Flat org structures are outperforming layered hierarchies, and the productivity numbers explain why

Tom Verrilli, who leads product at Whatnot, has heard the warning many times: stay hands-on and you will not scale. What Whatnot found, he says, is that the warning was wrong. Leadership staying close to the work can scale. The layers do not have to come.

Verrilli’s challenge to conventional org design goes further than a general principle. He asks whether the total compensation required to run a standard product hierarchy, five individual contributors reporting to a senior manager, four senior managers reporting to a vice president, might be better deployed on three people paid at the VP level and trusted to carry that full weight. The arithmetic is simple. The organizational implication is not. Most companies that face the choice add the pyramid anyway.

David Haber offers a striking data point in this direction. His company operates with no product managers. The routing of product decisions to other roles is not a gap in the organization; it is the organization. Evan Spiegel, Snap’s co-founder, arrived at a related but distinct position. As Spiegel put it, “My view was not that we don’t need PMs. My view is that designers should do that work.” That is a structural reassignment rather than a headcount argument, and the distinction matters. Spiegel is not saying the work disappears. He is saying the org chart determines who owns it.

One of the things that folks have been telling us for a long time is yeah, that won't scale. oh, leadership isn't going to be able to stay hands-on with what's going on. You're going to need to go and hire tons more layers and what we found is that's not true. Tom Verrilli

What gives these structural experiments more traction now than they would have had a few years ago is the change in individual productivity that tools are enabling. Patrick Collison, Stripe’s chief executive, puts it plainly: a single engineer can do what two teams of engineers could do two years ago. Mark Cuban makes the same point across a longer time horizon and in dollar terms, noting that two or three people are now building software that, five years ago, would have cost two or three million dollars a year to produce. When output per person rises at that rate, the traditional justification for adding coordination layers, that more people require more management, rests on assumptions that no longer hold.

The counterargument to all of this is that flat structures impose their own burdens. Without clear management chains, accountability can diffuse and decision-making can slow in ways that are hard to diagnose. That tradeoff is real. But the companies making the flat-org case are not arguing for the absence of leadership. The argument, in each case, is that leadership should be hands-on and that the work of coordination should live as close to the work as possible, not in a dedicated layer above it.

What connects Verrilli’s comp thought experiment, Haber’s PM-free operation, Spiegel’s redesign of ownership, and Collison and Cuban’s productivity observations is not a shared ideology. None of them are making a purely philosophical case. Each is describing an outcome. The traditional justifications for adding organizational layers were, in part, a response to the real limits of what individuals and small teams could do. Those limits are moving. Companies that have already reorganized around that reality are not waiting to see whether the movement stops.