We spent the last five months speaking with startup leaders from across North America to gain insights on what makes successful startups so high-performing and attractive to top talent.
More than ever, companies are placing an emphasis on making their workplaces as great as possible to attract and retain top talent. Although perks, benefits, and flexibility are enough for some, the growing number of employees, particularly Millennials, require deeper, more meaningful incentives. Specifically, more and more people are looking for a strong connection to purpose and work that gives them meaning in the form of believing in the company’s mission, connections to co-workers and the opportunity to grow and develop as an individual.
“The workplace has changed. People nowadays are looking for meaning in work. It’s a statement that rings very true to me, as well as talent entering the workforce. Millennials don’t separate personal and professional life as much. To them, work-life balance is all encompassing.” – Andy Yang, CEO of 500px
To create a great workplace, the leaders we talked to are investing a significant amount of time, effort and focus on fostering a great culture, connecting company vision to an individual purpose and cultivating strong teams. Here are some of the key themes and ideas that we liked from the interviews:
1. Give great people other great people to work with
One of the biggest factors in how engaged people are is the relationships they have with their colleagues. Organizations are built on its people. Therefore, the focus of hiring should be on people, not simply filling a vacancy. For this reason, leaders of successful startups dedicate significant time and effort to the hiring process to ensure the bar stays high with new hires.
There are two important factors to get right in bringing new team members onboard.
First, bring in only the best talent. Second, make sure they are a cultural fit. To achieve this, it’s important to be disciplined and avoid over hiring or the urge to fill a vacancy.
Being on an awesome team is the best thing ever. Everyone is the best at their job. We’re all rowing in the same direction and feel this incredible sense of ownership over what we do. That’s what I love about teams. It creates accountability. No one on a team wants to let down someone else on the team. Team mentality creates a positive, virtuous cycle.” – Brandon Weber, Founder & CEO of Hightower Leasing Management Software
“Mediocre people decentivize all the great people you have and you’re trying to hire. It takes incredible patience and discipline not to overhire. You must resist the temptation of ‘I could get to this opportunity if only we had a person to do x’. Instead, view each hire as bringing in a unique asset into the organization that will add value over a long period of time.” David Barrett, Founder and CEO of Expensify
“Ensure you understand what it takes to do well at your organization and don’t be afraid to let qualified, talented people pass by if they’re not the right fit.” – Carol Leaman, President and CEO of Axonify
“As a leader, hiring is one thing you shouldn’t entirely delegate. We’ve discussed working with recruiters as we’ve grown and had to deal with hiring spurts (this month we hired five people and are about to hire a sixth). But we haven’t gone there yet. Partly because of cost and our desire to stay lean, but also because I believe you lose something in delegating this super important task to a third-party.” Cliff Peskin, Co-founder and Co-president of BuzzBuzzHome.
“The single most important qualifier I look for in talent is cultural fit. Everyone at Wattpad fully buys in and believes in the company vision and lives its values.” – Allen Lau, CEO and Co-founder of Wattpad
2. Build trust and give people a sense of purpose by over-communicating and building trust through transparency
Being transparent with employees helps to build trust and demonstrates to them that you see them as partners. Part of treating employees as partners is helping them understand as much about the business as possible. This starts with clearly defining and consistently communicating and reinforcing company vision and values. But it’s also critical to communicate how business is trending, what the challenges and goals are, and how these factors influence what they’re working on day-to-day. Successful leaders disclose as much information as possible to employees so that they fully buy into the purpose and feel more involved in the success of the business.
Values are what unify an organization. They are what help make successful startups align with a meaningful purpose. In order for values to be ingrained within the fabric of the company, they must be communicated often and incorporated into the company activities as much as possible. One of the most useful exercises we conducted at SoapBox was identifying our core company values and then embedding them into our everyday. Our values dictate every decision we make and how every employee behaves — from hiring to determining the future of the company. Learn about how we uncovered our values here.
