How Culture Helped Careem’s CEO Scale a Startup into a Unicorn
Having a strong company culture can infuse your team with motivation and focus. Culture can help minimize the ambiguity and chaos that characterize scaling startups. But during periods of hypergrowth, processes break and your culture quickly becomes diluted. The co-founders of Careem, one of the first unicorns in the Middle East, learned this the hard way. In its initial two years, Careem grew exponentially—by 30% each month. Many companies don’t survive such intense hypergrowth. But Careem now operates in over one hundred cities and was acquired by Uber for $3.1 billion in 2019. In a series of interviews, co-founders Mudassir Sheikha, Magnus Olsson, and Abdulla Elyas reflect on how establishing a strong company culture was essential to their meteoric growth. In this interview with Shikhar Ghosh, they share their experience embedding culture into every aspect of the company.
3 Lessons on Establishing Culture That Helped Careem Scale
- All co-founders define optimal attitudes and behaviors.
- CEOs hold responsibility for creating a company-wide culture.
- Hiring based on cultural fit may be more important than hiring based on skills.
Why Company Culture Matters
Your startup’s culture reflects what the company stands for internally. What ideals matter most to you? A company’s culture doesn’t provide a set of scripted, procedural instructions. Instead, Sheikha learned that culture reinforces your underlying mission. Having a strong company culture empowers staff to interpret and respond to different situations. A well-established culture teaches staff “how we behave, how we work, how we treat each other, and how we talk,” Elyas describes. But for culture to be effective, it has to exist beyond theory. It needs to be embedded in organizational processes.
Co-Founders Define Optimal Attitudes & Behaviors
All co-founders should actively define and model company culture. The co-founders of Careem aligned on values and agreed on the culture they envisioned for Careem. But because they were focused on growing the business, they neglected to create formal processes to disseminate a company-wide culture. As the startup grew rapidly across diverse areas, the cultural ideals the founders believed in became diluted. Sheikha reflects, “We didn’t do enough up-front to define the culture that we wanted.”
“We created some values, and we just left it there. We didn’t really define what these values meant or what kind of behaviors we expected.”
CEOs Hold Responsibility for Creating & Enforcing Company Culture
Establishing a company-wide culture is often complicated and time-consuming. If you’re a founder or CEO, it requires you to shift focus away from product execution to define the culture you want to create. You must describe the attitude and types of behavior that embody that culture. Often this requires a complete shift in thinking.
Sheikha learned that one of the most important jobs a CEO plays as a company scales is establishing processes to reinforce the desired culture. As the CEO, he had to drastically change how he allocated time. He recalls, “I enjoy driving commercial strategy, getting shit done.” Assuming responsibility for disseminating culture seemed like a distraction, especially for the CEO. He confessed that he wanted to let someone else “figure out the H.R. side of it.” Unfortunately, that approach didn’t work as they scaled.
The thing that was most surprising for me was around people and culture. The task and the challenge of getting that right was not easy. I was naïve on that front.
Cultural Learning Curve
What makes culture dilute, especially as a startup rapidly scales? Sheikha explains that each new hire has a cultural learning curve. The duration of the curve depends on the environment they came from, their natural alignment with your culture, and the strength of your culture. If you haven’t established some formal mechanism to embed your culture into your organization, inconsistencies will arise.
New employees absorb culture from others. When you start with a small team, employees interact with the founding team regularly. They have the opportunity to observe the founders directly for cues on how to act.
As you hire rapidly, new hires learn culture from other recently hired staff who may not have had time to learn how things work at your company. Instead, they transmit values they learned in previous roles and that might not align with your culture.
Cultural Inconsistencies Grow as Staff Grows
As staff grows, the founding team becomes less accessible and less involved in all hiring decisions. If your hiring managers, HR, and function leads aren’t fully aligned with your culture, they will model behavior and standards that reflect their past experience. When that happens across departments and teams it can quickly erode your company culture internally. This leads to an inconsistent experience for your customer which can weaken your reputation.
Careem’s unique culture enabled them to expand into new territory, claim additional markets, and challenge Uber. After 2014, as growth skyrocketed and new employees flowed into Careem, cultivating a company-wide culture presented enormous challenges they didn’t anticipate. Sheikha shared, “We just thought, ‘Get the right people in place, and they will figure out what to do.’” But that didn’t happen.
