July 18, 2022

The Downside of a Startup's Culture of Freedom

Startups have a certain… magic.

The excitement and energy, shared by founders and employees alike, is palpable. The fear, thrill, and passion for the company’s success is entirely unique to the buzzing environment of a startup. Having been both a founder and employee in Startups at varying stages, I know firsthand how this experience plays out in a community of people eager to ‘make the world a better place’. Even the best-intended decisions can be the wrong solution, depending on the circumstances.

In sharing countless stories with peers, I am sure your journey at a startup is similar to my own. 

At the start, the mood in a startup is, almost universally, positive. Everyone has a shared goal and vision, there’s so much to do, and little wins go a long way. Securing funding, having your concepts and ideas validated – that feeling is indescribable. It’s like you’ve tapped into something completely fresh, something important. The world’s changing, and you’re in the driving seat.

The eqtble team

In those early days, everyone has a clear sense of purpose – or even several roles – and every little “first” feels like interstellar progress. The first office. The first paycheck. The first hires.

Even as the team grows, you know everyone’s name, what they do, and their strengths. You can trust them to have at it; go about their job as they see fit.

And why not? Lots of Startups subscribe to the lean, agile methodologies of working. They give their teams near-total freedom and autonomy, and as long as the results come in, it’s all good.

That agility is utterly liberating. It’s what attracts the top talent in the first place, and when their values align with yours – it’s just perfect.

The quality of work is staggering.

The pace intensifies, but it’s still good. Still comfortable.

The magic is in the air. Everyone feels it. Something big is going to happen.

And it does.

Something clicks. But, laced into that excitement and rapid growth, a cocktail of powerful emotions starts to build up. And as the business becomes more complex, so do the emotions.

For founders, those feelings are enormous, and most of the time – nameless. Sometimes, we say “this is fine'' when in reality, we’re burning out.

We just don’t know what it is we feel because it’s new. Just like everything else has been since Day One.

Over time, that culture of freedom we established, with the best of intentions, can begin to turn in on itself.

It can become a trap. And we don’t notice it – like the proverbial frog in the pan of water, slowly coming up to the boiling point.

For the teams building within a startup, that culture can become a frightening symbol of everything you never wanted it to be. The very thing that makes a company attractive can also make it repulsive.

When founders set out to build something great, our hearts are in the right place. We want to do good, do right by our teams, and create a workplace we wished we had when our careers began.

But our minds are often singularly-focused. We firmly believe that our thing is the most important thing. Newsflash: it’s not.

The warning sign that freedom might become a negative in the workplace can pass us by.

Until we notice the unlimited vacation days we offer aren’t being taken. The “flexible working hours” are pushing into 1 am, 2 am – and starting again at 8 am. The autonomy to do anything has become the expectation to do everything.

The magic is lost. Before long, you’re just another company, pushing back the tide of employee turnover.

In Startups, things can go bad as quickly as they get good.

Here’s the thing; the culture of freedom you want to foster can be preserved without it mutating into a trap. You just have to have the goals defined, set, and tracked properly. You need managers, and structure in place to facilitate and monitor that culture.

Putting your people first – as human beings, not staff – is at the root of a good startup culture, where freedom is, just as in the laws of society, clearly defined within boundaries designed to protect us.

What happens when you give your team too much freedom?

We already know the power of letting our teams work when they want, from where they want to work. But this can lead to a self-imposed expectation to be “working all hours”. To always be available, on the clock.

Even if that’s not what the company wants.

There’s a misconception that flexible working encourages procrastination and lowers productivity. Sure, in a big company, you’re bound to have a few people keeping Slack open while they shop online or watch some YouTube videos. It’s kind of to be expected, within reason.

Laurel Farrer, the CEO and founder of Distribute Consulting, provides another perspective on employees who are given too much freedom at work —  If a team member is given complete independence in their tasks and schedule, they’re instinctively going to work at their own pace, in their own way, and fulfill their own goals. Dangerously, these may or may not match what the company needs from them in their role. 

