Building your Startup's Culture with Pirate Metrics

Originally published Apr 2, 2016

One of the hardest parts about scaling a company is keeping its culture alive as it grows. You don’t want it to stay the same — it should evolve. Yet you also don’t want it to change too much — the core values should stay the same.

A lot of startups build their culture on perks and benefits. Brand new Macbooks, standing desks, free soda and donuts, beer in the office, Nerf wars… While these are all pretty cool, they are a gimmick. They can’t be the foundation of your company’s culture, not unless you want your culture to be as plastic as it gets. Don’t get me wrong, I love a good Nerf headshot as much as the next guy, but I wouldn’t work for you because of them.

I propose we treat our culture like we want our people to treat our product.

So let’s work with Dave McClure’s Startup Metrics for Pirates framework and scale our culture into a freakin’ Unicorn. Quantifying the 5 dimensions of the Pirate Metrics to check your company’s cultural pulse.

Acquisition

Here’s the deal: Startups don’t work without customers, they most definitely don’t scale without customers and they will never be profitable without… you got it, customers!

So we all put a lot of effort and money into acquisition. The same applies to your culture. Your culture’s customers are the PEOPLE that you hire. If you want to acquire these customers, you need to:Demonstrate your culture and your company’s value

Make them want to come to you, by clearly showing that you’re solving a pain they relate to and you’ll make someone’s life better

Allow your prospects to know more about you, to explore and learn about what you’d do for them in detail

Have a Recruitment team and process that is better than your Sales team (because they will also have to recruit Sales people)

Do things that don’t scale if you have to. Like with your product, you want to do things smartly, not mechanically. Maximise your efforts for learning. The first people coming in through your door: they’re the ones that will make you succeed.

Activation

Awesome, your first customer is through the door. Regardless of whether you’re a consultancy company, a design firm, a coffee shop or an internet economy giant, you want to delight them, awe them, drive them to their magic moment.

Then, you promise to repeat that experience for EVERY customer walking in.

So isn’t that what you need to do with your people as well?

It’s not enough to point people to their desk, giving them the latest ultra lightweight macbook pro and two 4K screens and let them do their thing.You come to their desk the next day, ask them your best version of:

“How’s it going, pal?”, followed by a quick “Oops, gotta run for a meeting with a big fish now. Catch’ya later! Let’s make some money, shall we?”.

I know you wouldn’t do this, but that’s what it sounds like to them when you’re not worried about onboarding your people the best you can.

Make their first experience extraordinary.You should be empowering them, showing them why you founded this thing in the first place, who the people are and what they’ve helped build, and where you’d want to have it in 1,2,5 and 10 years.

If their first contact with your product is special, they’ll be activated, they’ll find their magic moment, they’ll feel like your mission is their mission.

Make that moment count.

Retention

“What retention?” you might ask. “You want better retention than paying them good money every month?”.

Ok, first of all, yes. Money isn’t everything.

Secondly, retention is as much about having people invested as it is about rewarding them.

Picture this:

I’m on the internet. I am the customer.

A while back I found this great shopping site that let’s me find great deals on electronics. I’ve bought with them before and it went well. I’ve had to send my smartphone back once, they weren’t very helpful with the instructions and I ended up having to pay for postage because the whole thing wasn’t clear. Another time, I had a question about an order and they didn’t come back to me until after I insisted a week later. Still, they ARE the cheapest out there, so I can put up with these annoyances. As a company, they’re doing great and have been around for a while.

Now, a friend of mine tells me about Amazon. I’ve been looking for new headphones lately. I dive in, find the same model I’ve been looking for. They’re not cheaper there than on that other site… But I start thinking about the last pair of headphones I had. They broke after 6 months and I had to threaten to sue before they admitted it wasn’t my fault and sent me a replacement. Is Amazon’s customer service any good? I call my friend — He raves about it. It’s great! Best thing he’s ever experienced in his life!

Oh well, let’s give it a go! There are NO barriers to exit from my current product, and there are almost no barriers to entry in this new one.If you’re a company and deal with highly qualified and talented people, you are in this same situation. They’d find a job in 2 weeks if they wanted to, and the fact that you’re a good deal NOW, does not mean the same will be true in 6 months.Work on retaining them. Raise barriers to exit. Make them know you care, they’re appreciated, their work means something and you wouldn’t make it without them. Give and ask for feedback. Be responsive and have a great User Experience. If they have any problems, provide AWESOME customer service.

When the going gets tough for you, they’ll stick around.

Revenue

You’re struggling to make ends meet. You’re a startup… You’ve just barely started paying your own salary and this is you: working 18h/day, dreaming/having terrible nightmares about it the other 6h.And here I am, talking about how you need to build a culture that will make you thrive? You need to fix bugs, launch features, get shit done! Well, culture is getting-shit-done. In fact, if you do it right, you’ll get more shit done than ever before. Most importantly, the right shit. The shit that matters because your smart people are engaged and want to find out what that is.Your people will be more talented, deliver faster and more reliably, you’ll spend less time in pointless meetings and explaining things they should’ve known from day 1, having discussions about who owns or was supposed to do what.

Revenue won’t be born from culture, but it will only grow as fast as your culture allows.

Referral

The power of your product is exponentiated by great PR. Word-of-mouth is the best acquisition channel you have and social referral is the new word-of-mouth. To go Viral, you want every customer to refer more than one other customer. If you do your job right, your best customers will often know other great customers they will refer to your product.

Extremely talented people, will also know other talented people. They most likely didn’t get there alone, and they have recognized themselves in other many times before. They will know someone else who can add to your company and they will be your best recruiters. Promote referrals, encourage them, have your people vouch for your new people.Leave room for others, of course, you don’t want to fall into the trap of making everyone look alike. Diversity is important, and it’s not because of political correctness. It’s because it prevents you from tripping over your own biases.Treat your people like you treat your product. Measure how you’re doing in Acquisition, Activation, Retention, Revenue and Referrals.

Set up a system to do this. Your world-class culture will take care of itself.