Test Double was recently recognized for the third year in a row as one of the Inc 5000 and for the fourth year in a row as one of Columbus’ Fast 50. Both of these honors reflect our persistent growth over the last four years, and we want to celebrate them because that growth is the result of a lot of hard work and success that our team has had delighting clients, finding prospects, and expanding the recognition of our brand across the US. We typically don’t discuss growth as a goal though, so we wanted to share some thoughts on our goals, metrics, and general views on growth.
We’ve always felt that working in the open and being transparent with company financials was important at Test Double. It allows every team member to operate from a shared understanding of our financial health so that decisions we all make that affect the business are done with a relatively similar context. These are rarely done as a means to highlight our year over year growth, however. They were always meant to serve as an indicator of company health and stability.
We don’t focus as much on the financials now as we used to, because we’ve realized that financials are too lagging an indicator of success (or failure). Instead we manage the operation of the business based upon some key goals and metrics that are more leading indicators of our success. Things like the diversity within our pipeline, the month to month profit margin, the happiness of our employees and our clients. These are all better indicators of the relative health and stability of our company. If we find issues with any of these, it allows us to course correct in near real time so that we remain a great company for years to come.
This is counter to a lot of other businesses, especially in startup land, in that their focus tends to be strictly on growth. This is often measured as revenue growth, number of paying customers, or even the number of engineers that they employ. This last metric hits a little close to home as we have discussed growth in terms of the number of agents we would like to hire at both the 3 year (30 double agents by end of 2018) and 10 year (agent number 0100 has been assigned by end of 2025) marks. When people see those numbers they think that maybe our long term goals are to be a giant company. We are commonly asked “How big does Test Double want to be?”
The most accurate answer to this question is, “We don’t know." If you asked Justin and Todd separately, you’d more than likely get two different answers, and we’d be surprised if it were any different asking any two members of our team. We don’t have a venture capital firm who has invested tens of millions of dollars in us, and we don’t have a bunch of public shareholders that we have to report earnings to. Without either of those two things, we don’t necessarily need hard and fast metrics of revenue or employee growth that drives a lot of short term decisions. We honestly don’t think too much about the number itself in our day to day. Usually when people hear this non-answer the immediate follow up question is, “Then why grow at all?”
Growth has a few significant advantages that we have all seen first-hand as Test Double has progressed from two people to more than thirty. First and foremost, we’re a much more stable company, financially, when we’re bigger. When Test Double was only eight employees, over half of them were at the same client. Should a change have occurred at that client that would’ve resulted in four or more of the agents being dismissed, the company could’ve been in danger of closing its virtual doors after only a couple of months without new client work. Further, the tightrope we had to walk financially meant that we couldn’t be as selective about client engagements and our agents would have to bear the brunt of this instability in the form of less than ideal projects. Fast forward a few years and now that we’re at thirty-plus agents we find ourselves prioritizing a queue of different client opportunities, hiring people directly to the bench, and spending more on other aspects of our culture like company retreats than we ever have before.
Additionally, the bigger we are the more we’ve been able to stretch into new opportunities (both as individuals and as a company). We’ve seen agents move into support roles that better suit their career goals, and this will only continue to happen as we get bigger and bigger. A company of eight people doesn’t need a lot of specialists, but a company of thirty or more does. Should agents determine that they are more focused on marketing, sales, mentoring, or some other aspect that we need, we will likely have more positions to fill in either part-time or full-time capacity as we grow.
As a company, the growth has allowed us to step into more disparate technology via project work than we could’ve in earlier years. It’s difficult to imagine us responding to a four-person, six-month opportunity in Elixir and Elm years ago because our staff didn’t have enough experience in either of those technologies and our network wouldn’t have been able to find people who did at that time. Now we’re able to build up teams to respond to these opportunities, and we’ll be able to invest more strategically in technology that we want to work with via open source, blogging, and research.
Most people hear and acknowledge these benefits, yet a lot of us have deep scars from prior employers who have undergone extensive periods of growth. We believe there are a number of potential drawbacks to growth, the ones we’re aware of include the following:
Relationships: A huge benefit of Test Double at its current size is that we can basically know a little bit about everyone who works here and have a genuine relationship with each coworker. Can that continue at 50 agents? 100? 200? Likely not, according to some anthropological research. The bigger the number of relationships we have, the more shallow the relationships will likely become until they are nonexistent with at least a portion of the staff at all.
Quality: It’s almost an anti-pattern with consulting agencies at this point. In the early days the agency hires a lot of very talented people, then as growth goals loom they have to start easing the qualification restrictions to accommodate growth. This results in a weakened brand, diluted offering, and a sense of loss for employees who were there when service was exceptional. This sense of loss drives out a lot of the more talented people, and the spiral of worsening quality deepens.
Bureaucracy: The bigger the company, the easier it is to hide behind policy and/or bureaucracy. Even at our smallish size now, it’s tempting to quickly respond with a “Our policy is to not expense X, Y, and Z”. Fortunately, most of our agents challenge these ‘norms’ because they realize that a couple of people set what few policies we have. One of our key strengths is that we’re able to quickly and effectively change, we’re rarely bound by the mindset of “That’s the way things are here”. It would be painful to see our company gain so much inertia that it can’t change and adapt when it’s obviously pointed in the wrong direction.
Culture Shift: This is rather nebulous but it resonates with almost anyone who has gone through the drastic growth of a successful company. It may be a combination of the above factors, but it also just seems like everything that is great about a company becomes diluted as it grows. In our personal experience it’s a tendency to start valuing the organization over the people themselves. This lends itself to employees feeling like relatively small cogs in a giant machine, whose voices aren’t heard and thereby have little impact on the direction and success of the company.
Those challenges are front and center in our minds when we talk about growth. We’re committed to maintaining the awesome environment that we work within at Test Double, and we are committed to slowing our growth when it is apparent that we are making too many concessions in the above areas that cannot be fixed at a larger size. Yet, we are also committed to exposing as many people as possible to what we feel is a better way of building, motivating, and growing healthy software development teams. When we see other awesome developers who are stuck in jobs that are slowly draining the life from them, we feel it. We were those developers a number of years ago, and we wish we’d had a company like Test Double to join at that time. It’s the very reason why we built this company in the first place. We feel that there are a multitude of awesome developers who would be great additions to our virtual team out there. We will continue to add them to our ranks up to the point where we start to experience the drawbacks listed above. At that point we’ll either fix the issues, or we’ll naturally settle into a size that supports a great culture made up of great people. We can’t answer what that size is just yet, though.