Stop pretending it’s all a party: The social contract of working at a startup. By Sarah Lacy On June 25, 2013 Perhaps it’s because I’ve worked my whole career in media and startups. But I’m having a hard time getting super lathered up about Bloomberg’s takedown of what it is like to work at Fab. Don’t hang your jacket on the back of a chair? Don’t use a certain font in emails? Those are friendly suggestions compared to having to walk into the Conde Nast building everyday. Conde Nast gets away with this, because fashion is core to its brand. But let’s not stop at Conde Nast. And while we’re at it….how about Bloomberg? Companies are living organisms. Startups are like newborns.
Startups are raw outgrowths of founders’ personalities, pure and simple. This isn’t just true when it comes to creating companies. Companies like Yahoo and Google and Facebook and Fab and Airbnb and Github aren’t just reinventing their industries, they are reinventing what it’s like to work in a major corporation in America. Right or wrong, I laughed when I read this in Goldberg’s blog today: Never, Ever Compromise: Hiring For Culture Fit. Your company culture is the foundation on which everything you do rests. Your culture acts as an unwritten set of rules that drives behavior and cohesion across the company. Cohesive, insular cultures are more resilient and can withstand shocks to it (e.g. pivoting multiple times) as well as can be extremely motivational / draw out the best in people (e.g. engineers at Palintir sleeping under their desks in their belief they are helping national security, the emergence of Google's "don't be evil" doctrine).
Bad Culture Fits Lead To Pain Most companies do a poor job of enforcing a common culture or are willing to sacrifice the cultural aspects of who they hire in order to "get someone effective" or "to fill a need". This typically backfires in a big way over the short to medium term. How To Build A Strong Culture Have strong hiring filters in place. Hiring For Culture Fit For an early stage, raw startup, your hiring focus should be on homogeneity. 1. 2. 3. 4. 5. 6. 7. B. THE STATE OF GOOGLE. Hack week! For all of last week, the Dropbox office was transformed into a gigantic open workshop for our first annual Hack Week.
Hack week is a dedicated week for members and friends of the team to work on something entirely new, while turning some of the ideas that have been brewing in the back of our minds into reality. This gave everyone the chance to work on projects that might not fall under their team, and opportunities to work alongside Dropboxers they normally couldn’t.
The idea was for everyone to dedicate themselves to pure creation and construction of Dropbox projects that were engaging, complicated, and most of all, fun. Complementing Hack Week were a variety of activities including: C type declaration bee, ping pong tournament, DDR tournament, and a drawing contest. Also, many friends of Dropbox hung out for the week to help with some of our projects. To view the rest of our Hack Week photos, head to our gallery. Dropbox Rewind [Coming soon to a Dropbox near you!] The Cover-Up Culture. In a startup “Good news needs to travel fast, but bad news needs to travel faster.” There’s something about the combination of human nature (rationalization and self deception) and large hierarchical organizations (corporations, military, government, etc.) that actively conspire to hide failure and errors.
Institutional cover-up’s are so ingrained that we take them for granted. Yet for a startup a cover-up culture is death. In a startup founders and the board need to do exact the opposite of a large company – failures need to be shared, discussed and dissected to extract “lessons learned” so a new direction can be set. Lie to My FaceThe first time I saw a corporate cover-up was as a new board member of a medium size public company.
It would have been so much simpler for him to say, “We’re screwed, and I need your help.” Cover-up Or Look Like an Idiot In large companies executives are hired and compensated for pristine and efficient execution. Lessons Learned Listen to the post here: Doing the Right Things is More Important than Doing Things Right. Yesterday I wrote a post about top-down versus bottom-up thinking. There is a corollary to that advice, which is “doing the right things is more important than doing things right.” Sounds simple but in practice I promise you most organization fall into the latter trap. Here’s how it goes: You have a business development group with two people. They are tasked with “getting deals done” so they race around talking to tons of potential partners inking anything from channel sale deals, product integration, international distribution agreements, co-marketing arrangements, M&A discussions, etc.
You have a marketing department with three people. When you hire people in functional roles they want to show that they’re achieving results and results are easiest to measure by tasks accomplished. So many CEO’s just carry on being … CEO’s –> fund raise, get media attention, attend conferences, hire staff, “set direction”, whatever. Let me give you an example. . - with whom are we trying to communicate? Events Often Overtake Companies. I've found myself saying "events overtake companies" a lot this week. I'm not sure exactly why it was the phrase of the past week, but I did spend a lot of time talking to entrepreneurs running businesses that are growing rapidly, causing the founders to rethink their strategic plans. I think less than 20% of the companies we back end up doing what they started out planning on doing. They build something, get it into the market, and then things happen.
Often it turns out the market wants something a bit different than they are offering. Or that the users adopt one part of the product and don't use another part very much at all. There are two big takeaways from this for me: 1) Don't get too attached to your strategic plan. 2) Don't spend too much time on planning. I would spend as little time as possible on the planning and focus instead on turning their prototype into a working system and getting that out into the real world.
StartupCFO: Which F1 driver are you? Hiring: Lack of Diversity Becomes Self-Reinforcing - Continuatio. Hiring: Lack of Diversity Becomes Self-Reinforcing The first startup I was involved with was a management consulting company in Germany. I had been out of college for less than a year when I joined four much more experienced guys in forming Bossard Consultants Germany (some initial funding was provided by Bossard France, a well established consulting firm there).
We got off to a great start, landing some premier clients such as Lufthansa and Porsche. The firm grew rapidly and we hired a lot of very smart guys to join the team. Notice a pattern here? I am writing this because I see some startups these days going down a similar path. Should Founders Be Allowed to Take Money off the Table?
This is part of my ongoing series “Start Up Advice” but I’d really like to call this post, “VC Advice.” If a company has reached a level of success, has been around for a few years and you believe the company has potential to break out into a much bigger company then you should let the founders take money off of the table. It’s that simple. Only then are you truly aligned. Not FU money, but “feed the family” money. And to be clear – I believe it is also in the VC’s interests. I think too many VCs simply don’t understand this. I know this is a controversial topic. Let me start with a couple of stories.
A friend of mine is a serial entrepreneur and is running a high-profile, early stage company in NorCal. We were trading emails on a recent rant posted on The Funded about founders’ equity and here is what my friend wrote to me in our exchange (printed anonymously with his permission): I agree 100% with my friend. I know because I’ve been there. Fast forward to my second company. Uh Oh. Not Another “Don’t Be Evil” Company. Long ago Google unofficially abandoned the Don’t Be Evil mantra and replaced it with, no kidding, an “evil scale.” Sometimes you have to chose between the lesser of two weevils, as Patrick O’Brian would say. And frankly, just staying this side of decent is enough for most companies. So when Twitter CEO Evan Williams said earlier today that one of Twitter’s operating principles was to “be a force for good” I cringed a little.
One of the most important lessons I’ve learned in business, and am still learning, is to never trust anyone who says “you can trust me.” That’s a big red flag that they’re planning something really messed up in the near future. And likewise, a company shouldn’t be out there saying “don’t be evil” or “be a force for good.” First because it’s basically impossible to balance a profit motive with a goodness motive. Why I Sold Zappos.