Tuesday, May 22, 2007

Lesson #21 - Create a Culture

Of all the startups I have been a part of as a founder or investor - I always found the ones that succeeded had an X Factor that was not something that could not be manufactured - it just happens. For lack of a better name - I call it "culture".

Here is a definition of Culture that I think describes exactly what I see in successful startups

"The system of shared beliefs, values, customs and artifacts that the members of society use to cope with their world and with one another"

When a culture doesn't develop in a company - there is something wrong. I realize this is a very general statement, and I am sure their are exceptions - but from what I have seen culture thrives when people are engaged, happy and motivated to do whatever it takes to succeed.

Lets take a minute and break down the definition above, so I can add some color to the definition of startup culture.

1. Shared beliefs - A startup is 95% trust. Everyone knows a startup is risky, and when you cut through all the hype of any early-stage company - there is a high likelihood you may not see a paycheck next month. The only thing that keeps people from going insane is the shared beliefs. The job of a CEO is to show a path to success and have everyone believe it is achievable. If one person doesn't believe - its like a virus of doubt that will spread throughout an organization - and ultimately kill a company's culture. Everyone needs to believe.

2. Shared values - Everyone in a startup must share the same values. In a dynamic and hectic environment where everyone is pushing the rock up a hill, you can't afford to have someone pushing in the opposite direction (or not pushing at all). Core values like honesty, hard work and team work are always critical - but more importantly values like self-sacrifice are what makes good companies great.

3. Shared Customs - Every time I see a custom develop in a startup (no matter how ridiculous or immature) I see culture personified. Whether its someone ringing a bell when they close a deal, or everyone watching a movie together on Friday nights - a custom is the voice of culture. It ties everyone together in a simple act. There is no culture without customs.

4. Shared Artifacts - Every culture marks history through artifacts. Artifacts are the physical representation that capture a moment in time and allows people to savior the memory of how they felt that day. A common artifact of every startup is the first purchase order or first dollar of revenue. Highlight your successful milestones by creating artifacts. There is nothing more motivating than remembering history and appreciating the investment of hard work and time you have made and reminding you of the work that needs to be done.

And finally, the last part of the definition which I think is highly relevant - "use to cope with their world and with one another". What a realistic statement. The word cope is a great combination of acceptance and patience. Culture is not easy. Some people may feel that the "shared customs" are sophomoric or feel that the developers don't share the same value system as the sales team. Friction is a part of culture and needs to be acknowledged and accepted. Sometimes the differences in each person are what brings us together and enable each person to contribute and make the culture personal and unique.

1 comment:

Gauri Shankar said...

wonderful post...
surely useful!!