Every company wants to grow, but 'growth culture' often plants a ticking time bomb that's almost impossible to disarm.
Originally posted at The Journal of Uncharted Blue Places.
Note: This is a longform post with numerous terrible-looking pictures of triangles, so I’ll be posting it as two separate stories when republishing it here. If you can’t wait for Part 2, you can read the post in its entirety here.
In our last edition of How To Kill Your Tech Company, we explored just some of the various ways corporate edgelord Elon Musk managed to crater a supposedly $44 billion dollar company by making, and this will not be surprising for anyone who's followed Musk's other recent career moves, just about every executive screw-up it's thought possible to make and at least one that was considered nearly impossible to pull off. What can we say? The man has a gift.
This time let's talk about Vice. Specifically, Vice Media, which filed for bankruptcy in 2023 and which announced in February 2024 that they were closing down their websites to—and yeah, it was as weird as it sounded—instead distribute their content by "partnering" with other companies to—you know what, forget trying to explain it here. You can read about that announcement here if you missed the whole debacle and no, it's not really any more coherent now than it was then.
I'm counting Vice as both a media company and a tech company, because once Silicon Valley and the hedge funds got involved with online media any website that included Content was considered Tech because that allowed the enormously pretentious gits brought in to manage them to justify larger salaries and attend a more hedonistic type of parties. Does it primarily exist online? Sure, fine, it's a tech company.
I'm going to warn you in advance, though: We're going to start out talking about Vice as our now-famous example of horrible ridiculous face-planting management failures, but what this post is really going to be about is the reasons why growth-obsessed management of the hedgefundian and brunchlordian and privatequitarian varieties is often a ticking time bomb for their companies even if those executives are competent and well meaning.
They're often not, of course. We are all adults here, ones with W2 forms and favorite music and broken childhood dreams, and we're all perfectly aware that most of the most visible tech and media company failures come at the hands of incompetent grifting lying showboaters, the sort of people who always seem to walk away owning bigger and bigger boats even as each company crashes around them. But the moment any company starts what it intends to be a transformative, company-altering growth spurt, unless it is carried out by talents that do not come along nearly often enough for all such companies to share them, it sets the timer on that company's own eventual collapse.
Hang on, that's the most important point we'll be making here and it needs to be a blockquote:
The moment any company starts what it intends to be a transformative, company-altering growth spurt, unless it is carried out by talents that do not come along nearly often enough for all such companies to share them, it sets the timer on that company's own eventual collapse.
Ah, that's the stuff. But first: Let's talk about Vice.
The collapse of Vice Media is at this point an infamous story, and rather than hashing all of it out here again we can rely in large part on the definitive postmortem by Chris Thompson at Defector. It's worth a full read and a re-read, but of particular note is that the executive team there made a hell of a lot of money burning the thing to the ground, and from the now-public obituaries it seems the burning mostly took the form of trying to grow the company into All The Things while ignoring the advice of all the little peons who had made the company worth investing in the first place.
Vice Media leadership was still self-dealing hefty bonuses in the days immediately preceding its bankruptcy; De, who was given a whopping $200,000 bonus in April one day after The Wall Street Journal reported that 100 or so workers in her department were being laid off, defended her compensation in a July call with angry workers as commensurate with her experience. Vice Media Group's leadership masthead lists 12 of these bozos; that's millions of dollars off the top, much more in salary and bonuses and benefits to C-suite freaks with ill-defined job responsibilities and made-up titles than Defector makes in revenue in an entire year.
The absolute best that can be said of any of Vice's grotesquely enriched stewards over the years is that some of them believed in the value of the work; unfortunately that belief too often took the form of cocaine fantasies of conquering all of media, and inspired its leaders to recklessly burn through actual billions of dollars of investment capital. This was no less destabilizing for Vice's workers, who might otherwise have been able to guide their excellent publications through the industry's tumults if they hadn't been subject to the whims of captains who make Ahab look like Andy Griffith. Meanwhile, the solutions for sustainable digital media are out there, even amid all the carnage and panic of the collapse of the advertising economy.
