Why an early stage startup must start working on culture from the word ‘Go!’
When you’re trying to scale a company, there are so many things you have to keep your eye on that sometimes, culture can slip from the top of the mind. And when it does, you can end up creating more problems than you solve. Culture is one of the highest impact activities where you need to really dedicate your energy.
Hi there! I’m Alison Eastaway, VP of People at Sqreen, an application security platform and a Series-A startup backed by YCombinator and Greylock Partners. I’ve been instrumental in building culture at Sqreen, which is work-in-progress, and I am sharing some of the lessons we’ve picked up along the way.
In case you have just a couple of minutes, check out the main points below but don’t forget to bookmark this to read it when you have some time (weekend, maybe?).
- Start early when it comes to building culture. It helps you: a) to hire and retain culture b) get through bad times c) scale up d) have an organic effect on employer branding e) turn passive candidates to active and f) more importantly, it’s a responsibility towards your team.
- Culture is your company’s personality, values, norms and rituals, mission and long-term vision. It’s the way you do things and make decisions and the glue between everything else. It’s not a bunch of adjectives on the wall and is descriptive, not aspirational.
- Culture is born organically, which is both the good news and the bad news. It exists whether you know it or not. Shape it and work on it intentionally and don’t take your eyes off it.
- Start working on culture when you have more than one person in your startup (even if it means you have recently got a co-founder). You can start by codifying some of the things you naturally do and why you do them. You need not spend too much time and keep it simple.
- If you can’t quote any recent examples of what you talk about as being part of your culture, then don’t say it’s part your culture. Put in efforts on what you want to build or change as part of your culture for at least six months and then share it with your employees and ask them how it can be done better.
- Keep in mind the gap principle, which is, if you can’t deliver what you promise, there’s a gap and people will have a hard time trusting you when you talk about your culture. It’s better to be clear and descriptive about your culture even if it’s less shiny.
- At Sqreen, we value EQ over IQ and our values are centered around sharing knowledge, learning, paying it forward and ownership. We have clarity on the kinds of behavior we tolerate, don’t tolerate and reward. We empower our earlier employees as champions of culture so that they are empowered and are prepared for the next stage of scaling instead of being left behind.
- We hire for culture add instead of culture fit. We want people who are fundamentally aligned with our core values and can add something to make it better.
- Though it’s not necessary, it’s nice to have a great alignment between your product mission and culture because it would be hard to preach something as an overall organizational goal when the necessary values to achieve that goal aren’t part of your culture.
- The last word on culture from me would be: Be intentional about everything you do. If you’re not, it’ll still move ahead but it might not move ahead in the direction you want.
You can watch my session here:
If you prefer to read a post based on the session, here you go! Let me know if you want to discuss any of the points further or have ideas that we could consider adding to Sqreen’s culture!
1. Six compelling reasons to focus on culture
What is a real business case for culture? As an early stage startup, you’re figuring out how to do sales (maybe for the first time), you’re building a product, you’re probably distracted by fundraising and trying to connect with your first users. It’s easy to think that maybe, culture will just take care of itself or you could put that on the back burner for a little while.
The reality is you know culture really pays dividends, even from the very earliest stage of a company.
a) Hiring and retaining great talent: When you’re trying to hire even one person into your early stage startup, your culture is really a critical piece that’s going to make a difference between a great talent choosing to join your early stage venture or the thousands of other opportunities out there.
It helps you retain people during turbulent times such as 2020. People will trust you to find a way through even though you may not have all the answers on Day 1. When the pandemic struck, we didn’t have answers to questions such as what does this mean for the business, will we be able to raise funds, will we be able to keep people and hire more. However, the team said they trusted us because we had made good decisions keeping all of them in mind.
b) Getting through bad times: You build your culture in the good times to see you through the bad times. So it’s almost like a rainy day savings account. When everything’s going well, when you’re hitting your growth targets, when sales are through the roof, when customers are happy, you’re hiring like crazy, you’re growing everyday and you feel you’re thrilled to be a part of the adventure – it’s very easy to have a good culture or to feel like you do.
But things happen (such as 2020). I feel like for companies who weren’t investing strongly in culture before 2020, all of a sudden going distributed overnight in a pandemic context and having layoffs would have been a real shock to the system. When you’re starting from a point where you’re losing customers, sales are declining and laying off people due to financial reasons, that’s a really tough place to start.
