Startup Culture Quotes

By positioning Theranos as a tech company in the heart of the Valley, Holmes channeled this fake-it-until-you-make-it culture, and she went to extreme lengths to hide the fakery.

Every culture has a myth of decline from some golden age, and almost all peoples throughout history have been pessimists. Even today pessimism still dominates huge parts of the world. An indefinite pessimist looks out onto a bleak future, but he has no idea what to do about it. This describes Europe since the early 1970s, when the continent succumbed to undirected bureaucratic drift. Today the whole Eurozone is in slow-motion crisis, and nobody is in charge. The European Central Bank doesn’t stand for anything but improvisation: the U.S. Treasury prints “In God We Trust” on the dollar; the ECB might as well print “Kick the Can Down the Road” on the euro. Europeans just react to events as they happen and hope things don’t get worse.

no company has a culture; every company is a culture.

A startup is a team of people on a mission, and a good culture is just what that looks like on the inside.

Dov Frohman, the founder of Intel Israel, later said that to create a true culture of innovation, “fear of loss often proves more powerful than the hope of gain.

In stark contrast, China’s startup culture is the yin to Silicon Valley’s yang: instead of being mission-driven, Chinese companies are first and foremost market-driven. Their ultimate goal is to make money, and they’re willing to create any product, adopt any model, or go into any business that will accomplish that objective. That mentality leads to incredible flexibility in business models and execution, a perfect distillation of the “lean startup” model often praised in Silicon Valley. It doesn’t matter where an idea came from or who came up with it. All that matters is whether you can execute it to make a financial profit. The core motivation for China’s market-driven entrepreneurs is not fame, glory, or changing the world. Those things are all nice side benefits, but the grand prize is getting rich, and it doesn’t matter how you get there.

What’s new is that in this internet-ruled age, when a guru can be godless, when the barrier to entry is as low as a double-tap, and when folks who hold alternative beliefs are able to find one another more easily than ever, it only makes sense that secular cults—from obsessed workout studios to start-ups that put the “cult” in “company culture”—would start sprouting like dandelions. For good or for ill, there is now a cult for everyone.

HYPERGROWTH FOR A COMPANY ALSO REQUIRES HYPERGROWTH OF THE PEOPLE INSIDE IT.

The entrepreneur’s mind-set is completely different to the employee’s mind-set. The entrepreneur finds it abhorrent to conform to organizational norms, whilst the employee finds joy and stability in all that’s tried and true. It’s not that one’s wrong and the other is right. It’s the mind-set that differentiates the two.

I simply don’t have it in me to define my life’s success playing someone else’s game and following someone else’s rulebook.” --Dipa to her Grandfather

Think big. Start small. Scale fast.

Investors are people with more money than time. Employees are people with more time than money. Entrepreneurs are simply the seductive go-betweens. Startups are business experiments performed with other people’s money. Marketing is like sex: only losers pay for it.” “Company culture is what goes without saying. There are no real rules, only laws. Success forgives all sins. People who leak to you, leak about you. Meritocracy is the propaganda we use to bless the charade. Greed and vanity are the twin engines of bourgeois society. Most managers are incompetent and maintain their jobs via inertia and politics. Lawsuits are merely expensive feints in a well-scripted conflict narrative between corporate entities. Capitalism is an amoral farce in which every player—investor, employee, entrepreneur, consumer—is complicit.

When it first emerged, Twitter was widely derided as a frivolous distraction that was mostly good for telling your friends what you had for breakfast. Now it is being used to organize and share news about the Iranian political protests, to provide customer support for large corporations, to share interesting news items, and a thousand other applications that did not occur to the founders when they dreamed up the service in 2006. This is not just a case of cultural exaptation: people finding a new use for a tool designed to do something else. In Twitter's case, the users have been redesigning the tool itself. The convention of replying to another user with the @ symbol was spontaneously invented by the Twitter user base. Early Twitter users ported over a convention from the IRC messaging platform and began grouping a topic or event by the "hash-tag" as in "#30Rock" or "inauguration." The ability to search a live stream of tweets - which is likely to prove crucial to Twitter's ultimate business model, thanks to its advertising potential - was developed by another start-up altogether. Thanks to these innovations, following a live feed of tweets about an event - political debates or Lost episodes - has become a central part of the Twitter experience. But for the first year of Twitter's existence, that mode of interaction would have been technically impossible using Twitter. It's like inventing a toaster oven and then looking around a year later and discovering that all your customers have, on their own, figured out a way to turn it into a microwave.

Westrum’s description of a rule-oriented culture is perhaps best thought of as one where following the rules is considered more important than achieving the mission—and we have worked with teams in the US Federal Government we would have no issue describing as generative, as well as startups that are clearly pathological.

those companies, I knew they existed, and with a little time, capital, and effort, they would have their moment. I’d soon come to see that there were other people with checkbooks who believed that, too. Marlon Nichols, Troy Carter, and Suzy Ryoo at Cross Culture Ventures; John Henry at Harlem Capital Partners; Kesha Cash and Stefanie Thomas at Impact America; Aaron Holiday at 645 Ventures; Monique Woodard at 500 Startups; Charles Hudson at Precursor; Austin Clements at Ten One Ten; and Freada

No company has a culture, every company is a culture

the culture was strong enough to transcend the original company.

Educating people about why their support is necessary and valuable goes much further in securing their support than

Love is the surprising emotion that company builders cannot ignore.

What you permit becomes your culture.

When strategy, culture, and brand harmonize, they amplify one another and resonate loud and clear.

