Most companies have a mission statement and many have a values statement. But not so many companies live their values so much that they permeate the company and ooze out from every pore; the product, the office, the hiring process, the marketing, and so on and so forth.

Last night I did an event with City National Bank and their clients. I did a chat with Robin Gill and he asked me to talk about my most successful investments. I don’t really like to stack rank my investments so I struggle with that question. But I found my footing and started talking about Etsy. Etsy oozes its values from every pore. I am not sure they have a printed out values statement. Maybe they do somewhere but I don’t think I’ve seen it. But it really doesn’t matter because Etsy’s values are hard coded into their culture and they emanate out in every conceivable way.

Kickstarter is the same way. They stand for something. It’s not just talk. It’s real. And you can feel it in the product, the office, the marketing, and in the founder and in the CEO.

Twitter is like that too. I saw that they filed a lawsuit in Federal Court to be able to publish a full transparency report of all government information requests. That’s fucking awesome. And it is not a publicity stunt. Dick Costolo once said “Twitter is the free speech wing of the free speech party” or something like that. That’s a deeply held core belief of the company and it runs deep and strong in the culture.

These are three examples that folks will have some connection to and are easy to talk about. They are not the only three companies I work with or we have invested in that live their values. Meetup and SoundCloud would be a couple of other obvious examples. But they are good enough for the point of this blog post.

Values matter. A lot. In a hypercompetitive world where technology eats at every advantage you have over time it is good to have unique and distinct values that you live as a company. That’s a form of differentiation that is not easily copied. It matters and is at the core of building great companies. The kind of companies I like to talk about when people ask me about my best investments.

#VC & Technology

Comments (Archived):

  1. awaldstein

    I saw the Twiiter action and felt similarly.Spending time with early to mid stage growth companies–20-50 people–lately and it struck me that early with just a few people we have core beliefs that drive our decisions, with teams building, culture and values become central to who they are.

    1. fredwilson

      that is how it happens. it is organic and natural. not forced or made up. like when parents live their values and their kids adopt them as a result.

      1. awaldstein

        Yup–one of my challenges when doing M & A and turnarounds with larger companies was always this value/culture fit.

        1. fredwilson


          1. awaldstein

            Relationship of that culture, those values to the ability to recruit and retain teams is really key.50% of all hires leave in 18 months. Values are the part of the puzzle to solve this debilitating stat.

          2. William Mougayar

            Yup, it’s like an organ rejection. The corporate system does that in as little as 6 months if an employee doesn’t fit.

          3. awaldstein

            Talent and hiring is just a broken system.All day long we bring our employees into the know and invest in them moving us forward.All day every day the $60B recruiting business is dialing to move those same employees somewhere else.Hey–how about those 50K now unemployed HP folks looking for work?

          4. William Mougayar

            HP is not the same HP I knew or I lived. It hasn’t been for a long time. Since Carly came around and messed everything up, HP had been on the decline, at least for sure from an old values and culture point of view.I don’t get the splitting up. Not this one, and not the previous ones. Incompetent CEOs can’t manage scale, so they start to split things up instead of managing autonomous parts. There has always been a lot of synergies inside of HP. The more you split up, the more you lose part of the heart, the soul, the veins and everything in-between.This isn’t a splitting. This is butchering a company that was once a greatest and most admired one for several years, if not decades. Sad to see it happen before my eyes.

          5. awaldstein

            Well said–thought you’d have something to say.I raised funds from HP in the 90s and sold product through their channels and my experience was quite good.Although honestly as a pure startup guy for 85% of my career, I don’t have a lot of emotions towards any company that I didn’t build.

          6. LE

            The other issue with HP and companies like HP is that it’s easy to do the right thing (assuming you know what the right thing is) when there is plenty of money and things are going well.Then the market shifts and even though you can blame the execs and the people in charge the fact is the business environment changes, people get older and priorities are altered. Every man for himself.Companies do what they do (things that are admired) because they are in a unique position to do so given their financial situation. [1] Alarge part is as a result of luck. It doesn’t come from the fact that they are nice guys or have a core mission statement although that could certainly help all else equal.I’m sure it’s pure hell to work for many airlines. That’s because of competition. They aren’t making money like Google and Apple does so of course labor and benefits are going to take a hit. They can’t do anything but pay pilots a crap wage (also to many pilots is a large part of the “problem”).People like to rally around these companies and talk about how great they treat everyone. But they treat everyone great because they can and have the money to do so. If and when the shit hits the fan you will see that all of that will go out the window.[1] My ex brother in law worked for Apple. He ended up having an operation that left him unable to do his job (confined to a wheel chair he had been a sales exec.) I don’t know what Apple did for him exactly but I know he was extremely please with how they handled the situation. Great healthcare, great disability (for life) paid for his salary for a long time and so on. That’s great right? Reason is they are profitable and they can. Not because they are nice guys. Lancaster Bread Company wouldn’t be able to do the same thing. Neither would HP most likely or any company not swimming in cash.

