Don’t Think of Your Startup as a ‘Family’
In the early years of my company, we did not extend an employee’s one-year-long contract because their performance was okay, but not outstanding. Also, we were in the middle of a financing round and had to save on cash. It was a perfectly rational decision. However, since it was the first instance that we had let go of somebody under such circumstances, the rest of the team was confused. I had been calling our companies’ culture “family-like” many times before. That didn’t help at all in the situation.
“How could those monsters in management cold-heartedly fire a family member?” was the question written over the faces of the staff. The mood of the team was down for weeks, and we probably lost more cash on unproductive time than we saved on the employee’s salary.
The family dilemma
Startup founders often praise their “family-like” work culture with good intentions. A “family” sounds like a warm contrast to a bigger corporation’s mechanical, reserved, and often highly political environment. In my startup, employees would often go out, play sports, or vacation together. On a Friday at 10 p.m., you could usually find people in the office drinking beer and having fun. People bonded. You could feel that warm, cordial atmosphere. The place sure looked familial.
In a startup, ‘love’ has a condition, which is cultural fit and performance.
There is a big problem with the term “family” in the startup context, however.
Families are all about unconditional love. You support each other no matter what. In a startup, “love” has a condition, which is cultural fit and performance.
A startup is always a race against time with too few resources. Dragging someone along who doesn’t cut it anymore sends the message that you accept mediocrity. The same goes for culture: Keeping someone on board who is performing well but whose behavior is toxic might cause cultural deterioration. Remember that “one bad apple can spoil the whole bunch.” And even if performance and culture are stellar, an external situation like a fundraise can require a tough decision, which lies outside the…