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Summary:

Dave Kashen of Quantum Leading calls for a change in startup culture. He believes that when we operate according to our core values and principles, in pursuit of a vision for the future that inspires us, we maximize our individual and collective well-being.

Values

The most neglected fact in business is that we’re all human.
— Chip Conley, founder of Joie de Vivre Hospitality

We humans are an extraordinary bunch. When inspired, humans can accomplish amazing things – from enabling flight to creating microprocessors to putting a man on the moon. As incredible as humans can be, we are fundamentally wired to maximize our chances of survival and our social status. This makes us highly susceptible to the cultural norms and principles of those around us.

Values

At the societal level, we’ve created a political and economic system designed to optimize the overall production and consumption of goods and services; to maximize our financial wealth. Yet, over the last 50 years as our per capita GDP has skyrocketed, corresponding measures of well-being, life satisfaction and happiness have flat-lined.

The key assumption that has served as the backbone of our cultural norms and principles for nearly 200 years is no longer valid. Exponential increases in the efficiency of producing food, clothing and shelter have enabled Western society to overcome scarcity – we now have more than enough stuff. It is no longer true that maximizing economic productivity and consumption maximizes our individual and collective well-being.

Try to think of someone you know who goes to work every day inspired and leaves better off than when they arrived. Now think of someone you know who finds their workday draining and detrimental to their well-being.  Which was easier?

Why are we tolerating this? There has to be a better way.

In the startup world, thousands of entrepreneurs focus their ingenuity on finding ways to make millions of dollars. They look for market inefficiencies and focus on questions like: “Will consumers pay for this?” without asking “Will this make people’s lives meaningfully better?” It’s not that we shouldn’t try to make money, it’s just that money should be merely one of many factors we strive for, and it’s played far too central a role for far too long.

So, if maximizing economic output fails to achieve the goal of maximized well-being, what might be an alternative hypothesis worth testing? Here’s my proposal:

When we operate according to our core values and principles, in pursuit of a vision for the future that inspires us, we maximize our individual and collective well-being.

As individuals, this seems relatively intuitive. In those rare moments when we have the audacity to truly be ourselves, we feel energized, alive, and free. When we dare to take a stand for our beliefs or go after what we really want in the face of social pressure, we feel exhilarated. When we take action for a cause we believe in, we experience a deeper, more sustained joy and peace.

I propose that we start testing this hypothesis at the company-level by architecting and building companies from the ground up that are designed to achieve an inspiring vision for how the world could be, driven by a core set of values and principles. I envision a world of values-driven people and values-driven companies. And what better place to start than with the youngest, most innovative companies in the world: startups.

The values-driven startup

The values-driven startup operates according to a set of clearly-defined values, aligned with an inspiring vision and strategy, that drive people’s behaviors and decisions every day.

The core building blocks of a values-driven startup include an inspiring vision, an effective strategy, well-defined values, observable behaviors for each value, and company-wide processes and routines that reinforce the values. The key is that everyone involved in the company truly embraces the vision, and actually lives the values day in and day out. There are already a number of startups beginning to operate this way, and they are illuminating the path for a new generation of companies built to maximize the well-being of all stakeholders. Here are a few that stand out:

Automattic

Automattic (makers of WordPress, see disclosure below) has a vision to democratize publishing and make “the web a better place.” They define their values in a creed that is included in each employee’s offer letter. When new employees sign on the dotted line, they’re committing themselves to live by Automattic’s core values of learning, taking initiative, embracing change, helping others, humility, impact, open source, maximum communication, long-term focus and perseverance.

Eventbrite

Eventbrite’s vision is to empower everyone to create, experience and share live events. They define their key values (“brand attributes”) as Accessible, Empowering, Social, Delightful, Innovative and Genuine. Their values are woven tightly into their hiring process, including an evaluation of each and every candidate for values alignment. Founders Kevin and Julia Hartz operate by the core principle of putting people first, company second and personal interests third. Despite raising more than $50 million in their recent financing round, Kevin and Julia did not take a dime off the table.

Sharethrough

Sharethrough’s vision is to build the future of media through their social video platform. They define their values as Optimism, Action, Purpose, Transparency, Respect, Creativity and Personal Growth. In the process of choosing a key vendor earlier this year, CEO Dan Greenberg had all but made up his mind. But when one of the company’s new employees pointed out to Dan that choosing a less experienced vendor would more fully honor Sharethrough’s value of Personal Growth, Dan and the team took a chance on the new vendor and haven’t looked back.

New questions

Entrepreneurs, I invite you to start asking yourselves new questions. What vision of the future truly inspires you?  What values and principles do you want to live by? What will allow you and your team to flourish? In the words of philosopher Howard Thurman, “Don’t ask what the world needs. Ask what makes you come alive, and go do it. Because what the world needs is people who have come alive.”

Dave Kashen is the founder of Quantum Leading, a leadership coaching and culture development firm for startups, and the Unleashed conference series. He writes the Awesome Culture blog.

Disclosure: Auttomatic is backed by True Ventures, an investor in the parent company of this blog, Giga Omni Media. Om Malik, founder of Giga Omni Media, is also a venture partner at True.

Image courtesy of Flickr user cdsessums.

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  1. Spot on, Dave! This is a topic dear to me and a few of my other entrepreneur friends. What you are hinting at is the social entrepreneur movement. A good place to look into is changemakers.com, and of course the amazing Ashoka.org, a prime example.

    I have seen an overwhelming amount of professionals from all walks of life and industry come to me saying they were professionally unhappy and wanted to do “something meaningful”. When pressed, they usually said they wanted to give back to the community.

