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Hi, I’m Brad Feld, a managing director at the Foundry Group who lives in Boulder, Colorado. I invest in software and Internet companies around the US, run marathons and read a lot.

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Startup Culture: Values vs. Vibe

Comments (32)

My friend Chris Moody, the COO of Gnip, has another guest post up today titled Startup Culture: Values vs. Vibe. He’s written about this in the past on his blog, but we both thought it was worth reposting. Enjoy – and comment freely, especially if you disagree or have constructive feedback.

I hear some form of the following question frequently from founders that are starting to have early success:

“How do we hire a bunch of new people and grow the company quickly without losing the culture we’ve worked so hard to establish?”

I’ve been fascinated by different company cultures for as long as I can remember and I love asking entrepreneurs to describe the culture of their companies.  Over time I’ve come to realize that when you break down culture descriptions you’ll often find a mix of two components:  values and vibe.  Although each component can have a significant impact on the overall feel of a company, the way you establish and manage the two should be different.

Values

I think of values as the guiding principles or a code-of-conduct upon which a company was founded and which it operates on a daily basis.  If you establish the right set of values early, these principles won’t change with time.  Values establish your company’s view of the world and determine how you treat others including employees, customers, partners, and investors.  Most importantly, values serve as the foundation on which tough company decisions are made.  Values are 100% controlled by the company and should be unaffected by competitors, market conditions, and industry trends.

The people you hire will come with their own set of values. Every person you hire should have personal values that completely align with the values of your company.  95% isn’t good enough.  In fact, if a team member violates a company value, the violation should result in removal of the individual from the company.   Here are some other things to consider around establishing and maintaining company values:

  • Document and talk about your company values with your team all the time. Consider publishing your values, and talking about them with customers, partners, etc. to add an extra level of scrutiny to your commitment.
  • I believe a set of five or less documented values is ideal because you want all your employees to have them top-of-mind when making decisions.  If you have too many values, people simply won’t remember them.
  • Determine a set of tough “trade-off” questions that you can ask during the interview process that will help you determine if a candidate’s values align.
  • Good values require tough decisions to be made in order for the values to be upheld.  If you establish values that are never challenged, these values aren’t serving any real purpose.

This last point is particularly important.  Watered down or generic values might be easy to uphold, but they also won’t establish a strong culture.  Companies with unique cultures tend to have values that are unconventional and sometimes controversial.   A famous example of a unique value is Google’s “Don’t Be Evil”  (I believe the actual company published version is “you can make money without doing evil”).  I’m guessing “don’t be evil” is discussed at Google hundreds of times of day when decisions are being made, and I bet it is surprisingly hard to stay true to this value even though the premise seems fairly simple.  The fact that Google allowed this value to become public knowledge has resulted in a huge audience of observers that are constantly scrutinizing Google’s actions to see if they are staying true to their values.

Vibe

Vibe represents the emotional side of the company. Like all emotions, vibe can be fairly volatile and is highly influenced by outside factors.  For example, think about the vibe of a company on the night that the first product is launched vs. the vibe of the same company when Apple announces they are launching a competing product or service.  When it comes to vibe, management can certainly set a tone and lead by example, but the reality is the vibe of a company will naturally change with time as the company grows and the products/employees mature.    The biggest influence on vibe is typically success.  Most companies that are doing well tend to have an overall positive vibe.

In the last few months, I’ve talked to two different startups that described one of their values as “Work hard. Play hard.”  Is this really a value? Perhaps this statement actually describes the vibe at a certain moment in the life of the company. If an employee is no longer willing or able to play hard but is still producing at a high level, is this person no longer valued by the company?   Working and playing hard together might be an important part of the company in the early days, but will it be a necessary component for all 300+ employees when the company has been around for 10 years?

As a leader, there are aspects of vibe that you will naturally want to try to control.  However, you have to ask yourself a few questions:

  • Is this aspect of the company important to our long-term success?
  • Does this aspect need to be maintained forever and is it sustainable?
  • Does this aspect apply to all areas of the company and to all employees?
  • Will establishing this aspect help us make important decisions in the future?

If you answered, “yes” to all of the above, congratulations: you’ve just identified a new potential value.  However, it can be fairly liberating to realize that the foosball table in the middle of the office is nice, but it isn’t crucial to the long-term success of the company.

