Scaling Transitions | SBI GTM Corner

This was the third and final episode in a series with Tony Erickson, SBI's managing partner, and we closed it out by talking about what happens when a company outgrows the person who built it.

I told Tony about my first sales job, back during the dot-com boom, when I was employee number 26 at a company called Introspect. Six years later we'd gone public as one of the largest tech IPOs in the world, right up until Google took that title away from us -- 6,000 employees, a $9 billion valuation, up from $750,000 in sales when I started. I didn't know it at the time, but I was watching a company move through every stage of its life in fast motion, and the things that worked at $5 million in revenue actively broke the company at $100 million.

We talked about the moment a founder or a top operator has to become a leader of leaders instead of the smartest person in the room -- and how much vulnerability that actually takes. The best leaders I've watched go through a private equity hold period are the ones willing to stand up and say "I don't have this figured out yet," not the ones insisting nothing needs to change because they're somehow different from the rest of the portfolio.

We also pushed back on the stereotype that PE ownership is just about cutting costs. Sometimes it's the Rule of 40 through pure efficiency, sometimes it's pouring gas on a growth fire -- but either way, the job is understanding the actual investment thesis and grounding every change in it, not in nostalgia for how things used to work.