          7. William Mougayar

            Even HP has become more thrifty about these things.

      2. LE

        like when parents live their values and their kids adopt them as a result.Total agreement.The way to get your kids to do things is not by telling them but by allowing them to observe what you do and more importantly to hear what you say about other people and the things that they admire and that they don’t admire. It’s my theory on unzipping a head and dropping an idea in to percolate. Kids pickup on what their parents are excited about, what their parents admire, and what their parents do. Not so much what they tell them.In other words if my Dad had been Charlie’s dad I’d be Charlie.

      3. Andrew Kennedy

        This is a great point.

  2. RichardF

    damn I thought this was going to a post on bitcoin value 😉 …… (actually your posts have got me thinking a lot more about it)

    1. fredwilson


  3. jason wright

    does USV have a written values statement?

    1. fredwilson

      no, but i believe we emanate our values from every pore, including this blog

      1. jason wright

        yes, you do.some people write values, some people do values.

        1. BillMcNeely

          Insert picture of tele evangelists

      2. LE

        I totally believe it as well. Because over time it would be impossible for someone to say the things that you do and not contradict themselves and show it was all BS. So to your credit you’ve passed my lie detector test which is highly tuned to ferret out hypocrisy and lack of consistency.And the fact that it’s not written is actually better in my opinion.

  4. Mac

    You’re referring to the type of values that lead to scale?

    1. fredwilson

      not really. i am talking about what matters to the company. why they do what they do.

  5. Not usually a Guest

    Many women who come here today are thinking about Kathy Sierra.…Every value has a shadow side.

    1. fredwilson

      can you elaborate? i am not sure i understand the point you are making

      1. Not usually a Guest

        The “free speech” value, unbounded, has the power to hurt people. Adria Richards’ timeline from last night is chilling.And every value has this possibility, this shadow.It’s a leader’s role to get people to understand what it means to live an organization’s values. It happens through stories, daily conversations, and even by saying, “Because our value is X, here’s how we’ll act.”

        1. fredwilson

          Ah. I see. It is true. But I would rather live in a world where people are free even if it has those consequences

          1. Not usually a Guest

            I agree with you — with boundaries.Fire in a crowded theatre? Nope. Flashing GIFs in an online epilepsy forum? Nope. Inciting people to file a bomb threat at someone’s home, to initiate a massive response by first responders? Nope.Here at AVC, I’ve flagged crappy comments that you/your mods have gone on to delete. Yes!So, it’s drawing the lines. And then figuring out how to respond when the lines are crossed.Staffing up, using technology, to respond to the truly harmful things.That’s living a value, too.Thanks, Fred! Have a good day.

        2. ShanaC

          Hey – if you need me – you can reach out to me.

    2. JimHirshfield

      I read her blog post yesterday. Depressing!

      1. Not usually a Guest

        Where’s that Yessssss button?

        1. JimHirshfield


  6. Bala

    Could not agree more, when technology is democratized as is happening at a rapid pace what defines success in a team is the leadership and the values that the team stands for. It is easy to write up the values or the mission, living it everyday defines the winners from the also played. Any team that shows leadership at all level, lives the values day in day out builds the winning culture.

  7. Jon Michael Miles

    “Values are a compass pointing towards our shared true north.” – from our values statement. Thanks for the great reminder Fred.

  8. John Revay

    Fred, this post reminds me of another post you did a few years back…re” Twilios’ nine things…

  9. Rohan

    We had the CEO of Beam give a talk. He said something nice that resonated – “A value isn’t really a value until it costs you money.”(He was talking about a decision they made that would have cut costs.. but they had to pull back as their customers were unhappy.)

    1. Girish Mehta

      Nothing to add except its such a profound point you make here. Thanks.

      1. Rohan

        Glad it added value!

    2. pointsnfigures

      that was probably the infamous Maker’s Mark decision.

      1. Ryan Frew

        Can you elaborate? Googling your comment brings up a decision they made not to water down the whiskey. Is that what you’re referring to?

        1. pointsnfigures

          right. they were going to change the proof…..@andyswan can talk chapter and verse on that.