I run Venture for America, a nonprofit organization that recruits dozens of our country’s top graduates each year and places them in startups and growth companies in Detroit, New Orleans, Las Vegas, Providence, Cincinnati, Baltimore, Cleveland, Philadelphia, and other cities around the country. Our goal is to help create 100,000 new US jobs by 2025. We supply talent to early-stage companies so that they can expand and hire more people. And we train a critical mass of our best and brightest graduates to build enterprises and create new opportunities for themselves and others.

FAILURE IS NOT AN OPTION. Nobody in the startup world could have such a mug, I mused; it would be ridiculous. My experience is full of situations where reality proved too unpredictable to avoid failure.

When you're thinking about where is the best place to start a business, there's a lot to consider - It's about culture, it's about physical infrastructure, it's about how educated the people are, it's about the housing, it's about the natural ecosystem, it's about the regulatory and legal frameworks, it's about the local transportation system and the efficiency of all the other systems that are there. But location matters.

good luck and please do read those books, watch The Office, and believe in the people who disagree with you…Lying is a disgusting habit, and it flows through the conversations here like it’s our own currency. The cultural disease here is what we should be curing before we try to tackle obesity…I mean no ill will towards you, since you believe in what I was doing and hoped I would succeed at Theranos. I feel like I owe you this bad attempt at an exit interview since we have no HR to officially record it.

The cultural differences between Israel and the United States are actually so great that Intel started running “cross-cultural seminars” to bridge them. “After living in the U.S. for five years, I can say that the interesting thing about Israelis is the culture. Israelis do not have a very disciplined culture. From the age of zero we are educated to challenge the obvious, ask questions, debate everything, innovate,” says Mooly Eden, who ran these seminars. As a result, he adds, “it’s more complicated to manage five Israelis than fifty Americans

The short version is that if a tech company is about technological innovation first, and company culture second, a startup society is the reverse. It’s about community culture first, and technological innovation second. And while innovating on technology means forecasting the future, innovating on culture means probing the past.

Since tech became a consumer phenomenon, thousands of nontech people have come up with great ideas that use technology. But if their startups outsource their engineering, they almost always fail. Why? It turns out that it’s easy to build an app or a website that meets the specification of some initial idea, but far more difficult to build something that will scale, evolve, handle edge cases gracefully, etc. A great engineer will only invest the time and effort to do all those things, to build a product that will grow with the company, if she has ownership in the company—literally as well as figuratively. Bob Noyce understood that, created the culture to support it, and changed the world.

It is best to be the CEO; it is satisfactory to be an early employee, maybe the fifth or sixth or perhaps the tenth. Alternately, one may become an engineer devising precious algorithms in the cloisters of Google and its like. Otherwise, one becomes a mere employee. A coder of websites at Facebook is no one in particular. A manager at Microsoft is no one. A person (think woman) working in customer relations is a particular type of no one, banished to the bottom, as always, for having spoken directly to a non-technical human being. All these and others are ways for strivers to fall by the wayside — as the startup culture sees it — while their betters race ahead of them. Those left behind may see themselves as ordinary, even failures.

When I’m consulting to start-up founders, I often have to tell them that many of their people aren’t going to be competent in the new world order they’re heading into as they scale. Usually they respond, “But I like them and they work hard and they’re really great!” But the questions are: Can they do the job at scale? Are you going to need them to do tomorrow the same job they’re doing now? What’s your plan for them?

A company that is not designed to create high-tech products is very unlikely to have the culture or the DNA that it takes to create high-tech products. So if you are a high-tech person in that company, then you're basically a glorified typist in some sense. It's very unlikely that the kind of people who would be successful in an entertainment company would even understand what programmers do that makes them more than typists.

It is well-known that a big percentage of all marriages in the United States end in divorce or separation (about 39 percent, according to the latest data).[30] But staying together is not what really counts. Analysis of the Harvard Study data shows that marriage per se accounts for only 2 percent of subjective well-being later in life.[31] The important thing for health and well-being is relationship satisfaction. Popular culture would have you believe the secret to this satisfaction is romantic passion, but that is wrong. On the contrary, a lot of unhappiness can attend the early stages of romance. For example, researchers find that it is often accompanied by rumination, jealousy, and “surveillance behaviors”—not what we typically associate with happiness. Furthermore, “destiny beliefs” about soul mates or love being meant to be can predict low forgiveness when paired with attachment anxiety.[32] Romance often hijacks our brains in a way that can cause the highs of elation or the depths of despair.[33] You might accurately say that falling in love is the start-up cost for happiness—an exhilarating but stressful stage we have to endure to get to the relationships that actually fulfill us. The secret to happiness isn’t falling in love; it’s staying in love, which depends on what psychologists call “companionate love”—love based less on passionate highs and lows and more on stable affection, mutual understanding, and commitment.[34] You might think “companionate love” sounds a little, well, disappointing. I certainly did the first time I heard it, on the heels of great efforts to win my future wife’s love. But over the past thirty years, it turns out that we don’t just love each other; we like each other, too. Once and always my romantic love, she is also my best friend.

Kevin Kelly: The biggest invention in Silicon Valley was not the transistor but the start-up model, the culture of the entrepreneurial start-up. Marc Porat: It’s the style of thinking and behaving that’s called “being an entrepreneur.” Megan Smith: I grew up in it. It’s extraordinary. An entrepreneurial culture of like, “Hey, how can we solve this?” And really caring about helping each other. Carol Bartz: It really is just this need to change as fast as possible to enable the next great thing. We don’t even have to imagine the next great thing yet. We just have to get the tools to do something and use trial and error until we have the next great thing.

