15 Minute Founder E6: How to define company culture

In this episode of 15 Minute Founders, Alex Levin and Rebecca Greene dive deep into the pivotal role of company culture in shaping the trajectory of a business. With their combined experience as co-founders of Regal.io and past ventures, they provide invaluable insights into the significance of cultivating a strong organizational culture right from the start. From the genesis of defining core values to implementing strategies for sustaining them, Alex and Rebecca offer practical advice and anecdotes that shed light on the importance of culture in fostering employee engagement, decision-making processes, and ultimately, business success.

Main Topics Covered:

1. The Importance of Defining Company Culture Early On
2. Aligning Values with Business Goals
3. Strategies for Crafting and Communicating Company Values
4. Interviewing and Hiring for Cultural Fit
5. Celebrating and Reinforcing Values through Recognition
6. Nurturing Culture Through Team Activities and Off-sites
7. Handling Conflicts Between Core Values
8. The Evolving Nature of Company Culture and Adaptation over Time

Transcript

Alex Levin: 0:01

Hi, this is Alex Levin. I'm one of the co founders of Regal.io, and this is 15 Minute Founders. So I'm here with my co founder, Rebecca, and today we wanted to talk about culture and what it means. And honestly, there's nobody better than Rebecca because at the companies we've been at in the past, Rebecca was literally the one who wrote the culture deck. I think all of us read the Netflix culture deck and aspired to that, and Rebecca got close. So. So maybe start there, you know, when, when we were at the last company and you were thinking about, you know, important projects to do, you know, for the business, instead of picking a project that was linked to revenue, you said, no, I'm going to go take three months and go do this culture project. Like, how did that come about?

Rebecca Greene: 0:41

Well, specifically, I think at the company we're at, I think we did this maybe too late, but we were either series B or C by the time we actually went and decided to write down what the culture is for our company and what we wanted it to be and be intentional about it. And we had scaled very, very quickly. There was a lot of VC money we had raised, and we had grown really quickly and realized that the founders and the leadership team had kind of. Lost the initial opportunity to author the culture and decide exactly how we thought we were going to win as a company and how our talent was going to behave to get us there. And when you just hire hundreds of people, and they each bring their own perspective on how to behave and what to do, then you kind of lose ownership of the culture and whatever happens happens. And so we had an opportunity at that moment to reset and that's why it was so important for us to do it at that time. I think. You know, now that we've built Regal, I think it was the 1st slide you and I ever even created in our pitch deck was what what the values of Regal were going to be in this writing those 5 things down. That's what I would encourage other companies to do. But yes, in that specific context, like, I think it was the most important thing we could have been doing to make sure we could get the business on the right trajectory. Because at the end of the day, it's all about the talent at the business. Who's actually building it?

Alex Levin: 1:59

Yeah. So, I mean, I think back to that experience and I had never thought about it so intentionally, certainly. Like I remember being at some companies. Going, I don't agree with how like the execs are making decisions or being at other ones going, Oh no, I like, I, the way they make decisions, it makes sense to me inherently. And I understand the direction that we're going and I understand how I should make decisions. So looking back, I now understand that's culture. Like, it's not like, did they have a ping pong table? Did they have a fancy office? Like, did they take us out to drinks or not? Like, that's all fun and games that I, you know, great, but the, the. The realization I had when you finally did that exercise was if we can be really clear about how we make decisions as an organization, what we reward and what we punish, so to speak. That's the, that's culture like, and you know, if you're in an organization where you where it's clear and you agree with it, you're going to have a great time. If you're going to, even if they don't have the ping pong table in the fancy office, but if you're in an organization where you don't agree with the way they make decisions, I think it's really a struggle. So like, without naming names. As an example, there's a company that I used to work with a lot where their way of making decisions was all consensus driven, was very emotive, less data based. And I really struggled working with them because they would refuse to look at the data we gave them. They would refuse to let one person who was the boss there make the decision. And so it took much longer to get to an answer. And the answer wasn't necessarily one that. Made any sense to me coming from a perspective of being very data based. And so it was just a good reminder of like how different some cultures can be.

