Not that I have a rigorous source, but I feel we can generally agree the following:

New hires take anywhere from 3 months to 8 months or more depending on the position to ramp up

During ramp up period, there’s a productivity toll taken on the team via teaching the new hire

Thus during this time, productivity is hampered

——

For culture, I think it’s a bit more subjective. But if you have a team of 5 who then gets 1 new hire to teach over 6 months, generally it allows them to “mesh” better in the culture.

Both in terms of team mates learning about the new hire, and the new hire having room to fit in within the culture, and bring their own value to the team (assuming an already existing good culture.

Now say you have 3 new hires on a team of 5. If we further presume productivity is also hampered more as more people are onboarded at once, that creates additional stress on the team to teach them.

Further, it could be harder to have the new hires feel part of the team if less time is spent getting to know each one. But assume this isn’t the case:

Business will most likely expect at least the same productivity from the team. Now they’re stressed from teaching, higher expectations on their output (onboarding a team member is tiring work), and the business is going to soon expect productivity to increase further after headcount is upped by over 50% in this example.

Now take that, and add on new teams created to interact with, additional communication layers, and it’s pretty straightforward to assume growing too fast can be negative

Cash flow solves everything, or profit solves everything are perhaps better phrases, since apparently people forgot that the purpose of a company is to make profit, not just revenue.

You can have run a company for zero profit and it can still be a benefit to society, so no the "purpose of a company is to make profit" is not necessarily true.

"If we want to know what a business is, we have to start with its purpose. And the purpose must lie outside the business itself. In fact, it must lie in society, since a business enterprise is an organ of society. There is only one valid definition of business purpose: to create a customer. The customer is a foundation of a business and keeps it in existence. The customer alone gives employment. And it is to supply the customer that society entrusts wealth-producing resources to the business enterprise.

Because it is the purpose to create a customer, any business enterprise has two – and only two – basic functions: marketing and innovation. These are the entrepreneurial functions. Marketing is the distinguishing, the unique function of the business."

- Peter Drucker

> You can have run a company for zero profit and it can still be a benefit to society, so no the "purpose of a company is to make profit" is not necessarily true.

On one hand, fair. Technically correct.

On the other hand basically all laymen use the word "company" to mean for-profit corporation, and pretty much everyone who wants to talk about corporations that are designed not to make a profit use the term "non-profit".

I think you've ignored the context in which the comment was made.

> I think you've ignored the context in which the comment was made.

I would argue you did. The parent was being pedantic about the saying "revenue solves everything" and tried to make seem as if profit is the be-end-all. My overall point is still consistent with Drucker's "the purpose of a company is to create customers". If you're in a bull market and you hire like crazy to achieve the creation of customers, then hiring like crazy is NOT WRONG.

> On the other hand basically all laymen use the word "company" to mean for-profit corporation

P.S. - Amazon ran without profit for 10 years. Did we magically call them a non-profit for 10 years and then a company thereafter?

> and tried to make seem as if profit is the be-end-all

That statement was paired with a teleological statement about the purpose of a company. When paired with the common usage of the word "company", the statement becomes tautological. Admittedly, this isn't the most insightful realization ever, but the point from the comment was that people forget that a profit needs to be extracted.

> My overall point is still consistent with Drucker's "the purpose of a company is to create customers".

And, pray-tell, why do you think companies want customers, if not for eventual profit?

> Amazon ran without profit for 10 years. Did we magically call them a non-profit for 10 years and then a company thereafter?

Amazon made an intentional decision to re-invest profits, as a gamble that it would lead to greater profits later. That's not refraining from profit, but just operating on a time-scale that isn't quarter to quarter.