In Webvan’s case premature scaling was an integral part of the company culture and the prevailing venture capital “get big fast” mantra. Webvan spent $18 million to develop proprietary software and $40 million to set up its first automated warehouse before it had shipped a single item. Premature scaling had dire consequences since Webvan’s spending was on a scale that ensures it will be taught in business school case studies for years to come. As customer behavior continued to differ from the predictions in Webvan’s business plan, the company slowly realized it had overbuilt and over-designed. The business model made sense only at the high volumes predicted on the spreadsheet.

asked him to imagine the following: If I selected an employee of the company at random, from any level or function or region, and that employee had an absolutely brilliant idea that would unlock a dramatic new source of growth for the company, how would he or she get it implemented? Does the company have an automatic process for testing a new idea, to see if it is actually any good? And does the company have the management tools necessary to scale this idea up to maximum impact, even if it doesn’t align with any of the company’s current lines of business? That’s what a modern company does: harnesses the creativity and talent of every single one of its employees. Jeff answered me directly: “That’s what your next book should be about.

Focus on People, Perseverance, and Passion These “Three P’s” are the keys to successful entrepreneurship. People are the most important, particularly in the first year of a venture. To maximize their value, spend as much time as you can assembling the best possible team that really complements your skill set and can lead a little bit into where you’re heading, not just where you are. Creating the right kind of dynamic in terms of culture and commitment is really critical. Perseverance: never underestimate the value of really caring about your idea and being unwilling to drop it. If you have a big idea, and you know in your heart it’s going to happen (Passion), but know there will be roadblocks and challenges along the way. In this regard, a high degree of passion and commitment is extremely important. In my experience, really big ideas often take a decade to reach fruition. Sign

How to build a strong culture44 1. Have strong hiring filters in place. Explicitly filter for people with common values. You need to be careful that this does not act as a mechanism to inadvertently filter out diverse populations. You can have both a common sense of purpose and a diverse employee base at the same time. See later sections and the interview with Joelle Emerson for more information. 2. Constantly emphasize values day-to-day. Repeat them until you are blue in the face. The second you are really sick of saying the same thing over and over, you will find people have started repeating it back to you. 3. Reward people based on performance as well as culture. People should be rewarded (with promotions, financially, etc.) for both productivity and for living the company’s values. 4. Get rid of bad culture fits quickly. Fire bad culture fits even faster than you fire low performers.45 This chapter focuses on #1 above:

The VCs were prolific. They talked like nobody I knew. Sometimes they talked their own book, but most days, they talked Ideas: how to foment enlightenment, how to apply microeconomic theories to complex social problems. The future of media and the decline of higher ed; cultural stagnation and the builder’s mind-set. They talked about how to find a good heuristic for generating more ideas, presumably to have more things to talk about. Despite their feverish advocacy of open markets, deregulation, and continuous innovation, the venture class could not be relied upon for nuanced defenses of capitalism. They sniped about the structural hypocrisy of criticizing capitalism from a smartphone, as if defending capitalism from a smartphone were not grotesque. They saw the world through a kaleidoscope of startups: If you want to eliminate economic inequality, the most effective way to do it would be to outlaw starting your own company, wrote the founder of the seed accelerator. Every vocal anti-capitalist person I’ve met is a failed entrepreneur, opined an angel investor. The SF Bay Area is like Rome or Athens in antiquity, posted a VC. Send your best scholars, learn from the masters and meet the other most eminent people in your generation, and then return home with the knowledge and networks you need. Did they know people could see them?

The reasonable man adapts himself to the world; the unreasonable one persists in trying to adapt the world to himself. Therefore all progress depends on the unreasonable man.” George Bernard Shaw On a cool fall evening in 2008, four students set out to revolutionize an industry. Buried in loans, they had lost and broken eyeglasses and were outraged at how much it cost to replace them. One of them had been wearing the same damaged pair for five years: He was using a paper clip to bind the frames together. Even after his prescription changed twice, he refused to pay for pricey new lenses. Luxottica, the 800-pound gorilla of the industry, controlled more than 80 percent of the eyewear market. To make glasses more affordable, the students would need to topple a giant. Having recently watched Zappos transform footwear by selling shoes online, they wondered if they could do the same with eyewear. When they casually mentioned their idea to friends, time and again they were blasted with scorching criticism. No one would ever buy glasses over the internet, their friends insisted. People had to try them on first. Sure, Zappos had pulled the concept off with shoes, but there was a reason it hadn’t happened with eyewear. “If this were a good idea,” they heard repeatedly, “someone would have done it already.” None of the students had a background in e-commerce and technology, let alone in retail, fashion, or apparel. Despite being told their idea was crazy, they walked away from lucrative job offers to start a company. They would sell eyeglasses that normally cost $500 in a store for $95 online, donating a pair to someone in the developing world with every purchase. The business depended on a functioning website. Without one, it would be impossible for customers to view or buy their products. After scrambling to pull a website together, they finally managed to get it online at 4 A.M. on the day before the launch in February 2010. They called the company Warby Parker, combining the names of two characters created by the novelist Jack Kerouac, who inspired them to break free from the shackles of social pressure and embark on their adventure. They admired his rebellious spirit, infusing it into their culture. And it paid off. The students expected to sell a pair or two of glasses per day. But when GQ called them “the Netflix of eyewear,” they hit their target for the entire first year in less than a month, selling out so fast that they had to put twenty thousand customers on a waiting list. It took them nine months to stock enough inventory to meet the demand. Fast forward to 2015, when Fast Company released a list of the world’s most innovative companies. Warby Parker didn’t just make the list—they came in first. The three previous winners were creative giants Google, Nike, and Apple, all with over fifty thousand employees. Warby Parker’s scrappy startup, a new kid on the block, had a staff of just five hundred. In the span of five years, the four friends built one of the most fashionable brands on the planet and donated over a million pairs of glasses to people in need. The company cleared $100 million in annual revenues and was valued at over $1 billion. Back in 2009, one of the founders pitched the company to me, offering me the chance to invest in Warby Parker. I declined. It was the worst financial decision I’ve ever made, and I needed to understand where I went wrong.

