Here's my belief of why startups, and even larger companies in general, struggle with innovation as they scale their team.
If you think of a startup founder, they have no choice but to innovate to survive. They're trying to do what's not been done before, and have the mindset to be the one to do it (hence why they found a company). Their main concern is product market fit and cash.
It's when a company expands beyond the founders and they need to delegate innovation down to the team that innovation is at risk. It's now the team's responsibility to carry the innovation forward.
But they have a new problem that the founders did not have.
Individual Contributors (members of the team) have the fear of making a mistake that could cost their job or reputation. So they start to make safe bets. They innovate within the rules of 'is it logical' and 'will I get fired if it goes wrong'.
To answer if it's logical, you have to compare it to what's been done before, and as a result, you limit your innovation to incremental gains, not huge leaps. As for costing their job, it resorts to 'I wont get fired for making a logical decision'.
So what happens? Innovation slows down. It becomes incremental. The team end up with a culture of supporting only logical decisions that are safe. The only ones who can do something about this are the founders, by creating a culture of safety and vision.
What are your thoughts? Do you agree or disagree? Have you seen this first hand, or is there something else that can slow down innovation?