What is Startup Culture and How to Create It in 5 Steps


Culture is a hot topic in the startup world.

In some young businesses, culture develops naturally based on the personalities and working styles of the founding team. In others, culture is an intentional decision.

It can be the reason why startups thrive or why they fail. Culture can also be the difference between attracting top talent and average talent.

Startups benefit from being able to create their cultures from the ground up. In established companies, it can be hard to cultivate a new way of existence after years of operating and behaving in a certain way.

As a fast-growing business, it’s important to decide who you want to be when you grow up early on. You need to create the space for your founding team to discuss what it wants the culture to be and how it will come to life. Otherwise, you’ll find yourself years down the road working in a company that doesn’t look anything like the one you envisioned. 

Below are five keys to creating the ideal culture for your unique startup.

1. Choose What to Reward (and What to Punish)

So much of a company’s culture is determined by what you celebrate. If you celebrate effort, you’re more likely to build a company of hard-working employees. If you recognize achievements, you may foster a group of results-at-all-costs individuals. 

If you let gossip run freely, you send the signal, intentionally or unintentionally, that it is okay to talk about peers behind their backs. If you discourage pushback or debate, your employees could become “yes” people who agree to everything superiors put forth, even if they don’t support decisions on a personal level.

Think intentionally about what kinds of behaviors you want to encourage on your team. Reward the good and punish (or address) the bad. If you do this consistently, your employees will internalize the culture and orient themselves accordingly.

2. Align Culture and Vision

Your company’s culture should align with the overall branding and purpose of your business. You want to present a united front to the external world that matches what employees experience internally.

When culture and vision don’t agree, it can confuse both customers and teammates. For example, you don’t want to build a serious and stiff workplace if you sell children’s toys. It won’t work. Employees will feel the tension, and many will leave as a result.

Make sure who you are as a startup is consistent starting Day 1. When culture and vision align, powerful brands are born. Southwest Airlines does a fantastic job of this. 

3. Create a Culture Scorecard

When building a company culture, it can be helpful to create a scorecard or tool for measuring how well you are doing based on your goals. 

Although it may seem silly, put into writing what characteristics you want to define your culture. If you want to establish a culture of openness and honesty, put those “metrics” in a table and grade your startup continually. Evaluate anything below a B for correction.

Revisit your culture scorecard often and distribute it widely. Make sure everyone understands precisely what you are aiming for so that they can support the cause. If you keep your goals or metrics a secret, you can’t expect change to happen. Team members need to know what they should be aiming at if you want them to hit the targets. 

4. Evolve Over Time

Startups do change over time. They mature as they discover more about themselves, customers, and market dynamics. As a result, company culture may need to evolve in step. 

It’s okay if your business needs to go in a new direction. Be sure to communicate openly about what it will mean for everyone going forward. You may lose some talent as you tweak your culture, but if it’s the right move for the business, it needs to happen. 

Your leadership team could also realize one day that one particular aspect of the startup’s culture has produced unintended consequences. For example, rewarding effort may inadvertently entice people to spin their wheels on projects when it would be better for them to seek assistance. An employee may see you celebrate hard work and shy away from asking for help for fear of looking lazy.

This is why it’s so important to keep tabs on your process and check in on your culture regularly. You can catch issues early and address them before they create other challenges.

5. Hire Through a Cultural Lens

There are some things you can teach when it comes to culture. But, not all talented hires will be natural fits for your business. 

Sometimes, it might make sense to turn down an extremely experienced person whose personality or values don’t align with your company’s cultural vision. It’s easier to make these decisions if you hire good cultural fits consistently. Discerning a “good” fit from a “great” fit isn’t as hard when your office is filled with other “great” fits. 

As a fast-growing scale-up, you likely can’t invest the time and resources necessary to get this right every time. It’s often better to bring in outside help, like Funded.club, to help take care of this critical piece for you.

Our recruiters take the time to learn the nuances of your company’s culture so that they can speak your language and represent your brand well. As entrepreneurs, we understand how important it is to make the best possible hiring decisions every step of the way. 

To learn more about Funded.club’s recruiting approach, contact us today

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