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What is Startup Culture & How to Build It in 2022

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Updated: 
January 5, 2022
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Building a “startup culture” comes with a series of benefits that include easier recruiting, longer employee retention, higher workforce motivation, greater productivity, and less frequent mistakes.

In this article, we’ll cover what a “startup culture” is, why it is important, who is responsible for it, and some key points on how to build one.

What is Startup Culture?

First of all, what’s the culture?

The culture of a society boils down to values and interactions amongst everyone and everything. Those values and interactions turn into what we know as the arts, education, institutions, and entertainment. 

In the same way, your work culture or company culture is about the shared company values and those who make it up, as well as the way they interact with each other.

Workplace culture is mostly about the underlying or unspoken psychology of the company, what the company represents, and its relationships amongst its members.

Okay, so what’s startup company culture, then?

Startup culture is a relatively new type of work culture aimed at breaking down the barriers and hurdles of growth that more established corporations might have. 

Startup culture is mostly known for being creative, laid back instead of rigid, and passion-driven.

Characteristics of a Startup Culture

There’re are four key factors that make up the feel of ideal startup culture:

  1. Passion: Is the reason work doesn’t always feel like work and why the long hours feel worth it. It’s what defines the existence of the business and acts as a great motivator for the team.
  2. Personality: Is what makes the startup unique -- what cannot be found anywhere else.
  3. Agility: Is the ability for knowledge and information to flow at a pace that greatly improves all aspects of the business. It’s the more visible factor as it can be identified in the way workers work, offices are organized and brainstorming sessions are carried out.
  4. Authenticity: Has to do with the freedom and respect of each individual’s own identity. Bureaucratic companies tend to have processes for everything and a strict decision-making chain. The opposite is within the startup culture values. 
Startup Culture Factors

Startup culture has also gained both a good and a bad reputation for being perhaps too laidback. Maybe you imagine people playing foosball and sitting around in bing bag chairs with flip flops. The reason these types of things might work depends on the culture, not the environment.

WeWork's Startup Culture
WeWork’s Broadway workspace has both bing bag chairs and foosball. Pretty sure some New Yorkers go with their flip flops. They are just missing ping pong tables!

The work environment is not synonymous with culture. Simply adding a foosball table and free snacks will not solve your work culture problem, but will define your working environment, which refers to the physical attributes of the workspace. 

While the work environment is not the same as the startup work culture, it is important. The environment can either help the culture or hinder it. 

Think about where you work: Can you easily engage the people you need to? Does the lighting make you feel drained or energized? Do you feel confined?


5 Definitions from Founders

While most entrepreneurs may agree on the general concept of a “startup culture”, most of them will probably disagree on the startup culture values.

That’s why here we bring 5 points of view about startup cultures from some well-known founders.

1) Jeff Lawson, Co-Founder of Twilio

Jeff Lawson is the co-founder of Twilio. +4 years ago, he was interviewed on Zurb’s podcast and asked about startup culture. There, he claimed the following:

“Thousands of decisions are made every day in Twilio. Culture is how I, as the leader of the company, trust that each of those decisions is the right one. Another way to think about it is that all those decisions should add up to represent 'the Twilio way', the way Twilio would do these things.”

Then he added:

“Earlier this year, we rolled out what we call our nine things, which are like our core values. Most people think of core values as a thing on the wall and a nice frame with words like 'integrity' that nobody pays attention to. We, instead, have articulated 9 things that we liked and cherished and felt were fundamental to who we were as Twilio.”

2) Joel Gascoigne, Co-Founder of Buffer

In 2012, Joel Gascoigne, co-founder, and CEO of Buffer, wrote an article in his blog describing his view about culture and how it looked like in his company. He claims:

“Although company culture is something that is worked and adapted over time, it is heavily affected by the personalities of the founding team. There’s no right or wrong with culture, it is simply a combination of natural personality in addition to proactive work to push the culture in the desired direction and maintain certain values.”

Then he adds:

“Building a culture that inspired people to work for you, requires time to make changes and shape it. On the extreme of the proactive approach of culture, you can hire and fire people very specifically based on cultural fit with your company”

3) Rand Fishkin, Co-Founder of Moz

Rand Fishkin, co-founder of Moz, has written an article explaining his view on what is and what’s not company culture. He starts by claiming the following:

“Secret Santa gift exchanges, karaoke nights, Nerf gun fights, are not company culture things. Those are things people working together may or may not do and that indicate a specific type of workplace environment, but they are NOT company culture”.

