Why it is important to build a right culture from the beginning

There is a very famous saying - Culture eats strategy for breakfast. Simply put, culture is how people behave and make decisions when no one is looking over their shoulder. As a company scales, and the core team can't be everywhere all the time all at once, culture is what drives the tone and trajectory of a company. Culture isn't something you can build overnight and its seeds are sown in a company's infancy. Not setting a culture will only lead to the organization organically forming one of its own which may not necessarily be inline with its vision.?

Yet we at times see founders underinvesting in culture, typically because:

1. Performance vs survival: In early stages, founders are focussed on surviving. Mostly bootstrapped and in pursuit of a product-market fit, the journey is more focussed on keeping the lights on. Improving or optimizing performance is usually the last thing on founders' minds.?

2. Small teams: Early stages companies have small teams. Founders often end up working sitting next to each employee. In such a setting, it is very easy for founders to personally influence each and every employee. Hence, they don't need to?dedicatedly and separately?think about org culture.?

3. No immediate ROI: Culture takes a while to show up in tangible results. Without an instant metric to show for founders, culture seems like all talk no show and just some fuzzy concepts management gurus (or VCs like us) talk about.?

4. Copying others:??For founders who do end up thinking of shaping up culture, they often end up copying blindly from competitors or perceived?successful companies. Worse, they sometimes mistake superficial things like ping-pong tables and free snacks as "culture". But culture is contextual and often a choice, so blindly copying others almost never works.?

Here are a few considerations/guardrails for founders looking to set the culture of their organizations:

1. Over-communication: It is very important to very clearly communicate what the organization does and doesn't stand for. It needs to be brought?up repeatedly across time and touchpoints. People are always busy in?getting through their day-to-day and it?takes time for them to internalize what is being communicated.?

2. Reflect where it matters: Just talking about culture is not enough. Not?adhering to it should?materially impact team members. We've seen how people have performed wrt to the company's cultural expectations and baking that into performance reviews and eventually promotions is a great way to make it worth people's while.?

3. Focus on the frontline: While culture is set by the core team and the top management, it's the junior most people in the team?who live it day to day. It is important that you overinvest in getting them onboard more than anyone else.?

4. Role-model: When founders live and show their team the culture and behaviors they expect from them, the team feels inspired to follow their footsteps. It gives founders the moral authority to expect from the team what they themselves are willing to live.?

5. Celebrate champions: While performance management is one way to make known that you take your cultural values seriously, it is also important to celebrate?team members who display examples of company culture through distinctive?behaviors and acts. This serves as an inspiration for all and makes it look easy and possible to adhere to it.?

6. Customers feedback: One strong indicator of how well culture and values have propagated through your organization is what your customers are saying about you e.g. if bias for action is an organizational value but your customers keep saying that your CX teams dilly-dally in solving issues, you know there is scope to drive it better.?

7. Remote vs in-person: The one distinct nuance in a post-COVID world is remote organizations. A lot of companies and business models lend themselves?well to remote work. For companies that operate this way, founders need to make an even higher effort to drive company culture as people can end up feeling siloed. For e.g. a company that was otherwise fully remote, decided that its leadership should work from the office one week every month so there is easier collaboration and faster decision making.?

Founders should actively invest in culture early-on vs treating it like a chore to be dealt with for later.?