When it comes to both tech and media companies—God help you if your company is both—this is a phenomenon that's so commonplace it really deserves its own name. Executive team comes in; executive team announces that they know How To Business; executive team proceeds to nail their tongues to the big conference room table; eventually some Executive Rescue Force arrives to bust down the door, destroy the majority of the office furniture, and spirit the newly freed team off to some other company that has classier and more expensive office furniture anyway so yay, everyone who matters gets their happy ending.
Unfortunately all of the names I can come up for this pattern are so adult-oriented that typing them down here would immediately trigger every content filter on the internet, so we'll just set that one aside for the moment.
The second obituary of note came from TechDirt's Karl Bode, who's been relentless as chronicler of the tech sector's aggressive tongue-nailings and enshittification. It's from him we get a categorization for the failure: "Incompetent Fail-Upward Brunchlords."
Numerous Vice editors and staff writers were paid salaries as little as $35,000 a year in New York City (you’d find retirement or financing a home purchase easier with a career at fucking Quiznos). At the same time, executives, clearly incapable of any sort of coherent strategic vision, gobbled up massively outsized compensation not at all commensurate with their workloads or performance:
[...] Even as the company was facing bankruptcy and freelancers and staffers were either fired without severance or (like myself and other Vice freelancers) watched huge segments of their incomes instantly evaporate, legal filings illustrated how Vice executives were handed $11 million dollars — for doing arguably little to nothing — from May 2022 to May 2023.
and:
This, somehow, often gets distorted into the “unforeseen challenges facing modern online media ventures today” by a feckless press pretending to ascertain what went wrong without pissing off management.
When it comes to financing Vice journalism and keeping the lights on, the problem wasn’t the people doing the actual fucking work. Nor is it the costs of doing actual journalism. As noted previously, The equally incompetently managed The Messenger burned through fifty million fucking dollars in less than a year; enough to fund any competently managed modest newsroom for the better part of a decade.
But again, if you read most mainstream analysis of the Vice collapse, executive incompetence is either downplayed or simply nowhere to be found. Instead, the collapse of Vice, like most mismanaged modern U.S. media companies, is often left causation free, somehow the unfortunate, unforeseen consequence of ambiguous externalities in the thankless job of informing the public about factual reality online.
The Vice collapse came because a series of more and more prominent executives came in with instructions to grow an online journalism company into the next US Steel by doing (shrug emoji). Multiple hundreds-of-million-dollar deals with everyone from Fox to Disney provided access to a Matterhorn of money, a good chunk of which went into paying the executive teams raising it. There was, from the outside, never a very clear picture of how Vice's various subgroups and new ventures were going to coagulate into something larger, and from the beginning to the end of it all it appears the workforce producing what the company was actually trying to sell was considered a $35,000-per-person burden that ugh, just kept offering suggestions and pointing out numbers and needing paychecks and ugh how tedious can you get, time for a long lunch to reward ourselves for having to interact with them.
Every company wants to grow; every group of company founders dreams of their new venture being so successful that they can achieve that most precious of all goals: leaving it to do something else, secure in the knowledge that money will still be landing in their bank account regularly. But the effects of growth culture, as management fetish, can be pernicious.
It can quickly turn into a poison, and the conventions of supposed leading-edge Business Doing almost require that it become one. The existing consumer base might come to be seen as group to be exploited or merely a burden that must be placated in order for the company to leapfrog to some newer, possibly imaginary consumer base. The employees who scrambled to bring the company to its current success may now thought of as has-beens; once you grow the company to a certain level now it's time to bring in the More Important People, people who have worked at "bigger companies" and can tell you how to run your successful and expanding business like Boeing or Enron instead of the presumably stupid way you've been doing it until now. Those new More Important People will in turn bring their own More Important People, typically pulled in from their own past allies and partners, and so on.
Is such growth transformative? You bet. Does it have the potential for great success? Sure. But the process of Embiggening an already-successful small or midsized company is much, much more perilous than most executive teams imagine it to be, because even if got one of the rare teams that understands how to refurbish a Cessna into a 737 while it's in flight, never once letting it touch the ground, you're either going to get to your destination or you're going to hit that ground very, very hard.
It's also a very short walk from let's expand the company by bringing in executives who don't know all that much about our particular market niche but who can tell us how the bigger companies do things to the Musk Principle:
One Idiot Can Ruin Everything.