I know this won’t be a popular statement, but I don’t think maintaining culture (as defined by many entrepreneurs I’ve encountered) is important.  Instead, I think it critical to focus on establishing strong values early and hiring people that have aligning values.    Maybe it is all just semantics on how you define culture, but I believe you shouldn’t sweat the vibe part.  You’ll have an overall positive feel if you are successful and that is the only type of vibe that really matters.

  • Anthony Giallourakis

    The values component can be restated as “our value added”, which defines how we can create “synergistic leverage” and positive results from that leverage. Leverage comes from work, which individually does not need to be a part of the overall company’s values, but collectively, it should.

    Vibe is another descriptive (and a very cool one at that) for the transmission of a frequency (or vibrations) that creates a harmonic resonance with something or someone else. “That song has a neat vibe to it”; is an example of how some people’s music might impact a sympathetic listener.

    If your audience and target market is not capable of being sympathetic to your vibe, it will have no positive effect, and your results will not be what you sought.

    Create leverage from work which adheres to your collective values, then harmonize all of that outwardly to those who will be sympathetic to the harmonic it all generates. Then dial into the resonance you create and optimize.

    Great blog!

  • Carl Grant
    • http://twitter.com/chrismoodycom Chris Moody

      Particularly like the part about incorporating your values in to the interviewing process. Nice and concise.

  • http://twitter.com/dgmandell David Mandell

    Values are established and maintained through the actions of the executive leadership. I’ve seen too many execs say their values are one thing yet act differently. The second someone who violates those values is rewarded, those values are altered completely.

    • http://twitter.com/chrismoodycom Chris Moody

      Dave, couldn’t agree more. As I mentioned, violating the values is a BIG deal. Having someone from the senior leadership team not exhibit the values is a disaster.

  • http://www.justanentrepreneur.com Philip Sugar

    Great post. I’d love to hear some of your values.

    Some of ours are that we will never “shine” a client on. I.e. tell them or let them assume we do something we don’t. And we will never do anything that puts our core engine at risk. Those sometimes are hard to uphold and as David says if the executive leadership doesn’t hold them the go to hell quickly.

    Our vibe though has significantly changed. We used to do the beer and foosball late night thing, but now that has been replaced by getting out exactly on time to pickup the kids. You are right, the vibe doesn’t matter nearly as much as the values.

    • http://twitter.com/chrismoodycom Chris Moody

      Phillip, those sound like two great values. As your company grows/matures it gets easier to see the difference. But, for some early stage startups, it isn’t always so obvious. Sounds like you guys have a firm grasp on the differences.

      Two of our values at Gnip:

      1) Always be honest
      2) Hire great people and trust them to accomplish great things

      • http://www.justanentrepreneur.com Philip Sugar

        I agree but I think you have to be more specific. For instance values can be we are going to have honest disagreements but we are not going to take it personally. We are not going to tolerate gossip and politics.

        Because I don’t think anybody starts off saying I want to do evil, be dishonest, and hire shitty people. You get there if you tolerate other things.

        And I don’t know if I agree on the “do no evil” because I think if most people knew how much data google stored on them and how they use it people might think otherwise. duckduckgo certainly has some nice graphics about it.

  • http://blog.printfection.com/ Casey Schorr

    100% agree with the ‘vibe’ part, Chris. And thanks for sharing your take on Values. I have a lot to learn from the first half of this post.

    It’s refreshing to hear a startup CEO echo my thoughts on ‘vibe’. We’ve never been the sexiest startup. For the first five years we worked out of a warehouse by DIA. Then we got a fancy downtown Denver office. Now we’re working from home, and having team meetings at my business partner’s house or starbucks – about as unsexy of a ‘vibe’ as you can get.

    But the important part? The company is the most successful we’ve ever been. Nobody wanted to work for us when we had our downtown denver fancy office, because we were struggling. But now, with no cool-ness factor at all, we’ve had numerous people from more ‘vibe-y’ startups in Boulder and from around the USA inquire seriously about working for us. And you know what, they don’t really care about our vibe. They care about the team, and the success we’re having, and wanting to be a part of that environment.

    • http://twitter.com/chrismoodycom Chris Moody

      Amen. And, really happy to hear about your progress. Congrats!

  • http://www.facebook.com/profile.php?id=207139 Brent Daily

    Nice distinction Chris. Foosball isn’t a value.

