The other fatal flaw is that in larger orgs there is almost no existential risk to the organization from individual behavior. All the cloaks and daggers will get sorted out in the wash and Amazon will still be just fine. But this is not the case for a scaling startup. Bad individual behavior — prioritizing career progression over company success — especially at the expense of other employees, can and does sink smaller companies.
I think the stage of scaling is something that industry experience doesn’t provide a ready supply of employees to hire for. There are too many variants of startup company, too many weird starting structures, and the critical periods too short and intermittent.
The other variable not discussed here is the environmental constraints. An established org can be managed because the environment is relatively stable. The customer base is more of a constraint and the financial expectations are better integrated. A startup is still trying to execute various transitions at this point, often from loss-leading to not, and this introduces more opportunities for chaotic regimes that need to be tightly regulated.
