There’s a moment in every growing company’s life where the magic dies. It happens somewhere between 30 and 50 employees. The scrappy energy that built the company starts curdling into something darker: politics, blame, and a creeping toxicity that drives out the people who made it work in the first place.
I’ve seen this pattern enough times now to recognize the symptoms. And the research backs it up: this isn’t bad luck. It’s a predictable failure mode.
The 30-Person Threshold
Robin Dunbar’s research on social group sizes identified clear breaking points. At 5 people, you have intimate trust. At 15, deep relationships. At 30-50, things start breaking.
— Dunbar's research on organizational scalingKeeping things below 150 means you can manage the system by peer pressure. Above 150, you need top-down, discipline-based management.
But the real danger zone is 30-50. This is where the founding team’s informal culture stops scaling. Where “we all just know what to do” becomes chaos. Where leaders who succeeded on instinct discover they have no actual management skills.
Facebook’s CPO Chris Cox put it bluntly: after companies pass certain thresholds, “weird stuff starts to happen.” The companies that survive this transition invest in leadership development. The ones that don’t? They eat their own.
The Playbook for Dysfunction
Having lived through this and studied the patterns, the symptoms are remarkably consistent:
Blame Flows Down, Credit Flows Up
Stanford research on blame culture found something chilling: blame is contagious. One person pointing fingers triggers others to blame completely unrelated failures. It spreads through an organization like a virus.
In dysfunctional companies, this creates a predictable flow. Wins get claimed by leadership. Failures get pushed down the chain until they land on whoever is least able to defend themselves. Usually engineers. Often engineering leadership.
People instinctively blame personal traits over systemic issues. “She failed because she’s lazy” is easier than “our process is broken.” This cognitive bias lets bad leaders avoid accountability indefinitely.
Accountability Without Authority
Researchers call this “unempowered accountability” and it’s rampant in growing companies. You’re responsible for outcomes but have no power to make decisions. You own the deadline but not the scope. You’re accountable for the team but the CEO talks directly to your engineers.
This happens partly because scaling companies are uncertain by nature. But mostly it happens because first-time executives have never learned to delegate properly. They want control without responsibility. So they create a management layer that exists purely to absorb blame.
The CEO Bypass
One of the most destructive patterns: the CEO who goes around their own leaders to talk directly to engineers.
They tell themselves it’s about staying connected. Being approachable. Keeping an open door. What it actually does:
- Undermines managers’ authority publicly
- Creates conflicting priorities and duplicate work
- Signals that the chain of command doesn’t matter
- Leaves managers working with incomplete information
The research is clear: this creates “frustration, lowered confidence, increased stress, and resentment” in the managers being bypassed. And it makes the company worse. If the CEO doesn’t trust their leadership team to lead, why did they hire them?
The Thankless Grind
79% of employees who quit cite lack of appreciation as a major reason. But in toxic companies, the problem compounds: you’re expected to work crushing hours and receive zero recognition for it.
The data shows reducing recognition makes employees 48% more likely to report burnout. When appreciation exists, burnout becomes 87% less likely. This isn’t soft HR nonsense. It’s basic organizational physics.
But some executives see gratitude as weakness. Thanking people might make them complacent. Better to keep them hungry. Keep them scared. This is how you build a culture where your best people are perpetually polishing their CVs.
Weaponized Insecurity
Google’s Project Aristotle identified psychological safety as the #1 predictor of team performance. Some leaders read that research and think: “Good, now I know what lever to pull.”
In toxic companies, insecurity isn’t a bug. It’s a feature. Your job is never safe. Your performance is never good enough. That project you shipped? Already forgotten. What have you done lately?
This is deliberate. Keep people anxious and they’ll work harder. Keep them uncertain and they won’t push back. The cruelest part: these environments often demand “vulnerability” while punishing anyone who shows it. Raise a concern and you’re “not a team player.” Admit a mistake and it goes in your file. The request for authenticity is a trap.
Gaslighting as Management
58% of workers have experienced workplace gaslighting. The patterns are consistent:
- “You’re overreacting”
- “That’s not what happened”
- “You’re too sensitive”
- Excluding people from decisions, then blaming them for not knowing
The goal, conscious or not, is to make employees question their own perception. When you raise a concern and get told you’re the problem, eventually you stop raising concerns. Which is exactly what bad leaders want.