Rebecca Greene: 3:39

Yeah, and I, I think back to my experience before getting into startups, which was at Amazon, which is I can say it because it's so famous for the culture and the set of values or principles that they've created and. I think what's great about it is it's, it's great when it's not for everyone. I think a lot of people, when they think to what, what culture do we want to build, they think to set out and like, what's going to make the most people happy and successful at our company. And I think that's the wrong way to go. I think it's to be really intentional about what you believe is going to make. your company different and more successful and how you're going to operate to do that. And you want people to self select out. Ideally, you want to do that through the interview process, but you don't always get it right. And so if people join and they just say, it's not for me because I don't share these values, that's actually a good outcome. And I think when I was at Amazon, not everyone realized that or shared that perspective and thought it was too hardened about what the culture would be. But I think it's a huge part of why they're so successful.

Alex Levin: 4:34

Yeah, I mean, I agree with you. Like, I think some people look at Amazon and they go, Oh, I would love to work at Amazon, except the culture. And I'm like, no, no, that's the whole point. They only want the people that agree with their way of doing things because they want to do it that way. And if you don't agree with it, then you shouldn't go to Amazon. You should go to a different place where you agree with how they do things. I mean, you know, I think about the different startups I've been at and I think. Part of what was so fun about being founders from the beginning is that, you know, in the past, even if I agreed with the culture, ultimately, like, it wasn't entirely the thing I wanted. And so, like, when we got to start something to be able to say, like, here, this is the way we want things done. We want it done in our image, you know, we want bracelets made saying, what would Rebecca do, for instance, like. That's I think one of the best parts about starting a company where you can be so intentional about it. So to your point, it was something very early we did. So as you think about, you know, how you come up with those values, like how should people start doing it? Like, how do you come up with that list of what the things are?

Rebecca Greene: 5:36

I think if you're doing it really early, In some ways, it's an extension of the quote DNA of the founders themselves. You know, you and I sat down to have that conversation and asked ourselves. What's most important to us? What do we believe? What do we think are the set of things that have made us successful in our career? And do we think will apply to Regal and make Regal successful? If everyone espoused those values, that doesn't mean everyone's the same. Everyone thinks exactly the same, right? You pick a succinct set of things that people need to do or believe and operate against. And so I think it stems from the founders. To start, and I think it has to be married to the type of business that you are like the frugality principle. If that's something you really believe in, but you're in a fat margin business and a great market environment, like, maybe that's not the most, you know, top 5 important thing to. Put as part of the company, because it's not really critical that you win, but for a retailer, like. Amazon or for our previous company that had lower margins, that was really critical to be a part of it. So I think it's a marriage between the founders and the business. And I think the farther out you get, because values should change and evolve as a business evolves to some extent. So at our last company, when we did a reset on that and it was farther out, it became not just a reflection of the founders by that point, because the company already had a history and a way of doing things, some that worked, some that didn't, and there was already an exec team. So in that case, it was a little bit more of a reflection of. the history of the company and the exec team, not just the founders themselves.

Alex Levin: 7:04

Yeah. And, you know, to your point there, they're not static. Like they don't have to be the same forever. Like you as a leadership team can decide to change them. I'd say the question that I find hardest to answer about values, and I'll pick some examples of our values, is let's say one of our values is built for customer love, and another value is you know, use data to make good decisions. What if they're in conflict, right? What do you do in a situation where you have multiple values are in conflict? I think our answer has largely been, well, some, you know, all are equal, but some are more equal or whatever, or certain values that we brought, you know, keep above the others. And so that helps break ties. So, you know, build for customer love, maybe above other values, even if you have multiple, and I think the other answer we sometimes give which is not very satisfying to people, but as honest is it's okay for the values to conflict. Like, it doesn't mean that you always have to have a clear answer. The point of the value is to help you make the decision by forcing you to think through the lens of customer love and data, but it's okay to say, well, I thought through the lens of customer love and the answer is we should do this product. And I thought through the lens of data and the answer is, well, we should do it in a different way. And that's in conflict. And how am I going to solve that? Well, that's okay. It's okay to have that conflict. It's not always going to give you the answer, but it's still forcing you to think about it in that way. So I think like, it's not bad for a conflict to be created. Now, if you whitewash it and you pretend that like the conflict never happened, that's unfortunate. But if it's leading to important conversations in the company, it's great. It's a good outcome, in my opinion.

Rebecca Greene: 8:38

Yeah, I agree. Values are a lens with which to evaluate opportunities and make decisions and act that doesn't mean they're all going to point always in the same direction. It's the healthy tension and the discussion around it and feeling as a company that you had the language to like, help you understand it and make that decision. Even if there was tension, that's important. So that everyone is bought in to. Okay. We did think about it in the right way. We, we reached this tension and we chose to make this decision and go forward.

