One of the common mistakes among startup leadership is the belief that culture comes from the top. This is incorrect. The culture of a small company is an organic, evolving thing. It will grow and respond in unpredictable ways. Believing you can control it in any meaningful sense is a bit foolish.
But leadership does have some control over company culture. Unlike the rank and file employees, leadership gets to define the rules the culture must play by. These rules either enable or disallow various activities.
Let's say a founder announces a weekly happy hour at the nearby bar. This creates the space for cultural growth, but it isn't the growth itself. The company culture will decide if it grows into this space or if the space goes unused and eventually forgotten. Either way the culture decides this organically.
Conversely, a leadership member may decide that a company poker night is too tenuous of legal footing to sanction on company property. Here, the inverse occurs: leadership has explicitly drawn a barrier that prevents the culture from growing into a new space.
Both of these scenarios are entirely reasonable and common. The problem is that cultural rules are often drawn implicitly. The founders unaware of their very existence.
Implicit rule setting
A buddy of mine helps companies at TechStars. The other night he was sharing parts of a conversation he had with a founder. The founder had made a statement that really stuck out:
"Sure, we made 10k this month but it doesn't feel like something to celebrate when we are aiming to make millions."
Anyone who has been in early stage startups before will recognize this a familiar, and poisonous, mindset. Early wins are hard to come by for companies. Those wins are even harder to find when they involve getting money from customers. Celebrating those milestones, even if they feel insignificant in the greater scope is critically import to employee morale.
This is also an example of implicit cultural rule setting. Employees who heard this opinion expressed will likely adopt an obvious understanding: we don't celebrate unless the victory is enormous. And possibly revenue-based.
Either way the founder has implicitly and unintentionally created cultural limits that stand to exist long behind the conversation. And this is one sentence. Image how many such sentences get spoken through the course of years.
Build more sandboxes
It is inevitable that over the years leadership with unwittingly draw many limits on the culture of the company. Even if they never intended to, the stories we each tell are certain to draw a few themselves.
This is why it is important to create new spaces for culture to grow into. I think of these spaces as sandboxes. Some might be ignored, but just knowing they are there can help bring some breathing room to cultures that are too often constrained instead of nurtured.
The freedom in startups is at once a blessing and a curse. We are all afforded the opportunities to make every mistake in the book. Most of us do. Narrowing the conscious and subconscious understanding of the limits of culture is just one way we screw up. Fortunately, some consistent effort to rewrite the rules, without it feeling forced or mechanical, can undo some of the damage.
tl;dr: Build a culture of celebration. Ensure the small wins matter. You will find the big wins come more consistently that way.