Nokia Startups Mistake #4 – Culture Gone Wrong

“When the servers are down, it is the wife’s (or husband’s) job to wait.” says the Tough Love Angel. 

This article originally appeared on ArcticStartup.

This is part of my Nokia Startups Mistakes series. For a backgrounder, please read the introduction. It is a big challenge for anyone with a long work experience in a large corporation, including Nokia, to succeed in building the right kind of culture for their first startup. It is a huge challenge even if you have a lot of startup experience.

In many Nokia-based startups, the key cultural problems I have seen are the following:

  • A way too many people on the payroll
  • Sky high salaries in case they have been able to attract funding
  • Consensus-driven culture and lack of sense of urgency

And finally this 08:00 – 16:00 work mentality that just won’t work in any ambitious product startup. This rotten work mentality is a wider Finnish issue beyond Nokia-based startups, with its roots in our welfare state where life is so much more than work. It shows here, and it sucks.

Why culture eats strategy for breakfast?

Building startups is tough. There will be an unthinkable amount of challenges ahead, and to survive these challenges and keep the team together in rough waters the entrepreneur and his founding team needs to build and maintain a strong startup culture.

I believe a strong culture is a leadership tool with two main purposes:

  1. It makes people more productive while executing strategy towards a shared vision.
  2. It keeps the team together in times of change when vision falls apart (= pivot), strategies fail and the company is in the brink of bankruptcy.

Visions change, strategies alter but the glue that keeps everything together is – the culture combined with strong leadership. A great culture must be built upfront before facing a crisis. Crisis, however, is the only real acid test to see whether you have a strong culture or not. Complicated!

A culture is part of the bigger whole

A big vision of something worthwhile – something that is going to change the world – serves as the anchor point. A great vision ignites people and gives them a sense of direction in the ocean of uncertainty.

It is the CEO’s job to communicate a vision that both founders and early employees find as understandable and worthwhile pursuing. In an early-stage startup, a vision typically centers on the core problem to be solved and on the more detailed vision how to solve it, i.e. product vision. There has to be adequate mutual respect between the leader and the troops, for the leader to be able to lead his troops, and for the troops willing to follow their leader. Agreeing on the vision is not enough.

Among the troops there must likewise be an adequate compatibility and mutual respect too. Folks must like each other to the extent they appreciate each others’ work and working together is at least efficient and smooth if not always super fun. The troops, however, don’t need to be best friends. Culture is what takes a group of individuals with diverse backgrounds and values, and melds them into something greater.  Into a high performance team with common goals and winning attitude.

There are super talented individuals who can’t efficiently work together no matter what culture, but you can take that to the bank that without a great culture, there is no high performance team.

What are the key ingredients of a great startup culture?

  • Hard work. Everybody must work really hard. A co-founder’s typical continuous weekly load should be at 60 hours. Work less and achieve more is nonsense most of the time.
  • First priority. It is very important to create and maintain a sense of urgency in a startup. Startup must be the first priority at all times. If a server is down, it is more important at that time than a nagging (or crying) wife.
  • Wearing multiple hats. A team of five (or less) must do the job that in a large corporation would be assigned to a small army of, say, 50 people. Be flexible. If no one knows how to build a great UX, it is then everyone’s vested interest to contribute and come up with a solution. No silos!
  • Being frugal. Watch every penny, and create a frugal attitude towards everything. 2000-3500€/month is the right salary range in a small, non-profitable, underfunded startup.
  • Having fun. Very important! You are likely going to fail anyway, so try at least to enjoy the journey and have fun.
  • Openness and transparency. Share almost everything. Don’t create any information silos. It is the right of all co-founders and early employees know precisely what is going on in their company. Being transparent and open creates trust and fosters creativity.

How to build a great startup culture?

