Why Your Culture and People Are So Important When Scaling A Business
“Culture eats strategy for breakfast” - Peter Drucker.
Most start-ups are laser focused on one thing: growth. When a startup of ten suddenly becomes a team of fifty, everything shifts: from the way you communicate with employees, to the way you hire, train and retain. In order to ensure rapid growth doesn’t come at the cost of culture, founders must find effective ways to ensure everyone on the team is ready for hyper-growth and a shift in ways of working. According to data from Glassdoor 77% of job seekers consider a company’s culture before applying, so it’s important that founders and business owners take time to ensure rapid growth doesn’t come at the cost of cultural integrity.
My startup - Virti - grew nearly 1000% in under 12 months. Today I'm going to cover some of the lessons I learnt from this period of hypergrowth to help you build winning teams and company culture. We're going to cover:
Being upfront about growth strategies, tightening up your hiring and onboarding processes, prioritising building community and rapport across teams, encouraging side hustles, ensuring employees know their worth, not worrying about churn or delegating responsibility and processes and well-being.
Be upfront about your growth strategies
Your team will perform best when they know in advance what changes to expect. As a founder, it’s essential that you’re transparent with new and existing hires about what you’re planning and how your growth aspirations might impact their experience at work. They’ll then have the freedom to choose whether they want to be part of the next phase of your startup’s journey.
The reality is that fast growth changes everything about a business. Some people may prefer a smaller team environment, and not wish to work in a hyper-growth startup of fifty or more employees. For others, their role may be evolving or expanding into something they didn’t originally sign up for. Your people deserve to know when and how their work life is about to change. Failing to be upfront could lead to resentment and the loss of valuable talent.
Tighten up your hiring and onboarding processes
Your cultural values need to be bought into and upheld by everyone in your organisation. The best way to ensure everybody understands what these values are and why they’re important is to build scalable, reliable hiring and onboarding pathways, which support new hires to build a deep understanding of your culture and work ethic.
Spend time building out a hiring process which goes beyond “hiring for culture” and analyses prospective hires through a data-driven hiring process to pull out key characteristics that align to your company culture such as coachability, ability to adapt and an aptitude for fast-paced environments.
In practice this means breaking down your cultural values into digestible bullets for new hires to study, alongside case studies that showcase how they’ve been reflected in your work - so they can get a sense of how your culture operates practically. You should also make it clear how these values translate into what you expect from employees. To support this process, codify company knowledge and best practice in such a way that makes it easy for everyone to communicate and access. This way, your team can easily remind themselves and others of the most salient points.
Securing cultural buy-in from new hires as soon as they’re through the door will help to maintain a strong ethos throughout the entire team. It’s important that your vision is shared and nurtured by every employee at every level and culture is celebrated at daily stand-ups, weekly meetings and quarterly awards to help get everyone excited and aligned to the company culture.
Prioritise building community and rapport across teams
Building a strong company culture is all about fostering great relationships between people. With remote work and digital nomadism being adopted widely, it has grown increasingly difficult to build a cohesive culture when your team is apart.
For teams (like Virti’s) that operate internationally, connecting across cultures, continents and time zones can present an additional challenge. I’ve found the key to building community between a remote team is to give people opportunities to connect and collaborate outside of a work context. When you’re not meeting up in an office and having water cooler conversations, you need to find other ways to bring teams together.
We have used our own tech to help everyone connect despite timezones and remote work. Asynchronous video posting of work-updates; random slack and video coffee meetings help people to feel connected and have meaningful conversations. We also empower people to own team meetings by having different teams adding their own flavour to running company-wide meetings. All help to build rapport and community digitally.
Encourage side hustles
Innovation and creativity can sometimes feel at odds with following a roadmap or hitting quarterly OKR goals. Empowering your people to follow their passions and act like mini CEO and entrepreneurs helps to foster creativity and gives people freedom to innovate in an open and safe environment and to learn new skills that can benefit their careers and company productivity. Google advocate 20% of employee time is devoted to side projects with Gmail being a famous example of a developer working on a 20% time side project which then. While Google popularised side projects the concept can be traced back earlier to a comparable program, launched in 1948, by manufacturing multinational 3M which required employees to have 15% time: to dedicate up to 15 percent of their paid hours to a personal interest.
