How to scale culture as your company grows
With the explosion in VC funding and rise of ‘unicorn’ startups, recent years have been characterised by a huge increase in hyper growth companies around the world. Coined by Alexander V. Izosimov in the Harvard Business Review, hyper growth occurs when an industry or company grows explosively (or steeply on the S-curve). This phase is also characterised by skyrocketing company valuations, high compound annual growth rate and crucially, a growing team.
Reid Hoffman, founder of LinkedIn, wrote in a post that “when you scale at speed, you can capture the market quickly and also outmaneuver potentially global competition. Given the parallels with military and sports strategies, we can call this blitzscaling. Literally: lightning scaling.”
With a new form of scale emerging for startups, company culture can be easily compromised if founders don’t plan for growth. In this post, we’ll apply the learnings from Mandy Johnson’s famous book “Family, Village, Tribe — The Story of the Flight Centre” to understand how you should account for culture as your company grows.
Family
When a company starts it’s normally one or a few founders with a shared vision. Culture is typically communicated orally and is shared by definition. The initial team will be a small group of generalists who need to juggle multiple balls at once to grow grow grow.
At this point culture is implicit as the early team will be focused on finding product market fit and not so much on longer term strategy. At the family stage, there are typically strong bonds between team members which lead to easy communication, fast reactivity and clear feedback loops.
However, there are also numerous pitfalls to avoid. Familial relationships can sometimes relegate the importance of performance as a KPI. Under-performers or mis-hires can occur where the team tries to preserve this ‘cosy family atmosphere’ over doing what’s best to achieve the company goals. Thinking of your startup more as a sports team and the founder as a coach can help to address some of the threats of family culture, as addressed in our recent blog post and also this thought piece.
Tribe
By this point you already have 20+ people in your startup team and culture can no longer be communicated verbally alone. Now there needs to be clearer alignment on mission/values and formalised feedback loops. The ‘tribe’ nature comes from the fact that to grow multiple smaller teams will form and work closely together rather than all as one. Anthropologically this is similar to human kind’s own development into hunter-gatherer groups and can be considered ‘human nature’ to an extent’.
At this stage, you’re ready to craft your organization’s Employer Value Proposition (EVP) and develop a culture playbook that will align with your strategic initiatives, internal competencies, and talent attraction and retention initiatives. Most importantly, these tools will clearly articulate who you are and where you want to go, in a way that resonates with your talent. And when you’re in high-growth mode, being able to clearly and quickly share your culture and values with others in a compelling way, can make all the difference.
Village
Now comes the big shift to village life. At this point you are probably growing so fast you may need to double your team very quickly or even just ensure your existing team feels constantly plugged into the core culture as new people join. You’ll need to begin really institutionalising culture at each level of management in your growing organisation.
Here are a few things to bear in mind:
- Align goals and culture — Strong performers on your team are great but not if they don’t align with the values of your team. Topline growth is attractive but make sure to keep a focus on how culture can be transmitted throughout daily life, and maybe even to your customers/users
- Be authentic — Don’t let growth compromise your core values as a founder or as a company. There’s a reason you’re growing so quickly — it’s because you’re good at what you do. Don’t lose sight of your organization’s competencies, vision, values, and why you exist in the first place
- Focus on communication — There is no substitute for communication. Creating feedback loops at every layer of your growing team will be crucial in ensuring that your staff feel appreciated and their roles feel purposeful. Having a clear EVP, feedback mechanisms and a solid onboarding process can dramatically improve your team’s understanding of culture
In the age of hypergrowth, it’s now important more than ever for founders to prioritize culture. Not only can culture make your team a great place to work, but it can be a weapon for amplified growth in its own right