      2. Rohan

        Exactly right! I forgot the name of the brand (since I am not a consumer myself). Thanks so much for adding it, Jeff. 🙂

    3. Kasi Viswanathan Agilandam

      Yes Rohan… I remember one of the images @Andy used to post…the image of a Bourbon maker which says….something similar like ….We make the best BourbonAt profit if possibleAt loss if we have to … but the best Bourbon.And that is called a value….

    4. JamesHRH

      That’s an old saying…..but an eternal truth.

  10. William Mougayar

    Twitter is also #1 in the Glassdoor ranking of the top 25 companies with the best Culture and Values. That’s quite an achievement for a company that’s 8 years old.

  11. jerrycolonna

    …and every single time one of my client companies gets lost, confused, or can’t figure out the way through even the most mundane product discussion, returning them to purpose and values inevitably helps. Why are you here? What makes your company different? Why should a customer do business with you? Why should I work here?…Values and purpose help define and answer those questions.Working at and running businesses are hard enough. Losing touch with purpose makes it soul-crushing. I often think of a container and its contents. A container–strong fiscal purpose, good operations, excellent “doing”–is essential. But content defines why you do what you do every day. A container without content is meaningless. Content (or values and and purpose) without container is ineffective. You need both.

    1. William Mougayar

      Can you fix culture and values if they are not there from the beginning?

      1. JimHirshfield

        I think so…why not? I’m interested in @jerrycolonna:disqus ‘s opinion too.

        1. William Mougayar

          To use a similar analogy as Jerry’s, if a blood transfusion is needed (content), it can be done. But if the body (container) isn’t good to begin with, that’s tough.

          1. JimHirshfield

            Plastic surgery and liposuction… Duh.

          2. awaldstein

            Ever been responsible for a large corporate turnaround?This is about personalities en mass and about leadership.Non trivial at its core.

          3. William Mougayar

            my mind was more into the startup world, i.e. under ~ 200 employees

      2. jerrycolonna

        Yes. In fact, since it’s the prime job of the CEO, you HAVE to be able to embody those values as much as you broadcast the vision.

        1. David Semeria

          Hi Jerry, I think the real question is how deep do the values go?I’ve met quite a lot of people who were model citizens when the sun was shining but when their back was against the wall, the facade fell away pretty quickly.It’s the difference between surface and substance, and — in my humble opinion — it’s the true measure of a man (or woman).

        2. Twain Twain

          Eleanor Roosevelt on “walking the talk”:”It is not fair to ask of others what you are unwilling to do yourself.”

        1. ShanaC

          He’s an interesting guy to watch

        2. William Mougayar

          thanks. good read.

      3. Megan Cunningham

        If you can’t change the people, change the people!

    2. fredwilson


    3. Richard

      Howard Hughes proved this to be true.

    4. JamesHRH

      Jerry – you must know this guy: https://www.startwithwhy.comI really like what Marc Andreesen said recently: focus on what contribution yo ucan make, not what passion you have…….All unicorn startups have non-business missions (MS-PC adoption, Goog-organzied information, etc).

  12. kirklove

    Kickstarter and Etsy would be the same two that came to mind for me. You can’t fake that shit. Some companies do. They don’t.

    1. fredwilson

      I like what someone said in these comments. It isn’t real until it costs you something. Fakers don’t pay for their values.

      1. Richard

        Yep, “I don’t speak because I have the power to speak; I speak because I don’t have the power to remain silent”

      2. Twain Twain

        “Fakers don’t pay for their values” and, coincidentally, what appeared in my Google Plus stream today?Muhammad Ali on suffering and the prices paid to be a champion.

    2. BillMcNeely

      The older cats at the bar will remember the Chicago Murders and Johnson and Johnson’s swift removal of Tylenol from the shelves at great cost themselves to protect consumers. The young pups can learn about it here

  13. Jorge M. Torres

    The values articulated by Ewing Marion Kauffman have strongly influenced how I try to do business. They’re worth listing:1. Treat others as you want to be treated. 2. Share life’s rewards with those who make them possible.3. Give back to society.

  14. JimHirshfield

    Etsy oozes its values from every pore. I am not sure they have a printed out values statement. Maybe they do somewhere but I don’t think I’ve seen it. But it really doesn’t matter because Etsy’s values are hard coded into their culture and they emanate out in every conceivable way.Yessssssssssssssssss

    1. fredwilson

      Copycat 😉

      1. JimHirshfield

        *Imitation is the sincerest form of flattery*

        1. fredwilson


          1. Kasi Viswanathan Agilandam

            Well done …. it is very hard to get (see) your upvote.In the last 4-5 years i have seen it 3-4 times only and this is one of them.

    2. Twain Twain

      Haha! I said we need a Yesssss button! Forget about the “like” button already!