Then, he talks about the three things that he believes that form a company culture:

“Values, those that are stated by words and exhibited through actions; mission & vision, the goals that the company is driving toward and the force behind it; hiring, firing and promotion criteria, the reasons why people join the company, are let go or receive a promotion/reward.”

And mentions something that goes hand in hand with Jeff’s thoughts:

“Actions speak louder than what’s on the company mission statement or the core values list.”

4) Brian Chesky, Co-Founder of Airbnb

Brian Chesky, co-founder and CEO of Airbnb, has also written about the subject, particularly about tech startup culture. He did it on a Medium article titled “Don’t Fuck Up the Culture”; these was the advice given by Peter Thiel to Airbnb’s team after the company had raised $150M in series C.

On that article, Brian shares his view on how culture should be built:

“We’ll build it by upholding our core values in everything we do. Culture is a thousand things, a thousand times. It’s living the core values when you hire, write an email, work on a project or walk in the hall. We have the power, by living the values, to build the culture. We also have the power, by breaking the values, to fuck up the culture. Each one of us has this opportunity, this burden.”

5) Tony Hsieh, CEO of Zappos

Tony Hsieh is another entrepreneur who has written about company culture. He was the CEO of Zappos and he published this article in Huffpost titled “Your Culture Is Your Brand”.

On it, he shares Zappo’s hiring and training process, which he believes is the base of company culture:

“Building and maintaining the culture starts with the hiring process. At Zappos, we have two sets of interviews: the first one is done by the hiring manager and his/her team, looking for relevant experience, technical ability, etc.; the second one is done by the HR department which looks purely for culture fit.”

Once hired, the employee goes through a 4-week training program. Tony states:

“On it, we go over Zappo’s history, the importance of customer service, our long-term vision and philosophy about company culture, summed by 2 weeks or taking customer support calls. We also offer everyone $2,000 to quit as we want to be sure everyone is there for more than a paycheck.”

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Startup Culture vs Corporate Culture

A common question around startup company culture tends to be how different it is from corporate culture.

Corporates and startups differentiate a lot on the way of doing work, their decision-making processes, and the size of the workforce, among other factors, which definitely has influence over the culture of the business.

In the following illustration, you can find some of the main differences the culture on these two types of organizations has.

Startup culture vs corporate culture

Note that none of these cultures is better than the other, they are just different.


Why is Startup Culture Important?

Startup culture affects businesses in lots of different ways.

The clearest effect is on productivity. A great startup culture will lead to higher workforce motivation, and therefore, greater productivity and less frequent mistakes.

If your employees hate their work, they won't produce the best results. If your employees have a bad relationship between them, they won't be able to collaborate and communicate well.

But a great startup culture has also a series of indirect effects, which include easier recruiting, longer employee retention and, in some cases, even better business reputation among your customers.

Author, Entrepreneur, and speaker Gary Vaynerchuck puts it this way:

“The internal company culture will either enable your company to grow or it will rot it from the inside out.”

Here are some interesting stats that show the importance of startup culture:

Startup Culture stats

Who’s Responsible for Setting it?

It starts at the top.

Putting the right people in charge is essential for any company and its culture.  As a CEO or founder, you are responsible for ensuring the people you place in management roles have the necessary skills to lead effectively and create the desired startup culture. Therefore, you need to be coaching and pouring into them so they can better pour into your employees.

Management training should be as equally important as any position if not more important. There should be some kind of basic instructions, guidelines for your company, resources, encouragement, and additional or extra training for growth. 

Ensure leaders are managing your employees in the most effective way possible. If you have a high turnover rate, take responsibility. If people are not excelling or producing below their capability, take responsibility. Instead of looking at everyone else as a problem, consider how you can help them reach their potential.


How You Can Build a Successful Startup Culture?

1) Hire the Right People

I’m sure you are hiring the people that you think are the best fit for the position; however, no position is contained in a vacuum. What I mean is, if you hire a purchasing manager, they are going to have to work with other team members.

What kind of team do you have? Everyone you bring in should match the type of culture and team you are creating.

Hiring the right people is more than just finding the most qualified candidate or best resume. Consider their emotional and physical health, what it takes to motivate them, and if they fit with the rest of your team. 

2) Caring For Your Employees

Caring for your employees is the next step in building your company culture. Once you have the right team members it is vital that you actually care about their wellbeing and success. How much can you expect them to care about the work they are doing for you, if they don’t think you care about them.

