A lot of folks will claim all of this is just survivorship bias, but I believe there are lessons to learn. For example most of the extremely successful software products produced by small teams have a heavy focus on UX. Arguably, it is nearly impossible to achieve in a big team, because UX is a bottleneck that is hard to scale.
I also find it really sad that a lot of the small teams who are on the road to success get distracted by applying "best practices" that were built for big teams (e.g. Google uses kubernetes, we should too).
My favourite tin-foil hat conspiracy theory is that Kubernetes, microservices etc are promoted by big tech to lure potentially disruptive small teams into adopting momentum-killing rabbit-hole solutions because they are "best practice"...
This also holds for project management practices such as Scrum.
Actually used k8s for the first time ever to set-up a new product from scratch.
I would call it essentially an Autobahn whereas everything else was a dirt road.
Our team is just 3 people, and it took me just 1 week and 1 youtube video to setup a 100% availability load-balanced production env cluster with 5 node.js microservices, and it is working like a charm, rollout deployment takes 30-60 seconds and i can monitor it all at glance without leaving my terminal.
UPD: I was into your theory too before:)
> I also find it really sad that a lot of the small teams who are on the road to success get distracted by applying "best practices" that were built for big teams (e.g. Google uses kubernetes, we should too).
Totally. It takes some experience and maturity to be confident enough to resist the big business “best” practices. That, or a very intuitive entrepreneur
Worth explaining a little more why survivorship bias doesn't apply here - the point is that small teams are capable of achieving billions of dollars worth of value add. This is closer to a claim of existence.
Obviously most small teams don't generate that much value. There are a lot of tiny podcasters out there. Nobody is going to mistakenly think that all small teams are Joe Rogan. But it is nevertheless possible for a small team to be absurdly productive given the right conditions - success isn't about team size, it is about the opportunity and available skillset.
FWIW, politics is very similar. One person can't achieve very much, but a small group can wield devastating levels of power.
Can you elaborate on why you think survivorship bias doesn’t apply here?
If you fall off a ship in the middle of the ocean you might survive and those survivors may have had strategies but we just don’t know if the people that died did not have the same strategies. Same goes for this list I’d think.
I don't believe that one bit. They have a scoped heavy perspective on what they are doing so they don't skew into feature creep. It has nothing to do with big teams and little teams. Either model can work as long as you break projects down and prevent feature creep. The more features a service has to support the larger the team has to be and thus enters feature creep. And there is Product teams who think they are smarter than everyone claiming more feature ideas while increasing their department size and this only adds to feature creep because literally it is just echo chamber of development hell.
The thing is that "feature creep" is a symptom rather than cause.
"Feature creep" in a small company is a sign of flailing around trying to capture a market. Sometimes a whole new feature is developed under pressure from Sales to land a big whale client, or a desperate CEO who thinks runaway success is just that one key feature away.
In a big company feature creep may be the result of a corporate culture that doles out promotions and bonuses for building shiny new things rather than the boring work of maintaining old things. Google is a good example of this, only with entire new services rather than features.
Either way feature creep is symptomatic of deeper problems with a company, regardless of size.
I really appreciate this comment. You've very clearly presented a problem that I hadn't considered and now that you've presented it, I can immediately see it in my work life. The business I'm with is suffering from "service" creep. "We can and will do anything." It's really damaging the quality of our services and putting a lot of pressure on us to expand in a direction that's not our biggest area of opportunity. You've given my something to think about.
> I also find it really sad that a lot of the small teams who are on the road to success get distracted by applying "best practices" that were built for big teams (e.g. Google uses kubernetes, we should too).
Principal-agent problem, i.e. conflicting goals. Sometimes it's the team vs. company, sometimes it's the team or a person against themselves. There are choices that are most beneficial for the current project, and there are choices that are most beneficial for one's career after the current project, and/or choices that are most interesting to the person.
So e.g. Kubernetes may be a total overkill for most things anyone does, but if I get around to doing some side project where Kubernetes would be a fit, even if rather poor, you can bet I'll at least try to use it, because it's highly likely I'll encounter it later at my current or future job. Now, this is just my side project, but then, many (most?) widely-used FLOSS software started as someone's side project.