The early culture decisions set the trajectory and course of the company. The foundation for a startup’s culture is built in the early days – during the first few months to be precise. Here is a check list how to do it:

  • Cultures are not put together by an individual.
  • While a founder or a founding team can have a dominant voice in establishing the culture, it’s the founding employees who cement it.
  • Each person a company brings on board should not only be talented and work hard but also fit smoothly into the company’s core values and be compatible with the rest.
  • The CEO must interview every new hire up until a certain threshold.
  • Define what your company’s culture is, and what do you expect from each employee and co-founder until hiring, and make sure they understand and agree on expectations. Be specific.
  • If someone, no matter how important employee or co-founder, continuously violates your culture and thus sets a bad example – fire him immediately.

Did I miss something you believe to be an integral part of great startup culture?

A collection of related links can be found from Kippt here. Watch especially a video by Mårten Mickos, where he brilliantly explains why he thinks entrepreneurialism is a belief system. If you know a relevant link that you would like to share with others,  please feel free to send it via email to mika (at) marjalaakso (dot) com.

I hope you will enjoy this series, the thoughts it provokes, and the discussion it triggers. Please do participate to the discussion by sharing your own angle and experiences on this topic, or commenting on something, anything on this post. The preferred place for discussion is the Facebook page at https://www.facebook.com/ToughLoveAngel.

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4 thoughts on “Nokia Startups Mistake #4 – Culture Gone Wrong

  1. Krista Lagus

    Are there any examples that you could give on this: “Define what your company’s culture is, and what do you expect from each employee and co-founder until hiring, and make sure they understand and agree on expectations. Be specific.”

    What is specific and what is not? What kind of expectations would you define?

    Reply
    1. mikamarjalaakso Post author

      Hey Krista,

      Thanks for a great question. This is a short answer! For instance, you would first define the cornerstones for the culture you believe would be great for the company in questions.

      One cornerstone (or ingredient), as indicated above probably would be HARD WORK. You would then go on and draft that in your company on average it means this many hours per week (e.g. 60 hours) on a continuous basis, and sometimes when needed you would expect co-founders to put in e.g. up to 100 hours short term to ship the product, or whatever would be so significant for the success or survival of the company that it justifies this mad amount of hours spent – and expected from key contributors.

      You would sit down with potential co-founders and talk through the whole thing, set the expectation and nail down things that everyone understands and agrees on what is expected, and why it is so damn important.

      In recruiting situations, you would probably build a check list of questions / assignments you would ask candidates to do / perform to test directly or indirectly how they would fit to your company values and culture.

      If one has lot of other priorities in his life, typically 60h/100h working requirements per week are a no-go, and he would not thus pass your test. In case you didn’t notice, do read this excellent list of things to remember (not all related but perhaps you find something useful here also) http://betashop.com/post/32913573235/90-things-ive-learned-from-founding-4-technology

      Sorry for not answering directly all your simple questions but these culture things are complex and always kind of situation specific ….. and thus dangerous

      BR,
      ,,Mika

      Reply
  2. Krista Lagus

    Thanks Mika!

    I understand that giving a straight answer with real examples can be dangerous 😉 I also realize that I need to define my own culture. For example, I realize that my list would not include 60 hours of hard work, but rather something along the line “we will take breathing space and breaks” as I feel this is a key ingredient in continuing to be mentally productive and creative in the long run. Also perhaps “a culture of mutual respect” and other stuff about open communication, and the spirit of co-creation would perhaps be on my list. Or will be. I am still trying to understand which of these are the kind of things that could be explicit enough to act as a check list in hiring. But I guess this will clarify over time.

    Your blog posts are excellent thought provokers, so deep thanks and keep up the great work 🙂 ❤

    Krista

    Reply
    1. mikamarjalaakso Post author

      Krista – thank you very much! It’s all about balance and what works here doesn’t work there. Situations are different. AND: to work 60h/week you need to balance that somehow, and that somehow could be having fun and enjoying working and achieving with your co-founder mates. But to say that we are going to have breaks …… I wouldn’t. 🙂

      Reply

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