    The most important point you make is that everyone shares the same value system. Zappos’ culture sounds fun, but it won’t work for every company.

    Two points as culture alignment relates to start-ups:

    1. It pays to have these conversations early. A puzzle with with 50 pieces is easier to put together than one with 750. Focusing on your internal customers is just as important as external customers and product.

    2. You treasure what you measure. Measure your culture and report on it in board meetings. Culture doesn’t have to be a squishy, nebulous thing. If it is, then you’re going to lose control of it. Know your values. Score those values for new hires and ensure you’re becoming more and more aligned as you grow.

    • http://twitter.com/chrismoodycom Chris Moody

      Brent, great points. As I recall, a tool like Roundpegg is particularly helpful with the 2nd
      point. I’m a big fan of what you guys are doing!

  • QualityCoding.info

    Cool stuff, thx.

  • http://www.facebook.com/profile.php?id=100000530923082 Ned McClain

    Great post Chris – interesting suggestion to try and limit yourself to five… makes so much sense but also is so hard to do! Ours is ten, I think Zappos has about that many, Twilio’s newly-published list has nine: http://www.twilio.com/company/nine-values
    Still, I agree that a shorter set of five, or even three, values are much more likely to be top of mind day-to-day.
    Best, Ned.

  • JamesNCleveland
  • http://twitter.com/robert_hatta Robert Hatta

    Interesting that you chose the “Don’t be evil” value at Google as an example of one that is unique when I’ve used it as an example of one that is overly broad/subjective, and therefore meaningless and impossible to reinforce. http://www.jumpstartinc.org/Blog/The-Importance-of-Cultural-Fit-in-Startups.aspx.

    Otherwise, I couldn’t agree more and love how you’ve decoupled vibe from values.

    • http://www.justanentrepreneur.com Philip Sugar

      I love that fucking post :-)

      • http://twitter.com/robert_hatta Robert Hatta

        Thanks, Philip.

  • http://petegrif.tumblr.com/ Pete Griffiths

    Values are critical because they are the things that guide decision making by employees when they have little else available. (“What would Steve do?) Management can’t be there holding peoples’ hands all the time. And people won’t have all the data they might need for every decision. That’s when strong values are critical. A vibe doesn’t help you here.

  • COECOVentures

    One concern I’ve always had about those the place too much importance on ‘vibe’ is that they attempt to create this artificially. A vibe occurs naturally. To force it, or fabricate strife, in attempt to foster creative energy typically backfires. By instead concentrating on values a company can generate its own vibe. Plus, as per Philip’s comment, that gives room for that vibe to change over time.

  • Jesse

    Another way of thinking about this is culture vs. climate or character vs. mood. We’ve latched onto a concept called Simple Rules in our company where we try to stick to 3 fundamental human behaviors that guide day to day decisions. Our culture centers around exploring and creating the future in a very organic way, sticking together as a team, and connecting our work to things that will have impact. Instead of a list of catchy phrases we’ve then focused on screening and hiring with a values assessment(we made a lot of hiring mistakes early on and hired for experience rather than culture), having great group discussions, developing people, evaluating performance against these rules, and assessing our progress with a structured diagnostic along the way. We’ve made lots of mistakes but it feels like we’re actually getting closer to the culture we want(rather than losing it).

    Still young and small so there is lots more mistakes we could make.

  • http://www.about.me/briankung Brian Kung

    Where is the line between company and personal values? Are there personal values that would be less suitable as company values?

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  • http://twitter.com/talkaboutgeorge George Mobile

    So True! I am glad someone is stating the difference between the guiding principles that become everyday decision-making criteria and whether one should take a break shooting nerf bombs at the crew that are busy coding. Thanks Brad

  • http://twitter.com/DavidSandusky DavidSandusky

    Important post especially the comment you think might not be popular “but I don’t think maintaining culture (as defined by many entrepreneurs I’ve encountered) is important”.

    Trying to maintain a culture at different stages of business growth is a common failure. Hiring those who lead based on evolving companies and inevitable change in culture is important – maintaining those founding principles and core values is key. I hope you don’t mind I share my quick post with a few things to think about when hiring for culture rather than simply competencies:
    http://founderrecruiting.com/blogs/post/Hiring-for-Competencies-No-Problem-Culture-Not-so-Fast/

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