And the same reasoning happens in companies big and small, as failing to keep your skills fresh is a recipe for trouble sooner or later, and the industry-standard approach to software developers' growth is "figure it out on your own, we're paying you for labor, not for your professional growth".
An interesting case here is Craigslist. I won’t say their UX is poor per se, but it’s very much a matter of taste that not everyone shares. Notably, the Venn diagram of their user base and the people who vocally laud their UX is likely an enormous circle with a competitively tiny one hiding inside it (respectively).
I think it’s interesting because while I personally don’t like the Craigslist UX, I have no objection to using it anyway (even if might I try other solutions first). They provide enough other value to me, and the UX is good enough, that I still have an overall positive impression of the service.
I also find it interesting because the debatability of their UX is really very surface level. There are all kinds of things I wish were different, but that’s mostly because it was perfectly fine in 200* and hasn’t much changed with the times beyond a few utilitarian niceties.
I’m sure this is way overly specific to CL as a reply, but your comment about UX focus resonates with me, and I’ve long found Craigslist’s lasting success fascinating in this light.
Craiglist has great usability, its just aesthetically bland. Usability is generally the most important part of 'UX' though the 'UX industry' skews towards the attractiveness side (particularly latest aesthetic trends) as their input is easier to see/quantify there. The other important side is marketing/branding and in some ways craigslist has built that brand around its 'basic' interface.
On the other hand, stability has value too. I can go onto CL and immediately know how I'm going to drive it, because it has been so stable. This can save a surprising amount of time.
I think UX is a heavy focus because most of these are B2C where UX matters more. Than again B2B solutions are probably more difficult to build with a smaller team.
You can beat product quality of well funded big teams with an experienced small team. Most that successfully do so don’t brag about it. Only reason to pay for PR is if you are trying to attract a lot of talent or pretend you will dominate the market (which is a VC play). Bragging about success as a small team is like waving a huge juicy steak at all the VC EIRs. Not worth it. Instead of sweating competition, you can keep capturing more of your market quietly. With Generative AI I would bet more and more products will be dominated by small teams of pros. Google and Meta the will always be restricted by screen size and competing internal projects, so consistency wins if you get a revenue stream to keep you alive.
They could start or join a company to directly compete with yours, and/or direct the attention of the VC fund to such company. If your existence is a proof positive there's opportunity to exploit, it's not wise to advertise it, as there are people whose very job is to find such opportunities and frack them (as in https://en.wikipedia.org/wiki/Fracking, except with money instead of a fracking fluid).
> Instead of sweating competition, you can keep capturing more of your market quietly
Would you recommend this strategy to a non-niche / broad category B2C product? It would feel instinctive to just get it out there and leverage every opportunity there is to market it, within the budget.
Some of these are so odd. When Kylie Jenner launched her company she could have sold celery and still made $1B+. It wasn’t because of the effectiveness of her small team.
Ken Thompson prototyped the first version of UNIX in assembly language for PDP-7 in three weeks, while his wife was away on vacation. One could argue Ken Thompson/Dennis Ritchie/Doug McIlroy have made a remarkable impact on laying out the principles behind the future of computing even today in such a short time.
In the case of Joe Rogan, Kylie Cosmetics and the Gartman Letter, an individual is the product. To me, it does not make sense to include these in the list.
for me I'm surprised that craigslist is just randomly in the middle of the list, a business that makes 1bn in ARR with 50 employees is insane and should be in it's own separate category.
all other companies are listed in 10s of Mil in Annual rev (sometimes one spike) or acquired for billions (which implies rev in 100s of mel).
It would be interesting to see a list of unsuccessful small teams as a point of reference. Oh wait… it probably wouldn’t. Then again, a list of unsuccesful large teams may not offer much insight either.
There may be many advantages to small teams and yes there are cases where they have wild financial success, but in general these may just be outliers. Are these outliers because they have the secret sauce worth emulating? Maybe, and maybe their stories will show why they succeeded where so many failed. Success is rarely all luck, but we’ll likely also invent myths around their exceptionalism as we tend to do. Not the type of exceptionalism which precludes the rest of us from having a similar shot of course, but one about cleverness and grit or other characteristics we can fairly easily attribute to ourselves.
