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3 Es – The Startup Mantras For A Low Attrition Rate

3 Es – The Startup Mantras For A Low Attrition Rate

Strong Culture = Happy Employees = Low Attrition Rate

According to a recent reports, India has now become the 3rd largest startup ecosystem just behind USA and UK. India has attracted investments worth over $5 Bn which has resulted in three or four startups being born every day. With so much money and so many people getting onboard, the startup bandwagon, working for a startup is no longer a taboo. In simple words, it is now the ‘cool’ thing to do.

Every startup goes through these phases – initial struggle, survival and then success/failure. However, multiple factors define success or failure for a startup. The obvious ones being having a niche product, an innovative go to market strategy, scalability, access to sufficient capital, product-market fit and so on and so forth. The one thing, I feel that makes or breaks a startup is the team. A low attrition rate for any startup ensures consistent performance, a strong & united workforce and a sense of ownership. But maintaining a low attrition rate is easier said than done. Employees, now a days are spoilt for choices with offers pouring from every possible corner. Attrition rate in startups is definitely the biggest evil affecting the ecosystem, and one has to make small and decisive steps to kill it. As employees hunt for more generous pay packages and stock options, it is getting difficult for startups to retain them.

So what can be done to prevent this? Give them higher salaries? Give them better stock options? Give them more responsibilities? Show them an aggressive future roadmap?

While these are some of the obvious reasons, the one thing that will go a long way in retaining your employees is your culture. While no direct statistics exist, anecdotally, there seems to be one constant in all successful startups: a really strong culture. This culture does not always consist of flowers, fun and hippy love; it can be harsh, competitive and aggressive, however, making it strong matters. Your growth hinges on competing against established companies for talent, and your culture really is the only competitive advantage you have against companies that can offer much richer compensation packages, so it’s absolutely essential that you nail it.

Establishing a culture begins with the first person in the company, not the 10th or the 100th. It grows and changes, but the pursuit of culture in an organisation works as an active process. You cannot sit back and hope a culture emerges, you have to create it and guide it with intent. Culture can make or break a company. Culture sets the tone for everything from how the team interacts to the kinds of hires made to how customers are treated to how you build your company’s perception. A positive culture can boost morale by making the workday more pleasant, which translates into higher productivity and lower employee attrition. By the same token, a negative culture can poison the office environment, damage external relationships, and generally lead the company down the road to ruin.

More importantly, the cultural diversity that a startup faces when they are growing the employee base. How can you generate the right motivation among employees which will ensure that you do not face a high attrition rate?

There are 3 ‘Es’ that worked for me and LocalOye:

Employ the right people

Build your core team of first 20 people. Do not sacrifice quality here, and if it takes time (it will), so be it! Make sure the entire team is on the same page about what the company stands for, and what kind of people we should get further. This is the first and the most crucial step of your culture trickling down to all major verticals of your startup. Live-in as a concept works really well to find the right people. A short work stint of 3-4 days goes a long way in benefitting both the parties to gauge each other.

Engage them

Articulate your core values and come up with fresh and innovative ways of communicating them to your employees. It can be as simple as a company mission statement or a really cool employee welcome kit or for that matter acknowledge their contribution by giving them quirky awards. It is also helpful to train others to articulate those values for you, so that a strong sense of the culture permeates the business at every level – in recruiting, during team projects and even when individuals are working independently.

Empower them

Chart out a clear cut road map for the company and showcase how it will help the employees in their careers. Cultivate a sense of ownership by giving them strategic responsibilities for which they would be solely accountable for. Give them the freedom to experiment and explore new avenues of conducting their activities. Comfort them if they fail and at the same time acknowledge them if they succeed.

An empowered employee is the one who feels proud and something amazing happens to the company and also feels the pinch when something goes awfully wrong. His energy and enthusiasm is so addictive that it rubs on to others too.


Culture is one of the strongest components of a successful organization. The main thing to remember is that company founders are attracting people to build a vision, and beyond financial incentive, their feeling that they are a part of something greater than themselves is truly what makes successful organizations work. Whatever kind of organisation or company you want to build, make sure you know what culture you want and gather people that will feed that vision. The culture that emerges from these ideas will forge a strong foundation and could inevitably save your startup.

Note: The views and opinions expressed are solely those of the author and does not necessarily reflect the views held by Inc42, its creators or employees. Inc42 is not responsible for the accuracy of any of the information supplied by guest bloggers.