    It’s impressive to see so many people like this, from different industries. I’m also glad to read your article here on GigaOM where I feel you can reach many younger entrepreneurs with that desire within who might not be able to put their finger on it.

    Kudos.

  2. wow, posting blog articles and having a baby on the same day! Impressive!

    Dave, you know I agree entirely with you. Not only is it more fun to be values driven, we’ve found it to be much easier to recruit and retain amazing talent. people don’t job shift for money, they do it because they want to work in an inspiring environment. I applaud the work you are doing to crystalize these somewhat qualitative concepts such as values driven into actionable metrics.

  3. Benjamin deRuyter Saturday, December 17, 2011

    Your article is an inspiring read Dave. Thank you.

    My guess is that practitioners who test your so-called “alternative hypothesis” are, in fact, more likely to achieve maximum economic output as a mere byproduct of their values-driven approach. Some metrics here would be really interesting.

    Cheers!

  4. Patrick O’Neill Saturday, December 17, 2011

    Well put. Our company was founded based upon the thinking you’ve outlined. We believe that if you make conducting charity easier, more direct and more rewarding, more people will help. Your piece will be a required read at our co, YouGiveGoods.com. Thanks. Pat

  5. Michael Langhout Saturday, December 17, 2011

    Values, when developed in collaboration with other team members, should in fact drive the critical business decisions. Nick correctly points to social enterprise, but this concept needs to be also driven into the DNA of for profit startup companies, which I believe is your key point. Not sure how the equity investors will respond to the idea, but it can be a very effective way to build trust, and grow the company if everyone on the team buys in and follows the path.

  6. Stephen VanDyke Saturday, December 17, 2011

    Entrepreneurs and founders should be and usually are idealists, even if it’s not always the most profitable course of action.

    It’s nice to have a solid moral foundation within your employee handbook, but as most tech people are all too aware there has to be a constant drumbeat to ensure the distance between company and customer does not grow to the point that you look and act like cigar chomping men in power suits who only see suckers and dollar signs.

  7. Very well said. We at jeebster.com envision a drastically improved local economy by promoting and supporting small businesses. Your quote regarding core values and principles is amazingly thought-provoking and rather moving.

  8. The most interesting sentence, for me in this article, is about over-productivity. Machines in developed countries, can manufacture more than it’s needed, what drops prices.
    In my opinion, also I think competition too often fight by lowering prices, always aiming to grow, overgrow…

    Conc. efectivity, my startup, http://www.pricemap.co , helps not to find the cheapest but the most effective: close and acceptable price. I would like to read also full manifestos, which are published on our facebook profile.

  9. This is a great article and I totally agree with everything you gave stated. Now can you get venture capitalists to follow the same thought process when making investments?
    I have been teaching by example my 7 year old that if you always put the needs of others first that your life will increase drastically. We are a society consumer by money and individualism as opposed to community.
    Maybe this is why I have been unable to secure cc funding because I am old school. Every project involves helping people.

  10. Thanks for taking the time to articulate this so eloquently. I am on my third start-up and I firmly believe that start ups, and purposeful work, should follow the maxim of “do what you love, and love what you do” and the highest form of doing something is in services to others or a higher cause. And, how we do it should be value-driven and of the highest vibration. At Virtual Bridges we make virtual desktop infrastructure. Yes, we target enterprises and commercial organizations as we perfect our product, but we also focus on non-profits and at-risk communities. The ultimate goal in birthing this new era in end user computing is to break the digital divide between the digital “haves” and “have nots” by lowering the cost and maintenance of a personal computing experience for under-privileged, at-risk and developing communities. The Digital Revolution must be accessible to all of the world’s citizens, not just the one’s who can can afford it. This higher purpose is the engine behind our passion and commitment to our company’s mission.

  11. Amazing read – thanks Dave! Most small startups don’t put enough emphasis on values but the companies that built themselves around a core set of personal and business principles have clearly delivered happiness, more than once. As a small team, we’re recognizing that….

  12. I find this post really Inspiring.

  13. In my work with startups, I try to get them to start thinking about culture from the point of their very first hire – as this is the line in the sand moment. It’s the easiest time to start and the point from which you can set the strongest foundation. See http://www.jumpstartinc.org/Blog/The-Importance-of-Cultural-Fit-in-Startups.aspx for more thoughts on this. Thanks for shining a light on this often overlooked topic.

  14. I loved every bit of your Article. Very well written with great piece of examples to support by. Like mentioned, values just help in everything that you do in organization. Be it Hiring, Communication(s), Sales, etc.
    As a co-founder, one of the core set of values we identified were Respect, Rewards and Recognition which was aligned to the mission of organization P.E.O.P.L.E.; we were able to outline the Fundamentals on which the Business should stand. It was primarily Principles and Rules on which we thought we will build a *great* company and not a Big Company, pretty much unlike the trend which is India. While we start operating on keeping the principles intact, there were enough occasions where we were required to bend the rules to align to changing business needs and this led to the definition of additional values which helped us sustain the growth and create a healthy culture resulting in transparency in decision making process and hence rock solid foundation on which Organization is still growing.
    Keep writing such great article(s).

  15. Sampathkumar Iyengar Tuesday, December 20, 2011

    An excellent article. Keep up the good work and seasons greetings

  16. Philip Galligan Saturday, December 24, 2011

    What a tremendous message Dave. I think we are at the dawn of some significant mindshifts in the corporate world where capitalism has to be for the benefit of many and not the few who cannot be trusted and who are driven by greed. Hopefully the 21st century is remembered as the century of social reponsibility and enlightened leadership. There is enough for everybody.
    Shared ownership should be the next instalment on this topic.
    Regards
    Philip

  17. Great points taking into account economic realities of our world!

    Make creed, not greed!

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