You've seen those graphs about how lines of communication explode combinatorically. Once an organization hits ~20 people, if they're all communicating directly and keeping up to date with everything they need to know, everyone could be spending every minute of their day communicating and not getting any other work done.

In order to cope with the communication overhead, larger corporations add management hierarchies that maintain linear communication "vertically" and smaller group sizes for "horizontal" communication. They also add processes that decrease or streamline the amount of communication necessary. Management and process are necessary to keep the company from grinding to a halt under the weight of its own communication overhead.

However, management and process even when done well will add a certain amount of overhead and slow things down. Less than they would if every engineer had to check with everyone in Sales and Marketing before deploying any change in order to make sure that a deploy wouldn't disrupt a major campaign. More than you and your two co-founders sitting next to one another and asking "hey, I'm gonna deploy the Foo feature now - is that cool?" And when done poorly, management and process slow things down even more.