We wrote the first draft of our values before we had a landing page (in contrast to many companies that don't even think about it until they're past a hundred people). We are now on version 5 of our values.
Assembling a set of well-written values isn't frivolous; in fact, it's an exercise in efficiency, because it provides immediate guiding principles for how we make decisions.
It reminds of the kind of people we want to be and the kind of organization that we want to build... and this set of cues flows into company policy (how do we handle vacations or expenses?); into stakeholder interactions (with employees, customers, investors, etc.); and into metrics (customer engagement vs. outcomes?).
In an effort to have "well-written" values, we've avoided platitudes and instead phrased them as "choose X over Y". As an example, "excellence" is a badly written value, because... who doesn't want to be excellent? On the other hand, considering what you're giving up by choosing to be excellent is a useful exercise. Are you saying "excellence over work-life balance?" Are you saying "excellence over perfection?" Those are very different sentiments.
Finally, we believe that values need to evolve to match the current identity of the company. We're in the early innings of many, many versions. Read on, and please provide feedback; we'll incorporate it in the next version — all in the spirit of Experimentation 😉.
To choose a single sentiment that embodies our culture, we aim to be Thoughtful. This value is expressed in three core sections:
Being fair is in your long-term self-interest — choosing short term outcomes is tempting, but life is long, and the world is small. Life is a multi-turn game.
We try to make fair decisions by considering the intersection of empathy and pragmatism.
In case the concept of fairness is still fuzzy, here's a litmus test. A fair decision is usually one where a disinterested third party, who has access to all the relevant facts, thinks is reasonable.
Characteristics of Fairness
Fairness is easier than Goodness — "Goodness" can be hard to agree upon. Try to decide if something is the "right thing" to do, and everyone will have a different opinion. However, fairness as a concept is very deeply rooted in our psyche — not just in humans but even in animals.
Follow the Golden Rule — by being fair to people you're automatically following the golden rule.
Choose integrity when it conflicts with self-interest — we're all self-interested. Nothing wrong with that. But when a self-interested decision makes you uncomfortable, check if you're doing something unfair. If you are, choose your values and integrity over that self-interest. This is not just true in interpersonal interaction... it's especially important in business. If you feel like you didn't do right by a customer, make it up to them, proactively. If someone's underpaid, give them a raise, proactively... not when they threaten to leave*.*
Pick empathy over hyperrationality — Make decisions that make you seem human — of course you should be rational and pragmatic, but if it violates the fairness test, it's probably lacking in empathy.
Practice radical candor — Radical candor is often thought of as brutal / cruel honesty, but the original reasoning is that not being honest to someone is actually unfair to them. Sugarcoating the situation to a direct report will backfire because you didn't give them fodder to improve and then you'll end up having to fire them.
Exhibit courage in interactions — We all need to make tough calls and have tough conversations sometimes, but don't let that freeze you in your tracks because you think it'll go badly. If you've been fair in the past, the other person will trust that you have your reasons for a tough decision. While radical candor and trust-building may be hard along the way, it's also critical for the inevitable tough situations.
Demonstrate loyalty — Be someone who sticks their neck out for other people, at personal cost. There's no better way to build trust than to create a positive sum game by giving up X so that someone can gain 2X.
Prioritize "stakeholder value" over "shareholder value" — Focus on stakeholder value instead: for your clients, your suppliers, your partners, your employees, your teammates, etc., with a sound strategy and business model. Profit and shareholder value are a natural consequence.
We are building a social enterprise — If people running a company ignore the social nature of a common enterprise — aka, building something together, and trying to do the right thing along the way — the company becomes a nameless, faceless monolith with no identity, culture, or integrity.
Assume good intentions — if everyone is expected to be fair, and held to that standard, you don't have to assume bad intentions.
- Never ascribe to malice that which is adequately explained by incompetence or oversight (Hanlon’s razor).
- Never ascribe to malice that which is adequately explained by differences in personality, behavioral tendencies, or value systems.
- There is no such thing as “healthy” paranoia. Instead, by choosing colleagues and partners who are trustworthy and beyond reproach, we're able to assume good intentions and act more freely with them.
Prioritize fair outcomes — Outcomes and processes are both important, but fair outcomes are more important than predictable processes. If a hard-working, high-integrity, capable person isn't performing, it's the company's fault. If the interview is "balanced" but the org isn't sufficiently diverse, fix the top of the funnel.
At first, we had "Ownership" here, but didn't love it, since a) it's generic as hell, and b) we realized that the precedent value to Ownership is Trust. You can be told "You're an Owner!" all you like, but if people keep micromanaging you, or if there is a lack of autonomy, it doesn't work.
You shouldn't ask for either forgiveness or permission. Instead, a trusting environment falls somewhere in the middle... ask your peers and managers for their thoughts on any thesis where you have conviction, to make sure you aren't missing anything. If so, run with it. This is the thoughtful way to break the mold.
