Francesca Carlesi, Founder Molo & CEO Revolut UK

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Welcome back to another episode of our 2024 Masterclass series - this series is the brainchild of Italians in VC and Made IT Podcast, and powered by BCG and Bizplace. 

The theme of today’s Masterclass is “does company culture matter for a startup and how to build it” and we are here with Francesca Carlesi. 

Welcome to the Masterclass! 

Francesca is the current CEO of Revolut UK and exited founder and CEO of Molo Finance, a fintech company born from her own frustration with getting a mortgage. Molo raised over £270M in funding and then recently got acquired by Columbus Capital in 2023.

​Before Molo, Francesca spent more than 10 years in senior banking roles with the likes of Deutsche Bank and Barclays. She started her career in consulting and private equity at McKinsey & Co. and Bridgepoint Capital and holds a PhD in Banking and Finance from the University of Rome, MBA (Hons) from Columbia University.

In the title of this Masterclass we ask “does company culture matter for a startup” because it is often an element that founders don’t focus on at the start and then realize it becomes an enormous challenge as they scale. So let’s talk about it!

EPISODE TRANSCRIPTION

Camilla Scassellati (00:02:57) -  I'll get started first with our own questions, and I'll remind that the title of the masterclass was thus company Cultural Matter for a startup. So I really wanted to start there, because often it is an element that founders maybe don't take us seriously at the beginning, because there's so many challenges that you're trying to solve as a founder at the beginning, and maybe you don't spend a lot of time thinking about what type of company do you want to be, what culture you want to build.

Camilla Scassellati (00:03:21) -  I want to ask you first, Francesca, is your definition of company culture, and do you actually believe it is crucial to start early with defining your culture? If you want to build a multi-million dollar company, or is it just a nice to have.

Francesca Carlesi (00:03:35) -  Let's talk about what it is and what is also not so. The way I define it is kind of the set in the group of behaviors that in a in a company distinguishes how people act, right? As everybody is what people do, how they interact with each other, what they believe in. But more than the beliefs, most in most cases actually the behavior what to actually do. So what culture is not for me is not a list of, you know, titles on the wall is not necessarily, you know, we have our values and then we behave completely different. It doesn't really matter. And it's not, something that needs to sounds good because that's what I noticed. A lot of companies, they want to very nice taglines that they put on the wall.

Francesca Carlesi (00:04:17) -  And then maybe nobody believes in that. And what is also not is not necessarily something soft. That's also important because a lot of people believe culture is needs to be the opposite of having high performing team. Not necessarily. I mean, culturally, you can have any any culture, but not necessarily needs to be something nice and softy. And then all of a sudden nobody will perform. Okay, that's really, really important. So for me, culture is more about how people behave in a company and usually is something that is unique to the companies. You step into the office and like, okay, I am a model or whatever, or I am at Facebook, right? So I do. I believe it's important actually. I think it's very, very important in AI. And it's really interesting because in the journey in the last few years, I think has strengthened my belief in this. I always thought it was important. But, you know, I first life in a way was in big companies and a big company I thought was important mentally, but never leave through what that really means.

Francesca Carlesi (00:05:12) -  And so when you set up a new company, you have actually a privilege, in my view, which is you actually get to set up your own culture. So and then people will follow this, right? This would be like growing up a child, in my view. That's how I see it. It's almost like if you have a you define a lot of these behaviors and personality when it's very young and, and this will define a lot of the success, but also a lot of how we will he or she will be when they grow up. Right. So in a way, actually I could witness in the startup journey how relevant culture is, because if people really are rallying around the same core values and this is really felt deeply, it can actually even save the company. That's as much as I would say, right? Because it's actually the core, the glue that keeps people together. And it's a startup. You really need that because it will always be bumps in the road and having a strong culture, whatever there might be.

Francesca Carlesi (00:06:07) -  Which means if people feel they are part of a team and they're not just some of individuals, then this will allow them to almost overcome anything.

Camilla Scassellati (00:06:16) -  Yeah. And I feel like when we talk to founders on Made It podcast, for instance, they especially founders were maybe already, you know, past the initial challenges and into more of a scale up mode. You always hear that the biggest challenge is how to keep the team together, how to scale, and how to bring the initial culture to more people. So we'll talk about how important it is to scale, but if it's important to scale, it means that you need to lay the foundations early for that to be successful. Because if you're already mid scaling and you're trying to put a culture together, I imagine that it's very, very even harder to get it across to more and more people. So what's your view on that? When should companies, when should founders start thinking about the type of culture that they want to have in their companies? And when you're a founder, you have this thrilling but difficult role that it's it almost all depends on you.

Camilla Scassellati (00:07:06) -  So I don't know how you do you have any suggestions on how to get started and thinking about your cultures and when to get started and thinking about your culture?

Speaker 4 (00:07:13) -  Yeah, I think.

