Speed Freaks

Running a business is one long race, and we're all competitors. Like Jeffrey Green, 29, one of three founders of Stamps.com, a 3-year-old Santa Monica, California, company that allows consumers to buy postage online. And make no mistake: Green is in a race, whether it's in establishing partnerships with Quicken.com and AOL so their customers will buy stamps from Green and not his competitors, or whether he's racing to manage his own growth, even as he tries to prepare for the further onslaught of customers the company expects in the near future.

Just how quickly has his company grown? Stamps.com has added more than 100 employees in three years. And that's caused some sharp growing pains. For starters, it's wreaked havoc on the company's leasing options. Stamps.com began in an office designed for four, maybe five, people. Then they moved to an office for 10. In August 1998, Green relocated to an office with 8,000 square feet; three weeks later, it was filled to capacity. So they leased the office next door--with the same amount of space--and filled it right away. They've recently moved again and signed a long-term lease for an office space of more than 40,000 square feet. (The secret to keeping your sanity in a similar situation? Find a real estate agent who specializes in short-term leases.)

You'd think Stamps.com's business plan has been worthless, but Green says that's not the case. "Strategically, we haven't left [the business plan] that dramatically. Execution-wise, in terms of the number of people and the amount of dollars needed, the dates we thought you were going to do things--nowhere close," he says. "You can't imagine how big your company is going to be when you [start off] working with three guys in a room, and you don't even have your own offices. The good news is [when you grow rapidly], you're still succeeding because you're following the initial vision of what the company needs to do or become."

But if your company is going to grow faster than you can fathom, Green advises: "You have to hire people who are willing to jump right in the middle and start sprinting. And you have to let them know that upfront. It's not the most nurturing environment, [but] if you slow down to teach everyone everything about the company before they start working, you fall behind."

Which mirrors the thoughts of Charles O'Reilly, a professor of human resources management and organizational behavior at Stanford University. He believes the least rigid corporations will rule the day. "There's all this rhetoric about the learning organization--frankly, the secret is how to unlearn. If you really want to be fast, you have to unlearn," contends O'Reilly. "When we say that an organization learns, what we really mean is it develops processes and systems, and that's great. But if those systems stop you from moving in new directions, they're deadly."

This article was originally published in the September 1999 print edition of Entrepreneur with the headline: Speed Freaks.