Inherited Sins
Here’s one that hits engineering leaders especially hard: being blamed for problems you inherited.
The codebase is a mess? Technical debt everywhere? Features that used to take two weeks now take twelve? The current team gets labeled “unproductive” even though they’re drowning in decisions made years before they arrived.
— Engineering leadership researchShaming developers for creating technical debt is shaming them for having done their job. Blaming previous management is counterproductive. Your current state is what it is.
Technical debt is always an operations problem. It reflects leadership decisions about timelines, priorities, and investment. But it’s easier to blame the engineers you can see than the decisions you can’t.
The Psychology of Bad Leadership
Why do executives behave this way? Stanford research on narcissistic CEOs found they’re significantly less likely to value integrity and collaboration. They “act out” via screaming, inflammatory messages, and disparaging comments behind people’s backs.
When challenged, they don’t adapt. They fire the challenger and replace them with someone more compliant. The result: “individualistic cultures with no teamwork and low integrity.”
The tragedy is that these leaders often got hired because of their confidence. Boards and investors mistake certainty for competence. In anxious times, people want someone who says “I have the answer” even when they don’t.
Why Good People Stay Too Long
If these places are so toxic, why don’t people just leave?
Because it’s gradual. You’re the boiling frog - the water heats so slowly you don’t notice until it’s too late. Early on there were good times, real camaraderie, genuine belief in the mission. You tell yourself it’s a rough patch. That growth is hard. That you’re being too sensitive.
The gaslighting works. You start questioning whether you’re the problem. Maybe you’re not cut out for this. Maybe your standards are unrealistic.
By the time you realize what’s happening, you’ve already lost months or years. Your confidence is shot. You’re exhausted. And you’re angry at yourself for not seeing it sooner.
The Companies That Make It
Not every growing company falls into this trap. Some leaders recognize the 30-person transition and invest in real leadership development. They hire experienced managers and actually let them manage. They build feedback systems that surface problems before they metastasize.
The difference isn’t just having psychological safety. It’s pairing safety with high expectations. The research is clear: you need both. Safety alone creates complacency. Accountability alone creates fear. The companies that thrive demand excellence and make it safe to fail, ask questions, and push back.
These places exist. They’re not unicorns. They just require leaders who’ve done the work to grow beyond their early instincts.
A Structure That Works
The 30-person threshold doesn’t require heavy hierarchy. What it requires is intentional structure.
Small, autonomous teams. Keep teams at 5-7 people with clear ownership of outcomes. This preserves the intimacy and trust of smaller teams while enabling coordination at scale. Each team should have genuine authority over their domain.
Manager of one. This concept, when done right, means trusting people to manage their own time, priorities, and decisions. It doesn’t mean abandonment. It means hiring adults, giving them context, and getting out of the way. The key: this requires more leadership investment, not less. You need clear goals, transparent decision-making, and regular check-ins without micromanagement.
Flat where it matters. Flatten access to information, not accountability. Everyone should understand company strategy, financials, and challenges. But someone still needs to be responsible for outcomes, advocate for their team, and make hard calls. Flat structures fail when they eliminate advocacy, not hierarchy.
Recognition as infrastructure. Don’t leave appreciation to chance. Build it into rituals: weekly wins, public kudos, regular one-on-ones where contributions get acknowledged. The goal isn’t forced positivity. It’s making sure good work doesn’t disappear into a void.
The common thread: structure should create clarity and safety, not control and fear. The best 30-person companies feel smaller than they are because they’ve preserved what made them good while adding just enough scaffolding to stay coordinated.
If your team is navigating this transition, Berst.io offers consulting on exactly this problem - aligning teams, building healthy workflows, and scaling without losing what made you good.
What This Means
If you’re in a company exhibiting these patterns, know that you’re not crazy. These are documented dysfunctions with decades of research behind them. The problem isn’t your perception. The problem is the organization.
If you’re leading a company approaching the 30-person mark, take this seriously. The skills that got you here won’t get you further. Invest in learning how to lead at scale, or hire people who already know and actually empower them.
And if you’re an engineering leader who just got blamed for a mess you inherited, treated like a scapegoat, and gaslit into questioning your own competence: you’re not alone. This happens constantly. The pattern is the pattern.
The best revenge is building something better somewhere else.
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