November 19th, 2014

Culture in the Early Days

A few days ago, I had the opportunity to tour Zappos, along with my colleagues, and speak with Tony Hsieh about what has made Zappos different. Zappos is known for its quirky, happiness culture where customers can have two hour conversations with customer support representatives, and where employees gleefully shake tambourines to welcome tour participants.

Culture is deeply important to Zappos, and it continues to be critical to their wild growth. Zappos’ culture centers around highly intentional human interaction – from the way they approach small talk with customers to the way snacks are laid out in the office (drinks are on even floors, treats on the odds – so employees meet each other).

On the flight home, I started to dig deep into how culture is expressed in an early-stage startup. Here’s what I came up with:

Culture will happen

Culture is critically important in the earliest days of a startup. It can be the catalyst for success… or a disease that slowly rots and decays until the company dies.

Culture will happenwhether you like it or not. It can get the team through the tough times and unify them in their successes. Whenever more than two people spend a lot of time together, a culture will develop. Thus, you can’t ignore it… you have to craft it.

Intentional culture

Intentionally-crafted cultures always start at the top. Culture defines the product vision, the prioritization of design and engineering, your behavior towards customers, the pace in which your company moves and how employees treat each other.

I’ve found that a good early-stage culture revolves around two core values: trust and respect. Your startup is constantly in a fight for its life, and there’s no room for neither ineptitude, nor diminishing issues under the guise of being affable.

For your team, respect comes first, and trust follows much later. Building a respectful and trusting culture requires a few initiatives:

Build the right team

Many have tackled this topic, and for good reason: It’s essential to ensuring that your initial team works together like clockwork.

Don’t just fill the spot – even if he is the only iOS developer you’ve found after months of searching. Spend a lot of time with candidates. Invite your team members to spend individual time with candidates over coffee. If a team member expresses any hesitation, you should probably pass. I’ve found that the best startup employees have these qualities:

  • Tenacity and drive
  • Exceptional skill at their craft
  • A keen sense for product, engineering, design and market
  • The ability to change their opinion when presented with new data
  • A growth mindset
  • Humility

Quickly remove those who don’t live up to your standards, or the standards of your team members. Startups require an abnormal temperament, and many aren’t up to the task. That’s OK, as long as you identify your hiring mistakes and deal with them quickly.

Team members will blow it

Every hard job, especially where problem discovery is involved, no doubt includes some failure – perhaps even spectacular failure. Clever individuals will realize their mistakes via continuous examination (and even before presented with outside data). But sometimes it takes a customer interaction or team member to point out a deficiency.

If someone screws up, give them the opportunity to fix the problem.

Individuals who iterate until they succeed; who always work to fix their mistakes and make the product better, will earn the trust and respect of their team members.

Encourage respectful debate

Early startups are in “Discovery Mode” – the search for a product and business model that will achieve exponential growth. Since there are so many unknowns, all assumptions need to be rigorously challenged. Agreeableness often masks inconvenient truths, so foster an environment where every team member can challenge any initiative or assertion.

Respectful debate never comes at personal expense. Your team members’ arguments should be about ideas rather than people. Don’t tolerate assholes. If a team member is habitually berating another, or leads into debates with ad hominem attacks, he should be removed immediately.

Often this distinction hinges on language. In potentially contentious design critiques, I’ve banned certain phrases that frame criticism as personal:

  • Instead of, “The way you did this will cause users to leave.”
  • Say, “I believe this interaction will cause user drop-off because it obscures the primary call to action.”

Sell Your vision…

You started your company based on a vision – an opportunity only you saw in the marketplace. Each individual on your team initially took the job because they were at least partially bought in. As you hit obstacles, doubt might creep in. To ensure your team is unified, you must reenforce this vision and ensure alignment with your team on a daily basis.

Your team will build on your resolve with a shared sense of mission, and they will begin to trust each other to do their individual jobs. Since everyone is working towards the same end-goal, objections and critique will naturally center on tactics instead of personal agendas.

…But also test it

Even repeat entrepreneurs rarely get their theories right out of the gate. To spare everyone the pain of latent failure, rigorously test your assumptions early and often. The Founders’ job is outbound – so you’re the first to encounter customers who just aren’t there; changes in the competitive landscape; government regulation… or any of the myriad of reasons your startup might fail.

Team members can sense when the train is going off the rails.

Be intellectually honest, and willing to modify your vision as soon as you encounter a major blocker. This ultimately leads to trust in your ability to execute.

Respect the foundation

Culture may start at the top, but it rests on the foundation of individual team members.

Its tempting for founders to think that the success of your company rests completely on their shoulders. Startups are best played as a team sport, where each individual is trusted by the “coach” to take high-level direction and make the right call on the field.

Trust is asymmetrical. Founders need to proactively trust their team early. Your team will begin to sense your confidence in them, and they will take the right risks by utilizing the full potential of their unique experiences and perspectives. Allow them to make autonomous decisions and stretch themselves a bit.

Your team will begin to trust you, the more you trust them. A good sign your team trusts you is if they occasionally come to you and disagree about key initiatives. On the contrary, you’ll find very little disagreement if you’re too controlling, because your team will be afraid to approach you.

By joining your startup, your team is giving you a gift – the most precious years of their careers, to make your vision a reality. If you respect your team, you’ll carefully investigate their concerns.

Ultimately, founders are responsible to their investors and customers. If you decide to go against the advice of your team, you should be able to carefully articulate why the team should respect your decision and trust your intuitions over their own.