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How Airbnb Uses Culture to Reduce Complexity

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“Culture is a thousand things, a thousand times. It’s living the core values when you hire; when you write an email; when you are working on a project; when you are walking in the hall. We have the power, by living the values, to build the culture. We also have the power, by breaking the values, to fuck up the culture. Each one of us has this opportunity, this burden. Why is culture so important to a business? Here is a simple way to frame it. The stronger the culture, the less corporate process a company needs. When the culture is strong, you can trust everyone to do the right thing. People can be independent and autonomous. They can be entrepreneurial.”

–Brian Chesky, CEO of Airbnb

Airbnb considers culture—“a shared way of doing something with passion”—their number one priority. As they see it, even if their product completely changes 100 years from now, their culture will sustain them. To build a culture that will stand the test of time like Airbnb’s, follow these three simple rules:

  1. Always go back to your core values. Everyone has the power to build or break the culture, whether that’s through writing an email or working on a project. But no matter what the activity, Airbnb checks in with their commandments to make sure they’re remaining true
  2. Let process grow from culture. When everyone has core values in the back of their minds, processes grow naturally from trust, rather than a rulebook. With a strong culture, employees will feel a real sense of autonomy, hold each other accountable, and support each other.
  3. Remember that the worst times pass. As a rapidly growing company, it’s easy to feel outside pressure, whether that’s through government regulation or intense profit expectations. Airbnb knows that culture will outlast any speed bump, so sticking to their values will help them get through the worst of times rather than chasing temporary goals.

Takeaway: Culture can’t just be a poster, or a one-time meeting; it’s a way of doing things that is reinforced (or diluted) every day. To make sure you’re encouraging the right behavior, think about culture on a longer timespan: what should your team be doing 10 or 20 years from now?

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About the Author

This article was produced by  NOBL, an organizational design firm. They unleash the creativity and capability of teams through new ways of working.

Entrepreneurship

Follow Your Dream and Start a Business

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A regular 9 to 5 job is a tiring and monotonous activity. Just after few years, this not only becomes boring for most of the people but it also creates the feeling among persons that they can’t achieve their dreams with just an ordinary job. On the other hand, they see their entrepreneur friend who is making good money and enjoying his life just after few years of successful business experience. This certainly creates the passion among the employees to do something big and they seriously consider starting a business to fulfill their dreams.

But starting a business is not always easy and one may face several risks that create hurdles for him becoming a successful entrepreneur. It is especially true for newcomers as they are usually short of capital and unaware about the severe competition that they may face in the market.

Limited resources and tough competition are the two main hurdles that are faced by new entrepreneurs and it is the main reason that many stick with their ordinary job where they are getting low but sure salary after doing an unexciting but rather simple work. But getting your dream business is not such an impossible task. There are many who have proved that determination and few tested points that can easily bring success to any new business.

Following this simple but effective strategy will greatly assist you in fulfilling your dream of becoming a successful entrepreneur.

Right down a Complete Business Plan:

The initial thing required for any successful business venture is a highly thought out plan. You must be aware about the type of business that suits you according to your financial resources. Your plan must contain the products and services you are going to offer, your target audience, the type of employees you need etc. After preparing the whole list of necessary items, just combine them accordingly and your initial step will complete. Now, you will be required to practically implement the plan of your new business.

Choose the Right Location:

Selecting the right location for physical presence of your company has extreme importance. A lot of research is required to select the right type of location for your intended business. Many factors have to be examined before choosing the most appropriate place for the type of business you are willing to start.

The things you must consider is that there should not be much competition in the area you are choosing, the comfort of people to reach that site and the safety record of the location. All these factors are extremely important especially for new businesses as they can’t afford undue disruption in the start of their process.

Complete Legal Process:

A business can’t take any legal risk whether it is a Dubai business setup or a company in Paris. All the legal documents must be completed before the formal start of your business. Choosing a unique name, acquiring proper license(s) from related authorities and getting tax number are important and unavoidable conditions for any business.

There are possibilities that you may face legal issues in the beginning and also later stages of your business. You can easily avoid this problem by either hiring a full time lawyer or get attached to a reputable law firm. Spending money for this purpose is mandatory and you can’t save money by avoiding solution of legal issues.

Spend Wisely:

Most of the small businesses can’t afford to waste their precious money in cosmetic steps. But even if there is no shortage of money, ruining your assets is against the norms of business and you can’t expect to get better results without saving some extra money. You can’t predict about the future of any business and it is always advisable to save something for the time when things are not going well.

If you have spare resources, then you can wait for return of favorable time for your business. It will help you stick with your desired business and may result in achieving your dreams with the same type of business after some time.

