Street Culture: Techstars Co-CEO on Coaching Startups to Define Culture
Technology startups that are accepted into accelerator programs have a unique advantage on developing company culture: built-in mentors, experience, and advice.
At Boulder, Colorado-based accelerator Techstars, co-founder and co-CEO David Brown says culture is one of his favorite topics to discuss.
“I think that culture is one of the few problems that you have to address before they’re problems,” Brown says. “If you’re struggling to figure out how to grow sales, you can wait until sales are in trouble and still turn it around. But if you wait until you’re in trouble with culture, it’s really hard to turn that boat.”
Culture is among the earliest and most important issues Techstars ensures that its startups address, along with issues such as product market fit and solving specific problems pertaining to products and services.
Brown believes that the culture of any company starts with the founders, and can remain in place even when those founders retire or move on. For the startups that Techstars assists, that process begins by helping founders define what their values are.
Techstars has helped more than 1,000 startups get their start, including Uber and SendGrid. The rate of failure for these companies stands at less than 12%, and total funding raised is pushing $5 billion. With 40 accelerators all around the world, Techstars is currently working with about 10 companies per location at a time.
The way that Brown approaches culture with these companies is by defining it, not by putting posters on the wall.
“It’s about defining, articulating culture in words, and making sure that’s a conversation that you have regularly,” he says. “In our case, we talk about it in orientation with new employees; we talk about what our values are, so it’s ingrained from the beginning and influences how they act throughout their tenure at Techstars.”
Techstars has four values, he says.
“Give first, which is the idea that life doesn’t have to be transactional; it doesn’t have to give you something without you giving something in return,” Brown says. “Network over hierarchy, which means more remote decision-making. Do what’s right for the founders—that’s about how our customer is the entrepreneur, and we make decisions with their best interests in mind. Quality before quantity is our fourth one. We’re happy to grow but only if we do it well.”
Those values emerged in Techstars’ very earliest days. Brown and co-founder and co-CEO David Cohen started Techstars because they wanted to “pay it forward,” Brown says.
“The ‘give first’ one was probably the basis for the formation of Techstars,” he says. “We were serial entrepreneurs, and we wanted to help other entrepreneurs. The words we used were ‘pay it forward,’ and that evolved into calling it ‘give first.’
When hiring new employees, Brown appreciates hearing from candidates who are familiar with Techstars’ cultural values.
“A hundred percent, there is nothing I love more than somebody coming into an interview and saying, ‘I love that give-first culture. I heard about it but hearing you explain it, I know that’s me and this is the place I want to work.’ If I hear that, I might overlook a couple of other flaws,” he says.
The companies with which Techstars works are very early in their development of culture, where most of the time, nothing is set in stone.
“I’m always interested by people who are doing things differently, like having an open pay structure where all salaries are shared with everyone in the company,” Brown says. “Or the open office, where nobody has an office. On balance, I think that’s a great thing. It keeps leaders from having too big an ego, like, ‘I get an office; you don’t.’ Anything to equalize is a good thing.”
In many ways, starting a company is like a marriage, he says. Many startups fail simply because the founders find themselves entrenched in conflicts that they can’t resolve.
“You have to get along and invest time in the relationship,” he says. “I hope people do that at home, but many forget to do it at work, too. [Conflicts] literally happen in every single program, probably a hundred times a year. There are probably, across the system, 30 or 40 breakups that happen every single year.”
Celebrating failure is one thing that Techstars taught childcare app company Sitter.me, and Brown says that stems from an ethos centered on ‘getting shit done.’
“I would rather make 1,000 decisions and get 900 right, and fix the 100 I got wrong, than make 100 decisions and get them all right,” he says. “It’s about the velocity of ‘I got 900 things right’ versus only 100. The point there is: Don’t overthink it. It’s okay to make mistakes. It’s okay to get it wrong. You have to make a mistake and fix it in order to learn from it.”
Establishing a company culture in which it is okay to make mistakes doesn’t always come naturally to driven startup founders. Brown recalled one founder from a company in Los Angeles who experienced a small but very real sense of relief just knowing that others had gone through what he was going through.
“He came to me, agonizing about how he was growing this business and kept having to make promises to customers in order to get the sale, and then he got the sale and the ops team was really, really struggling to deliver on the promise that he or the sales team had made,” Brown says. “And I just remember saying to him, ‘Oh, sell the dream, service the nightmare?’ I could see visible relief on his face, and he said, ‘There’s a term for that? It feels so good knowing that others have gone through this.’”
April Nowicki is a staff writer at Street Fight.