So ideally, you begin building culture during the good times and then you’ve got some sort of an insurance that will see you through the bad times. At Sqreen, we tend to say we didn’t grow our culture during the pandemic but we did maintain it and that was a win for us. We put in that sort of hard work up front so that we could keep it running through the past few months.
c) Helps in scaling up: Starting early on culture is a key part of attracting great talent who will help you take your company to the later stages of scaling. So, what you’re doing is pushing things out so that you have new problems to tackle.
d) Has an organic effect on employer branding: Due to the early focus on culture at Sqreen, we don’t spend any money on employer branding explicitly. Our approach is to do great things internally, talk about them externally and hopefully, have our team and also candidates to amplify that effect.
Today, that’s true. We get a lot of referrals from many candidates we didn’t hire and for me, that’s the number one check-in that we’re doing something right. When people you’ve rejected feel good enough about you to recommend someone, that’s pretty great. Also, people who’ve moved from Sqreen send us recommendations of potential candidates.
At the end of the day, if I had two metrics for the success of our culture, it would be the opinions of the candidates we didn’t hire and our former employees. What they say about us matters because they have nothing to gain from the transaction.
e) Turning passive candidates to active: We have quite a reputation for turning passive candidates into active candidates. So keeping people in general orbits well before we have a position that would match them or well before it would be the time for them in their careers. We do a lot of long-tail recruitment. In the past, we used to have these monthly events where we invite friends of employees and who usually have a great time. We are part of the security industry, which is by nature an extremely closed one. It’s unusual to find the office address of a security company online and it’s even more unusual for the outside world to be invited in. It’s rare for us to talk about the way we do things or to have any of our code public. You can see why people might tend towards the paranoid in the security industry as opposed to being welcoming and so we’ve tried very hard to show the world that it’s possible to build great security tools that are transparent instead of opaque, that are educative instead of sort of exclusive. And we try to do that through our culture.
What we’re building as a product and having our company culture align with it has really helped us bring people into recruitment processes who never would have thought to apply to or be a part of.
f) Is a responsibility to the team: I think it’s our responsibility to make work a good place for people to be. We spend a lot of our waking hours at work and it should be as good an experience as possible. Otherwise, we probably have no business founding things or working in HR and startups. That’s a radical position, but it’s my opinion.
2. What is culture and how to approach it the Sqreen way
Everyone talks about culture all the time and sometimes, we get a little bit confused about what it actually is and what it isn’t, just so that we all have the same baseline.
- Your culture is the personality of your company. So if your company was a person, what kind of a person would they be? Would they be the life of the party or introverted or somewhere in between?
- What are your values? Quite literally, what do you value?
- What are your rules and rituals? Is a 9 am meeting normal? Do you eat lunch together? Food is a big deal in France and at Sqreen? So, do you grab a sandwich in front of your computer?
- What happens when things go well, how do you celebrate, what happens when things go poorly – are they talked about or swept under the rug?
- What’s your company mission and it’s long-term vision? You’ll have a very different culture, if you’re looking to disrupt an industry swiftly and you want to be bought out by one of the big players. That’s very different to wanting to build up to an IPO, which will trickle down into your culture.
- We often say culture is the way we do things around here. So, if you came in and spent a day or a week, what would be the things that would stand out?
- It’s also the glue between everything else. How you interact with people, how you apologize or admit that you were wrong and it’s whether or not we do those things. It’s the atmosphere in the office when things are going great or not.
Though it’s very fashionable, culture is not a bunch of adjectives on the wall. Ideally, your culture shouldn’t be aspirational but descriptive. This also isn’t something you create during a company offsite.
3. Culture is born organically, which is both bad & good news
Culture already exists whether you know it or not. You don’t create culture. But how does a startup or a founder find out what their culture is? The bad news is culture exists whether or not you’ve designed it intentionally. Ideally, you want to keep shaping it with intention.
Cultures are really tricky beasts to tame. I often say it’s a little bit like a golden retriever puppy. It’s got plenty of energy and opinions of itself, and either you give it something constructive to do or it’s going to figure out something to do all by itself.
Culture is a living, breathing thing and you almost can’t take your eyes off from it even for a week. Throughout the last two years at Sqreen, we’ve never had our eyes off culture for probably more than a couple of days at a time. And when we do, we find we’ve got to come back in and do a whole lot more shaping.