But entrepreneurs should take cultures of extreme dedication seriously.

This was a success in itself, but it came with an added and unexpected benefit: The act of thinking about the problem and responding to it was invigorating and rewarding. We realized that our purpose was not merely to build a studio that made hit films but to foster a creative culture that would continually ask questions. Questions like: If we had done some things right to achieve success, how could we ensure that we understood what those things were? Could we replicate them on our next projects? Perhaps as important, was replication of success even the right thing to do? How many serious, potentially disastrous problems were lurking just out of sight and threatening to undo us? What, if anything, could we do to bring them to light? How much of our success was luck? What would happen to our egos if we continued to succeed? Would they grow so large they could hurt us, and if so, what could we do to address that overconfidence? What dynamics would arise now that we were bringing new people into a successful enterprise as opposed to a struggling startup?

Company culture” doesn’t exist apart from the company itself: no company has a culture; every company is a culture. A startup is a team of people on a mission, and a good culture is just what that looks like on the inside.

A solid process lays the foundation for a healthy culture, one where ideas are evaluated by merit and not by job title.

Process is only the foundation upon which a great company culture can develop.

They were so happy to be relieved of those strictures that they very quickly lapsed. Not everyone, of course, but the majority. We built the company a little too fast, and consequently the last 50 percent of the people hired really didn't have much commitment to the corporate culture. There were some warning signs. Consider McKinsey, which holds itself out as one of the world's leading repositories of knowledge on how to manage a business. They say they'll never grow their company by more than 25 percent per year, because otherwise it's just too hard to transmit the corporate culture. So if you're growing faster than 25 percent a year, you have to ask yourself, "What do I know about management that McKinsey doesn't know?" I still think it's more efficient—this is just an old Lisp programmer's standard way of thinking—if you have two really good people and a very powerful tool. That's better than having 20 mediocre people and inefficient tools. ArsDigita demonstrated that pretty well. We were able to get projects done in about 1/5th the time and probably at about 1/10th or 1/20th the cost of people using other tools. Of course, we would do it at 1/20th of the cost and we would charge 1/10th of the cost. So the customer would have a big consumer surplus. They would pay 1/10th of what they would have paid with IBM Global Services or Broadvision or something, but we would have a massive profit margin because we'd be spending less than half of what they paid us to do the job.

So we should not be surprised when The Economist tells us that “in Beirut, Cairo, Dubai, Riyadh or even Gaza City, small technology firms are multiplying.”18 We should not be surprised that in many Middle East cities women comprise 35 percent of Internet entrepreneurs, three times the global rate for such startups.19 We should not be surprised that in high-growth industries twice as many entrepreneurs are over fifty as are under twenty-five.20 Entrepreneurs are everywhere. Opportunities to nourish them are everywhere, too.

The point of school, after all, isn’t to do homework. The point of school is to learn. It was a mistake to assume that teachers—or anyone else, for that matter—automatically knew what was best for me. Rules are there to help us—to create a culture, to streamline productivity, and to promote success. But we’re not computers that need to be programmed. If you approach your bosses or colleagues with respect, and your goals are in alignment, there’s often room for a little customization and flexibility. And on the other side, those in positions of power shouldn’t force people to adhere to a plan for the sake of protocol. The solution, always, is to listen carefully—to your own needs and to those of the people around you.

I ask my young, white, male colleague to imagine that instead of saying that older people (gray hair and experience) are overrated, Halligan said that gay people are overrated, or women, or African-Americans, or Jews. Imagine Halligan saying, “We’re trying to build a culture specifically to attract and retain white people, because when it comes to technology, white people do a much better job than black people.” “But he didn’t say that!” my colleague responds. “He didn’t say anything about gays, or women, or black people!” As the Bible says: Jesus wept.

It’s a myth that an entrepreneur cannot work in a corporation. It’s all in the mindset.

Collaboration is different. In collaboration cultures people understand that even though everyone gets a voice, not everyone gets to decide. People are able to air their opinions, argue passionately for how they believe things should be done, and try to negotiate compromises. But it certainly doesn’t mean that everyone has to agree with every decision.

The culture that a founder creates is one of the most durable aspects of the company, outlasting the founder itself and carrying on the tradition of the firm.

I’ve never respected the profession. It’s business that has to take the majority of the blame for being the enemy of nature, for destroying native cultures, for taking from the poor and giving to the rich, and for poisoning the earth with the effluent from its factories. Yet business can produce food, cure disease, control population, employ people, and generally enrich our lives. And it can do these good things and make a profit without losing its soul.” Chouinard shaped Patagonia around his personal values,

Culture guides the team in their everyday work. It’s the foundation on which people make decisions and take actions.

companies are built in the image of their founders and that 80 percent of a company’s culture will be defined by its core leaders.

The myth of “founding a startup so you can do what you love” is at least as enshrined in the tech world’s popular culture as the myth of getting rich.

startup culture is about one thing: growth. As fast as you can.

Dazuzugehören ist ihre einzige Motivation. Welche, die schon im Abibuch vermerkt haben, ein Start-up gründen zu wollen, ohne eine Geschäftsidee zu haben. Die meinen, mit der Gründung eines Unternehmens viel Geld verdienen zu können, berühmt zu werden und ein aufregendes, unabhängiges Leben zu führen. Der neue Traum vom Leben als Rockstar. Dabei drücken sie sich vor der Arbeit, indem sie Artikel darüber lesen, wie sie ihren Alltag optimieren können, um mehr Arbeit zu bewältigen.

A team with shared culture and shared values will, almost always, outperform a team without these elements.

