Does my startup really need a core purpose?

Yep. Read about how it actually gets used.

Question asked by Sarah on November 28, 2015
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Weeding Out The Fluff: Your Startup’s Core Purpose

We hear a lot about a company’s vision and culture nowadays, along with a slew of other buzz words meant to inspire. These things are often associated with the touchy-feely activities on company retreats like trust exercises, and guided sharing. Just recently, I read about one company’s “Philosophical Heartbeat” that was defined in an attempt to get away from the over-used terminology which most of us think amounts to nothing in practice. As a startup founder, you might ask yourself, do I need to worry about any of this garbage? I think the answer is yes, but only a small portion of the garbage :)

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No Buzzwords

Let’s first define the term “purpose”, as I see it for startups. It’s a simple statement (without buzzwords) describing the reason for the company’s existence. Others use the term mission to mean the same thing, but I’m not fond of that one. It implies there is an end which can be reached, and this is not the intent of a purpose statement. A true purpose has value by itself and does not describe a goal that the startup is working toward. It describes the reason the startup does what it does. A well-written purpose will not change, even through pivots or re-organization of the company.

When starting out, your company’s purpose is the single most important thing, but it has to be the “right” purpose. It has to be the highest purpose shared by all founders, stopping just short of “to make our lives better”. In fact, your startup’s purpose should coincide with what makes the founders happy.

If defining a purpose sounds like a daunting task, it is. However, it’s worth thinking about before starting that fantasy business intended to make billions. With the failure rate of startups being 80% or higher, founders might as well be doing what makes them happy from day one.

Composing A Well-written Purpose

Simply put, the statement of purpose is the reason why you care, and it is your motivation and inspiration that will get you through years of startup struggles! Your business partners, your future employees, and your early customers will identify with the purpose behind the business and the product. Good businesses communicate a clear message about why they are doing what they do. The company purpose shines through in every decision made, and it makes doing business much easier all around if it has focus from the start.

So, why do you care about this business you’re about to create? What excites you about your startup? A good way to craft your company purpose is to start with what you know and work your way backwards until the purpose becomes clear. Speak out loud what you want to do and then ask yourself “why” until you run out of answers. The answer that comes right before “to make our lives better” is probably your purpose. Our clients are mobile & web app startups, so we recommend starting this exercise with the app itself (the solution). This is tough to do alone, so single founders should talk with friends or family members about it. Co-founders for a startup have it a bit easier because they can always discuss these things with each other.

Our Company Purpose

We penned our company purpose at BOUNDLESS eight years ago when starting out, and it hasn’t changed since. I have to admit, it’s a bit dry and we’d probably write something a little more light hearted now. But it’s part of our history, and it’s just as true now as the day we wrote it:

Through creativity and innovation,
contribute to the advancement of technology.

We wanted to create great things, and we wanted those things to matter. That’s why we quit our full-time corporate jobs, and that’s why BOUNDLESS exists. Since writing the purpose, I’ve realized that creating meaningful things rings true with me on a deeper level, and it’s what ultimately makes me happy. One of the key traits of a company purpose is the ability to share it with others, and allow them to identify with it’s underlying truth. Provided that the founders stay true to what is written, future executives and employees will more easily adopt it as their own. This is also what makes it so important for startups in the beginning. Attempting to communicate something fundamental like a purpose in the late stages of a company is where it becomes cliche and phoney.

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Using Your Purpose And Why It Matters

In order for your purpose to make a difference, you need to use it. It needs to be over-communicated to everyone, and you need to ask others about their purpose too. Marketing meterial is a good place to start, but not just marketing to potential customers. The startup’s purpose should be used in conjunction with every single relationship the company creates and maintains! This includes customers, vendors, employees, service partners, advisors, and any other resource I’ve missed.

Definition of the company purpose marks the beginnings of a startup’s culture. A pervasive company purpose fosters a feeling of genuine consistency when others are considering to buy or get involved on some other level. This is a very powerful thing, even for a young company!

Our Company Purpose In Action

The marketing version of our purpose is “{ create : awesome }”, and it’s the first thing that our visitors see on our website. It sets the tone for all other marketing content, and is more important than what we do or how we do it. Of course, it does not carry much business meaning by itself. We need to tell people how we carry out our purpose and what we produce before the marketing message is relevant. The key point here is that we communicate purpose first, and it is not buried on some “about us” page that visitors might read after consuming all the other content.

Through this purpose-focused marketing effort, we also stumbled upon our ideal customers; entrepreneurs & startup businesses. We realized that these are the people truly interested in creating awesome software because they are just as inspired as we are! These are the people willing to not only put in the money necessary, but also the effort required to make projects go well and achieve better outcomes. This little discovery was the beginning of where BOUNDLESS is today (much happier and healthier!). It is likely that you will discover something important about yourself or your business when crafting your purpose as well.

Some Examples

This is a pretty long article. If you’re still reading, you’re probably ready to draft your own startup’s purpose! Here are some categories to get you thinking about what makes you happy, and what your statement might look like.

The Money Purpose
Some startups are founded with the sole intention of making passive income or selling the business to make a profit with an exit. Taking this route seems logical, but there are a number of reasons why money is the “wrong” purpose.

Most importantly, making money is not very inspiring to others, and greed has a way of eroding trust even if founders move forward based on this common idea. When adding people of unequal company status into the mix, like employees, it gets worse. Overworked and underpaid will become the secret mantra of the employee who knows that making money is the only reason the company exists. Service partners and customers are also likely to feel cheated in some way knowing that more money is the main factor in all decisions. Since this company purpose carries a negative connotation, it is best to keep it a secret. A secret company purpose is the same as no purpose, which does not help to create a culture or exude genuine consistency.

Now that we’ve covered what not to do, let’s look at a few categories that make for a well-written company purpose.

Commitment To Other People
You might like the feeling you get while personally attending to a customer’s needs, or making sure that you have a positive effect on someone who works for you. Companies like Nordstrom (customers) and Marriott (employees) have written purpose statements focused on these aspects. In a broader sense, these purposes are about people and relationships in general. To some of us, taking care of other people or being charitable on various levels brings a deep sense of satisfaction and purpose. Many companies are founded on this idea.

Love Of An Industry Or Community
Some people just love cars. Others love horse racing, space travel, or food. To some of us, being involved with a particular industry brings an experience unmatched by anything else. These companies are founded by & for people with a common industry interest.

Similar to an industry, many people have a special connection with a geographical place. It may be where they grew up or had another particularly meaningful experience. Some entrepreneurs found their startups based on a specific community to work with others who share this feeling.

Abstract Ideas
Many times people will enjoy certain activities, but not necessarily because of the activity itself. The enjoyment comes from a related abstract idea like philanthropy, child development, or scientific discovery. Our purpose at BOUNDLESS is founded on the abstract idea of creativity, and we choose to help our clients build businesses and apps to fulfill that purpose. This is my favorite category, because it gets to the core of what brings happiness for the founders, and does not restrict the startup to any predetermined course.

What’s Next?

Take a little time to discover what makes you happy, and then craft the core purpose for your startup. After that it’s time to start thinking about your app’s business viability and whether it can be built with a reasonable budget. Using Lean App Development methods is the most effective way to make sure your money and time will be used efficiently. Get in touch with the experts at BOUNDLESS to make this happen. This last Dilbert cartoon doesn’t have much to do with defining a company purpose, but I find it pretty darn funny.

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