Francesca Carlesi (00:07:14) -  That's a very interesting question. And probably there is not one size fits all. That would be my learning. Right? So so what you need to be careful is you shouldn't just set up the company. And then the first thing you do is like, oh, we want a culture. And then you spend a lot of time thinking about what the culture is. And again, putting on the wall, I think it needs to be a little spontaneous process, but at the same time it needs to be very intentional. So in terms of timing, I do think that it's important since it's very important actually since the early phase of a company, to intentionally think, let's think or be self-aware, what type of culture you want in the company, because in that early stage. And especially in the fund that needs to be that person.

Francesca Carlesi (00:07:57) -  You cannot delegate to somebody. You cannot say, okay, let's hire a junior HR person and he or she will define the culture because it really doesn't really matter is about what you do every day. Culture is really about what you you as a founder in the early stage and the people around you really do every day. What do you do when there is a crisis, especially, what do you do? How do you fire? Who do you hire? How do you manage performance manage? So all of these are signals that you're giving to the team. So in a way, in terms of behaviors you should start from day one and thinking about okay, if I do, this was signals I'm sending to the team because that will translate in the company culture in terms of codifying the behaviors. So really getting boiling down into what are the five things we believe in, which is typically what people think culture is. You can actually wait. You don't need to sit down on day one and write this down.

Francesca Carlesi (00:08:48) -  In fact, I think it's actually better if you go with the flow of it. Get the core team around you, start adjusting it, see what are the tough choices in how you feel about them, and then gradually it will come natural and you realize, well, actually, this is what we stand for. The point when you want to codify document the culture, which usually boils down in some five values or do's and don'ts and things like that. It's better if you have a view, but you actually co-create it with a team that is the team at that time, right? And then after that the team will grow. But if you can of planted the right seeds, it will self perpetuate. Right. And then you'll have the core team that will act as an ambassador of culture. And then communication is very important to make sure that even if become a bigger team, everybody gets the same value and the same things. But but I really distinguish between this concept of doing it, and that is from day one to the concept of when you need to publish something or codify.

Francesca Carlesi (00:09:46) -  And I would not rush that, because otherwise sometimes you also run the risk that you want to write something down and is not what you really feel is not what the really the company stands for. And that's the thing is, I found was the right balance for me.

Camilla Scassellati (00:09:58) -  So there is a need for self-awareness, I guess at the beginning, as the founders and making sure that your behavior reflects what you want everyone's behavior to be. So if you want your culture to be free, for instance, like the very famous like no asshole rule. So if you want like a nobody can be an asshole in my company, then you need to make sure that you in the first place are not being an asshole, because otherwise you can't ask of other people that. So I guess there's a bit of self-awareness and leading by example. When you're the founder, is that the right way to think about it?

Francesca Carlesi (00:10:30) -  I think maybe come along. This this is a very important point. So maybe it's worth to to kind of highlight it, which is it should be under no illusion.

Francesca Carlesi (00:10:38) -  So I think it's very important to reflect on the fact that the culture inevitably should. It's like a personality, right. And it will reflect a lot the founders personality and your to believe in not personality, but what you believe in, what your values is. So don't try to fit the box or to fit like a checklist or a cookie cutter, because at the end you really need is very specific in your the culture of the company you found. It needs to be molded around what your real beliefs are. If you believe you know we want to be really customers and take a really believe in team player, I don't know, right? That can be part of the culture, but if you don't believe in it, don't try to force it because it will not come across. Right. And then yes. And then every day it is an everyday topic, which is every action you take. You kind of need to be very deliberate in thinking, what is this aligned to the culture and what signal is sending? Because in reality, especially in a small company, especially the funder, you are a role model and everybody will look it up.

Francesca Carlesi (00:11:40) -  What I will say is that this seems very easy, but it's not easy at all because and for me, the most difficult parts when it gets to people, at least in my experience. Right. But I'm, I'm, you know, talking to various people. It seems like this is always a common denominator when you it's about who do you hire, who do you fire, who do you promote? You find yourself in a situation. We have people that might be great performers, but they're completely adults. With the culture, you're hiring somebody, you're looking for skill set, but you want to check the mindset. Maybe it's not the right mindset, not the right culture. And then you need to make a tough decision, because in the early days of a startup, you are very stretched. You have a lot to do, very few people, sometimes even difficult to convince people to join. So when you find somebody who's actually good and wants to join, it's very easy to shock and say, well, actually doesn't matter.

Francesca Carlesi (00:12:28) -  He will. We will adjust to the culture. But in reality, you need to be very, very tough with yourself and very disciplined and make it a key criteria. So one thing we did in model, for example, we always had this in performance evaluation, for example, since the beginning, by the way, the concept of the what and the how. So you assess how, you know because it's important that you deliver on goals and objectives, but it's even more important or less equally important how you do it. How was. Into values and culture. And sometimes you find that if you're really disciplined around that, you might have to make tough decisions about people that actually are good or good from a performance point of view, but they don't fit. And that created a toxic culture, and you need to eradicate that. So that's what I think is important to keep in mind, at least in the culture is you. So you need to really be very deliberate. You need to it needs to be really fitting how you what you believe.