The best place to start when defining your culture for the first time or after a big shift, is to look at the decisions you made in the past where gray areas existed. We’re not talking about decisions where there was an obvious course of action to take. We’re talking about a situation where you could have just as easily have chosen Path A or Path B. So what led you to take Path A/B and why would you take that path again?
If you’re still uncertain, look at what recently got rewarded or celebrated, what’s tolerated on a day-to-day basis even if it makes you uncomfortable and won’t get punished. The easiest proxy for that is – who’s the last person you promoted, who’s the last person you hired and who was the last person you fired. And what were the criteria you used or what were those based on gut feelings?
We talked a little earlier about values. I use this exercise with managers and new HR folks. I ask them to sit and think about their teams and ask them why they say A or B are doing a great job this quarter. I ask them to start describing it and provide examples that put them on the green list. What’s it specifically about them that make them great performers?
Is it because they’re always available? If I ping them at 5am on a Sunday on Slack with a great idea and they reply straight away, maybe that’s what’s giving me the impression. This person cares about my startup as much as me (founder). It doesn’t matter. You’re not trying to judge at this stage. It’s not your job right now whether to say if it’s a good thing that they reply to your Slack message at 5am? You’re just saying what makes you think that they’re great.
Is it because they’re always helping the rest of the team? Maybe, there’s a new person in the team and even if they’re from a different department, they’re going out of their way to help them.
Do the opposite exercise as well. When you think of your team and you think of who’s underperforming and who could do better, what are the signals on that? Usually in an early stage company, you don’t actually have very good performance tracking metrics or hard facts.
So, a lot of who’s performing well or underperforming is usually based on gut feelings. So, what you’re describing as your culture is not hard facts around delivering. Therefore, sit down and describe the behaviors and the things you value or don’t value, as a company.
4. The right time to start thinking about Culture
As soon as you start to collaborate, particularly when you have more than one founder, which is quite often the case, you already have a culture of making decisions, for example. So, if there are two or five of you, how do you make decisions? Probably, for the first couple of years or when you have around 15 employees, the culture of the company, by default, will be the personality of the founders.
If you have founders who are naturally extroverted, your company probably will tend to reward people who are at the front, who are leading, talking aloud on LinkedIn and at conferences. If you have a more introverted culture, you’re probably going to focus on things such as appreciating solid analysis and thinking things through. And obviously, these are just examples.
So, if you don’t start to codify some of the things you do or why you do them and you try and bring an associate or your first employee on board, they’re going to immediately spot what your culture is, through the interviews. There’s a chance that they may not like what they see if you’re not aware of it. They might probably say something like – “It’s interesting there are three co-founders. So, who makes the decisions and who is the deal-breaker here?” If the three of you give different answers, the candidate might get the message that the three of you haven’t spent time thinking on who they are and who they want to be.
So, start as early as you can. It doesn’t really need to be heavy and it can be an afternoon spent with your co-founders codifying some of the things that you’re doing naturally. For instance, why did you not sign on a particular VC? Why did you make a particular decision with respect to your product? Why did you divide the equity between the founders in a particular ratio? Do you value co-location or drawing from a global talent pool?
If you perform the codification exercise, it’ll help you enormously when you write your first job ad or when you pitch to investors. It won’t be lost work if done early but there’s no need to spend a week on culture at this stage.
The culture at Sqreen predates my arrival. Pierre Betouin and Jean-Baptiste Aviat, two former Security Engineers at Apple co-founded Sqreen. They wanted to build Sqreen because they wanted to democratize security but they also wanted to have fun while doing it. I don’t think anyone says they’re going to build a company and it’s going to be miserable.
Sqreen’s co-founders, Pierre Betouin (CEO) and Jean-Baptiste Aviat (CTO)
Of course, it’s a serious business of building a startup involving a lot of hard work but that doesn’t mean it’s not fun. A lot of the personality of the cofounders was our first aspect of culture. I was employee number 13 but it was considered early to have someone with my focus on culture beyond pure recruitment.
A lot of people in the French and and also the US tech ecosystem often accuse our CEO of being obsessive about culture as if it’s a bad thing and that’s something we wear with a badge of honor. We are obsessed with it because we’ve seen you know how nuanced it is and how carefully it needs to be watched.
I always think of culture is when you have more than one person, you have culture. If you’re a solo founder, you can probably just focus on getting the MVP (minimum value proposition), launching your product, finding customers and you can probably put culture off for a little later.