Always ready for change in Circumstances:

Always keep an eye on various circumstances related to your business. Government rules can change at any time while economic conditions on local and international level can bring lot of changes to different types of businesses. Unless you are aware about the changes and take immediate steps to counter the alter situation, it is not possible for any new business to flourish. You must be proactive and take important steps before your competitors.

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About the Author

Brenda Cagara is a part of the business consultant team RIZ & MONA in Dubai. Her work is to assist the formation of companies in different states of UAE. Other services she takes a part in are visa processing, trade license, trade mark, bank account opening, product registration and local sponsors. Along with this, she vigilantly manages to pursue her writing career. Since the past five years, she has been writing on different niches. The top ones are business, taxation and finance.

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Entrepreneurship

Why Angel Investors are Shaking Up the Global Startup Scene

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Candace Johnson is someone who has made a global impact on our modern international telecom and broadcast business. She co-initiated the foundation of SES-Astra and SES Global, which today owns a fleet of 54 satellites and broadcasts 6500 TV channels. And she founded the world’s first Internet-based online service, Europe Online, making it into one of the first broadband Internet services.

But it was in her role as president of EBAN, the European trade association of several hundred business angels, which brought her to Eindhoven’s High Tech Campus recently. She explains why angel investors are making a difference to the global start-up scene and explodes several myths that surrounds the way they do business. She spoke with StartupDelta’s Jonathan Marks.

Building the match between angel investors and hardware startups

“People often think that angel investors are people who do investments around the corner, locally, or in services like e-commerce. To be frank, when the HTCE management told me that they were focussing on the hardware side of things, I was thrilled.”

“What I’m trying to do as President of EBAN, and having incubated MBAN (MENA Business Angels Network) and ABAN (African Business Angels Network) under my presidency, is to extend the scope of angel investments. The vast majority of angels are already tech savvy. But we need to educate our successful angel investors to invest more in hardware and infrastructure. We also need to help start-ups develop a pitch that speaks to the interests of angels, so they can get funding for their initiative.”

“We run the EBAN Training Institute with the goal of raising standards. We’re seeing more and more that the best angel investors are serial entrepreneurs. They bring their trusted network, expertise and experience to the table.”

“Money is important too, but it is not at the top of the list. Business angel investors are high net worth individuals who usually provide smaller amounts of finance (€25,000 to €500,000) at an earlier stage than many venture capital funds are able to invest. They are increasingly investing alongside seed venture capital funds.”

Angels are more important than most people know

“We follow the guidelines and standards developed by the European Venture Capital Association. For over seven years, during the depths of the financial crisis in 2008 until the recent recovery started, it was the angel investors who took over the role of early stage financing. More than €7.5 billion are being invested annually in Europe, with a sustained growth in recent years. Of that €5.5 billion comes from angels. In fact we have had to professionalize our profession to meet the demand of the growth in this early stage ecosystem.”

We always have an exit strategy

“Angel investors can only continue to invest if they have exits. I hear many people talk about investing. Only a few discuss exits. I want to change that. I also stress that proven entrepreneurial success is essential in order to become a member of our association. We need to ensure that useful “lessons learned” are shared with the start-ups. They are always based on hands-on real-world experience. We have no time for people who are using new blood to try and correct mistakes they made in their own failed companies.”

“EBAN was started in 1999 together with the European commission. For the first ten years, I think people were too focussed on the investing part. Now we need to focus on exits and returns on investment. Without returns, business angels are out of business. And remember there is only a short window of opportunity during which start-ups can scale-up to becoming global success stories”.

“Our feeling is that you should not make an investment in a company unless you can see the path for the exit. The exit may be a trade sale, an IPO, etc. The exit also does not have to be 100 %. It does, however, have to bring you a return on your investment so that you can continue to invest. This approach helps you focus on building great companies. There’s always competition in healthy markets, so no-one can afford to waste time. We’re not a charity; we’re doing this because we love building and financing global success stories. We’re therefore looking for companies with a real marketable product, not a prototype or a collection of well-presented ideas.”

Is there specific advice you can share with high-tech startups?

“In the last few years we’ve seen the rise of the accelerators alongside incubators. They have helped raise standards because a good idea needs to be validated by the market before it is the basis for a high-growth company.”

“As investors, we always need to see a start-up demonstrate that they have first clients and initial revenues. We’re not saying that they have had to scale or show market traction. But if we are going to put in our personal money, then we expect the founder to be resourceful enough to work out the first product, to have found the first clients and show us evidence of the first revenues.”

“The incubators who help get an idea into reality and the accelerators have been good at making startups better prepared for angel investment, offering the right coaching to turn an idea into a validated business. That means angel investors are better able to select the growth companies and focus on making a good return on their investment.”

Hanneke Stegweg

“We recognise that young companies need to present their business proposition to the angels attending our annual conference. So we’ve created ways that teams get immediate, honest feedback on the quality of their business presentation. We have one full day of preparation and coaching followed by a Global Investment Forum. The best go on to pitch to the entire network. This year, the “company to watch” category was won by Hanneke Stegweg, who is the Dutch CEO of the iLost company. Together with Neelie Kroes, I am keen to see more women founders lead entrepreneurial teams.”

What needs to change for things to move faster?

“We held this year’s EBAN congress in Eindhoven at the recommendation of several members. They all work in the innovation and financing of innovation field. But this region also came up in our discussions with StartupDelta. We have worked closely with Neelie Kroes when she was with the European Commission.”

“We were tipped off to the High Tech Campus specifically by our Russian members: the Russian Business Angels and the Skolkovo Foundation who are building the Skolkovo science park just outside Moscow.”

“And last, but not least, I know Eindhoven from my work in telecommunications and broadcasting hardware field. We often came here to work with Philips on the establishment of the DVD and MPEG-4 standards.”

“During our visit to the Brainport area it was clear that there is more than enough money in the region and a healthy appetite to invest in innovation. But there are some caveats that we feel need to be addressed.”

“Frankly, I think we are rather tired of the “nice-to-have” e-commerce companies. We would prefer to reinvest in world-class companies who are building something tangible, solving a real-world challenge. They need to demonstrate they can scale and become global.”

“We can see that the efforts by many have helped to raise the bar in the Netherlands and that’s good news for everyone. But remember there is a difference between entrepreneurs and SME’s. Entrepreneurs are the only ones to change our world. They create large companies, worthwhile employment, and that grows into large revenues.”

Failure is not an option

“We should get rid of this talk of failure being an option. If you’re taking angel money, it is NOT OK to fail.”

“If you take third party money, you have a responsibility as an entrepreneur to do everything you can to make a return on the investment of your business angel. The media keeps talking about friends, family and fools. But that’s nonsense! Founders, families and friends build great companies!”

“I have always been a free marketer at heart. Europe and The Netherlands need to create nations of investors. I believe in the power of private sector-led investment. Government needs to follow the leads set by business angels, not the other way round. We are investing our own money and using our years of experience to scale up these companies. An entrepreneur who is not willing to work and dedicate her or his lives 24/7 to achieve the goal should look elsewhere for money!”

“We’re fortunate that the EBAN network acts as a magnet for excellence. We were honoured to have the President of the European Research Council and the Head of Technology Transfer of the European Space Agency address our Congress to show us where the technology trends are going and where we should invest.”

“From a venture and entrepreneurial financing perspective, we were most grateful to our colleagues from the United States who joined with our European, MENA, and African colleagues to set the bar high in creating, building and financing global success stories. Amongst those joining us in Eindhoven from the United States were the president of the Global Accelerator Network from the USA, the president emeritus of the Angel Capital Association of the USA, the President of Start-Up Angels and Board Member of Up Global from the USA. We also welcomed the President Emeritus of the Crowd funding association of the US as well as the chairman of New York Angels. And we were delighted with the presence of David S. Rose, the president of GUST.com. These are some of the world’s best experts in angel investing.”

“They all said they were pleasantly surprised by the high standard of the startups that came to Eindhoven from all over the world. It was well above what they had expected. Start-ups from Africa, Middle East and Europe traditionally explain what they do, rather than explaining to investors why their idea is important. But that’s changing rapidly for the better. Entrepreneurs are also getting better at defining what they need in order to scale-up.”

NEXT STEPS : It’s all about active networking

“I should explain that in expanding our reach in Europe, with have formed alliances with the European Space Agency and the European Research Council. They also have their own accelerators and incubators. I think the onus is on the angel investor community to help bring this scientific community to a higher level of entrepreneurship. They need to think about the market for their inventions from the beginning. I believe we can help these organisations filter out the very best ideas and give those the attention they need to scale ideas into real businesses. There needs to be a validated market need for the technology they are developing.”

“We have two main events. There is the annual EBAN congress, this year in Eindhoven and next year in Porto, Portugal. And we run the EBAN Winter University, this year running from November 17–19th in Copenhagen. We’re doing this with leading organisations active in Europe’s creative industries. And all this is in addition to individual events and competitions organised by EBAN members at a local, regional and national level.

Increasingly we’re assembling cross-border syndicates, both between European countries and increasingly inter-continental networks linking Europe with innovation hubs in Africa, Middle East and North America. As companies scale and go global, it is important they have access to an international shareholder network. It’s a softer landing when they cross continents.

We also believe there is a way in which we can build partnerships with techno-business parks around the globe, led by the flywheel initiatives shown by High Tech Campus Eindhoven over these very fruitful days in the Netherlands.

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About the Author

This article was written by Jonathan Marks, Executive Director at Photon Delta. See more.

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