Why startups lose good employees and a word of strategy on how to keep them

Published on 27 Feb 2018 by Tushar

Startup! This is a sacrosanct word for many meritorious fresh graduates and experienced managers, looking to not only experiment but actually, dive into a ‘lifestyle’ is equated to adventures in la la land.

From getting a chance to be part of a rising, thriving or merely surviving, but never boring nor conventional working environments, a free hand on creatively pursuing problem solving, flexibility of all sorts from work timings to even the dress code, to coming to work with the inspired feeling that the whole team, not being too large generally is united and chasing a shared vision.

This is completely in contrast to the corporate culture where you can get boxed into cement compartments from the type of work you get to tackle, to corporatized almost mechanical human interactions, politics and favouritism, lack of any united shared vision and a feeling of serving the masters/ bosses living the life of a glorified bounded labour.

While all of this makes the startup world exciting and enticing over a corporate or even other professional jobs per se, an undeniable truth is that there exists a high level of attrition.
And, reality check? A lot of employees quit startups.

What makes startup culture attractive is what destroys it. The very arguments which make the startups attractive are many a time the reason why employees decide to leave. How can that be though? Here are some points that we as a startup feel any startup must notice with an objective of nipping the problems in the bud when the signs arise.

When the excitement fades, and the employees start echoing - 

“This is no different than working at a firm, MNC, handling operations for a corporate! Can we just go home already? No?” *Silent Shrugs*

From having to order meals post 12 at night to losing what was probably the biggest attraction to initially when deciding to work at a startup – flexible hours; it is employee and labour psychology 101 that being overworked is counterproductive to any organisation.  

In cases where a startup begins to notice signs like “Even after working for 10-12 hours a day, why do I sense that I am not able to utilise the employees’ time to the fullest” or “Where the hell are we lacking when we are already committing all our employees’ days to the work”, the answer pretty much lies in the questions.

A Standford University Study shows that in cases where overwork has been observed there is generally a case for the average productivity to have decreased just about till the point that if there were normal working hours the average productivity would remain the same or only get better.

In other words, grinding for longer hours is cool if you are a founder, but making your employees at a startup grind for hours which are in excess of a 50 hour work week is the death of productivity, creativity

A study conducted at the University of Pennsylvania shows that subjects who had only obtained 4 to 6 hours of sleep for 2 weeks showed cognitive performance deficits of a person who had not slept for 3 days consecutive days!

That is to say, their ability to perform normal cognitive tasks such as paying attention and reacting to stimuli becomes reduced substantially, so one can only imagine crucial work like solving difficult problems or thinking creatively is thrown out of the window.

Existential crisis- From being overworked to realising I didn’t sign up for this. One of the biggest reasons for quitting a startup-

“We are just another *Insert Competitors/ other companies name generally looked down upon*, this is different from what we planned to do!”

At a startup the united common vision is everything. It motivates employees to feel part of a tribe which is unique and hence everyone believes in it.

Imagine Tyler from fight club (it happens to be a cult movie, for the uninitiated). After Tyler is done fixing the rules for fight club, and effectively making random, overworked and frustrated people believe that they are set out on achieving something beyond what the mundane life offers, goes out of his way and posts a boosted ad campaign on Facebook. The fight club could disband faster than it formed for the sole reason that, “this is different from what we planned to do!”

Not stating in any way that ads on Facebook are a bad strategy, the issue is that the founder diverged from the core vision, breaking literally the only rule which made the team feel special.

The founder’s vision is crucial. Unfortunately, the world is cruel, and the law of nature says adapt or perish.

Sometimes As the startup expands, the vision is often lost in the process of achieving short-term goals. Small compromises hit every individual employee differently.

The only true solution might sound utopian but inclusive growth is the way to go. While adapting to the dynamic business environment, the employees’ perspectives and feedbacks must be shown to be valued and taken into account.

People are more likely to generate their own ideas, to contribute with enthusiasm, to keep slogging when there are frequent and long-term changes becomes unpleasant, and also to experience a sense of camaraderie and togetherness.

MONEY.MONEY.MONEY! Bro I have bills to pay! 

Nothing can be done about money when you are a bootstrapped startup. Shed a tear and adopt a different approach.


Everyone likes kudos, none more so than those who work hard and give their all. startups founders need to communicate with their people to find out what makes them feel good (for some, it’s a raise; for others, it’s public recognition) and then to reward them for a job well done.

Mostly happiness comes in small doses in a startup's journey. Leaders need to celebrate each time things go positive (however small they may be). This will keep the team motivated to strive for bigger success.

The middle name of whatever your startup might be called has to be Uncertainty. With all the mergers, acquisitions, fundings, and bankruptcies that continuously take place in this world, job and financial security is another reason why people chose to leave their alluring startup jobs once they make a serious personal or financial commitment. This of course, if the venture cannot match their expectations or share a definitive roadmap for career progression.

What about post growth?
All the success in the world, will not guarantee talent from escaping if the culture itself changes completely

When startups start bringing in the decent amount of business, it is commonly seen that there are sweeping changes to every aspect of the working environment. This includes the people (numbers increase naturally) as well as new physical surroundings/ bigger working spaces while also expanding to different cities.

The core of a startup is only an abstract idea, it is a feeling in terms of spirit and emotions.

Therefore to keep intact the culture of the work environment, rather than taking a quantitative approach, the best way is simply to actively observe the human interactions. Yes! As absurd as it might sound to give importance to the grapevine communication, that is literally where the culture is made.

Do not delegate. This is not a managers’ job, this should be done the by the very top level management and done with a smile while they are at it. It is the founders’ prerogative to engage and ensure that the culture develops in a certain way to balance the old with the new.

The very subtle things matter the most while engaging in a bid to influence the culture at a growing and successful startup. Again, it is the feeling, the spirit, the warmth, the level of concern in people's voices. That's the stuff that's the indicator of engagement.

Never let an employee remind you even the most basic promises of the past. The Richard Branson model of doing business is shockingly applicable to the Indian startup ecosystem.
Who comes first? Not the clients, not the product or service itself, neither the investors! It is your cherished people/ the employees who make or break a startup business. Look out for those who work towards your success while aiming to reach your goals to avoid losing them.

Micromanagement kills the atmosphere, trusting your hire makes the culture.

Nobody appreciates being told what to do and how to go about your job every time a mistake is made or the time taken is slightly more than what was anticipated.

This holds true especially in a startup where the idea is to do anything and everything with a tinge of creativity and maybe even a healthy dose of giggles. Give your teammates the responsibility of a task and let them decide how they want to execute it. You will not be disappointed trusting them and regardless that is just not the right strategy to employ in business management.

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