What can you do to remedy this situation? Here’s Laurel’s advice:

It’s critical that we draw enough boundaries in performance expectations to align our company culture and project roadmaps. They don’t have to be a lot, just enough to stay connected on shared goals and results. Otherwise, the company isn’t employing a professional, they’re just sponsoring the personal lifestyle of an individual.

We’re all people before we are workers.

But this is rarely the case at Startups, where teams are (at least personally, sometimes financially) invested in the company.

Studies have shown that flexible working hours do nothing to tackle overworking. Rather than procrastinate, employees shoulder the burden of their responsibilities – those assigned to them, and those perceived by them – by working longer hours.

There can be a sense of pressure to always “be on”. Emails, Slacks, WhatsApp groups – notification after notification… it becomes draining. Sleep gets disturbed. Happiness can become fleeting. Work is everywhere, all the time. There is no personal time. No boundary.

And then, they burn out.

This isn’t so much a cautionary tale anymore. It’s practically a roadmap. In a Deloitte survey of 1,000 US professionals, 77% of respondents said they have experienced employee burnout, under the pressure of an “always-on” work culture.

The solution? Well, some progressive and forward-thinking companies tried unlimited PTO. For most of them, it just made things worse.

Unlimited paid vacation days? More like unlimited stress.

Limiting our choices can make us anxious and frustrated. It can make us rebel. Psychologists call it “psychological reactance”; when we feel our freedom is being stripped, our brains fight back.

There’s a flipside to this. The paradox of choice. Unlimited choice causes anxiety, too.

You might be familiar with the concept of “option paralysis” – the phenomenon of being presented with lots of choices, and as a result, never choosing anything, for fear of making the wrong choice – or that somehow, any choice you make would be an inferior one.

Freedom to choose between a vast or unlimited range of choices is overwhelming. It causes the person in question to analyze all the available options in increasingly morbid levels of detail. The stress of choice becomes paralyzing. Like a deer caught in the headlights of an oncoming truck, no moves are made.

It’s the worst possible outcome. Most of the time, making no choice is worse than making a bad choice.

Then, there’s the stress of worrying about how your choices will be interpreted.

To use another analogy involving lights; imagine an average, on/off light-switch. Your choices are limited to lights on and lights off. Almost everyone will agree on which is the appropriate setting - lights on or off - at any given time.

Now replace it with a dimmable switch; any intensity of light can be chosen. And almost nobody will agree on what’s appropriate at any given time. That pressure to please everyone, and satisfy your own needs, is real.

It’s the same anxiety people feel when someone asks them to put on a Spotify playlist; a little voice inside whispers “what’s this going to say about me?”

“Will taking too much time off make me look selfish?”

“What will my team think of me when they have to pick up my workload?”

These psychological phenomena interplay with another; the perception of reduced value.

An unlimited resource has a lower perceived value than a finite resource. Diamonds are valued because they are scarce. If they were everywhere, they’d have a lower value.

Unlimited PTO has a similar effect. We don’t value it as highly as a given number of vacation days.

Freedom, it seems, is subjective. When it’s unlimited, it can have the opposite effect.

So… Is there a moral to all this?


There is such a thing as too much freedom in a startup.

Boundaries need to be established to stop work from engulfing life. But the very things that make Startups competitive – like agility and innovation – need a level of freedom.

What is that level?

Unfortunately, there’s no single answer. Every company, team, and individual is different. To know the answer, as it applies to your company, takes investigation. 

You need data.

After collecting your data, you can answer important employee-related questions. Questions like: How is your work culture? Are your employees working too much each day? Are they actually utilizing their PTO? What is your turnover rate? Why are you having turnover?

All these questions and more can be answered with your data. To achieve the most accurate insights, you’ll need a data interpreter.

eqtble acts as a collector, sorter, and interpreter of the key data that can unlock a healthier, more productive culture of freedom.

Can you quantify culture? Yes – with the right data.

eqtble’s groundbreaking, data-driven platform puts its easy-to-use workforce analytics software at your fingertips. It’ll even give you curated insights into how to tackle your company’s biggest problems. Even the ones you can’t quantify right now.

eqtble works with major HCM and HR tools, with seamless integration. Plug in your data, and eqtble does the rest. Sign up for early access. It’s free!