Alex Levin: 9:06

So, so you were talking about it before. You have a set of values. How do you, in interviewing screen for those, how do you and current employees You know, keep people focused on them. Like, what do you do to actually make sure that it's something that has lived throughout the company?

Rebecca Greene: 9:22

So really tactically and different companies do this different ways, you know, you could literally have something that's called like a bar razor interview or a culture alignment interview where you're interviewing candidates there for a specific team, but you always bring in either a founder or some culture champion from another team that doesn't have skin in the game on this particular hire, because they're not going to report into them or be on their team who is asking a set of behavioral questions. Tell me about a time where. You know, you had to use data to make a decision and they're open ended. They're hinting at the values, but they're not telling the person the right answer. And you're evaluating, well, how did they pull that data? Did they really look at the data and how did they inform their decision? And you're deciding, does this person really represent the data beats opinion value, which is one of ours. So I think that's one of the best ways to do it, is to have somebody not on your team doing that interview. A different way of doing it is having, you know, An interview circuit where each person on the interview team or interview panel has 1 or 2 of those questions. That's enough. That's an alternative. If you can't add a special interview for it.

Alex Levin: 10:26

Yeah. There's an apocryphal story about McKinsey that I've always loved, or apparently 50 years ago, when they interviewed people, they used to also go to a meal and they would watch whether you put salt on your food before you ate your food. So they're going to have to put salt or pepper on your food, pepper on your food before you eat your food. And there was a period where they wanted people who are more conservative. So putting salt or pepper before you tasted it was considered risky. And so like that would disqualify you on that value. And then apparently, McKinsey switched into a mode where they wanted people who were more go getters and would try things. And so putting the spice first was seen as something they wanted. So I tell that just to remind candidates that some of this is a little bit difficult for the interviewers to tell so I highly encourage everybody who's going to interview, go look at their values, read them, self diagnose. Is it something you agree with, right? Because if you don't, like, maybe it's not the right company. And if it is something you agree with, tell them, don't let them try and guess because you put salt before or after the food. Say, you know, if you were to ask my friends, The most important thing they would tell you is that I really care about the people I work with. And if you were to ask the people I work with, the most important thing is they would tell you how data based I am. And here's three examples, tell the company, give them the example. So the person can check the thing on their list. Don't let them guess because some random thing that you said. So then, you know, let's assume, you know, they've, they've joined, you know, we've done all kinds of different things to. Get people more involved in the values over time. So, you know, at all sites or like, you know, within the company. And I think some have been more like than others, but we do try to like, keep the values alive. Like what's something we've done that you think has worked better to, to make the values more alive for people.

Rebecca Greene: 12:11

I say 2 things come to mind. 1 is I do think just celebrating people who do represent values is really important. And so we have different ways of doing that, whether it's at off sites, giving values awards and calling out people, having others call out people for an example of where they exhibited the value or a value. We also do values T shirts. Where managers after 90 days pick a value that the person represents and, you know, in shout outs or, you know, 1 year anniversaries, we talk about values and things like that as well. So, I do think celebrating the right behaviors is like, really nice for people and other people get to see how others have exhibited those values, which is useful. And then the other 1, I would think in terms of more like instilling it, I've really enjoyed, you know, at our off sites. At, at some level of abstraction, the values become a little bit meaningless. And so you and I take the time in our quarterly or annual off sites to not just talk about business performance and what can people do to help the business perform better, but we go, we pick a value and we do a deep dive and we do an exercise. And so we. Over time, we're actually building out our values or culture deck and making it more robust by giving examples and going a layer deeper to explain what each of the values mean and then doing the exercise, I think helps in a representative way. But people collaborate and live a value. And so I think those have been received.

Alex Levin: 13:31

Yeah, I mean, always one of my favorite parts of all sites is where we like tap people on the shoulder at like meals with preparation to like talk about an example where like that value came to life. Because to your point, I think it's fun to recognize people and like fun for others to hear like an example where, where it really sort of comes alive. But I do want to make what would Rebecca do bracelets I still think that would be like that would be good. So that's all we have today. So talking a little bit about, about value, you know, if you ever want to reach us, feel free to email us at hello@regal.io and we'll talk to you soon.

Rebecca Greene: 14:05

Bye.