Francesca Carlesi (00:13:17) -  But then you need to walk the talk every single day. Every single day. The final thing I would add in terms of when it matters the most people decision is one and the other one is when you have difficult moments. So we, for example, went through Covid, we went to a couple shakeups and the interest rates or the massive impact on customer base in this moment, which typically and moments of panic and where even tough decision would be okay to make them. Will stick forever in the company culture. You know, in three years time, somebody will remember how we addressed Covid. Did we cut? Did we kind of laid off? Everybody? Did we sit down and and discuss with everybody transparently what's happening? How do you react. Right. So my suggestion would be difficult moments are in a way a great opportunity to cement the company culture if you do the right choices. Because if you say that you care about people, then it doesn't mean we need to show it. And if you do that, then you have created a bond that will last forever.

Francesca Carlesi (00:14:21) -  But if you don't do that, it doesn't matter what you do afterwards because you have created a breach. And we also last forever, right? There are some moment of truth that are great to cement the strength in the company culture, but could also work the other way around. Right.

Camilla Scassellati (00:14:33) -  I want to go back. We'll go back to the challenges point. And I also want to go back to the hiring point, because I think that's really important. And I'm sure a lot of founders are struggling with that, maybe right this very moment. But let's go to model for a second. What was what was culture like. And do you remember a little bit of some of the things that you went through in defining that culture, and any strategies that you use that you think might be helpful for people to hear in your experience what we.

Francesca Carlesi (00:15:00) -  Wanted to stand for, what I really believed, and I remember I started up model after spending a long time as almost 15 years in big corporate, so in kind of banking consulting.

Francesca Carlesi (00:15:12) -  So for me, it was the first opportunity to really set up a new company from scratch. The key driver of what I really wanted to do, okay, was to set up a company and a great product. But there was a big driver for me, which was about people. So it was about setting up team in a culture from scratch, because a little bit, being frustrated about being from being in several companies, big companies, they always talk about culture, but you never changes. So I felt this kind of privilege, but also duty to shape the best company culture ever and the right people because it's a privilege and you set up a company should really take this opportunity. So for me, the importance is they won. And, the type of culture we wanted to have was a little bit what I want to stand for, which is about a company, is very where people take ownership, think big, are really, truly customer focus for us was a big deal in an industry, in a sector which is mortgages, where to be honest, a lot of time people don't even talk about the customer, right? So our customer centricity, taking ownership, thinking big, do it with passion.

Francesca Carlesi (00:16:15) -  These are some of our values. And then working together. So template was very important right. So at the end was about meritocracy a lot. So I couldn't we didn't want to have a company where there's a lot of politics or people, you know, you need to do the right thing and then be rewarded for that. But then where people work together and help each other, but actually go the extra mile and you just don't you dare to challenge in a way, the status quo. That was also a very important point. So now all of these, the way we went about it is that on day one, you really need to build the company. So I don't think you should really spend too much time trying to write down a nice wording what you want to stand for, but effectively had an eye at the view of what that looks like for me. The first people that we hired in the company where people that kind of broadly without having codified, I thought, okay, it could work, like we could work together.

Francesca Carlesi (00:17:07) -  And I believe the the concept of they believed in three in the dream was very, very important. Right. And what we did is like it was all about bringing together a group of people that would be like minded. And then I think not even in here, one maybe near to a certain point, we had 15, 20 people, which was that size, where we had a core group of kind of the more a leadership team, but also a lot of the people. And then we felt the need to say, okay, we are growing is probably we're starting to suffer, actually some of the pain points. So we now need to hire fast. And we're starting to see they were starting to hire people. They're not great. Maybe. So we need to codify. And so what we did, we did an off site effectively did a couple of days with the old team and was a little bit bottom up. Okay. So we said, okay. One of those workshops, which was moderated by somebody actually internally at the time to say, okay, what is the culture that we want to publish right now? There were some strong top down views, but it came out from the team and then we got the team to also everybody to share what we came up with, the five values.

Francesca Carlesi (00:18:13) -  But then we asked everybody what those values meant for them, right. So in a way, by that time we already had a core group of people we already had established in the doing what good looks like. I mean, it was kind of it was right.

Camilla Scassellati (00:18:28) -  It's probably a good test to do it bottom up, because then you can see if what you thought was the company culture actually percolated to the whole team. So it's probably a good test to see was what Francesca wanted a day one what exactly.

Francesca Carlesi (00:18:42) -  And at that time and then you could at that point write it down in a more polished way. Because it was more crystallized. So so that's how we did it. And then effectively that actually helped because then we had these values on the wall all the time. They were part of we embedded it in our system. So our as I mentioned before, all our people processes were around not only how good you are in doing your job every day, but also how you do it, how aligned are you to the company values? And that played a role which is like at least 5,050%.

Francesca Carlesi (00:19:13) -  So that meant that we ended up having to make tough choices on people, just maybe because of the cultural fit. Right? You know, really, sometimes we had a lot of discussions about somebody really good, but it kind of probably is not the right place. Right? We embed into the hiring process as well. Right? So you need to embed it. Then it shouldn't just stay on the wall.

