How to build (and navigate) healthy fast-growing startup culture

In the cheap-money 2010s, tech startups developed a reputation for moving fast and breaking things. Following the Great Recession, disruptive early-stage and flashy new-economy companies funded enough growth to win the admiration of high-performing workers.

The water’s been rougher of late. Pandemic-powered labor demands coincided neatly with rising social consciousness; mental health and worker well-being rose in prominence. Workplaces everywhere were put on notice: low-paying nonprofits, stiff corporations and politically-agnostic tech firms renegotiated employee dynamics. And then there were those darlings of the 2010s: fast-growing tech startups.

“Everyday is something new to deal with and it’s just exciting to see things take off,” said Dave Monahan, founder and CEO of Kleer, which offers subscription-based dentistry. “The bad is the offshoot of all that is you’re basically creating chaos and stress.”

Kleer is a prototypical example of the form. Starting with a bet in 2016 that the dental insurance model was inefficient, Monahan and team cast about for what tech types call “product-market fit,” the hallowed ground where a company’s offering meets consumer demand. They built out software to support a subscription model for dentists and are entering rapid expansion — named to the Inc. 5000 list of fast-growing companies this year.

Fast growth can be measured in many ways: top-line revenue (Kleer has annualized growth at nearly 100% over the last three years, per their numbers), employees (the company is nearing 70 full-timers) and customers (Monahan’s preferred metric, which has gone from zero to 9,000 in the last four years).

The software era features such aggressive growth both because of the reproducibility of digital technology (adding software users is easier than selling more physical widgets) and because of the assumed network effects of many technologies, the so-called “first-mover advantage.” Though not necessarily required, rapid growth typically involves outside financing to fund investments beyond revenue and often involves scalable technology. Alongside this financial and technical debt that often comes from moving so fast, HubSpot CTO Dharmesh Shah recently noted that many companies also incur “culture debt” — company habits or employee personalities that contribute to a less healthy workplace. Herein lies the origin of startup workplace toxicity.

When you’re moving so fast, Monahan notes, “Sometimes you’re tempted to take shortcuts.”

Some shortcuts are inevitable within a startup environment, Monahan said, when a new company is forming new systems, approaches and technologies. It’s a mistake when those shortcuts include oveworking or underdelivering for employees.

“The stereotypical toxic overworking employee companies… I think, just from the very beginning, the expectations were wrong,” he said. Rules may be different for company founders, as just about any entrepreneur will likely tell you, but employees deserve boundaries and a workload within reasonable limits.

“You don’t have to work 12 hours a day to make something successful,” Monahan said. Of setting employee expectations, he advises other founders: “It’s not going to be perfectly smooth; it’s not going to be accepted 100%; you want to get some acceptance and then build from there.”

Startup employees still do typically log more hours than peers, but research has shown that productivity falls off precipitously beyond 50-hour weeks. Increasingly employees aren’t willing to accept much variety in the number of hours worked. Instead, employees at startups — or other organizations undergoing meaningful change — are more willing to welcome the fast-changing priorities and approaches that come with market validation, Monahan adds.

“The critical thing you have to establish in any organization is [that] you can balance your life” with your work, Monahan said. He added Kleer’s team includes parents and those who have other personal obligations outside work — one benefit of multigenerational teams. Ground your company in values, respect life outside work and be willing to cut ties when company and employee are unable to meet expectations that have been clearly communicated.

As Monahan put it: “Startups are not only hard work, they’re constantly evolving.”