Newly hired staff came from vastly different backgrounds and different places. Even though they began adding management layers to respond to growth, new managers often operated units in ways that made sense to them, based on prior experience. As a result, Careem’s culture didn’t reach new employees. Instead, it became increasingly watered down.
We had five different ways of running Careem, because different leaders were not working in a consistent, coherent way.
Establish Processes that Reinforce Culture
Sheikha discovered that cultural dilution led to inconsistent results. The co-founders agreed that culture needed to be cultivated and reinforced and that only the CEO could effectively establishing the processes to reinforce culture. Sheika reflects, “I feel now this is my responsibility now as the CEO of the business, and it takes time. It takes thinking, it takes a lot of doing. You always have to be positive, even when you’re having a bad day.”
Culture spreads top-down, bottom-up, and horizontally. Embedding culture into your hiring process, and directly relating culture to individual jobs, takes time. But it helps you in the long run.
I feel now this is my responsibility now as the CEO of the business, and it takes time. It takes thinking, it takes a lot of doing.
As CEO, Sheikha became the company’s beacon for culture. That meant that he became actively involved in shaping processes for hiring, onboarding, and employee evaluation. He began by clearly defining Careem’s values—“these are the values that we stand for, this is the culture that we want to build.” The harder part, he recalls, is making sure “people understand what they do every day and why they do it.”
Culture and Hiring
Olsson, Sheikha, and Elyas embodied Careem’s values, but the task of implementing a universal culture across the company was daunting. “You have to start the process and stay involved in the process throughout.” Sheikha discovered that as CEO, he needed to take the lead in ensuring that recruiting and onboarding processes communicated the company’s values.
“You have to start the process and stay involved in the process throughout. Only in that way can you embed culture into every aspect of the organization.”
Defining & Implementing Universal Values
Sheikha identified universal values that employees could apply in their daily work, regardless of function or geographic location. Each value is part of Careem’s three pillars—ambition, service, and ownership—that relate to daily work. He also made sure that performance evaluations were designed to reinforce culture. As Careem scaled, he learned to distill instincts and disseminate experiential knowledge to management in a systematic way.
Now, all employees receive training on Careem’s values. And performance evaluations measure the values in tangible ways. For instance, Sheikha adjusted company KPIs from measuring output to input by assessing things like, “How have staff served customers and captains? What initiatives have they taken? What projects have they collaborated on?”
Your team needs to understand how their role aligns with the company’s greater mission. If you don’t proactively establish your company’s culture in a strategic way that aligns across functions, it can derail your mission and weaken customer experience.
Prioritizing culture will slow you down at the beginning, because it requires some and implementation. But it would have saved us a lot of fires. It would have saved us from a lot more bad hiring decisions.
Your company’s culture will dilute as the venture scales. Once this begins to happen, how can you get everyone to start following the same script?
Hacks for Creating a Culture that Sticks
After discovering that “you can’t outsource culture” what basic advice would Sheikha recommend to CEOs of rapidly-scaling startups who want to create a company-wide culture? Sheikha recommends viewing employees as internal customers. Essentially, as CEO, you serve people on different teams and different locations.”You need to wow your staff. Because if you wow them, then they will wow your customers.”
In other words, if your employees’ daily experience in your organization doesn’t reflect your company culture, you can’t expect them to deliver an outstanding experience to customers. All of this takes time, he notes. But it’s a worthwhile investment.
Careem’s Tips for Establishing and Reinforcing Culture as You Scale
- Think about the optimal experience you’re creating for your customers. How do you want your customers to feel? What is your mission?
- Take time to define that optimal customer experience and your mission.
- Disseminate your mission and values—hardcode them into your culture so everyone on your staff knows it.
- Translate your ideal customer experience to the tasks staff do in their daily work. Tie your mission to job functions.
- Make that real by creating processes that reinforce values and the desired culture.
- All co-founders define optimal attitudes and behaviors and should actively model company culture—what the company stands for internally.
- The CEO holds responsibility for creating a company-wide culture. One of the most important jobs a CEO plays as a company scales is establishing processes to reinforce the desired culture. That means the CEO may have to drastically change how he or she allocates time.
- Hiring based on cultural fit may be more important than hiring based on skills. Culture spreads top-down, bottom-up, and horizontally. Embedding culture into your hiring process, and directly relating culture to individual jobs, takes time. But it helps you in the long run.