Camilla Scassellati (00:19:31) -  Can we talk about that? I want to talk about hiring because that's such an important way that you can. As you said, you can control your company culture because if you're hiring people that don't fit your company culture, you're diluting that culture automatically because those people are not going to walk the talk that you're talking and walking. And we had a question from a founder, David Villano from ring 33, that, for instance, asked, like, we are creating our team and hiring our first employees and finding it challenge to to understand how to create the right company culture. So I feel like that's the first time where founders maybe really, really need to think like our coming to terms with the idea that they need to think about culture because they're hiring.

Camilla Scassellati (00:20:10) -  Do you have any tips on how to think about hiring? Like you said, the how and what? Like is there anything else that you did that worked well in terms of making sure you were hiring the right people?

Francesca Carlesi (00:20:23) -  I think the water now is more for us was more later. But I want people on board on hiring. I think what the journey we went on, at least I went on, was that you really need to make sure you are honest with yourself and you clarify what you're hiring for. And for us, what work well is to shift from hiring from skills for skill set only to hiring for skill set and mindset and being very deliberate about that. So which means that in the screening, when you look at people because you screened and you for people based on a CV, it does help if you look through referrals, referrals always better because by definition, the people that know you will always refer people that may be more similar to the way you think. So hiring to refer us helps a lot because already attracting more similar people in general.

Francesca Carlesi (00:21:11) -  Second, when you do decide, okay, what type of people we want to make, make an effort in the job description on your internal, you know, thinking to say, okay, culture fit or mindset needs to be one of the dimensions and then you need to define it based on how you are, you know, just look into yourself. You don't need to have define everything. Just see what how are you what good looks like for you. You want somebody very driven. We want somebody very I don't know, a team player. Right. So that's and then codified make sure in the recruiting process even in a piece of paper. But you have that written down and then you force yourself to say, okay, this person has just met how the person even as fantastic CV, but how does it fit with this criteria.

Camilla Scassellati (00:21:56) -  Would you as a founder, did you do the first interviews with everyone? Were you interviewing or was everyone interviewing? Is there anything there that's important to talk about? Did you have questions that you really like that have to get out, get out? Some answers about culture fit.

Francesca Carlesi (00:22:13) -  Yeah. So so the first of all, you need to be involved in interviewing for a long time. I think a big part of your time as a founder at the beginning, but for a while, maybe even up to 50% of your time should be on people topics. And at the beginning is a lot of hiring. So don't delegate that either, because you cannot. I mean, it's very important that team, especially the initial team, you're the only ones has a stability to understand what really works. Right. So spend time on hiring and spend time and talking to people and even people. Maybe just create a little bit of a virtual bench. More people you talk to the better in addition to this, right. The way how do you bring it to life? I think usually for me is about asking about previous experience, like how in a certain situation, the candidate dealt with it. Right. So previous experience, especially mental difficulties, if you know already what type of what you're doing and you can anticipate what the challenges will be for that person, maybe asking him, asking them how they face similar challenges in the past.

Francesca Carlesi (00:23:12) -  It tells you a lot about how they reacted. What did they do? Did they panicked, or did they kind of stepped up to the game? Did they take risks when they were faced with the choice or they didn't? And then you kind of understand a lot there as well, right? So asking about one thing and say, how did you what was your biggest challenge or what was your biggest success in why did it make you happy? Says a lot about understanding the why people did some things rather than just do the usual interviews. Right. you know how good you are in this skill set, right? So it's about going back in history and then get people to open up and understand. How they react to certain things. That's that's very, very important, especially.

Camilla Scassellati (00:23:51) -  If you're hiring at the beginning, maybe more senior people, they'll have prior experiences, they will have worked in different companies, and maybe those companies will have shaped their their own ways of working in culture. So how much do you look at past experiences? And I guess you're asking the questions, right? So if maybe you're worried that the person worked in a very high profile, I don't know, maybe like in a very structured place, like a consulting company, you want to make sure that they're also like entrepreneurial.

Camilla Scassellati (00:24:20) -  You want to test for the things that you're maybe more worried about that specific person, I guess. Yeah, I don't know.

Francesca Carlesi (00:24:26) -  Absolutely. I think there are some biases. So I always try to be neutral and not be affected too much because there are some stereotypes, okay, in the industry, especially in the venture capital industry, in startup land, which is if you come from a big company, for example, you might not be a good fit for a startup, maybe in a big portion of a big percentage of the cases is true. But I tried also always to look through because it's also true the opposite. So I think I look at the CV mostly to understand the experience level, because you need experience in some roles, so you just cannot just make it up in some roles. But then effectively to understand how somebody thinks and how they would address challenges or the situation, usually the interview. And so the questions are more helpful. And I try to so let's say the following. If somebody has only done a big banking job for like 15 years, my challenge and my prob a little bit more is ability or ability to be entrepreneurial.

