I thought that founders would have turned a new page after the blowup at some of the most notable startups for alleged worker mistreatment and poor workplace culture. It seemed evident that the hustle and bustle of startup culture had its limits in this new generation, and no one was immune to the toxic workplace exposé, which was just one source leak away.
But perhaps I spoke too soon. As I continue to ask startup founders about their plans, they always list the vision to scale, build to return investments. They hardly ever mention how they are going to take care of the people they will employ to help them do all these tasks. Granted, startup life is hard. The hours are long and ruthless. The environment is not for the faint of heart; surely anyone looking for a more clear work-life balance would roll their dice in corporate.
Inside, it feels there is hardly any sympathy for the workers who gamble their time with a startup. Venture-backed companies have to scale fast. It’s a spin on that story about the scorpion that stung the frog it took across the river. You knew it was a startup when you joined. They can’t resist the exploitation urge. It’s in their nature.
But that was then. And this is now. Hybrid work is here to stay, the economy is still uncertain for many people, and layoffs are hitting the tech sector hard, and with this has come the itch for innovators to launch something new. But if they’re not ready with strategies to keep employees engaged, they will be quickly left behind.
Nina Mohanty, the founder of the remote-based fintech Bloom Money, told TechCrunch+ that it goes back to the golden rule taught in kindergarten: Treat others the way you want to be treated. It’s a mistake, she said, to put growth strategy over work culture until something happens. This is why some high-growth businesses falter.
But having a strong culture can lead to less churn and more efficient teams, and that is even better for the bottom line. “As we grow into adulthood, we tend to forget these basic tenets of human coexistence,” she said, listing empathy and trust as essential skills a leader should have. “In a world where people can work from anywhere doing anything these days, a healthy company culture is a competitive advantage.”
She said her company, located in the U.K., tries to have quarterly meetups in person and events with no-work chat. They also operate on a results-based performance framework rather than expecting employees to constantly be available. “If you have caregiving duties, take a break and care for your loved ones. Come back to your work when you have time. We treat our team like the adults that they are,” she said.
But Mohanty said her company also has a “no f-word policy” — as in, she never refers to the team as a family. “It sounds counterintuitive to say, but in my experience, many, sure, not all, companies who refer to their team like a family can be quite toxic,” she said. “I found the teams that called us a family were the ones most eager to exploit this ‘family bond’ and exploit us for unrealistic requests and longer working hours. Your family is your family. But we can be a group of people you enjoy working with.”
It’s a hard balance, though, and not every founder was meant to be a CEO, a lesson many of them learn late in the game. Women founders also deal with an unfair amount of criticism for their leadership skills. The definition of what constitutes a toxic workplace varies by the gender of the founder and often also the color of their skin.
Pryce Adade-Yebesi, the founder of Utopia Labs, said the fear and negativity-based leadership styles often stem from the fact that being a founder is simply a scary job with much uncertainty. His company has only been in business for two years, and in that time, he’s seen many different leadership styles among his peers.
“Many may grasp for a feeling of complete control through a dictatorial fashion that makes it easier to get certain things over the line or deal with the crisis,” he told TechCrunch+. “Environments of fear and low trust may have some short-term benefits, but they tend not to be the most inspiring companies to work at.”
He lists Stripe, Gusto and Coinbase as his workplace inspirations and said at Utopia, a positive workplace environment is not just a nice-to-have feature but an essential foundation for the long-term success and growth of any organization. “It goes beyond surface-level perks and incentives; it is about cultivating a culture of respect, trust, and genuine care for every individual within the company.”
Adade-Yebesi hired a head of human resources and started quarterly retreats. He and his co-founder also do monthly one-on-ones to help identify problems before they grow. They try to call out employee wins rather than failures, having an entire Discord channel dedicated to shoutouts. “It’s a very active channel,” he continued.
The hustle-and-bustle way startups are run now is no longer sustainable, said Michelle Drapkin, a clinical research psychologist who founded the Cognitive Behavior Therapy Center and works with founders. It’s time to now focus on better work-life integration rather than just a focus on work-life balance, she said. Founders need to allow their employees to learn what is important to them while also seeking work that has meaning and perform both concurrently.
“There are shifts happening, and organizations that pivot will have a more stable workforce,” she told TechCrunch+.
Chat with other founders in your network, listen to employee feedback, and sit down to map, research and brainstorm good workplace tactics alongside growth trajectory and investor returns. Founders don’t always know they are slipping regarding their treatment of workers, Drapkin said. “They have their meaning and purpose so strongly guiding them that they become blind to how their passion steamrolls those around them. It feels like it is all they can see,” she said. “We need to help leaders help their workforce prioritize and learn how to be flexible and resilient.”
So let this be a reminder to take a deep breath and reevaluate the type of leader you are and the workforce you are running. And if you need help with this, it’s better late than never to ask.
This story was inspired by an episode of TechCrunch’s Found podcast. Subscribe to Found to hear more stories and tips from the entrepreneurs building today’s most innovative companies.
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