While Indian CEOs in Non-Indian companies are getting all the praise and admiration from the Indians, startups born on Indian soil remain unrecognized - this is not a matter of pride, it's a matter of shame, especially for a population whose history is replete with mathematical, scientific and philosophical achievements.

Frohman had long tried to cultivate a culture of disagreement and debate at Intel Israel, and he had hoped this ethos would infect Santa Clara. “The goal of a leader,” he said, “should be to maximize resistance—in the sense of encouraging disagreement and dissent. When an organization is in crisis, lack of resistance can itself be a big problem. It can mean that the change you are trying to create isn’t radical enough… or that the opposition has gone underground. If you aren’t even aware that the people in the organization disagree with you, then you are in trouble.

Frohman had long tried to cultivate a culture of disagreement and debate at Intel Israel, and he had hoped this ethos would infect Santa Clara. “The goal of a leader,” he said, “should be to maximize resistance—in the sense of encouraging disagreement and dissent. When an organization is in crisis, lack of resistance can itself be a big problem. It can mean that the change you are trying to create isn’t radical enough… or that the opposition has gone underground. If you aren’t even aware that the people in the organization disagree with you, then you are in trouble.” In

Spinner at one point comes up with an idea to get some publicity. “We should pitch a story about you working here at HubSpot, and how you’re learning a whole new thing,” she says. “We can call it ‘Old Dog, New Tricks.’” I look at her as if to say, You must be kidding. She tries to backpedal, saying she didn’t mean it as an insult. She thinks it’s really cool that I’ve joined this company with such a young culture and I’ve done such an awesome job of fitting in. I want to believe she means well. I tell her I’ll think about

Leaders create growth trajectories by creating chains from five dimensions of growth: customer group (current or new), product (built or acquired), geography (current or new), capabilities (current or new), and culture (current or new).

We respect the intense struggle of the entrepreneurial process and we know that without the entrepreneurs we have no business. When dealing with entrepreneurs, we always show up on time and we always get back to them timely and with substantive feedback, even if it’s bad news (like a rejection). We have an optimistic view of the future and believe that entrepreneurs, whether they succeed or fail, are working to help us achieve a better future. As a result, we never publicly criticize any entrepreneur or startup (doing so is a fireable offense). This does not mean that we leave CEOs in place forever. Our obligation is to the company not the founder. If the founder is no longer capable of running the company, the founder will not remain as CEO.

We respect the intense struggle of the entrepreneurial process and we know that without the entrepreneurs we have no business. When dealing with entrepreneurs, we always show up on time and we always get back to them timely and with substantive feedback, even if it’s bad news (like a rejection). We have an optimistic view of the future and believe that entrepreneurs, whether they succeed or fail, are working to help us achieve a better future. As a result, we never publicly criticize any entrepreneur or startup (doing so is a fireable offense).

It’s worth noting that so many of the goals that companies put forward tend to be arbitrary or overly ambitious. Especially in the start-up world, the drive for billion-dollar valuations is not an indicator of a healthy company that is built to last. It is a standard that has evolved thanks to the venture capital industry (because valuations are how they make their money). A strong culture and the ability to fund its own existence (also known as profitability) is how a company actually stays in the game for the long term.

In stark contrast, China’s startup culture is the yin to Silicon Valley’s yang: instead of being mission-driven, Chinese companies are first and foremost market-driven. Their ultimate goal is to make money, and they’re willing to create any product, adopt any model, or go into any business that will accomplish that objective. That mentality leads to incredible flexibility in business models and execution, a perfect distillation of the “lean startup” model often praised in Silicon Valley.

and follow these stupid rules. Worst of all, I have to spend a horrendous amount of time in useless meetings.” The creative magic begins to wane as some of the most innovative people leave, disgusted by the burgeoning bureaucracy and hierarchy. The exciting start-up transforms into just another company, with nothing special to recommend it. The cancer of mediocrity begins to grow in earnest. George Rathmann avoided this entrepreneurial death spiral. He understood that the purpose of bureaucracy is to compensate for incompetence and lack of discipline—a problem that largely goes away if you have the right people in the first place. Most companies build their bureaucratic rules to manage the small percentage of wrong people on the bus, which in turn drives away the right people on the bus, which then increases the percentage of wrong people on the bus, which increases the need for more bureaucracy to compensate for incompetence and lack of discipline, which then further drives the right people away, and so forth. Rathmann also understood an alternative exists: Avoid bureaucracy and hierarchy and instead create a culture of discipline. When you put these two complementary forces together—a culture of discipline with an ethic of entrepreneurship—you get a magical alchemy of superior performance and sustained results.

established companies need to figure out how to accomplish what Scott Cook did in 1983, but on an industrial scale and with an established cohort of managers steeped in traditional management culture.

As Cook says, “Developing these experimentation systems is the responsibility of senior management; they have to be put in by the leadership. It’s moving leaders from playing Caesar with their thumbs up and down on every idea to—instead—putting in the culture and the systems so that teams can move and innovate at the speed of the experimentation system.

I’ve made billions of dollars of failures at Amazon.com. Literally. None of these things are fun, but they also don’t matter. What matters is that companies that don’t continue to experiment or embrace failure eventually get in the position where the only thing they can do is make a Hail Mary bet at the end of their corporate existence. I don’t believe in bet-the-company bets.

Jack Dorsey, the cofounder of Twitter and founder of Square, has an interesting approach to his weekly routine. He has divided up his week into themes. Monday is for management meetings and “running the company” work. Tuesday is for product development. Wednesday is for marketing, communications, and growth. Thursday is for developers and partnerships. Friday is for the company and its culture.9 This routine helps to provide calmness amid the chaos of a high-growth start-up. It enables him to focus his energy on a single theme each day instead of feeling pulled into everything. He adheres to this routine each week, no exceptions, and over time people learn this about him and can organize meetings and requests around it. TACKLE

If this book has shown anything, it is that becoming a force in technological innovation or disruption far beyond Silicon Valley has never been easier than it is today—but unimpeded access to the internet is essential. New entrepreneurs worldwide are creating ways to collaborate and solve local, regional, and even global problems. And governments should note that while these innovators are passionate about their homes and culture, they have also never been more mobile. If pushed, they can seek out other countries that embrace their talent. In addition to losing their best and brightest, emerging nations will have trouble competing if their legal environments squelch innovation.

