The Importance of Company Stages

“That’s a startup.”

A two-person team with Pre-seed funding is called a startup; a hundred-person company with Series B funding that is still burning cash also calls itself a startup. Even though both are called “startups,” the worlds inside them are completely different.

Even within startups, the picture varies radically depending on the stage. What’s more, the word “startup” itself is too ambiguous. Rather than using “am I a better fit for a big company or a startup?” as your criterion, consider evaluating based on the company’s stage.

This gives you clearer indicators to judge whether you should join the company. More than company size, what stage the company is currently in, how it survives, how it grows, and what its main bottleneck is will directly shape team culture and daily working atmosphere.

Why You Should Care

With the same title of “software engineer,” your day-to-day work differs entirely across different company stages. An engineer in the discovery stage might write backend code today, tweak the landing page tomorrow, and attend a client meeting the day after. An engineer at a mature company might spend three months solely optimizing the performance of a single subsystem.

Similarly, for a Product Manager, success during the validation stage means getting someone to pay for the product; success during the growth stage means achieving scale.

Each stage defines “good” completely differently. Without a clear understanding of the company’s stage, it’s easy to build unrealistic expectations about the job:

• “I’m a developer, so why am I doing so many non-development chores?”
• “Why does management always reject my refactoring proposals?”
• “I just wanted to change a button and fix some styles—why do I have to go through four or five approval processes?”
• “Technical debt keeps piling up; maintaining this code is pure agony.”

You genuinely want to make the product better, but everything you do seems wrong. Over time, this leads straight to burnout and resignation. “Fighting together as a team” sounds romantic, but in the gears of capitalism, you are often just a replaceable cog.

If you think a company is chaotic and lacking process, it might simply be at that stage. Conversely, having lots of rules and processes doesn’t necessarily mean maturity—it might just mean bureaucracy and stagnation have begun.

The Four Stages

Here are my own observations. Companies at each stage exhibit distinct characteristics, which you can use to determine whether the work environment fits you.

The x-axis is time, and the y-axis is money. For a SaaS startup, there is only one real goal: Growth.

Specifically, you must find the inflection point before your runway burns out to achieve exponential revenue growth. All your actions and outputs should align with this single objective.

The descriptions below revolve around this core theme.

The Discovery Stage

At this stage, the company is still searching for a market, a problem to solve, and a direction. The founders drive everything. What’s decided as A today might change to B tomorrow—policies change constantly. There are no stable processes; almost everything is experimental. The priority here is finding direction, so rapid iteration, fast failure, and capturing key metrics are what matter most.

Shifting directions constantly is normal at this stage. An early-stage startup has to pivot quickly. The most critical questions are: What problem are we actually solving? Does anyone actually want this?

What’s needed at this stage is speed and iteration. You can expect a lot of code to be born ready to die. You also shouldn’t expect comprehensive benefits or vacation policies.

As an aside, during the discovery stage, I strongly advise against using AWS right away; many PaaS options can help you iterate on your product much faster.

This stage suits people who thrive in chaos and love going from 0 to 1. If you expect well-defined division of labor and standard operating procedures (SOPs), this stage will be agonizing.

The founders’ values and working styles heavily dictate the company and team culture.

Joining during the discovery stage carries high risk. Unless you want to build raw experience or deeply align with the company’s direction and want to fight alongside them, I generally wouldn’t recommend joining at this stage. Here is why:

• The company is in its infancy and funding may not be substantial. With a short runway, everything you produce is scrutinized under a magnifying glass.
• If joining full-time, your compensation will likely be below market rate, while the workload will be significantly heavier.
• The product direction and requirements will shift constantly, which might leave you feeling lost.
• You need exceptionally high ownership; many processes and initiatives must be pushed through entirely by you.

Under so much pressure, you should first ask yourself: “What am I actually working so hard for?” Make sure you won’t burn out in such a high-intensity environment. All these conditions have strictly better alternatives—for example, joining a Series B startup or a Tier-1 multinational company. You’ll still experience high work pressure and a culture demanding extreme ownership, but at least they can afford to pay competitive salaries.

On the other hand, if you already have a powerful motive driving you forward, then dive in boldly. That experience will become a bedrock of resilience when facing tough challenges down the road.

What doesn’t kill me makes me stronger.

The Validation Stage

You begin to have customers (users), revenue, and people willing to pay, but you aren’t yet sure if this model is repeatable. Many results are still brute-forced by the founders or a few core team members, and product, sales, and delivery often blur together.

This period is somewhat more stable than the discovery stage. The most critical goal is achieving Product-Market Fit. Is this a viable business? Can this success be replicated?

Many companies mistakenly think that having customers means they are set, but it might just be that the founder is an exceptional salesperson. When a founder handles all sales and client conversations single-handedly and closes a few deals, it looks like the market has been validated. In reality, they are still far from a repeatable business model.

The central challenge of this stage is finding Product-Market Fit. Beyond whether there are paying customers, you must answer deeper questions: Is this a viable business? Can this success be duplicated? Can this process still function without the founder personally running it?

Although early startups should focus on Do Things That Don’t Scale, as you transition toward growth, you must start seeking repeatable, scalable growth strategies.