5. Make changes to culture but don’t talk about it for six months
When I came on board, I inherited a document that explained a little bit of values that had been done in conjunction with our early marketing department and there was a nice synergy between Sqreen’s brand personality and company personality.
Our rule of thumb is if we don’t have a recent example of something, then it probably means the description of our culture is probably outdated. That’s our litmus test. If I’m talking to a candidate or a starter about the way our culture is, I don’t have a script to quote examples. Instead, I think back to last week and wonder if I say we like to share a lot of information with our team – is that true? Did we just recently share our board meeting debrief with the team? Did something tricky happen and we had to explain it to the team. Did we?
If I find something where I’m racking my brain for a good example, then I need to review that part of our culture. I need to change something we’re doing or stop talking about it.
What happens if you start auditing your culture or you start writing things down in the early stages. Let’s say, you realize that you value people who spend long hours at the office, that you value people who only think about the company and don’t really do anything else outside of work or that you value people who are ruthless. You know all this is descriptive and true but you might wonder if this is who/what you want to be.
The founders who create the best cultures are very honest with themselves.
In the above example, good founders are able to see and think – “Sure, I love this kind of an employee but it’s probably because they are young, don’t have commitments, are able to spend all their time here and they seem to love it. But, do we want to build a company with only such people or do we want people who are in the later stages of their careers and do we want parents on board?”
When you confront that, you get really descriptive about your culture and it leaves space for you to ask what you want to change.
I often talk about gap principle throughout the entire employee journey. The idea is if you promise something but what’s delivered is worse, then there’s a gap. It’s amazing to have a shiny employer brand with high-quality blogs/videos. But if candidates who go through your recruitment process think it’s not how they expected it to be, then there’s a gap. Or if you’re treating your candidates like kings and queens during the recruitment process but the onboarding is bad, then there’s a gap.
Similarly, if you say you’re transparent as a company but when somebody asks a question during a team meeting and others say those are not the kind of questions usually asked or if every meeting of yours are behind closed doors, then the employees are going to disconnect. They are not going to believe you when you talk to them about your culture.
As founders and HR professionals or as people who are shaping culture, they must make sure there’s no gap, even if it means having something much less shiny.
For instance, if somebody remarks that Sqreen seems to be a forward-thinking company and that they guess it would mean it’s a remote-first, I’d go into a 15-minute explanation of why we’re a hybrid company. I let them know it’s complex as there are a lot of moving parts and it’s not really as simple as to say you can work from anywhere. We’d rather be clear and descriptive even if it’s less shiny.
If you want to change your culture, the best way to do it is to first make the change and then talk about it because actions speak so much louder than words. If your goal is to be more transparent, but you’ve started from a quite secretive starting point, don’t use the word ‘transparent’ out loud for at least six months. Just start being increasingly transparent until it’s a habit and then you can turn around and say to the team, “By the way, we wanted to start doing X and Y and that’s why we did D, E and F (recent examples). What else do you think we can do?”
But, give yourself six months because if you tell your folks that you’re being more transparent as a company but they’re still carrying the scars from what happened last week, then they’re not going to trust you and they’re not going to come along on the change with you.
6. Sqreen’s way of building culture
Sqreen’s personality: We define Sqreen’s personality as fun, bold, smart, humble and where EQ is valued more than IQ. The last point is reasonably unusual for engineering roles and tech-heavy companies. In the 70s, IBM wrote their engineer tests, which sort of emphasizes on IQ and sort of terms social skills as unnecessary. The industry suffered from that and we’re trying to sort of balance it.
EQ > IQ: Whether it’s for a principal engineer who’s working on our agent technology, which is extremely complex or for an engineering manager or an intern, EQ is the number one criterion we’re looking for. We want people who are self-aware, we want people actively working on getting to know themselves better so they can better know others and adapt for that. We think that’s key, not only for the workplace, but for building products for users who might be nothing like yourself.
The ability to put yourself in someone else’s shoes, be it a candidate or an user or someone from the purchasing department who might buy our software. That ability serves throughout the business. It’s not just that it’s nice to work with people with a high EQ – that’s a side effect but it’s a real business case for focusing more on EQ.
We’re much more concerned about the success of the team than we are about having individual superstars and we make sure that we prioritize and automate the sharing of skills and knowledge with each other.