In general, be it at startups or aggressive companies like Facebook, there should be a cultural bias for launching. The perfect is very often the enemy of the good, and as the Facebook poster screamed from every wall: DONE IS BETTER THAN PERFECT. Very few companies have died due to launching early; at worst, you’ll have a one time product embarrassment (as Apple did with the first version of its iPhone Maps app). However, countless companies have died by losing the nerve to ship, and freezing into a coma of second-guessing, hesitation, and internal indecision. As in life, so in business: maintain a bias for action over inaction.

the immigrant population in the United States is a terrific example of how the combination of embracing constraints and being surrounded by a new culture can lead to an explosion of creativity. Immigrants are more than twice as likely to start a business as native-born Americans, and 52 percent of Silicon Valley start-ups include an immigrant. Forty percent of the Fortune 500 companies were founded by first-generation immigrants or their children.7 Peter Thiel, cofounder of PayPal, makes this powerful statement about the importance of avoiding cultural entitlement: "Doing what we already know how to do takes the world from 1 to n. But, when we create something new, we go from 0 to 1. Unless companies invest in the difficult task of creating new things, they will fail in the future no matter how big their profits are." If you want to keep innovation alive, look for ways to combine something old with something new.

I had several friends from law school who were very enterprising guys, much more so than the average law student. They each started businesses after practicing law at large firms for multiple years. What kind of businesses did they start? They started boutique law firms. This is completely unsurprising if you think about it. They’d spent years becoming good at delivering legal services. It was a field that they understood and could compete in. Their credentials translated too. People learn from what they’re doing and do it again on their own. It’s not just lawyers; the consulting firm Bain and Company was started by seven former partners and managers from the Boston Consulting Group. Myriad boutique investment banks and hedge funds have spun out of large financial organizations. You can see the same pattern in the startup world. After PayPal was acquired by eBay in 2002, its founders and employees went on to found or cofound LinkedIn (Reid Hoffman), YouTube (Steve Chen, Jawed Karim, and Chad Hurley), Yelp (Russel Simmons and Jeremy Stoppelman), Tesla Motors (Elon Musk), SpaceX (Musk again), Yammer (David Sacks), 500 Startups (Dave McClure), and many other companies. PayPal’s CEO, Peter Thiel, famously made a $500,000 investment in Facebook that grew to over $1 billion. In this sense, PayPal is one of the most prolific companies of recent times. But if you look at any successful growth company you’ll start to see their alumni show up doing parallel things. Former Apple employees founded or cofounded Android, Palm, Nest, and Handspring, companies that revolve around devices. Former Yahoo! employees founded Ycombinator, Cloudera, Hunch.com, AppNexus, Polyvore, and many other web-oriented companies. Organizations give rise to other organizations like themselves.

There’s a country that does something a little like this. Its young people, including its very best educational prospects from all different backgrounds, spend two or three years training and solving problems in a nonhierarchical environment and get together every year. Many then collaborate to start companies. This country leads the world in venture capital investments per capita (over $170, versus $75 in the United States in 2010).1 It has more companies on the NASDAQ than any non-US country except for China, despite having a population of less than eight million.2 Its quarterly gross domestic product (GDP) growth rate was above 5 percent in 2011 and it’s in the top thirty globally in per capita GDP, above Spain and Saudi Arabia, among others.3 This country is Israel, where eighteen-year-olds complete two- or three-year tours in the military, getting to know each other in highly selective military units. They operate at a high level of autonomy and responsibility and then travel the world for months before heading to college and/or grad school. In Dan Senor and Saul Singer’s book Start-up Nation, this network and training ground is credited as helping give rise to a culture of risk taking and entrepreneurship. By the time Israelis graduate from college, they’re in their midtwenties and mature; in many cases, they’ve already been in operating environments and borne life-and-death responsibilities. This cocktail of experience gives rise to a mixture of both courage and impatience. As one entrepreneur put it, “When an Israeli entrepreneur has a business idea, he will start it that week. The notion that one should accumulate credentials before launching a venture simply does not exist. . . . Too much time can only teach you what can go wrong, not what could be transformative.”4 Another observer commented, “Israelis . . .  don’t care about the social price of failure and they develop their projects regardless of the economic . . . situation.”5

DOGS AT WORK AND YOGA AREN’T CULTURE Startups

In all my experience in both startups and large companies, including and especially at Facebook, I would always prefer - a hundred times prefer - being subject to the rigors of the market, the fickleness of luck, and the whims of users than to navigate the popularity-contest politics of a large company, surrounded by the mediocre duffers who've succeeded in life through nothing more than guile and appearances.

The culture of a startup is that you’re on a mission, not just doing a job.

...remote work, and many other perks [..], will work or fail because of the company culture, not because of the perk itself.

