Company Culture: How Scaling Kills What Made You Magnetic
Growth is exciting. But growth without culture is just expansion.
In this series, we've tackled challenges like time scarcity, burnout, and role misalignment. Today we turn to one of the hardest problems for CEOs to solve: how to scale without killing the thing that made people want to work for you in the first place.
When companies grow fast - whether through hiring, acquisitions, or market expansion - something shifts. You add processes to create consistency. You bring in leaders to professionalize things. Teams double or triple in size.
And without realizing it, you dismantle what made the company magnetic.
The weekly all-hands where anyone could challenge anything? "Doesn't scale."
The practice of letting people talk directly to customers? "We have a team for that now."
The founder who used to be in every decision? "You need to delegate."
All reasonable. All technically correct. All culture-killing.
Here's what most CEOs miss: Culture doesn't erode from neglect. It erodes from the very systems you build to grow.
Hit every milestone. Lost what mattered.
Late last year, I had a remarkable conversation with a CEO that was hard to forget.
"We just closed our Series B. Hit every milestone. Hired 150 people in 18 months."
He paused.
"And I realized I don't recognize the company anymore."
Three of his top performers had quit in the last quarter. Though all gave different reasons in their exit interview, each person meant the same thing.
The thing that made people want to work there? Gone.
Not because he neglected culture. Because of what he did to scale.
He'd hired a VP of Operations to "professionalize" things. Added approval layers. Instituted quarterly planning cycles. Built the infrastructure every board member said he needed.
And in the process, he'd systematically dismantled everything that made the company magnetic.
The weekly all-hands where anyone could challenge anything? "Doesn't scale past 50 people."
The practice of letting engineers talk directly to customers? "We have a product team for that now."
The founder who used to interview every hire? "You need to delegate, not bottleneck."
All reasonable advice. All technically correct.
All culture-killing.
Here's what most CEOs miss about scaling culture:
Culture doesn't erode from neglect. It erodes from the very systems you build to grow.
Every process you add to create consistency removes a degree of freedom. Every layer you introduce to improve coordination adds distance between people and decisions. Every "best practice" you import from another company dilutes what made yours different.
You're not losing culture because you're ignoring it.
Just when you want to differentiate yourself, you start managing culture in traditional ways - with frameworks, systems, and playbooks borrowed from companies that aren't you.
And here's the part that will make some people uncomfortable: Your culture deck isn't helping.
I've seen dozens of them. Beautiful slides. Inspiring words. "We value transparency." "We move fast." "We put customers first."
And then you watch how decisions actually get made. How information actually flows. How people actually get promoted. The deck and the reality have nothing to do with each other. Because culture isn't what you write down. It's what you tolerate, reward, and repeat when no one's watching.
The companies that scale culture do something different.
They don't codify values and hope people follow them.
They identify the behaviors that made the culture work when they were small—and they scale those behaviors, not the values statements.
An Example: The Decision Velocity Problem
One fintech that I worked with had a culture of fast decisions. When they were 30 people, anyone could make a call if they had the context.
At 160 people, that broke. Decisions slowed. People waited for approval. The thing that made them fast was killing them. Most CEOs would respond by clarifying decision authority. Creating a RACI matrix. Defining approval thresholds.
This CEO did something else.
He asked: "What made fast decisions possible when we were small?"
The answer wasn't "fewer people." It was:
Everyone had context on company priorities
People knew who to loop in (and trusted them to respond fast)
There was no penalty for making a reversible decision
So instead of building a decision framework, he scaled those three things:
Context at scale: Weekly memo from him to the entire company. Not updates—priorities. What matters this week and why. Five minutes to read. Non-negotiable.
Trust networks: New hires got a "decision map"—not an org chart. Who to talk to for what. Who responds fast. Who needs a heads-up but won't block you.
Reversibility doctrine: Explicitly named which decisions were one-way doors (need alignment) vs. two-way doors (make the call, tell people after). Most were two-way.
Decision velocity came back. Not because they had fewer processes. Because they scaled the conditions that made speed possible.
Here's how to think about this:
Your culture isn't the same as your values.
Your culture is the set of behaviors that happen when no one's watching.
As a small company, those behaviors emerged naturally because:
Everyone knew everyone
Context was shared by default
The founder's presence reinforced what mattered
At scale, none of that is automatic.
So the question isn't "How do we preserve our culture?"
It's: "What behaviors defined our culture—and what conditions made those behaviors possible?"
When you do this, you scale the conditions, not the behaviors themselves.
The trap most CEOs fall into:
They try to solve culture erosion the same way they solve operational problems: hire someone to own it. Chief People Officer. VP of Culture. Employee Experience team.
And then they're surprised when it doesn't work.
Because culture isn't an HR problem. It's a leadership problem. You can't delegate the thing that only you can model.
I've watched CEOs bring in consultants who run engagement surveys, facilitate off sites, and build competency frameworks. All useful tools. None of them fix culture.
You know what does?
A CEO who fires a high-performing VP because they treat people poorly.
A founder who keeps showing up to customer calls even though they "shouldn't have time for that anymore."
A leadership team that kills a project everyone's excited about because it doesn't align with the company’s vision.
Culture is built in the moments when living your values actually has a price.
Three questions to ask this week:
What did we do at 20 people that we've stopped doing at 100+?
Don't dismiss it as "doesn't scale." Ask why it mattered and whether the underlying need still exists.
What new procedures have we added that people resent?
Resentment is a signal. It means the process solved a coordination problem but killed something people valued. Can you solve the coordination problem differently?
Who are the people who still embody what we used to be?
They're your culture carriers. What do they do differently? How do they make decisions? What would break if they left?
Study them. Then ask: How do we make what they do the way we all work?
The real test.
Here's how you know if your culture is scaling.
Ask your last five hires why they joined.
If most say "the role" or "the comp," your culture isn't scaling.
If they tell you a story about something that happened in the interview—a conversation, a value they saw in action, a person who made them feel something—you're doing it right.
Aftermath.
Six months after that conversation I mentioned earlier, I checked in with the Series B CEO.
He'd rebuilt the weekly all-hands - but differently. Not updates. Stories. One person each week sharing a decision they made that embodied a company value. Sometimes it was an intern. Sometimes it was him.
He'd stopped hiring "culture carriers" from other companies and started promoting them from within.
And he'd done something that surprised me: he'd fired a VP who hit every number but treated people like robots.
"That one decision," he told me, "did more for culture than anything I'd written or said in two years."
The company didn't slow down. They sped up.
Because people finally believed the culture was real.
And finally…
Culture isn't what you say in the all-hands.
It's what people feel in the hallway, on Slack, in the moments between meetings.
You can scale revenue without culture. Plenty of companies do.
They're called “the places people work until something better comes along.”
For more insights on how leaders can instill passion and purpose in their employees, follow Karen Gilhooly here.
Want to learn how to Make Minutes Matter? Listen here.
Learn more about how Karen Gilhooly can recharge your workforce and build – or rebuild – a culture of high engagement and high performance at karengilhooly@karengilhooly.com or schedule a free discovery call here.
Discover more about The Three Bucket Leader here.