Let's assume, for the moment, that we have a theoretical company that's not run by barely-sentient human spambots like CNET's former owners or by the money-hoovering but let's-say well-meaning brunchlords that appear to have run Vice into the ground. What would growth look like in an ideal company?
Let's say we have a not-quite-startup, not-quite-established tech company, maybe it's got an operating budget somewhere in the $10 or $20 or $50 million range but it's got something special to it that, at least in the moment in question, is letting it make money hand over fist so there's good profits and what appear to be some real opportunities for growth. Maybe it's created a new bit of software that's taking off, or maybe it's designed a new handheld bit of electronics that lets you send someone else in the world a mild electric shock just by thinking bad thoughts about them—you know, something "useful." This is the sort of company that the world is full of, quiet and unassuming little nooks of industry that do alright for themselves and at some point think to themselves, but we could do better.
The organizational structure of our imaginary company generally gets depicted as something like this, though we'll forgo the lines representing who reports to who and prevent the vaguer version:
The most abstract possible representation of standard corporate structure: executives at the top, workers at the bottom.
Good ol' boring triangle—nothing beats that. Hang on, for the purposes of discussion let's change those icons out to differentiate between roles a bit.
That looks better. Those emoji help a lot.
Now, if this were a glossy-cover book about management being displayed in an airport bookstore the author would probably make a very big deal of this hastily thrown-together picture. "There are two kinds of people in your organization," they would write. "There are birds, and there are bees. The birds are good at communicating and conversation, and the bees are good at bee-ing industrious but often do not communicate using words the rest of us can understand. Also, they like living in honeycomb structures in which every cell looks exactly like the others, and—"
Yeah, we're gonna head that off right there. Our differentiation is between people whose primary duties are deciding what the company does next and people whose primary duties are getting those things actually done, which is coincidentally the way all of corporate America thinks of itself so who are we to argue. In practice, there are no 100% birds or 100% bees—each position consists of some fraction of both. In our corporate environments we are all complex and confusing hybrids of both birds and bees, horrible mutant creatures with seven wings and nine legs and compound eyes over a misshapen beak, something akin to that final evolution in The Fly, the Jeff Goldblum version, all moaning and keening at each other, begging for a quick and painless death.
There, put that on the back cover of your stupid management book. I dare you.
"In our corporate environments we are all complex and confusing hybrids of both birds and bees, horrible mutant creatures with seven wings and nine legs and compound eyes over a misshapen beak, something akin to that final evolution in The Fly, the Jeff Goldblum version, all moaning and keening at each other, begging for a quick and painless death." — Some Airport Book
But to get back to the actual structure here, our imaginary shockingly well-run company is probably headed up either by the inventors of whatever product our company is selling or those who partnered with the inventors at the very beginning; the rest of the staff consist of people who were likely brought on in twos and threes over the years as needs arose and capacity needed to be ramped up. By and large we know this group of people is mostly pretty competent at what they do and mostly pretty knowledgeable about the product their company is selling, its development, the troubles that arose when it was being designed or upgraded. We know that because the company's doing well for itself, which means the current staff is bringing in measurably more money than the company is paying back out, which is precisely why our fictitious company is now contemplating a much more ambitious growth spurt to begin with.
So after things look pretty stable and the company's key staff have looked at the numbers and decided that they could probably sell a lot of other product or services similar to the ones they're now selling, if they only had the capacity to do it, and someone says we need to grow this thing. Not because they're horrible greedy brunchlords, but because it makes good business sense. So that's what they do.
And how is that done, in modern capitalist America after about 50 years of inundation with new MBA programs that try to universalize management concepts by grinding them all up and presenting them as a cure-all soylent goo, and with fawning "business" cable television networks interviewing top business leaders who may or may not secretly be amazing screw-ups who can't work the office coffee machine without three assistants and an exorcist, and with airport bookstores filled with ghostwritten management books with some billionaire executive's smug face on the cover? By and large the small-company executives will always arrive at the conclusion the books and magazines tell them they should: We need to hire experts who have worked at big companies, so they can teach us how big companies do things. Then we will become a big company.
And thus the fuse is lit.
Next time: The Growth Bomb. (Or you can just read it here.)
The full version of this story originally appeared at The Journal of Uncharted Blue Places.
Also from Uncharted Blue:
