Kellblog

I am big believer in strong corporate cultures.  Culture can be used to set powerful norms.  Culture can bind people in an organization to a common set of values bigger than their quarterly objectives and key results (OKRs).  Culture helps attracts the right people to your organization – and can drive out the wrong ones when they get swarmed with corporate antibodies for showing the wrong values and behaviors.

Culture, to paraphrase Henry Ford’s thoughts on quality, is what happens when no one is watching.

But never forget the first four letters of culture spell “cult” and too often, in Silicon Valley at least, corporate cultures become corporate cults:

• MicroStrategy got into a lot of trouble in the early 2000s, I believe, in part due to a cult-like culture.
• More recently, Zenefits flew off the rails spectacularly thanks to its fraternity-like culture, where among other things — in a true Wolf of Wall Street moment — the new CEO had to ban sex in the office.
• Palantir got into some trouble over its culture, secretive as it usually is, with one major customer saying it “needed to get better at working with millennials.”
• The Theranos disaster, chronicled in Bad Blood: Secrets and Lies in a Silicon Valley Startup, shows clearly how culture played a key role in the downfall of Theranos. [1]

For many Silicon Valley companies, culture is a point of pride and is meticulously captured in long slide presentations, such as the Netflix or HubSpot culture decks. [2]

When culture turns to cult in Silicon Valley, it’s often arguably benevolent – a strong leader espousing a visionary worldview combined with positive incentives for employees to spend as much time as possible with each other and/or at work.  The company provideth all:  free transportation, interesting work, fun recreation, great food, social events, perhaps (indirectly) even a significant other.  So why not spend all your time with the company? [3]

But sometimes Silicon Valley cults are not benevolent – Theranos being the best recent example.  Continuing to work in such environments, prioritizing the needs of the cult over common sense and business ethics can do lasting damage to your personal relationships, to your health,  and to your career.

I first started studying corporate cults when Business Objects was competing with MicroStrategy back in the 1990s.  I found this book, Corporate Cults:  The Insidious Lure of the All-Consuming Organization, and had a few conversations with its author, Dave Arnott.

The first thing I learned from Dave was that, if you’re competing against a cult, that you should not attack it.  Attacking it, per Dave, only makes the cult stronger as the attack drives member together to defend the cult.

Consider some of the following similarities between cults and startups:

• Charismatic leadership. Startups are often led by charismatic people, passionate about their beliefs and persuasive that the company is on a broader mission. [4]
• Isolation from friends and family. This happens naturally at startups with long work hours, but is often exacerbated by the culture committee’s active social and events calendar.
• Homogeneous recruiting. MicroStrategy supposedly preferred recruiting in its early days not just out of MIT, but out of one specific fraternity.  Many startups recruit similar people, all from the top programs across the country.
• Hazing and rites of passage. Many startups have rigorous bootcamps where only the best get through.  Trilogy’s three-month bootcamp was the intense I’ve heard of.
• Elitism.  Once recruited and having passed bootcamp, members are reminded of how much better they are than anybody else.  For example, HubSpot loved to tell recruits (based on specious logic) that it was harder to get into HubSpot than Harvard.
• Specialized vocabulary.  At HubSpot, you’re not an employee, but a “HubSpotter.”  You don’t delight your customers, you give them “delightion.”  No one ever “quits” or is “fired,” former employees “graduate.”  How pleasant.
• Demands for absolute loyalty.  Theranos did this frequently: “if anyone here believes you are not working on the best things humans have ever built, of if you’re cynical, you should leave.”
• Excommunication of former members.  Former employees are more “dead to us” than “working somewhere else.”  Theranos was particular brutal in this regard, not only frowning on continuing relationships with former employees but subjecting them to constant surveillance and stunning legal harassment.

I’m not saying long work hours, free lunch, and and ping pong tables are bad.  I am saying that many Silicon Valley cultures border on cults.  Leaders should pay attention to this and try to avoid falling into common cult patterns, for example, by ensuring diverse recruiting programs, by building on-boarding programs that are more training than brainwashing, and by creating a culture that values dissenting opinions.  [5]

Employees should keep an eye out for lines getting crossed.  As they say with authoritarian leadership, it’s a boiled-frog problem — it happens slowly, you don’t notice any changes, and then wake up one day in an authoritarian regime.  Don’t let that happen to you, waking up one day to discover that you’re working at a malevolent corporate cult.

# # #

Notes

[1] Hint:  if everything is too secret, if management is routinely caught lying to customers and investors, if anyone who challenges management is summarily fired, and if you hear things like “if you don’t believe [our new product] is the most important thing humanity has ever built, you should quit now” – then you should probably go find a new job.

[2] Which nevertheless didn’t stop HubSpot from getting a good mocking in Disrupted: My Misadventure in the Startup Bubble.

[3] Some would certainly argue that even this is unhealthy.  Dave Arnott would argue there should be a line between “who are we” and “what we do.”  Even benevolent cults somewhat dissolve this line.

[4]  Which was so marvelously parodied in HBO’s Silicon Valley in a minute-long montage of founders pledging “to make the world a better place through Paxos algorithms” or “make the world a better place through canonical data models to communicate between endpoints.”

[5] Which is particularly important in a culture led by a strong leader.