Francesca Carlesi (00:25:23) -  So ask have you ever done something from scratch you in your personal life, right? Or did you have any big challenge to overcome in your job? Because clearly I have less evidence that survive a thrive in a in entrepreneur environment. But I try not to be biased against this, right in a way. So if somebody has had a different experience and has jumped around a little bit and studied big banks or big companies and then more smaller companies, it gives me a high degree of comfort. But at the same time, I try to be not to confirm and classic and see how they react to challenges. So I think you need to be very deliberate when you hire people, know that you been good in terms of knowledge or experience is not enough, and then carve out time and focus of your mind and try to be not biased, but to assess also mindset and be willing to let go of some candidates. If the second aspect has work, which is the most difficult part I guess sometimes.

Camilla Scassellati (00:26:19) -  How much does it matter if you like a person? Like do you try to say like, do I want to have dinner with this person? Is he nice or is she fun? Like, not fun and nicer.

Camilla Scassellati (00:26:29) -  Not the right words, but do you care about how if you like, if everyone in the team likes likes her or him for instance, that sort of got feeling? I don't know, it's hard to describe, but sometimes I think that it's great to work with people that you, you know, maybe want to have lunch with or go away with for a weekend. But sometimes I'm like, does that bring in a bias that you're only hiring people that are like you? And that creates maybe less difference of thought? I don't know if you have thoughts about that. No.

Francesca Carlesi (00:26:55) -  So maybe I'll say to two things. So one is I actually think it does matter if you like somebody not like more in general, but you need to be probably the odds are you're going to work a lot together sometimes, maybe very late at night. So you do need to have some level of personal bonding in this work. So I actually think it is very, very important that you have, I don't know, like more emotional connection, not emotional in a, in a crazy way.

Francesca Carlesi (00:27:20) -  But you need to kind of broadly like each other. And in fact, I actually think is a very good idea, especially for some roles. But honestly, I almost recommend for most roles in the early stages journey to meet not just in an office environment, but effectively go for dinner, go for drinks, meet for lunch, and and spend really time. Because in those that's where you see how people really are. And I let go a bit and that's where you talk about other things, but family or friends and so on. And you understand whether you could gel. Could I spend a lot of time with this person? And actually, if you need to have fun at the end, right. I think this setting, the meeting, the interviews in the first stage of succession in a more social or a more casual environment is super helpful. It's actually a highly recommended. I think the other thing though, that connect it to your point, you know, you need to be careful not to have a group thinking, but also not to hire people that are all the same.

Francesca Carlesi (00:28:12) -  And probably that was one of the hardest lessons I learned in my experience, and which is especially as a founder, especially when you're thinking about how you build your leadership team, it's really important that you have complementarity in that. So when you look for somebody in your hiring, somebody you need to think not only about is this person really good in what he or she does. Then of course, this this person has a romance, but also is this person that I fit for my leadership team. Which means that if you already have a certain type of personalities in your team and you had. Somebody that could be an explosive mix. You probably should not hire that person now. It sounds so odd because I didn't think this should be a criteria. I never thought about this before being a starter, but unfortunately it does matter because when you're in a start, at the beginning, the leadership team is really I mean, it's really the rock on which on what everything hangs together, right? So if there are conflicts there, it's it's the death for the company.

Francesca Carlesi (00:29:12) -  So the way you overcome that is first you need to form your view. But then second, we always see and model for a long time in reality, especially the beginning of a long time, even after you almost made up your mind about a person. We always set up some, you know, we kind of call them meeting great meetings, but they always should meet the team and sometimes they would actually meet the their team, the future team, meet all the other people. The leadership team, meet other key stakeholders. They need to get along with everybody, not with everybody. But you need to find that they actually come in, come in the team and they feel at home or there and then that matters. And if it doesn't work, you might need to be willing to. Now go ahead.

Camilla Scassellati (00:29:54) -  And there's a question here from the audience. I'm going to put it up because I think it fits right well, really well in what we're talking about. So Paolo G is asking, what kind of person should you not hire in a startup or in startups in general? I know it's a very broad question, so I don't know if there's anything that comes to mind on, like people that you try not to hire because you didn't think they were, they would be the right fit.

Camilla Scassellati (00:30:15) -  And I know it's hard to generalize, but maybe some backgrounds or personality traits or it is.

Francesca Carlesi (00:30:20) -  Very general because I think at the end probably everybody has a role if they're like in a complementary team in a way. However, if we need to find a pattern, I think probably one type of personality, one type of person usually is very difficult. So I actually struggle with making it work, especially in the early stage. Theta is the type of people that are very, very rigid in the approach. They need to plan everything ahead, and if there is a little bit of a hiccups, then they go crazy, which we actually had in the team and it didn't work out. That's why I'm saying this. So I think in general, for example, it's not bad to be very organized, very structured planning in a way and wanting to have everything. It's actually a good thing. But adjusting the early stages that things change every day. There's always the emergency of the day, it is always something you're not planned.

Francesca Carlesi (00:31:08) -  And so if you have that need to have everything under control and to have a stable situation, it could create it could create some some problems. Right. And it probably is not the right place, at least in the early stage of the journey.

