Ethan Yu

2024-09-13

I want us to reach $100m ARR with ≤100 full time employees. ≥$1m ARR/employee is an ambitious goal but I believe we can do it. For context, “good” is $500k, and best-in-class in tech is >$1.5m.

Revenue/employee of some successful tech companies:

Benefits of lower headcount

• Everyone gets to work on the most impactful projects and have major ownership, not do low-value busy work. Everyone else in the company depends on you to help the company succeed
• More enjoyable work environment, A players like to work with other A players. Working with great people is inspirational and great for development
• Less overhead, meetings, coordination. More time for actual work rather than bureaucracy, processes, policies
• Get to know more of your colleagues, form great working relationships, more trust among colleagues, not be a “cog in the machine”
• More agility — when the company needs to change strategy, easier to turn the ship around and get everyone moving in the new direction
• Better financial outcomes — in a great outcome, upside is distributed among fewer people. In a downturn, not having to do layoffs

What does it take to keep headcount low while growing the company quickly?

• Talented team
• Strong work ethic
• Focus
• Pain tolerance (willingness to do work others aren’t)