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How to Foster a Startup Culture

Newsroom | Articles March 10, 2021
Three employees of a business startup talking in an informal meeting.

How to Foster a Startup Culture

Startup culture can be defined by what it rejects: rigid processes, risk-averse decisions, sluggish development, dull working environments, and uninspiring goals.

No company embraces those characteristics, but as organizations grow and mature, the challenges of maintaining an entrepreneurial spirit and mission-driven culture soar. 

To foster a startup culture, business leaders identify what makes startup culture special so they can build those characteristics and values into their organizational DNA. Preserving the best traits of startup culture allows companies to remain competitive long after they’ve become established players in their industries.

What Is Startup Culture?

The phrase “startup culture” often evokes office perks, but foosball tables or free-bagel Fridays do not define startup culture. Startups are young companies bringing a new product or service to market. As such, they’re typically small groups headed by a single entrepreneur or a few founders. 

The challenge these lean organizations face in taking on competition with limited funding and resources calls for enthusiasm and hard work. Such requirements largely shape the most admirable characteristics of startup culture.

Benefits of Startup Culture

Upstart companies benefit from built-in advantages that are harder to cultivate at larger corporations. For example, an organization with fewer than 20 employees can take limited credit for having a close-knit team. 

 Similarly, communicating clear corporate goals poses little challenge when an organization is focused on a single product or service and a limited (or aspirational) customer base. The newness and limited scale of startups creates a number of additional benefits.

Clear Mission, Culture, and Purpose

Companies define the purposes that guide their decisions and practices with mission statements or founding principles. Any company can formalize its responsibilities and goals, but employees are more likely to find a mission statement relevant and inspiring when their role in impacting the organization’s culture and performance is clear. 

 Employees at large companies are no less driven or principled than their counterparts at startups, but their individual influence on a business environment that encompasses a large workforce and diversified operations is less obvious and immediate.

Engaged Team Members

Employees at large companies often feel their efforts are underappreciated. In contrast, startup employees’ individual contributions, whether independent or on small teams, are readily recognized. What’s more, employees at startups gain an early foothold in the business and are well positioned to move up. 

By necessity, they wear many hats, giving them chances to broaden their skill sets, explore professional interests, hone problem-solving skills, and, in some cases, gain leadership experience. A strong sense of accomplishment, coupled with opportunities for advancement, boosts employees’ sense of personal value and ownership.

Agile, Collaborative Work Environments

Having fewer employees, simpler product or service offerings, and smaller, less entrenched customer bases allows startups to make quick changes when market conditions shift. Because they have fewer responsibilities to outside stakeholders and no public shareholders, startups can also afford to take more risks than established competitors. 

 Employees in large, established corporations often complain that different divisions of the company are siloed and don’t work closely enough together. Such divisions are less defined or nonexistent in smaller companies. The flatness of most startup organizations makes them less hierarchical, so all employees have access to leadership.

Challenges of Startup Culture

Startups share a number of challenges. A bootstrap organization may lack the revenue or funding to afford all the resources it needs. New businesses often fail, so upstart companies typically offer less job security than their established counterparts. 

Employees often work long hours and experience high stress levels. The lack of structure within new businesses can contribute to chaotic work environments with unclear expectations and ill-defined roles. Inadequate administrative and human resources structures can result in functions such as employee training and formal professional development falling through the cracks. 

For companies interested in fostering a startup culture, the real goal is to strike a balance between the best aspects of an early-stage company and the benefits of a larger, established business.

Tips for Fostering a Startup Culture

As startups grow into mature businesses, practices and values that were born of necessity or evolved naturally have to be converted into procedures and policies that can serve larger groups.

1. Identify Core Values

The process of identifying the aspects of startup culture that should be fostered or preserved will be more successful if stakeholders focus less on what proved successful and more on why a value or practice matters to employees. As a company grows, it will necessarily change, but the underlying mission and values can remain constant.

Providing Office Perks

A startup’s practice of buying everyone pizza once a week won’t scale to a large corporation, but a large corporation can provide a meal allowance to all of its employees.

Encouraging Executive Access

An entry-level programmer who sat next to the CEO at a startup won’t have that level of access in a larger company, but the larger company can create a program that regularly puts staff members at all levels in front of executives so they can pitch ideas and voice concerns.

Promoting Career Development and Lateral Movement

An overnight leap from marketing to sales is unlikely for an employee in a corporate environment, but a corporation can provide an education stipend that allows employees to take courses and develop new skills.

2. Communicate (and Demonstrate) Values Clearly

A statement of mission or values is only effective if employees see clear evidence that managers and executives care about those values. Accomplishing this goal entails consistently making connections between actions the company takes and the value or mission those actions support.

Some companies establish award programs to publicly commend employees who take actions that embody core company values in their service of a customer or co-worker. For example, a company might reward cross-team collaboration or cutting through red tape to quickly serve a customer.

3. Solicit Feedback Regularly

The larger a company gets, the harder it becomes to gauge how effectively it’s fostering the core values that defined it as a startup. Employees are the best source of unvarnished feedback. Leadership can use tools such as surveys, company roundtable meetings, and all-hands company check-ins to surface issues, discover where the company has failed to live up to its values, and hear suggestions for improvements.

Become a Mission-Driven Leader in Business

Building businesses with an entrepreneurial spirit, value-focused culture, and agile market approach takes leaders of exceptional ability. LSU Online’s Bachelor of Science in Business Administration lays a foundation for such leadership by equipping students with the tools they need to evaluate and improve business practices.

Using sound scientific and financial knowledge, the curriculum teaches the most important disciplines of business, including finance, management, and marketing.

Visit LSU Online’s Bachelor of Science in Business Administration program page to learn more about opportunities to gain relevant training for modern business careers.

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