Everyone likes a good narrative, I suppose. And narratives about scrappy small teams achieving success meritoriously are more attractive than ones about how the massive organizations usually tend to eat them for lunch (despite having their own types of problems) or ones about the frequencies with which the scrappy teams fail. Cherry-picking data points is the key to any good narrative.
It's just probability theory meets survivorship bias. The larger the team the more it will trend towards the average because the joint probability that everyone in the team is simultaneously awesome (or awful) becomes lower and lower as a function of team size.
Same thing happened with "small schools perform better" so they got funded. But turns out it's possible for them to perform terribly for the same reason it is for them to perform well.
> Same thing happened with "small schools perform better" so they got funded. But turns out it's possible for them to perform terribly for the same reason it is for them to perform well.
> It would be interesting to see a list of unsuccessful small teams as a point of reference
You can just go look at Steam indie games. Those are all small teams. They are mostly all failures.
The median small team on Steam generates $4,000 in lifetime revenue. 2/3rds never cross $10,000 in lifetime revenue. Only the top 10% even cross $200,000. Which is more like "barely paid salaries" rather than some kind of F-U money.
The number of small teams on indie games that come anywhere close to the success of big teams on AAA games is minuscule.
> It would be interesting to see a list of unsuccessful small teams as a point of reference.
I guess it depends on what you call success. Most businesses are mom and pop businesses that generate enough revenue to pay their employees the market rate in the long run. And I’m including tech businesses.
Most flourishing economies in the world are composed essentially of small successful and sustainable businesses.
To me, that is success.
I know that a lot of people here live in the SV echo chamber (nothing pejorative, we all live in an echo chamber) but in fact being big is the exception, not the norm.
I’d even argue that most "rich/comfortable" people in the world are not tech founders but are just at the head of 0 to 10 employees businesses. I’d guess they call this success.
Small teams often move faster than big teams, that is why small teams are bought by big teams instead of big teams just building their own and quickly taking market share and crushing them with better designs, features, pricing, marketing budget and iteration speed.
Big stuff is slow by nature. Lots of moving parts.
there are way more small teams (1~10 fte) in software world than people expect, but they don’t make enough money to be on such list. still, their revenue might be USD $1m/enployee. good for individuals, but not good enough for media/blogs to report, because that won’t generate enough clicks :)
In most large businesses the most significant work is done by 20% or less of the workforce (I work for a fortune 100 company).
Too often the team size is a proxy for how successful an entrepreneur is. Although I’m not a fan of the solo entrepreneur/ build in public fad, there is a lot of merit to starting with one or two and only adding great people to the team when needed.
And I think entrepreneurs overweight their indicators for when more people are needed to continue scaling. A business can usually continue scaling by refining processes and building or buying better support and tooling software.
Readit News
I also find it really sad that a lot of the small teams who are on the road to success get distracted by applying "best practices" that were built for big teams (e.g. Google uses kubernetes, we should too).
This also holds for project management practices such as Scrum.
Totally. It takes some experience and maturity to be confident enough to resist the big business “best” practices. That, or a very intuitive entrepreneur
Frame this quote on the wall beside the monitor, things will magically (simply?) improve.
Obviously most small teams don't generate that much value. There are a lot of tiny podcasters out there. Nobody is going to mistakenly think that all small teams are Joe Rogan. But it is nevertheless possible for a small team to be absurdly productive given the right conditions - success isn't about team size, it is about the opportunity and available skillset.
FWIW, politics is very similar. One person can't achieve very much, but a small group can wield devastating levels of power.
If you fall off a ship in the middle of the ocean you might survive and those survivors may have had strategies but we just don’t know if the people that died did not have the same strategies. Same goes for this list I’d think.
OKR
"Feature creep" in a small company is a sign of flailing around trying to capture a market. Sometimes a whole new feature is developed under pressure from Sales to land a big whale client, or a desperate CEO who thinks runaway success is just that one key feature away.
In a big company feature creep may be the result of a corporate culture that doles out promotions and bonuses for building shiny new things rather than the boring work of maintaining old things. Google is a good example of this, only with entire new services rather than features.
Either way feature creep is symptomatic of deeper problems with a company, regardless of size.
