In the world of science & engineering startups, entrepreneurial culture is often considered a ‘soft’, wishy-washy concept. Instead, it is a powerful lever in the entrepreneurial process and can lead to exceptional outcomes. I gave a talk in 2020, hosted by Venture Center, on cultural do’s and don’ts for founders of IP-rich startups. This was based on my interactions with hundreds of startups and their founders since 2005. We discussed specific examples from my experience as a startup co-founder, board director, paid consultant, informal advisor, and angel investor.Startup-Culture-Leadership-Kindness-Trust
It’s as important to contemplate what to avoid as it is to know what to instill while creating an entrepreneurial culture.
We debated about the merits of hiring experienced professionals. Should founders instead hire fresh graduates and train them? Does a decade or more of corporate experience have any value in the entrepreneurial context? An easy thumb rule is that less experienced team members are better suited for exploration and risk-taking. Conversely, the more experienced ones can help harden the product, manage risks, and engage the senior-most stakeholders.
Often, founders are expected to behave aggressively with employees. There is a belief that hard-charging entrepreneurs can drive better performance. In reality, it is the kind and empathic entrepreneurs who turn out to be the best leaders. The underlying success factor for a positive entrepreneurial culture is trust. Charlie Munger put it best – work with others and strive to form a ‘seamless web of deserved trust’. Trust may not always be rewarded but it enables a low-friction environment.
Of course, founders must verify the metrics and outcomes reported by their teams. Nevertheless, a high-growth startup necessarily requires putting faith in the capabilities and motivations of junior team members. Thus, entrepreneurial expertise is as much a function of leadership and culture as technical or commercial skills. The true measure of successful entrepreneurship is whether customers, partners, and employees view the venture in a positive light.