Camilla Scassellati (00:31:21) -  And let's we'll move on from hiring. But it's such a big topic and an important one, especially when you're thinking about culture. But we also talked about you talked about being ready to fire people that don't fit your company culture. So after you've gone through all of the hiring process, it is natural that sometimes you might make a mistake in the hiring process. You might hire someone that seems like a great fit, but when they start working, it doesn't work with the team or they're not the right person. How important is it to fire people that don't work, especially in the early stages of a company?

Francesca Carlesi (00:31:53) -  Okay, so this is really a very important topic. I think, and probably something where I struggled for a while. So in a way, when you struggle, you learn a lot.

Francesca Carlesi (00:32:02) -  And so happy to share a view. Right? So there is this kind of saying in startup land, which is you should have high, slow and fire fast, which means which is actually a little bit draconian. But in a way it's partially true. So what I found is that in a in a small company, especially early stage, every person counts, every person matters, every person is creating a company culture because there are very few people. And besides you, you know, what you do every day creates a company in a way. So if you have the wrong person, there is actually much more impactful than if you are in a big company. And there are 10,000 people and there's one wrong person, the person is not going to impact the company. So in a startup, when everything is kind of very emotional stage, it does matter a lot. So that's why you need to take action quite quickly if it doesn't work, because the impact is not just that person is underperforming or that person.

Francesca Carlesi (00:32:57) -  It depends. Right? If, if, if it's not working because it's performance or because of mindset. But in both cases the damage created is broader. It's bigger than just the person. Right? So it's not just non-performing its role or her role. You are setting a role model, which is the wrong role model for everybody else. Because typically you have ten people. Everybody is working like crazy. And if you have one person actually not really put in the effort, gradually he or she will drag everybody down because of course, you know, you're setting a standard. You are telling everybody, you know, don't worry, it doesn't matter. You know, there are no consequences if, you know, really putting all the effort, right. Similarly, if you have this person or two or whatever, they even great performance, but it's creating a toxic culture. So it's like maybe backstabbing people, creating politics. So doing exactly the opposite we want them to do. Unfortunately, the halo effect of that is is massive, so you really need to stop it right away.

Francesca Carlesi (00:33:56) -  And sometimes it's difficult. I think it is difficult because at the beginning your core team is really everybody is a critical role. So letting people go, you really feel could could have perverse impact because it could slow down what you need to do, but also it could create bad optics with investors. That's what I thought right at the beginning was really good. If it's really bad if we fire everybody now, right. So it's not good. So but reality you need to be able to, you know, it's a short term pain that is kind of avoiding a long term impact. That could be much more radical in a way. Right.

Camilla Scassellati (00:34:31) -  Another big challenge that I think startups face right now is the fact that a lot of startups choose to set their workplace to be fully remote, which is great. It's something that we were able to do after Covid. We learned that we could all work remotely, which means you can get talent from anywhere in the world, and you can give your employees flexibility to work for from wherever they want.

Camilla Scassellati (00:34:53) -  But I also do think that it makes transmitting your company culture to all these people that work either all around Italy or all around the world, particularly complicated even for a large corporate. It is hard when people are working remotely. So are there practices that you would recommend that startups adopt to keep the team connected and engaged, even if they're remote? Was was, I don't remember, was small or remote or partly remote. And did you have anything that you did that worked well for for you guys?

Francesca Carlesi (00:35:22) -  Okay. No. Very happy to talk on this also because I feel like went to a personal journey on this topic. Right. So I'm a little bit old school. So originally I was was really I wouldn't say against. But we're not really supporting work from home or like remote working because also I think when you have a small company, you really need to be side by side, really up your sleeves. And actually it's a lot of culture gets created in that way. So and then what happened in, in our journeys that so that's how we started by the way.

Francesca Carlesi (00:35:50) -  So we're all in the same place working hard but also having fun right. So and then Covid hit and we had to go fully remote. And so in a way it was a necessity. And then gradually it took like two years to go back to a more normal pattern, which was never normal because in reality, right now, in, in at least in UK, people in the office 2 to 3 days a week. Right. And now I'm working Revolut which is is effective fully remote companies. So there is no even an attempt to bring people in. The office is a fully remote. You can be wherever you are. In fact, actually you could even be abroad. You can actually spend six months abroad and work from there. Nobody really cares. So it's really been a very interesting journey for me. So if I reflect on the transition, especially model, what do you do? Right. So I think there are a couple of solutions on one side. So it does have an impact.

Francesca Carlesi (00:36:38) -  Being in the same place helps with setting up a company culture. There is no doubt because we are humans at the end. It's not just about if you are in front of a video call, you become very transactional. You didn't know anything about the other person because you're doing a call for specific goals. If you are in the office, you learn so much more about the person you kind of get go for a drink. You can even create moments where you talk about something else. So I think to set up a company culture, proximity, I think it helps. For example, in Marlow when we switched to remote because we had a strong company culture, it was great because people were really hanging out together. What we did to keep everybody together, we always maintain our homelands meeting every week, and we had another. And we also had a situation where some people, we had to kind of follow some people. So we made it a point. I decided, okay, we always will have, not only our homelands, which is kind of a business meeting, but we set up a more social Friday wrap up meeting on Friday afternoon, which is completely not to talk about business and people share what they were doing, the projects, we kind of even played games, really.