Characteristics of Trust
Seek ownership — We expect every person to act like a leader (or future leader) of the company. It means we expect everyone to shape the company by owning their work, proactively suggesting and leading things that impact the entire team and mission.
This isn't to say we're a holacracy or an anarchy. To quote Ratatouille, "Not everyone can become a great artist, but a great artist can come from anywhere."... similarly, not everyone's opinion is equal, but a great opinion can come from anyone.
Dedicate yourself to Customer > Team > Yourself > Company — We expect every person to go above and beyond, and deliver that additional ounce of creativity, cleverness, and dedication. Prioritize outcomes for the customer first, then your team, then yourself. The company will succeed as a natural consequence. (Note: this doesn't mean long hours...quality work and commitment to success is weakly correlated to hours at a screen.)
Give transparent, generous equity — We set the high watermark in generous equity, especially amongst seed stage companies. We blew through a 10%+ equity pool in a year! "Acting like an owner" isn't lip service here. We believe everyone who joins us in the early days before product-market fit should be appreciated for their conviction and treated as pioneers. We don't treat "founders" differently than "early employees" — we're all "founding team". But with great power comes great responsibility.
Set checks and balances — “Wise restraints set men (/ women) free”. Create accountability for yourself, and others. Hold others to a high standard and set an even higher one for yourself. No one is above reproach. We don't believe in putting "founders", "executives", or "managers" on a pedestal. Be honest (in a constructive way, in the right forum) with everyone. Checks and balances improve reliability and outcomes.
Prize autonomy over caution; be pragmatic, not bureaucratic — we hire high-caliber people and trust them to operate independently. ICs should exhibit judgment and escalate as needed; managers should know when they really need to step in. Everyone should aim to make quick, thoughtful calls; put reasonable checks and balances in place; avoid reinventing the wheel; avoid messing up Type 1 decisions.
Avoid both unbridled chaos and perfect harmony — We're an early stage startup... the hardest judgment call is knowing how much chaos is okay. Some chaos is essential. Too much will kill us. Embrace the chaos, but put essential processes in place to avoid a breakdown.
Communicate directly, and efficiently — It's okay to be a little rough around the edges, as long as you have good intentions.
Build vulnerability-based trust — This can often serve as a key enabler of radical candor. If you trust each other, it's much easier to be honest with each other. Seek to solicit feedback on yourself, and on your work — and offer the same to others. Show, appreciate, and encourage mutual trust.
AO becomes a generational company when you take risks and take initiative, especially with Type 2 decisions (those that are easy to reverse). We expect you to mess up once in a while, as long as you (and we as a company) learn something valuable from it.
We don't reinvent the oval wheels, just the square ones. We reason from first principles. We question current practices, but without being iconoclastic. If the current "best practice" is solid based on logical reasoning, we codify it. If "market norms" make no sense, we question why it works that way by a) stress-testing assumptions, and b) coming up with a better solution.
Plus, curious people are just way more fun to be around. They're more fun to talk to, to learn from, and to grow together with.
Characteristics of Experimentation
Embody kaizen — Not just within AO, but to impact every startup out there. Our model is predicated on the idea that — through transparency and better data — companies can harness the experience of thousands of other companies to experiment, learn, be better.
Aim for cleverness rather than predictability — Past solutions are not always predictive of future outcomes.
“How do you beat Bobby Fischer? You play him at any game but chess. I try to stay in games where I have an edge.” - Warren Buffet
Be a generalist, wherever possible — Exhibit broad curiosity. When solving complex, real-world operational problems, the entire team needs to exhibit generalist tendencies, to detect holistic solutions. Avoid silos, and look for better cross-discipline and cross-functional outcomes. We need to see the whole board, the whole battlefield. We need to be enjoyable to be around, not just smart. We optimize for polymaths, not PhDs. We prioritize marathons, not sprints.
Be relentless... - But if you think something is an incomplete solution, dig deeper. Live by the pareto rule but don't be superficial. Drill deeper. Interrupting is okay in the pursuit of the right answer (as long as you don't compromise our first value by being unkind... exemplify "yes, and").
... But pick the practical solution — The dark side of curiosity is diminishing returns. Don't overengineer things. Curiosity is more about the best outcome than the most interesting outcome. Interesting outcomes compromise ownership, a key value of ours, by being inefficient or impractical.
“Strategy is about making choices, trade-offs; it's about deliberately choosing to be different.” - Michael Porter
Exhibit foresight — Own not just your outcomes, but the team's. Own not just your outcomes today, but over the long term. Know that when you make decisions and establish precedent, others will rely on it. Do your best to play 3D chess, not checkers, to see around corners, and to achieve long-term outcomes rather than short-term efficiency.