?
All of these questions point to the same underlying principle. Leadership doesn’t scale through harder work or better individual decisions. It scales by building an organization that can make good decisions without you. That means creating clarity, hiring strong leaders, drawing clear swimlanes, and giving people enough context to act without waiting for approval. At 200 people, your job isn’t to be the bottleneck. It’s to build an organization that no longer depends on you being one.
The best leaders understand that. They’re willing to change how they work, rethink what made them successful, and sometimes recognize they’re no longer the right person for a particular role. Ironically, that level of self-awareness is often what makes them exceptional leaders in the first place.
The question isn’t whether someone can scale forever. The question is whether they can keep evolving as fast as the company does.