The Problem with Scaling

Over the last few decades, I have watched a pattern repeat itself over and over.

Someone sees a problem in the world and creates a different way of doing things. They build something rooted in relationships, trust, care, community, or stewardship. It works. People are inspired. The idea spreads.

Then comes the inevitable question: How do we scale it?

We see something working and almost immediately begin asking how to make it bigger. More capital. More markets. More growth. More efficiency.

But what if that isn’t always (ever?) the right question?

What if some things work precisely because they remain in relationship with the people and places that gave rise to them? What if they need to stay embedded in their communities, responsive to local conditions, and accountable to real people?

What if, instead of trying to scale everything, we allowed more things to grow organically and trusted them to find their own right size?

A right size that emerges through relationship rather than expansion.

A right size that stays connected to context rather than being extracted from it.

I’ve been thinking about this recently because so many people are asking how we build alternatives to systems that are no longer serving us. The assumption often seems to be that we need to replace one giant, scaled-up, globalized system with another.

But is that what we really want?

Before we rush toward bigger, faster, and more scalable, it might be worth looking at what happened to some of the pioneers who came before us.

The Body Shop

Founded in 1976 by Anita Roddick, The Body Shop was one of the first globally visible examples of a business attempting to prove that commerce could be a force for social and environmental good. Ethical sourcing, opposition to animal testing, activism, and fair trade were not marketing campaigns. They were core to the company’s identity.

In 2006, Roddick sold The Body Shop to L’Oréal for £652 million. The sale was immediately controversial because many customers saw a conflict between The Body Shop’s values and those of its new owner. Boycotts followed, and many observers felt the company gradually drifted from its founding ethos.

Nearly twenty years later, after multiple ownership changes and a final sale to private equity, the company entered administration. Many long-time customers point to the gradual erosion of its distinctive values as part of the story.

The Body Shop was one example among many. Odwalla, later sold to Coca-Cola, followed a similar path.

The B Corp Response

The repeated loss of mission through acquisitions in the 1980s and 1990s helped fuel interest in structures designed to protect purpose. The B Corp movement emerged from a recognition that if the mission wasn’t legally embedded, financial markets would eventually override it.

The idea was sensible:

• Put purpose into governance.
• Expand fiduciary responsibility.
• Protect social and environmental commitments.

Yet even this approach has struggled against the gravitational pull of large-scale financial systems.

Pukka and the Limits of Acquisition

Pukka Herbs was built around carefully sourced herbs, relationships with growers, and deep commitments to organic agriculture.

When Unilever acquired Pukka in 2017, the founders spoke openly about finding a larger partner that shared their sustainability goals.

Years later, after Unilever spun off its tea division into a private-equity-backed entity, integration and restructuring followed. The team working on it reportedly resigned en masse.

The details differ from company to company, but the pattern feels familiar.

When mission-focused companies are financed and scaled through traditional financial structures, the mission often comes under pressure. The moment people believe money is being “left on the table,” the pressure to optimize for financial return begins to take over. We’ve seen this happen repeatedly, including with B Corps acquired by larger companies.

Microfinance

The same pattern appeared in microfinance.

Pioneers like Ela Bhatt and Muhammad Yunus demonstrated that people excluded from traditional banking could successfully lend to and support one another.

What began as a relational innovation rooted in trust, community accountability, and local context gradually became an investment asset class in many parts of the world.

The original innovation wasn’t tiny loans. It was relationships.

Once community accountability and trust became secondary to growth targets and investor returns, many programs drifted far from their original purpose. Today, microfinance loans carrying interest rates of 28% or more can be found around the world.

The result is often predatory lending and more extraction, the very thing the movement was originally designed to address.

The Lesson I Keep Coming Back To

A few years ago at Coralus House, we hosted a conversation about rotating savings and loan circles (ROSCAs) with Caroline Hossein who wrote about them extensively in The Banker Ladies.

They exist all over the world. Known as Susus, Pardners, Hagbads, Tandas, and many other localized forms of capital flow. Over 500 hundred million people participate in these alternative finance systems. 

They’re 100% relationship-based and rooted in community.

As we discussed them, people said we need to have more of these, get the word out. But do we? I think from a storytelling perspective, something that is working and in a strong relationship field is a signal for us to pay attention to – in this case, there are other ways of doing the economy. 

The warning to us is to be careful of our conditioning  when we discover something that works through relationships, our instinct is to extract it from its context, package it, financialize it, and scale it.

And then we wonder why it stops working.

We have seen this many, many times through the hundreds of ventures we have funded at Coralus.

Perhaps We Need a Different Question

What if the goal is replication, not scaling?

What if the goal is helping a thousand locally rooted versions emerge?

What if resilience comes not from bigger systems but from more living systems?

Perhaps the future isn’t one giant network. Perhaps it is a mycelial one. Many nodes. Many stewards. Many places. All connected through shared principles rather than centralized control.

At Coralus, we are midwifing a new relational field. And perhaps one of the most important practices is learning to recognize when growth strengthens relationships and when it begins to strip them away.

Maybe the opposite of scale isn’t small. Maybe the opposite of scale is relationship.