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

• A startup founder said that leaner teams may not be the right approach for every company in the AI era.
• Chatbase CEO Yasser Elsaid said he plans to double his 40-person team within six months.
• AI models are “extremely smart and capable, but not fully independent,” he told Business Insider.

As some companies race to use AI to shrink their teams, one startup founder is going against the grain by planning to hire more people.

Yasser Elsaid, the founder of customer-service AI startup Chatbase, said the company now has 40 employees and plans to double its team over the next six months.

“I might have been wrong about building with a lean team in the age of AI,” Elsaid wrote in a post on X this month.

Elsaid previously embraced smaller teams. In a LinkedIn post in January, he said Chatbase, a San Francisco-based startup that lets companies build AI agents for customer service and support, had stayed at 17 full-time employees for much of its first three years, with most hires in engineering.

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

“I think it’s a big mistake for founders to live in a future that doesn’t exist yet,” he said.

But Elsaid said that this conclusion only holds if a startup keeps the same roadmap it had before AI. Rather than accept that code had become a commodity, he decided Chatbase should set its sights higher.

“If building is easier, build harder things,” he said. “Most moats in software come from someone doing something hard for longer, and being right. That hasn’t gone away.”

‘Not fully independent’

The same logic has powered the “tiny teams” startup trend: OpenAI CEO Sam Altman has predicted a one-person billion-dollar company, while Cursor grew from $1 million to $100 million in annual recurring revenue in under a year with fewer than 50 employees, according to private market research platform Sacra.

But Elsaid said the best models are not yet independent enough to replace people. They still need humans to decide what to build, give them direction, and make sure the result works for customers, he said.

“Code is largely right or wrong: it does what you want or it doesn’t,” Elsaid said. “But what to build, how it should work and what the experience should feel like is what makes your product different.”

He estimated that about 90% of Chatbase engineers’ work is now product work: researching, talking to customers, forming an opinion, and turning that into a specification an agent can code.

The rest requires engineers who can understand the code and make sure different AI agents are not working against each other, he said.

Chatbase is also hiring customer-facing staff, particularly in sales and customer success, he said, because enterprise customers still need to be heard and persuaded.

The models are “extremely smart and capable, but not fully independent,” he added. “Maybe that changes and one day you won’t need humans in the building process at all. But that isn’t today.”

Read the original article on Business Insider