Francesca Carlesi (00:37:44) -  It was very remote, but but it actually helped a lot. So even in a remote environment, finding a way to connect beyond work is very, very important. And that's that's actually matters a lot. Now if you are anywhere remote and so on, what I would do, well, how do you do it? I think my suggestion would be one is, well, if you are really early stage of a company of three people in a room, I really try to advise that you spend some time together no matter what. Right then later on, if you want to go fully remote and actually does have a lot of flexibility, make sure you bring people together at least every once in a while. So first of all, have some cadence in the company meetings, but then maybe every month have a social event or every quarter. Bring people together for no matter. It doesn't matter where they come from, but in the same place, in the same office one day or two, because this bonding is too important.

Francesca Carlesi (00:38:37) -  So let's focus in that way.

Camilla Scassellati (00:38:39) -  Yeah, I was I will give an example. I was talking to a founder that was saying that their company is fully remote and with the money that they save on. Not having an office. Then once a quarter they fly everyone to a location. That's fun just to have team building and fun and drinks and lunches and also talk about the direction of the company. But a big part is just social so that you can get people together. People then like each other, and they'll then continue that relationship in their own time beyond the video call. So that can be a strategy. You're saving on rent, but you're flying people out, to, to a hotel for a few days, etc. and.

Francesca Carlesi (00:39:17) -  You need to do it. Don't think it's a waste of time or money, just be disciplined around it because this goes along a long way and it's really the social part. So it's good to talk about business, but you also want to maintain a life, that connection and so on.

Francesca Carlesi (00:39:33) -  Right? Yeah I think these are the main things. So and then also, you know, I think if you are remote, besides bringing people together every once in a while, I think you need to do an effort of communication. And communication really matters a lot. The difference is that if you are all in the same room, in same place, kind of communications happens by itself. For example, you could have you have your values on the wall, you could have a room on the wall, you catch up for coffee and like for example, Imola. We used to have always Friday, we always had a Friday lunch together. I don't know, we would order pizza and then we'd have a game. Right? So naturally you do much more, many more things if you are in the same place. If you're not, I think you need as a founder, especially if a leader or a leadership team, you need to think about it and specifically be very deliberate to make sure you you not only bring people together every once in a while, but in your you do have certain type of meetings to communicate, to make everybody aware.

Francesca Carlesi (00:40:30) -  For example, the big picture, what's happening in the company, what are key decisions we have taken or reiterates a message about what matters? What does it matter? So which means you need to to really be very much more deliberate and specific. But communication, communication, communication is very, very important. And maybe even you feel that you're repeating always the same things, but that's how you kind of get people behind you, and you get people to actually realize that actually we are on a journey and they need to see everybody needs to see the journey and every point in time.

Camilla Scassellati (00:40:58) -  And I will call on people to ask questions. I see there is a few in the chat, but, don't be shy. Ask your questions. It's your chance to ask maybe questions that you're pondering yourself even. It's very specific to your startup. We're happy to maybe think about it together, so don't be shy. There's a couple that I want to make sure we get to. let's start with the last one. Maybe we talked about firing, and Giacomo Rossi's asking, what is the best way to fire someone in a startup.

Camilla Scassellati (00:41:25) -  So I don't know if there is a way beyond just telling them. That also depends on where you are, I guess Italy versus the UK. Labor laws are very different, so it's important that you know what you're facing in terms of firing. And I don't.

Francesca Carlesi (00:41:39) -  Know what you mean. Best is just the best interest of the human input. I would say. So for me, probably if you park any legal consideration, you know, because clearly different countries, different, you know, legal situations, but in terms of the human impact and also the company impact, what I would say is, is, is actually transparency. That's what comes to mind to me. So effectively, I think the best way I found is that you just well, first of all, it's making the time and acknowledging that this is is an important moment. Don't just fire people on the sides once you're busy doing other things because it is a significant impact, right? Unless something dramatic happened. But secondly is be very open and transparent on the decision.

Francesca Carlesi (00:42:20) -  That's the other thing, because when you communicate, take the time, explain the why. Don't kind of sugarcoat, don't blame it on somebody else like the board decided, right. Just you need to own the decision, explain the why. And honestly, a lot of times maybe, you know, explain that this is about fit. It could be bad performance, but in reality, sometimes it is really about say, listen, it's not about you is effective. What we need in this moment in time and it's a special company, whatever. So talking about the fact that it is a fit problem helps, but also being very transparent and caring in my experience is very, very important. And what I would add then is to think carefully together with the person about the communication to the team. That's usually the most painful part, especially when a group or small team. So typically what I always said is that once the decision is taken and, you know, we kind of decide how to move forward, you agree together the steps, the timing and the content or how this is communicated to the rest of the team.

Francesca Carlesi (00:43:23) -  Because again, you shouldn't hide that your voice is not about funny, but you can say, you know you need to agree or same communication, but then communicate in a timely manner to everybody because everybody will know anyway very quickly. So make sure you again own the decision. The same the team understands why, has access and can talk to you if needed, but don't have people that drive. I don't. Just blame somebody for something. So that's what I would say. But it's about transparency and doing the right things at the end.