Principal-agent problem, i.e. conflicting goals. Sometimes it's the team vs. company, sometimes it's the team or a person against themselves. There are choices that are most beneficial for the current project, and there are choices that are most beneficial for one's career after the current project, and/or choices that are most interesting to the person.
So e.g. Kubernetes may be a total overkill for most things anyone does, but if I get around to doing some side project where Kubernetes would be a fit, even if rather poor, you can bet I'll at least try to use it, because it's highly likely I'll encounter it later at my current or future job. Now, this is just my side project, but then, many (most?) widely-used FLOSS software started as someone's side project.
And the same reasoning happens in companies big and small, as failing to keep your skills fresh is a recipe for trouble sooner or later, and the industry-standard approach to software developers' growth is "figure it out on your own, we're paying you for labor, not for your professional growth".
I think it’s interesting because while I personally don’t like the Craigslist UX, I have no objection to using it anyway (even if might I try other solutions first). They provide enough other value to me, and the UX is good enough, that I still have an overall positive impression of the service.
I also find it interesting because the debatability of their UX is really very surface level. There are all kinds of things I wish were different, but that’s mostly because it was perfectly fine in 200* and hasn’t much changed with the times beyond a few utilitarian niceties.
I’m sure this is way overly specific to CL as a reply, but your comment about UX focus resonates with me, and I’ve long found Craigslist’s lasting success fascinating in this light.
Would you recommend this strategy to a non-niche / broad category B2C product? It would feel instinctive to just get it out there and leverage every opportunity there is to market it, within the budget.
Don't forget to take care of your folks and yourself, friend.
all other companies are listed in 10s of Mil in Annual rev (sometimes one spike) or acquired for billions (which implies rev in 100s of mel).
craigslist is the gold standard of this category.
There may be many advantages to small teams and yes there are cases where they have wild financial success, but in general these may just be outliers. Are these outliers because they have the secret sauce worth emulating? Maybe, and maybe their stories will show why they succeeded where so many failed. Success is rarely all luck, but we’ll likely also invent myths around their exceptionalism as we tend to do. Not the type of exceptionalism which precludes the rest of us from having a similar shot of course, but one about cleverness and grit or other characteristics we can fairly easily attribute to ourselves.
Everyone likes a good narrative, I suppose. And narratives about scrappy small teams achieving success meritoriously are more attractive than ones about how the massive organizations usually tend to eat them for lunch (despite having their own types of problems) or ones about the frequencies with which the scrappy teams fail. Cherry-picking data points is the key to any good narrative.
Same thing happened with "small schools perform better" so they got funded. But turns out it's possible for them to perform terribly for the same reason it is for them to perform well.
And reason(s) would be?
You can just go look at Steam indie games. Those are all small teams. They are mostly all failures.
The median small team on Steam generates $4,000 in lifetime revenue. 2/3rds never cross $10,000 in lifetime revenue. Only the top 10% even cross $200,000. Which is more like "barely paid salaries" rather than some kind of F-U money.
The number of small teams on indie games that come anywhere close to the success of big teams on AAA games is minuscule.
I guess it depends on what you call success. Most businesses are mom and pop businesses that generate enough revenue to pay their employees the market rate in the long run. And I’m including tech businesses.
Most flourishing economies in the world are composed essentially of small successful and sustainable businesses.
To me, that is success.
I know that a lot of people here live in the SV echo chamber (nothing pejorative, we all live in an echo chamber) but in fact being big is the exception, not the norm.
I’d even argue that most "rich/comfortable" people in the world are not tech founders but are just at the head of 0 to 10 employees businesses. I’d guess they call this success.
Big stuff is slow by nature. Lots of moving parts.
a book i always recommend is https://www.amazon.com/Million-Dollar-One-Person-Business-Gr...
It just seems too scary to me...
Too often the team size is a proxy for how successful an entrepreneur is. Although I’m not a fan of the solo entrepreneur/ build in public fad, there is a lot of merit to starting with one or two and only adding great people to the team when needed.
And I think entrepreneurs overweight their indicators for when more people are needed to continue scaling. A business can usually continue scaling by refining processes and building or buying better support and tooling software.