Lessons from the old economy that can detoxify hypergrowth start-ups

After reports of a toxic work culture at their companies surfaced, with stories of their impossible deadlines, horrific temper tantrums and humiliating punishments for ‘omissions’ on social media – they allegedly ransacked the Ola Electric campus. Asked an executive not to make three rounds. Leaving an entrance open – a repentant Agarwal said in an interview: “Passion and emotion are high and we are not on an easy journey,” adding, “But I would not choose an easy journey for myself or for Ola. I want. My anger, my frustration – that’s who I am as a whole.”

Of course, passion and emotions are what separate the plodders from the stars. And it’s hard to argue with Agarwal’s success, or his passion for going big or going home. His first venture, ride aggregator platform Ola, is worth $7.3 billion in his previous fund-raising and is one of the few Indian B-to-C companies to venture outside India.

The second unit that makes electric scooters, Ola Electric, is valued at $5 billion. And Agarwal is already rolling out vehicles from the world’s largest electric two-wheeler manufacturing plant – a hyper-factory straight out of Elon Musk’s playbook, a figure often compared for his innovation prowess and appetite. Is. development as to their unpredictable behavior.

Agarwal, of course, isn’t the only start-up founder to think this way. Bombay Shaving Company founder Shantanu Deshpande found himself in social media crosshairs after a LinkedIn post calling on freshers not to “random lament” about work-life balance and instead indulge in the 18-hour workday it was done. Harsimarbir Singh, cofounder of Healthtech Unicorn Pristine Care, posts about “interview hacks” – including ringing up candidates at 8 a.m. to check if they’re going to wake up early, scheduling interviews at 11 p.m. to see Asking whether they could work longer hours, and asking outside candidates to come the next day to see if they could “hustle” also created a storm.

What these reveal are some undeclared assumptions about whether – and that a start-up is a business like any other – a success, from unreasonable working hours to impossible deadlines; A culture where “burn rate” applies as much to human beings as financial capital and one where terms such as “work-life balance” or “gender equality” are considered irrelevant. Primarily, they boil down to one thing: a culture where necessity growth outweighs all others, and one where a toxic work culture is grossly generalized.

India is not unique in this. China’s tech experts rallied a few years ago against the so-called ‘996’ work culture (working from 9 a.m. to 9 p.m., six days a week) supported by people like Alibaba founder Jack Ma, who said, “It’s a huge pleasure to be able to work 996 to do. If you want to join Alibaba, you have to be willing to work 12 hours a day. Otherwise why bother to join?”

But what really sets true high-performing companies apart from the rest is the culture. Strategy, innovation, and putting in hours can probably get you growth spurt, but if you keep burning up your talents, you soon run out of ideas and momentum. If one looks at real high-performing companies – those that have delivered both high growth and high returns for all stakeholders; Promoters, investors, employees and customers – over a continuous period of time, in many cases running across multiple generations, the one thing they have in common is a great work culture.

Of course, cultural context matters here; A ‘normal’ work culture in Japan is quite different from the one in India. But there is no shortage of examples at home. From Tata to Godrej and from TVS to State Bank of India, these groups survived, flourished and flourished for a century or more. They – and even relatively new-age compatriots and global success stories like Infosys or Wipro – all enjoy a great reputation for work culture. And they couldn’t have survived so long, without fostering a culture of innovation and achievement, giving up diversity and syncing with global peers – minus the toxicity.

McKinsey’s research in more than 1,000 companies identified four key reasons why culture matters to companies. One, culture is concerned with performance. Those in the top quartile cultures (as measured by McKinsey’s Organizational Health Index) posted 60 percent higher returns to shareholders than average companies and 200 percent higher than those in the lower quartile.

Two, culture is inherently difficult to imitate. The ultimate competitive advantage, they found, is a healthy culture that automatically adapts to changing circumstances to find new ways to succeed. Three, in contrast, unhealthy cultures do not respond well to change. And last but not least, they found that over time, unhealthy cultures lead to poor performance, or worse, failure.

These are important old-economy lessons that start-up CEOs need to imbibe.