At Virti we introduced quarterly ‘Game Jams’, where we encourage our team to work in groups to pursue a passion project not related to the work we do, a bit like a mini-hackathon. We encourage people to work on anything that interests them: tech-related or otherwise giving them a fun opportunity to learn and work with others. The idea is that everyone gets to create and apply their skills to a new scenario. Games jams are a great way to work with colleagues outside of normal team structures and to get to know them better in the process.
Ensure employees at every level understand their worth
It sounds obvious, but when you’re scaling quickly it can be easy to sideline things like ensuring every employee understands their value and feels accountable. Everyone must know how their role furthers the company goals and helps to solve the problems faced by customers. When you’re working remotely, this sense of accountability and self-worth will keep your team motivated and your culture strong.
Ensuring everybody in the team knows (and is reminded of) their worth will help build a trusting and supportive culture, and will likely improve peoples’ performance, too. We decided to go beyond simple alignment tools like OKRs and created our own tool called the Virti Operating System or VOS2 which tasks employees to align their value, strategy and goals to their team quarterly focus and the overall mission of the company. This helps people to focus, prioritise and understand that what they are doing is hugely beneficial to the overall company vision.
Celebrate Wins Large and Small
When working in a fast paced environment with regular success it can be easy to forget to take a moment to be grateful and celebrate the small wins. As you grow your team celebrating employee milestones such as graduating from onboarding, helping a team member or demonstrating the company culture should all be celebrated. This can be done through shout-outs at company wide all hands meetings, gifting from team leads or a formal awards programme at the end of each quarter. For high performing sales team where commission is flowing thoughtful non-monetary incentives personalised to the individual go a long way.
At Virti all team leads and me as CEO know what every employee enjoys doing and will recommend a thoughtful, personalised gift for reward occasions. Equally with sales teams fun incentives such as the VP Sales being made to sing Karaoke if personal targets are hit helps keep things light and allows team members to get their own back on the keeper of the quotas. At Virti we celebrate company culture regularly through shout-outs at our weekly company-wide cinnamon bun meeting (yep all our meetings have weird names but with some fun stories behind them) and this meeting is also used to reflect and be grateful for the week.
Don't worry about churn or delegating responsibility
Human beings naturally resist change as we try to maintain homeostasis and a safe environment. As a business grows change is natural. Reporting lines, people's roles and senior hires will all change company dynamics as you scale and this will not suit everyone. Some people are fantastic in small, fast-moving environments where they make every decision with little process while others are better suited to larger corporates, set processes and managing people. This sentiment applies to founders too. You will need to give away your toys and responsibilities ideally to people who are much better and smarter than you in senior positions if you wish to truly work on your business rather than in it.
Annual employee churn in early-stage businesses is reported as anything from 15-30%. As you and your processes evolve, just like a winning sports team climbing the leagues, some of your players will be benched and some transferred. This element of competition and team optimisation is part of being a head coach in any sport just as it is as a founder to ensure that the overall team is as good as it can be. As employees leave thank them for their period of contribution to your journey and hire superstars who will take you to the next level.
Processes and well-being
When growing at pace, ethics and integrity can be harder to hold onto. Rather than rushing ahead all guns blazing, startups must plan for this and put processes in place to protect culture and retain a moral compass as they scale.
The success of your business will ultimately be defined by your human capital. So while cutting corners and working people hard in the name of scale might serve your business goals in the short-term, failing to prioritise your people, ethics and culture will ultimately have long-term implications for your business. As soon as your people start to lose faith in the vision they signed up for - or reach burnout points - morale and that sense of community you’ve worked so hard to build can start to slip, with noticeable consequences.
Fostering a coaching culture and focusing on employee development is vital. Regular check-ins and honest feedback on employee mood is really helpful at ensuring that work remains fun and enjoyable. We strive to be like Warren Buffet suggests and ensure everyone loves what they do and love the people they do it with.
Plan ahead to ensure you’re ready to scale whilst retaining the values and ethics that have brought you this far. It’s one of the most important things you can do. When you reflect back on the journey it is the people you were on the journey with and their growth and development which is in my opinion the most rewarding aspect over any end-goals.