Sqreen’s values: At Sqreen, our values really center on things like sharing knowledge, learning, paying it forward and ownership. We have a lot of internal perks and policies such as the open book policy. You can pick up any book you want to read and Sqreen will get that for you. The idea is to share a couple of lines and pass it onto somebody who would enjoy it next.
We have a side projects’ program where you can use a week per quarter to work on a side project of your choice.
We spend a lot of time talking to people outside the organization to learn from them. It could be someone who’s a step ahead of us, who might teach me about how to build a great people organization in the Series B stage or other early stage founders or HR people.
We value learning, sharing and paying it forward without thinking about it as transactional. Being generous with knowledge and time is valued.
Behaviors tolerated, rewarded and punished: I think the number one definition of culture is what you tolerate and what you punish is what you don’t like to stay around or who you let go. For instance, if there’s a subtle joke that makes people uncomfortable but nobody calls it out, it can get toxic. We don’t think it’s enough to set about building a diverse team if then you bring them into an environment where they can’t thrive. So inclusivity is a really big thing for us.
At Sqreen, a joke or a snide remark that tears someone down is not tolerated. Sqreen essentially is about monitoring and providing web application security. Imagine your apps are under attack, you’re going to get an alert and we will intervene and stop it. And I think that’s a really nice kind of allegory for the way our culture works.
As soon as we see something that doesn’t belong, we’ll get five or six things that light up and about 5-6 people noticing the issue and intervening to fix it.
We try very hard to have zero politics. We are like – What you see is what you get. You don’t need to overthink things and what it does is it takes away all that unnecessary, thought and energy that you’re expanding for no good purpose.
Culture across time zones: We have some specific challenges to our culture, which comes from the fact that we have teams in Paris, teams in San Francisco and teams in between. We try to stay really close and aligned via a number of rituals like having a Friday all hands meeting and sending weekly recap emails from Paris to San Francisco about everything except work.
One of the ways we try to manage keeping our culture intact and build on it are keeping the camera on when it matters, especially difficult conversations, interviews and one-on-ones. Organizing a lot of virtual, no-agenda coffee meetings similar to the kind of conversations you’d have if you bumped into somebody at the coffee vending machine. Even though the company started out in France, we were very conscious of keeping English as our language of communication because making the switch later on would be very difficult.
Travel is a big way we keep our culture alive and do a lot of cross-pollination.
Alignment between product mission and culture: Our product mission and approach matches up nicely with the way we do things internally. I think when you can have that synergy, it’s great. It’s not necessary but when you have it, it’s really nice. Our product mission is to democratize security or to make security very simple, which is traditionally a complex subject.
It would be hard to kind of preach that as a product mission internally if everything was red tape and and you know you had to go through 10 steps to get anything done. We’re really allergic to complexity and we keep refining until we find the simplest way forward.
Good old days’ problem: In the early days of a startup, people are in the same office, sitting together and working with a direct line to the CEO and the CTO. As you start to scale and bring in more specialists and senior people and open more offices because you’ve raised money where you’re more visible and have increased traction, you can face what I call the ‘good old days’ problem.
Early employees who trusted you when there was no evidence you would succeed tend to feel left behind the culture as you scale. We were sensitive to this from the beginning. Focus on how to bring the team along culture growth and how to make them active for the next stage as opposed to just along for the ride.
What I recommend is involving your early employees as owners and every employee who joins after and empowering them. Instead of them needing approvals to do certain things, you could get them to act independently if it’s under a certain budget. You could just ask them to send you receipts, which sends them this message that you trust their discretion and decisions. This way they’ll get inspired and bring more ideas to the table.
It’s good to have them help onboard new employees into your culture and have them to be the first to say that we’re probably drifting and that we need to get back on track. Not a week goes by without somebody pinging me about something related to culture. I love it when people come to me with problems because what’s worse is there’s a problem but nobody speaks about it.
Culture add over Culture fit: I recommend hiring for culture add and not culture fit. We look for people who see the way we’re doing things and are fundamentally aligned with some of our core values. A diverse team is the best performing team. We want people to see what we’ve got and say, hey, I think I could make that a bit better.
While interviewing candidates, we often ask them which are the best and worst cultures they’ve seen and what can be implemented at Sqreen or what’s the one crazy idea they’ve had about culture that nobody has allowed them to put in place.
You shouldn’t reinvent the wheel when it comes to culture, just do great things. Of course, there’s no one size fits all. You don’t have to be brand new and shiny about it. Just do the thing that makes sense to you.
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