I think there are a few key priorities:

• Gradually codify the experience accumulated through trial and error and intuition into systems, processes, and methodologies to find truly replicable models.
• Validation can no longer rely on gut feelings; it must be backed by data.
• Begin distinguishing between one-off wins and scalable successes.
• Find ways to reduce dependency on a few key individuals. As long as growth remains tied to the founders or core members, the company has not truly moved beyond its early stage.

You can expect some typical traits during this stage:

Role boundaries are blurry. In title, you might be an engineer, PM, or designer, but in practice, you often do much more than your primary role. You might be writing a feature while sitting in on sales calls, or handling customer requirements while helping draft process documentation. Many boundaries haven’t been cleanly drawn yet.

Requirements still change frequently. The direction is starting to narrow down, but pivots still happen often. A feature built for Client A today might be deprioritized two weeks later when you realize Client B is the real paying demographic. Priorities get completely reshuffled, and you might even need to build custom features for key enterprise clients. You’ll feel the company is steadier than in the earliest days, but it is still far from stable.

Ship it first, figure it out later. This doesn’t mean people don’t care about quality; rather, the company cares more about whether an initiative is worth continued investment. This is also a frequent source of conflict for developers.

Accumulating technical debt. Things left over from the discovery stage usually start coming back to bite. Code written purely for speed becomes exponentially more expensive to maintain as users multiply, requirements get complex, and data volume grows. This is another common friction point between engineering teams and leadership.

The Growth Stage

The company has identified a repeatable customer segment and sales engine, but the organization hasn’t fully caught up. Headcount grows, middle management becomes necessary, and hiring, collaboration, and communication costs rise rapidly. The challenge shifts from turning occasional wins into consistent success while sustaining expansion.

Many people work at companies in this stage: expanding on the inside while patching holes on the fly.

Product is growing, headcount is growing, and revenue may be growing, but technical debt, process complexity, management overhead, and communication costs are ballooning alongside them.

Many issues tolerated when the team was small are magnified at this stage. Technical debt begins to drag on development velocity, and management frictions start affecting organizational efficiency. The company increasingly realizes that relying on a few brilliant individuals is no longer enough; it must transition from people to systems.

• Headcount increases. Office politics arise; meetings, processes, and documentation multiply.
• Cross-departmental collaboration surges. With more stakeholders involved, communication costs rise noticeably.
• Requirements are no longer just about building it. It’s not enough to simply build something; it must be delivered reliably and sustainably.

The Maturity Stage

Companies in the maturity stage have typically navigated past the intense uncertainty of the earlier phases.

Their business model is relatively established, market positioning is clear, and division of labor, processes, and management frameworks are mostly in place. The company no longer needs to prove every single day whether it can survive, nor is it in a state of constantly hunting for direction while trying to scale.

As a company grows larger and more stable, rules and processes bring order, but they also bring inertia. Decision-making chains lengthen, risk aversion increases, and initiatives that once moved swiftly now require more coordination, more evaluation, and easily get bogged down in internal friction.

I call this the unavoidable predicament of the mature stage.

If you’ve ever worked at a large enterprise, you know that behind the polished exterior, the internal chaos, abstraction, and surrealism far exceed what outsiders imagine.

Clear division of labor. Role boundaries are distinct, processes are comprehensive, and getting things done requires navigating more internal procedures.

Long decision chains. Many things require layered approvals. For instance, provisioning a new server might take two weeks of requests, and logging into the production database is only permitted under strict monitoring.

Internal politics. Resource competition grows, making it harder to push through initiatives you care about. Often, the barrier isn’t whether you can build it, but whether you can get organizational buy-in.

Different Stages Suit Different People

This matters even more than ability.

The discovery stage suits people who thrive in chaos and are eager to shoulder broad responsibility. The validation stage suits those who can patch holes and run fast experiments. The growth stage suits those who can build systems and collaborate across teams. The maturity stage suits people skilled at optimization, governance, and driving efficiency.

Because each stage has distinct characteristics, working at a company stage that doesn’t fit you is often the root cause of burnout.

I have experienced this mismatch myself.

I once felt comfortable and highly valued at a growth-stage company, but after moving to a discovery-stage environment, much of my past experience became irrelevant. The fundamental nature of the problems was completely different, and what the company prioritized had completely shifted. The reverse is also true—some people thrive in chaos but feel suffocated and ineffective once placed in a rigid, process-driven organization.

Ultimately, it comes down to a difference in perception. The company stage demands a focus on A, yet you’re constantly trying to optimize B.

When a company is still in discovery, what it needs most is rapid requirement validation and fast iteration, but you might be obsessing over whether the architecture is pristinely decoupled or whether SOPs are fully established. Conversely, when a company enters the growth stage and desperately needs collaboration, structure, and predictability, you might still be tackling problems as a lone-wolf individual contributor.

That’s why I don’t believe it’s simply a matter of lacking competence.

When you work hard yet the results consistently fall short of expectations, it’s easy to internalize the blame over time and conclude: “Maybe I’m just not that good after all.”

But as mentioned earlier, without understanding the nature of company stages, your strengths may simply not align with what the company currently needs. Still, take time to reflect on whether the environment is truly the problem, or whether you are simply avoiding difficult challenges.

Once you understand this dynamic, navigating your career choices becomes much clearer.