People may want to do a good job, but you want to make sure your employees WANT to do the best job. How can we activate that desire in them?

Gary Vaynerchuck believes in “The Ambition of a Human Based Company”, where if he can be front and center and just give people a little bit of time so they know he cares, they will go the distance. 

The biggest principal to him is empathy. As the saying goes, “No one cares about what you have to say, unless they know you care about them.”

3) Lead by Example

Leading by example may be a cliche, but it is often forgotten. If you want your employees to be rude or short to each other, be sure to do that to them when they make a mistake.

Remember, work culture is a top-down issue. Always be patient, kind, and graceful when people make a mistake, and they will pass it on (if they don’t, you need to fix that).

4) Acknowledge People's Achievements

Many highly motivated and driven people just want to power on through to the top. However, more often than not, some team members need to be acknowledged for their work and accomplishments. 

It might just be one more step for you or a piece of the puzzle, but it is their hard work and time. If people don’t feel appreciated they will not want to continue to perform at their best. 

5) Build Relationships With Your Team

Take the time to learn about your employees and build relationships. Life throws hard times at everyone. Check-in and keep your eyes open for when someone might be going through a difficult time. Maybe they need a day off or to leave early on certain days. 

Making connections with your team members is the only way to know when there is something distracting them from performing at their best. Making connections is the only way you will learn what they need to be fully present and putting in 100% every minute they are on the clock. 

6) Establish Your Startup Missions

The mission is the most crucial part of your business. It should define who you are as a company, how do you operate to make your customers thrive, and why are you relevant to today's society.

You need to define this even before you make the first hire because culture starts from you and spreads to your future colleagues.


5 Ideal Startup Cultures

1) Spotify

Spotify is well known for its great startup company culture, which they call “Spotify Engineering Culture”. Spotify’s engineer and product teams are organized in “squads”, self-organized and cross-functional groups of no more than 8 people, who have complete autonomy on what they build and how they do it.

Of course each squad has a mission and they are all coordinated so that they are aligned with Spotify’s mission and objectives. They aim to achieve both high alignment and high autonomy. Only if alignment is achieved you can trust on a group of people to do work completely on themselves, without worrying they will go on contrary directions.

2) Buffer

Another successful case is Buffer’s culture. We’ve already talked about how Joel, it’s co-founder, thinks about startup culture. This great culture can be identified in Buffer’s approach in 2013 to getting hacked and making their users publish all kinds of posts on their social networks.

The company accepted 100% responsibility, delivered clear and transparent messages to their users and the whole community and provided helpful rules on what could be done by each user to protect their accounts. This brought positive press for the startup, which, according to Joel, saw a massive increase in signups in those days.

3) Auth0

Another interesting case is Auth0’s one, which considers “innovation, experimentation and learning” as the backbone of the company. Similarly to Spotify, this startup provides their engineers with a lot of freedom to innovate and try new things. Failure and mistakes are incentivated and it’s encouraged to learn from them and keep moving.

Note that half of Auth0’s team is remote. Clayton Moulynox, Director of Culture of the company, states that, in that way, people can work when and how they perform better.

4) Wistia

Wistia

Wistia’s case is also really interesting, particularly for those building a tech startup culture. They have created the Wistia Code School, in which they pair their developers with employees within the company interested in learning to code. The training lasts 4-5 months and it culminates with the employee solving some real-world problems.

These employees are generally within customer support, which means they start solving coding issues themselves, instead of opening tickets and asking engineers for help as they used to do.

5) Paylocity

Finally, Paylocity is a great demonstration of how can culture be shaped and adapted. They rely on employee, partner and client feedback in order to determine their culture and how they can improve it.

The objective is to make sure the team understands the company’s goals and objectives and work in contributing to them. 

FAQ

What is the startup culture?

Startup culture is a type of work culture mostly known for being creative, laid back instead of rigid, and passion-driven.

What makes a good startup culture?

A good startup culture should generate passion for work, make the information and knowledge flow fast, and enhance respect for each individual’s identity and way of doing work.

How do you create a startup culture?

Creating a startup culture starts at the top of the organization, by hiring the right people, caring for employees, leading by example, acknowledging people’s achievements, building relationships with employees, and establishing missions and goals.

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By now, you might have realized startup company culture is a very complex issue that affects the success of your company on many levels. If you don’t put the time into making sure your employees are performing at their best then you are losing money.

We’re here to help! If you have any questions or anything to say about the article, send us an email to hello@failory.com.


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