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"Getting everyone in one room together is a tradition that starts when a company is small, and often it continues in the same format well past the point that it's an efficient use of everyone's time. For a tiny startup, you can go around the room and have everyone talk about what they're up to, and coordinate who's doing what. It has a kind of charming informality, and since there aren't too many people there, it's not going to take too long.
As a company gets bigger, that format starts to break down, usually at around 10-15 people."