when the hell is this ever ok? even for a to-do list app. The closest we will come to this is a screen-sharing session with the customer
There are many types of applications where that level of privacy would not be okay. But actually protecting the users' privacy is non-trivial. Short of encrypting all user-provided data, I don't see how you could prevent every startup employee from seeing any data.
Larger companies usually separate their operations and development teams, partially for this reason. Developers aren't allowed to access production data or servers. That at least limits the number of people with access to a trusted few, at the cost of a substantially more complicated development/release process.
As long as the action is logged it doesn't seem worse than anything else.
Organisations (usually relatively small ones) where everyone can be root or access any user's file in the database so they can Get Things Done sound great, right up until the point where it turns out you hired the wrong person, they did something naughty with your database, and your whole organisation and/or its executives personally are sent to live in legal/regulatory hell for months/years/ever.
Prep for scaling should be something like;
1. testing to see when you'll need to
2. monitoring so you know when
3. planning before you reach date / time from #2 how you'll do it
5. test you've done #4 properly
7. repeat the whole process
Work out a methodical way that makes sense. "Setup a caching layer" is not that.