This can have devastating consequences for the fast-growing company. Over a short period of time, say a year, the number of employees can leap from 50 to 150 in a startup, or from 150 to 500 or more during a later phase of rapid growth when the business model is promising and the funding is in the bank. Seemingly overnight, the new employees can vastly outnumber their predecessors, and this dynamic can permanently redefine the corporate culture. Brent Gleeson, a leadership coach and Navy SEAL combat veteran, writes, “Organizational culture comes about in one of two ways. It’s either decisively defined, nurtured and protected from the inception of the organization; or—more typically—it comes about haphazardly as a collective sum of the beliefs, experiences and behaviors of those on the team. Either way, you will have a culture. For better or worse.”2

In fact, the culture of innovation is so pure and so stridently noble that it often sounds like advertising. You hear about the startup that is going to help with sanitation in African cities; the one that’s going to print out prosthetic hands for disabled children; the one that’s procuring clothes for homeless children. “We’re with people who are curing cancer in a different way, and changing banking technology, and helping folks who can’t see anymore,” says a woman in a short YouTube video about MassChallenge. Inno is going to solve global warming. Inno is coming up with new treatments for autism. Inno is so inherently moral that there is even a UNICEF Innovation team; dial up its homepage and you will encounter the following introductory sentence: “In 2015, innovation is vital to the state of the world’s children.” The fog of righteousness surrounding this concept is so thick it allows all manner of absurdly altruistic claims. “Can startups help solve Boston’s Biggest Problems?” asked an email I received last spring. Of course they can! The group that sent it, CityStart Boston (“Leveraging the Innovation Community to Tackle Civic Issues”), announced plans to mobilize “the entire Boston startup ecosystem” to “collaborate to develop viable ventures designed…” Wait! Stop here for a moment, reader, and try to guess: in what way is the startup ecosystem going to collaborate to solve Boston’s biggest problems? If you guessed “to enhance innovation in Boston’s neighborhoods,” you were right. Startups are going to collaborate to enhance startups.

David versus Goliath Asymmetry lies at the heart of network-based competition. The larger or smaller network will be at different stages of the Cold Start framework and, as such, will gravitate toward a different set of levers. The giant is often fighting gravitational pull as its network grows and saturates the market. To combat these negative forces, it must add new use cases, introduce the product to new audiences, all while making sure it’s generating a profit. The upstart, on the other hand, is trying to solve the Cold Start Problem, and often starts with a niche. A new startup has the luxury of placing less emphasis on profitability and might instead focus on top-line growth, subsidizing the market to grow its network. When they encounter each other in the market, it becomes natural that their competitive moves reflect their different goals and resources. Startups have fewer resources—capital, employees, distribution—but have important advantages in the context of building new networks: speed and a lack of sacred cows. A new startup looking to compete against Zoom might try a more specific use case, like events, and if that doesn’t work, they can quickly pivot and try something else, like corporate education classes. Startups like YouTube, Twitch, Twitter, and many other products have similar stories, and went through an incubation phase as the product was refined and an initial network was built. Trying and failing many times is part of the startup journey—it only takes the discovery of one atomic network to get into the market. With that, a startup is often able to start the next leg of the journey, often with more investment and resources to support them. Contrast that to a larger company, which has obvious advantages in resources, manpower, and existing product lines. But there are real disadvantages, too: it’s much harder to solve the Cold Start Problem with a slower pace of execution, risk aversion, and a “strategy tax” that requires new products to align to the existing business. Something seems to happen when companies grow to tens of thousands of employees—they inevitably create rigorous processes for everything, including planning cycles, performance reviews, and so on. This helps teams focus, but it also creates a harder environment for entrepreneurial risk-taking. I saw this firsthand at Uber, whose entrepreneurial culture shifted in its later years toward profitability and coordinating the efforts of tens of thousands. This made it much harder to start new initiatives—for better and worse. When David and Goliath meet in the market—and often it’s one Goliath and many investor-funded Davids at once—the resulting moves and countermoves are fascinating. Now that I have laid down some of the theoretical foundation for how competition fits into Cold Start Theory, let me describe and unpack some of the most powerful moves in the network-versus-network playbook.

Travis would regularly say to the product teams, “Product can solve problems, but it’s slow. Ops can do it fast.” As a result, Uber saw itself as an “ops-led” company, and it was this team that best embodied the startup’s entrepreneurial and creative culture. The hustle within the Ops team was renowned, and one of the foundational elements of Uber’s success.

Topics & Questions for Discussion In Chapter One, “Cyrus Jones and the Magic Funeral,” Asha describes Cyrus as “mostly human, a little bit cartoon, a tiny bit ghost.” Having read the book, what do you think of Cyrus as a character? Have you met anyone like him in real life? Think back to your high school crush(es). Do you recall that first feeling of attraction? How would you react if you happened upon that person now? What does Asha’s relationship with her older sister Mira bring to story? How does she add to your understanding of Asha as a person? Jules is a source of support, emotional and financial, for Cyrus and Asha. What other roles does he play in the novel? Recall the manifesto Cyrus writes in Chapter Three: “We don’t try to convince people to buy things We don’t spy on anyone We don’t sell our souls (we don’t sell anything) and We are equal partners and make all decisions together.” Did you predict any of these points might falter? Were you correct? Consider what kind of workplace Utopia is. Would you like to work there? What elements would you like to see in your current work situation? At the end of Chapter Five, Asha thinks about the cultural differences between her and Cyrus, contemplating his “whiteness.” To what extent do you think their differences affect their understanding of each other? Have you had to think about cultural differences in a similar way? Besides WAI, several other app ideas are mentioned in the novel: Consentify, LoneStar, Buttery, Flitter, and so on. Discuss your favorite, or if you have any other start up ideas. Asha, Cyrus, and Jules must delve into all the logistical aspects of starting and growing a business, from assembling the right team to sourcing funding. What seem to be the biggest challenges to starting a business? The novel deals with themes of gender dynamics and white male privilege throughout. At what points can you see these dynamics at play, and how do the characters respond? If you were Asha’s friend, or family member, how would you react to her relationship with Cyrus? Would you have warned her or supported her? What does or doesn’t seem to work about their marriage?

