This article was originally published on Lifehacker in June 2016.

There’s a well-known adage that nine out of 10 start-ups fail. In my time at Leading Teams, my observation is that start-ups frequently fail in their early days, and fail for lots of reasons. But the one we typically don’t hear about is how the team play an important role in ensuring success.

And yet CB insights cited that ‘lacking the right team’ was the third most important reason why start-ups fail, covering a quarter (23%) of the 101 post-mortems reviewed earlier this year. This was ranked after more fundamental reasons such as lack of market need and running out of capital.

Having the dream team and establishing the right company culture is crucial for any start-up or small business to ensure its longevity.

Here are few tips for those who want to get started.

The people factor

A team that is clearly aligned with the values and culture of a business brings confidence to the leadership team in delivering on expectations.

Vinomofo, an Adelaide based start-up which has gone on to secure $25 million in funding this year, usually hires users of their service. This means candidates are well aware of the company culture, what is expected from them and what the company believes in before joining.

Laying out what the business stands for, and the behaviours that are celebrated or out of question at the start, enables the team to work cohesively without any room for doubt.

Mechanics and dynamics

A common scenario during a start-up period is, typically, that the mechanics are right but the interpersonal dynamics have not been planned for. Being task-focused is important but it can be easy to forget that it’s the people that are driving the business and the human element is just as crucial.

Managing expectations early through an agreement about how the team will build the business is the first step. Ideally the leaders agree on codes of acceptable conduct and behaviour. This opens the door to creating a transparent and honest team environment. Thus ensuring people work with mutual trust and respect to achieve what the team needs to accomplish.

Team players

Having a diverse skillset in a team is essential for navigating a tricky start-up business environment. And while it is important for everyone to be clear of their roles and responsibilities, all members need to be invested in being team players. High performing teams work by having a common purpose, and believe in coming together to solve problems. Being engaged as a team to deliver on tasks, and having an environment that encourages open discussion, invariably allows for businesses to flourish.

The right culture

People often profess their admiration for start-up culture. But it’s not about having a table-tennis table or beer-o’clock Fridays. Having the right culture means you can trust that every decision made in the company is made in the best interest of the organisation. Culture is not built in a day, but if you establish the right parameters from the beginning, your business has a far better chance of surviving the treacherous waters of being a start-up.


Jim Plunkett

Jim Plunkett

Jim is a former Facilitator. He joined Leading Teams in 2001 and left in 2016.