“I recently delivered a state of the union to the company. The subject matter of the address wasn’t great: I talked about how the markets are crashing and how half of the value of the SaaS market was wiped out in three days. However, instead of being demotivating, it had the opposite effect. It was motivating to them. I received many comments about how that level of transparency made the team feel like they were part of the inner circle. Now the finance team and everyone else became involved in solving the problem. You want everyone in the room, regardless if they make $50K or $150K, to feel a sense of ownership. You want them to shoulder the responsibility, to push each other to do better.” – Brandon Weber
“Not enough early stage CEOs are transparent. They have fear about disclosing too much to their employees. Where risk is involved, they tend to keep that information close to the chest. That’s a mistake. Keeping that information private ends up damaging your company’s culture, which is the backbone of startups and early-stage companies. The reason why I’m not afraid to disclose the company’s most private information with my employees is because I trust them. I genuinely believe that they come into the office every morning intending to work hard, give it their all, do good things, and want to be recognized for it. They want to be successful. They want to win, too. So I treat them like partners, not like paid guns doing task work. They know what I know.” Carol Leaman
“I think it’s important to over-communicate the company’s objectives, goals and the mission and strategy. It sounds like an obvious thing but it actually takes a lot of time from me and from the rest of the leadership team to make sure that everyone within our organization is aligned. Nowadays, people don’t just follow orders. Employees aren’t robots. They have to understand “why”. Transparency is very important as it reinforces the “why”, so this is something I focus on everyday.” – Allen Lau
Some of the things Allen does to ensure the company’s objectives, goals and the mission and strategy are well communicated are: weekly all-hands meetings that include an AMA (ask-me-anything) Q&A session; an internal only daily blog post where Allen reflect on business, values, culture or whatever is top of mind and important to communicate to the organization; despite significant growth, Allen commits to a one on one with each employee at least once a year.
3. Embrace the upside of risk to give them an environment where they can thrive
When you’re spending hundreds of hours interviewing the best and brightest candidates, don’t you want to reap the benefits of their talents? In addition to building trust and great communication, the most effective way to do so is by establishing goals and objectives for them to work towards, equipping them with the proper tools and resources, and then letting them go off and figure out how to attain those milestones on their own.
This often involves a degree of risk and risk is often perceived as a negative thing. However, leaders should also balance the upside of risk. Risk can bring bottom line growth and innovation, but through risk also comes the opportunity for individuals to grow and develop.
One benefit is that by taking risks you attract talent. Talent wants to work for organizations that are going to allow them to take some risks because it’s through pushing new boundaries that top performers get personal growth and development. That’s why people gravitate towards startups. They take risks. Talent sees them as an opportunity to grow and receive increased responsibilities. You need to provide that environment at big companies too.” – Ted Graham, Innovation Lead at PwC and author of “The Uber of Everything”
“We do this by taking calculated risks on people. In the same way we take a risk on a recent grad to give them experience towards their career, we take risks when promoting within. It means that sometimes we’ll put people that don’t quite have all the right experience in new roles as long as they have demonstrated an ability to learn and a desire to grow.” – David Barrett
The other element of providing an environment people can thrive in is to empower employees and give them autonomy. Show employees that you’re interested in what they have to say by soliciting their feedback and letting them have a voice in shaping how the company pursues its strategy. Communicate the company goals and ask them for ideas on how to reach these goals. Once you receive the ideas and feedback, evaluate the input and respond! Closing the feedback loop is as, if not more, important as soliciting the input itself.
“In order to become truly autonomous, leaders must abandon traditional organizational structures and processes. Easier said than done. Let go of structure and process.” – David Barrett
The last element of providing an environment to thrive in is taking chances on people and giving them additional responsibility and promoting from within.“No one likes to be managed, but everyone likes to be led. That’s why real leaders become elected by their peers vs. given a title and org structure. Avoid hiring managers from the outside. Hiring from the outside instead of promoting within disrupts the internal leadership structure and positions the new hire as an enemy to the rest of the company. Without any relationships inside the organization, you’re just setting them up for failure.” – David Barrett