How to Build a Thriving Culture 03-27

How to Build a Thriving Culture – An Interview with Dharmesh Shah, Co-founder of HubSpot

I have an immense amount of respect for the team at HubSpot.

The work we do here at KISSmetrics is awesome, but if there’s one company that I look up to and try to model, it’s definitely this one.

In just a few short years, HubSpot has hit the #314 spot on the Inc. 500 list and gone from $2.2 million revenue in 2008 to $52.5 million in 2012. Not too shabby. Now it’s adding about 25 employees each month.

Recently, the co-founder of HubSpot, Dharmesh Shah, put together a deck on how they’ve defined their company culture. He invested over 200 hours building it.

But why is there such a strong emphasis on culture? Why go through the trouble? As Shah explained in a LinkedIn article:

• Small decisions get made faster and large decisions get easier.
• You have a much easier time attracting amazing people to your team.
• Hiring people that are a bad fit has a corrosive impact on your organization even long after they’re gone. A well-defined culture helps you avoid this.

As of this writing, the HubSpot Culture Code already has amassed 159,000 views in just a few days. Here it is:

It just so happens that I was able to catch up with Shah and ask him a few questions about how to build a thriving culture. Here’s what he had to say:

How did you figure out the tenets of HubSpot’s culture?

“It’s been an iterative process over many years. In the early years of HubSpot, we didn’t talk about culture at all. We were a small team, and the culture organically grew based on my co-founder and I — and the early team. Over time, we started feeling a need to think about our culture and what we wanted it to be, so we could communicate it better as we continued to grow and scale.

“The first pass of what is now the HubSpot Culture Code deck was focused primarily just on people patterns (which is now just one section of the deck). The early deck described the kinds of people that seemed to do well at HubSpot and that we wanted to recruit.

“Then, last year, I started getting feedback from the team that, though the original culture deck was useful, it needed to be revisited and refined. It also wasn’t going far enough. It described the who but didn’t address any of the how or why. So, we started a project to update the deck. What I originally thought was going to be a relatively simple “lets revisit our original thinking” project ended up becoming an all-consuming one. After all was said and done, we’re pleased with the results, and the updated culture code deck already is proving useful on just about all fronts.”

Can these tenets be changed and iterated on, or is it critically important to get them right the first time?

“I think they can (and should) be iterated on. As companies grow, they often too closely hold on to the “we want to maintain our startup culture” mantra. Though there certainly are elements of the startup culture that you want to keep forever, not everything that made sense at 5 people or 50 people makes sense at 500. Some of the core values should remain constant (and they have for us), but others should be revisited.

“What I’ve found is that, as you iterate on thinking about culture, you don’t change that much – but you refine and clarify a lot. For example, we’ve always believed in transparency as a core value. That’s been a core value at HubSpot since the day we started and has continued through the last two big iterations of our culture code.

“But, now, we try to dig into what we mean by valuing transparency – and what the limits are. That’s why the new culture code deck makes clear that we want to be radically and uncomfortably transparent. The “radical” part is to convey that it’s a moving target. What’s radical today may not be radical tomorrow. We want to constantly push on the edges. And the “uncomfortable” part is there to acknowledge that we are deliberately going to do things that don’t quite sit well with everyone.

“On the flip side, the new version of the deck also talks about the limits to the transparency (things we don’t share), which includes things that we don’t feel the company completely owns (like salary/compensation information).”

What’s the biggest challenge you faced when trying to instill your culture?

“The biggest challenge is recognizing that you can’t really instill it.

“The culture spreads by virtue of the kinds of people that are brought in – and by the behaviors they emulate based on what is going on around them. Culture can’t be forced. It can’t just be a “we have big posters on the wall.”

“And, most importantly, it needs to be “inbound.” It can’t be bought. It has to be earned. Simply having free beer, ping pong tables, and parties does not get you culture. Too many companies make that mistake. They think having “retreats” that give people a chance to socialize and bond is what makes for a great culture. It doesn’t. What makes for a great culture is when people wantto socialize and spend time with each other.”

How did you accomplish that?

“I’m not sure that I have yet.

“HubSpot is growing fast. I can remember a time when there were only 25-30 people in the company. That felt pretty big. Today, we’re adding about 25 people a month to the team. This means it’s harder and harder to communicate the culture and make sure everybody “gets it.” It’s easy to drift, and that’s the thing I live in mortal fear of.

“What helps a lot is our early tenet of transparency. The discussion around culture at HubSpot is very public. We get feedback from everyone on the team on whether they’re happy or not (and why) every 3 months. I read through hundreds of comments from HubSpotters to try and get a sense for what people are thinking and feeling. And, though it’s tough sometimes, I get biting, scathing, painful feedback sometimes when I wander astray. It’s hard getting that kind of feedback, but it’s part of what makes me love the company. We speak the truth and face the facts.”

What’s the single, most important action that someone needs to take in order to improve the culture at their own company?

“First, accept the fact that you’re going to have a culture – and that you canand should influence it. Then, spend some calories (you don’t have to go all crazy) thinking about it, talking about it, and maybe capturing it. It’s going to feel weird and cheesy the first time you do it. But, it’s worth it. Trust me.”

More Resources on Building Culture

Shah cited all of these as inspiration:

1. Netflix Culture: Freedom & Responsibility
2. The Valve Handbook for New Employees (warning: links to a giant PDF)
3. You Don’t Create a Culture – 37signals
4. When Culture Turns Into Policy – 37signals
5. What Your Culture Really Says – @shanley

Definitely check them out. They contain plenty of insights you’ll be able to apply to your own company.

About the Author: Lars Lofgren is the KISSmetrics Marketing Analyst and has his Google Analytics Individual Qualification (he’s certified). Learn how to grow your business at his marketing blog or follow him on Twitter @larslofgren.

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