You do not want to preserve culture; you want to collectively steer the right evolution of the culture.” —Patrick Collison

I think there are five top responsibilities of a CEO: being the steward of and final arbiter of the senior management; being the chief strategist; being the primary external face for the company, at least in the early days; almost certainly being the chief product officer, although that can change when you’re bigger; and then taking responsibility and accountability for culture.

In most business books, the role of the CEO boils down to a small number of key responsibilities. The CEO: Sets the overall direction and strategy of the company and communicates this direction regularly to employees, customers, investors, etc. Hires, trains, and allocates company employees against this overall direction while maintaining company culture. Raises and/or allocates capital against this overall direction. Acts as chief psychologist of the company. Founders are often surprised by the extent to which people and organizational issues start to dominate their time.

One day, not long after I relocated to California, I was driving to a meeting in Palo Alto when I spotted an amusing bumper sticker on the beat-up Porsche in front of me: PLEASE, GOD, ONE MORE BUBBLE BEFORE I DIE. The fallout from the dotcom crash was still fairly fresh. Was this someone who had missed out on the boom times, I wondered, or someone who had profited and then lost it all? Either way, the sticker highlighted a fascinating mindset that still pervades Silicon Valley: Are we out there just wishing that another bubble would come along, to boost our spirits and our bank accounts for as long as the party lasts? It’s a dangerous wish. Where would that leave us when the next bubble breaks? Many generations have seen true progress and growth, but not without moments when reality falls out of alignment with inflated bubble metrics. Hope, by its very definition, gets too far out in front of reality, and many of those hope-fueled companies don’t survive. The general formula in Silicon Valley is that there will be nine failures for every success—that high rate of failure is a necessary consequence of the freedom to take the risk to innovate. Even so, those failures leave damage and casualties in their wake. Part of the brilliance of startup culture is its dexterity and speed and conviction. Those same characteristics, however, can also manifest as vulnerability, as they frequently lead to shortsightedness, impatience, and volatility.

Axios is currently a more than 500–person start-up with a lively, hyper-ambitious, insanely transparent culture. Every employee owns equity in Axios, and we’ll answer any question, with two exceptions—how much someone makes and why someone left. We stay silent on those two out of respect for individual privacy.

SUCCESSFUL START-UPS often begin with a culture where people challenge one another directly and even fiercely, but also show they care personally.

Interview for culture fit. This seems basic, but it’s usually poorly done. Train hiring managers to interview for not just technical or domain skills but also mindset and culture fit.

So how do you help your Band-Aid solution stand out with people who don’t know they’re cut? You cut them! Of course, I’m not suggesting you cause any physical harm to your customers. Rather, you should adopt an approach that clearly conveys the problem you solve in advance of communicating the way you solve it. For example, back at my third start-up, when positioning our new-age feedback, coaching, and recognition solution, we could have invoked statements like: “We help employees get the feedback they need to perform their best and grow their careers.” “We help managers become great coaches.” “We help promote your amazing culture by making winning behaviors visible.” All imply that employees don’t get enough feedback at work, managers can often be poor coaches, and your people do amazing things that not everyone sees: fair points and all problems there is value in addressing. But they are also statements that are easy to dismiss. After all, many organizations already feel they provide their employees with sufficient levels of the feedback, coaching, and recognition they crave. We found prospects were much more responsive to our pitch when we preceded those statements with messages like: “Seventy percent of people leave their company because of a poor relationship with their manager.” “Most millennial employees use the word ‘hate’ to describe how they feel about performance reviews.” “Four out of ten employees are actively disengaged at work and cost companies millions in lost productivity.” Why did this approach work so well? The messages were striking. They were laden with specific and compelling statistics. And they invoked real business pains. They made the customer realize that they were already experiencing a loss. In other words, they were bleeding and in need of a Band-Aid.

As it turns out, Brian thrived in a high-Clarity culture. When handed a playbook, he knew exactly what to do. And did it flawlessly. But in the whirlwind of a fast-growing start-up, he was completely lost. He had trouble transferring what he had learned in his old role to his new job. Frustrated by the lack of guidelines and procedures, he kept going to his boss for help in making every little decision. He was too overwhelmed to innovate. He was lucky to just get through the day. In the interview, Violet had been so focused on what his company was doing, she didn’t get a good sense of Brian’s capacity to replicate it on his own.

If a startup begins by identifying an economic problem in today’s market and presenting a technologically-informed solution to that problem in the form of a new company, a startup society begins by identifying a moral issue in today’s culture and presenting a historically-informed solution to that issue in the form of a new society.

One decision about team composition that early-stage startups often wrestle with is whether to hire for attitude or skill. This is a delicate balance. If founders hire mostly for attitude, their team will be comprised of highly motivated, hardworking, jack-of-all-trade generalists who will shift readily between tasks as circumstances require. Hiring for cultural fit can yield similar results,

having access to boatloads of capital can be a competitive weapon if a startup has to confront aggressive rivals. But raising a big round can damage a startup, too, if it allows management to spend in profligate ways. Marc Andreessen suggests that a startup that has raised too much money can “become infected with a culture of complacency, laziness, and arrogance.” Resulting dysfunctions can include 1) over-hiring, with a commensurate slowdown in decision-making as too many managers get involved; and 2) schedule slippage, as employees say, “What’s the urgency? We have all this cash.

At the heart of Lean management is giving employees the necessary time and resources to improve their own work. This means creating a work environment that supports experimentation, failure, and learning, and allows employees to make decisions that affect their jobs. This also means creating space for employees to do new, creative, value-add work during the work week—and not just expecting them to devote extra time after hours.

The badly needed reforms that the elites regard as a threat—the right to free expression, tolerance of experimentation and failure, and access to basic government economic data—are necessary for a culture in which entrepreneurs and inventors can thrive.