A tech founder says he was 'pretty wrong' about lean teams in the AI era

As several companies competition to use AI to shrink their teams, one startup originator is going against the kernel by preparedness to employ additional people.

Yasser Elsaid, the originator of customer-service AI startup Chatbase, stated the business now has 40 workforce and plans to twice its squad complete the next six months.

"I power have been incorrect concerning construction alongside a lean squad in the age of AI," Elsaid wrote in a article on X this month.

Elsaid earlier embraced smaller teams. In a LinkedIn post in January, he stated Chatbase, a San Francisco-based startup that lets companies build AI agents for client assistance and support, had stayed at 17 full-time workforce for much of its archetypal three years, alongside most hires in engineering.

However, in comments sent to Business Insider, Elsaid stated that he now considers his bet on lean teams "pretty wrong."

"I think it's a big error for founders to live in a forthcoming that doesn't be yet," he said.

Elsaid stated that additional capable coding models, including Anthropic's latest Claude example Opus 5.5, initially made him think Chatbase could get by alongside small people.

But Elsaid stated that this decision lone holds if a startup keeps the identical roadmap it had before AI. Rather than obtain that code had rotate into a commodity, he decided Chatbase should set its sights higher.

"If construction is easier, build harder things," he said. "Most moats in application arrive from person doing item difficult for longer, and being right. That hasn't gone away."

'Not completely independent'

That perspective runs oppose to a broader shove toward AI-powered lean teams.

Block cut nearly half its workforce in February, alongside CEO Jack Dorsey saying AI and "smaller and flatter teams" were changing how companies are built.

Coinbase, meanwhile, cut 14% of personnel in May, citing engineers' capability to ship in days what formerly took teams weeks; it is now evaluation smaller AI-native pods and "one individual teams."

The identical logic has powered the "tiny teams" startup trend: OpenAI CEO Sam Altman has predicted a one-person billion-dollar company, during Cursor grew from $1 myriad to $100 myriad in annual recurring income in under a twelvemonth alongside small than 50 employees, according to personal market investigation phase Sacra.

But Elsaid stated the finest models are not yet autonomous adequate to substitute people. They motionless need humans to decide what to build, provision them direction, and create certain the outcome plant for customers, he said.

"Code is mostly correct or wrong: it does what you desire or it doesn't," Elsaid said. "But what to build, how it should activity and what the cognition should awareness akin is what makes your merchandise different."

He estimated that concerning 90% of Chatbase engineers' activity is now merchandise work: researching, talking to customers, forming an opinion, and turning that into a specification an delegate can code.

The remainder requires engineers who can comprehend the code and create certain distinct AI agents are not operating against all other, he said.

Chatbase is additionally hiring customer-facing staff, particularly in revenue and client success, he said, since endeavor customers motionless need to be heard and persuaded.

The models are "extremely astute and capable, but not completely independent," he added. "Maybe that changes and one day you won't need humans in the construction procedure at all. But that isn't today."