Camilla Scassellati (00:43:55) -  there was another question that was asked by, I'm sorry, I don't remember. I didn't write down the name of the founder, but the founder was asking, and you talked about this a little bit in your intro speech. So I think it's worth wrapping up with it. Can a high performance and healthy culture coexist? So the idea that, as you said, like maybe culture is seen as like the soft thing and if it's your being so nice with everyone, then it's not high performing.

Camilla Scassellati (00:44:18) -  What's what are your thoughts on that?

Francesca Carlesi (00:44:20) -  That's super easy because I think there is a there is a concept on this. Right? So I would say absolutely. Yes. In fact, you know, only that could exist. But if I could help each other, in my view, because, culture does not mean that all of a sudden you're nice to everybody and you just kind of relax and nobody does anything. As for me, it's like thinking about sport team. Like if you think about soccer team, if to win, everybody wants to win. To win, you need to put into a hard work. And you you want to have high performing the best athletes, right? And then the best athletes want to be with the best. They want to win. So in reality and then you're really building a team. You can build a culture around that. But it doesn't mean that if you have a good culture, you have to have bad athletes. So it's actually the opposite. So I would say absolutely, yes, but probably take away this concept that culture means not being performing right.

Francesca Carlesi (00:45:14) -  The culture is what you define. And you could define by the way, that's perfectly fine. They want you just setting up this company. If it is something that is like more of a lifestyle choice, which is okay, and then it's a certain type of culture and a certain point to a certain type of performance expectations. But that's a very specific case. Otherwise, these two things go hand in hand. In fact, I think they're really full on each other. If you have the right culture and the right performance aspirations, in a way, great.

Camilla Scassellati (00:45:41) -  Let's wrap up the mascaras with the last question from Ada Gentile, which, goes back a little bit to our hiring discussion. So our drive and ambition more important than experience when hiring for early stage startups?

Francesca Carlesi (00:45:54) -  Yes, I would say yes. It depends a little bit on the role however. So in general, driving ambition in my view fit into what I call this mindset bucket, which is you need to be eager, you need to want to change a role and believe in it and be a little bit of, of a dreamer, but also wanted, you know, have resilience and grit, you know, that that matters a lot.

Francesca Carlesi (00:46:15) -  So we a lot Imola, we kind of took decisions in specific roles to maybe higher personnel, less experienced many times, but was so driven and we thought, you know, he or she can learn what needs to be learned, but you cannot substitute the mindset and the drive. Right. So I think I would say yes, if you have to generalize. I think though for some roles, especially maybe in a regulated industry, maybe we need to differentiate. If you need to hire somebody, that is a risk that needs to go in front of regulators. Maybe you need to make sure he or she has some experience. I wouldn't say 25 years on the job, but, you know, some experience. It needs to be there, right?

Camilla Scassellati (00:46:51) -  I guess it depends. Yeah. What what seniority level. If it's a very junior hire, I would say 100% drive and ambition probably. That's all you really, really need. And if it's a more specific senior higher than it's a obviously a more of a balance of both.

Camilla Scassellati (00:47:06) -  Yeah.

Francesca Carlesi (00:47:06) -  Maybe just to clarify or not to leave, you know, with the wrong impression. I think typically it's not a black and white situation. It's not that you need to choose between a person with lots of experience and zero mindset, or hopefully.

Camilla Scassellati (00:47:18) -  You get both.

Francesca Carlesi (00:47:18) -  Yeah, usually what I found a real difficulties usually is you have for a role, let's say given a say for row two people, that one of them has is kind of as a massive track record than they see for before. And maybe it's a little bit more relaxed. And then you have somebody slightly to step behind. So still has some experience, but it's never really done that role fully. But actually there's a lot of drive and ambition to do it. And how you act in that moment make a massive difference. We had this dilemma many, many times. Most times we went for the drive and ambition. But you know, we still has a solid professional, right? But it's tempting. It can be tempting to go for what people think is a safe option to go for experience.

Francesca Carlesi (00:47:58) -  Okay, it's done that before. The problem is that in a startup environment, that might not be the safest option because you want somebody is also dynamic and you know, can adapt quickly. Great.

Camilla Scassellati (00:48:08) -  We are at time and I can't thank you enough, Francesca, for for dedicating your time to give back and talk about this important topic. I hope it was very helpful for the people who joined, but I'll also remind that this will become a podcast episode, and so hopefully a lot more people will be able to listen to it and learn from you. We know you're busy, woman, so we really, really appreciate your time and expertise. And it was such a broad topic. There was so much more that I wanted to cover, but we might have to do a part two on how to scale a culture, which we didn't really get to talk to, but hopefully, we covered the, you know, the basics in this chat.

Francesca Carlesi (00:48:43) -  Thank you Camilla. Thank you everybody. It was really a pleasure to chat again.

Francesca Carlesi (00:48:47) -  And, yeah, we're happy to do, you know, part of it is an important topic. So keeping in mind. And it can make a difference for yourself.