      1. fredwilson


  15. William Mougayar

    Good company values are also the carrot for attracting new employees.

  16. Kasi Viswanathan Agilandam

    Value has a very very long tail … it lives ON even after u r gone.

  17. Tom Labus

    is there a hard core study depicting financial results and values?It’s very impressive when you run into a company that has a core. It kinda just pops out eve if it’s a bad core

  18. Ovidiu Schiopu

    Love it! Totally agree. Well said…

  19. Twain Twain

    Here’s a photo of the Lehman mission statement Jonathan Rosenberg, who co-authored ‘How Google Works’ with Eric Schmidt, posted on Google Plus on 5 Sept 2014:”Culture is an incredibly difficult thing for companies to change once it’s been established, so it’s important to define yours early. Your mission statement should capture the founding team’s vision, setting the tone for what the company will focus on and how it will behave.Too many companies’ missions read like a group of marketing and communications people got together one night with a six-pack and a thesaurus!+Alan Eagle and I gave our high school buddy, David Staley (formerly of Lehman Brothers) an early draft of our book. That weekend after reading the section on culture, he surprised us with this photo of the Lehman Brothers mission statement, which he dug out of a box in his garage. It’s one of my favorite useless mission statements. What are some of yours?”*****************************************************The “Why, Who, When, Where, How and What” of values are issues I explore deeply as I figure out how to commercialize my technologies.The scientist-engineer in me has a tendency to describe everything in functional process terms: this is what the system does and how it works.The strategist thinks in terms of consumer choice and democratization of technology: this is its usefulness and utility for others.And the artist simply wants to create something so brilliant it’s like Magritte’s “Ceci n’est pas un pipe. (This is not a pipe).” People will go, “Wow, this is playing with our minds!”_______________________The DNA of a company (its values, its raison d’être and its commitments to global society and our humanness) is often planted by the founding team and first key hires.Probably that’s why investors like Fred and Marc Andreessen are pro-founders — because how the values of a company makes us FEEL is a lot less replicable than the product features that are the same as other companies.Smartphones are just pieces of glass, metals, chips etc., after all.Yet watch some of Steve Jobs and Apple’s event videos and compare them with the most recent Google I/O videos (I did; I even transcribed them) and the feelings each company elicits via their expressions of values is very very different and distinctive — just like DNA.

    1. Salt Shaker

      Loved the Lehman Bros. mission statement. Classic memorabilia. Thanks for sharing. Curious if any FS companies have the words trust, honesty and/or integrity woven into their mission statement? Doubtful any. It’s all about increasing shareholder value…victims be damned.

      1. Twain Twain

        Well, here’s the thing…….Some of AVC community have commented about Bitcoin being about “distributed TRUST”. It’s also written about as a competitive threat to the financial institutions and there have been articles about some politicians lobbying for the regulation of Bitcoin.I’m wondering when Marc Andreessen or fredwilson will highlight to an audience at a conference like World Economic Forum that, in the aftermath autopsy of the global financial system, there was not a single panel on how technology might be applied to restore the trust and make transactions more transparent…………….And now we have an opportunity in the Bitcoin protocols.**************Actually, a number of the FS companies do have trust, honesty and integrity in their mission and values statements. An example is Barclays whose new CEO in 2013 made the values case of: respect, integrity, service, excellence and stewardship.Barclays HQ in Canary Wharf London has those 5 words in the form of giant glass sculptures at its entrance (see image). Moreover, Barclays CEO sent a memo to staff that if they didn’t abide by those values, they should leave the bank:*…99.9% of bankers are decent people and were not involved at all with those toxic mortgage CDOs. It’s the system set-up and the 0.1% who abuse their positions and break the trust engendered in them that cause the problems and destroy value for everyone.

        1. Salt Shaker

          Props to Barclays CEO. Refreshing. Hopefully others will follow their lead, in practice not just principle. Here’s JP Morgan’s value statement:…Not entirely sure JP is frankly living up to their stated standards, but maybe they too are revisiting. On a personal note, my girlfriend for many years worked for both JP Morgan and Lehman Bros, and to put it mildly, neither is (or was) gender neutral. Quite discriminatory, if not overtly then certainly tacitly. She’s now a happy camper working in the art field.

          1. Twain Twain

            Oh, she should read about the values in the tech sector and the advertising sector:*…*…This is on Leo Burnett advertising agency’s campaign website:”At the current rate of hiring, true equality will not be realized in the advertising industry until 2079. In 2013, Leo Burnett decided sixty-six years was too long to wait. NO.2.66 is a wake-up call to spark immediate change throughout the industry. And it begins with you.”* http://www.no2six6.comEven GoDaddy, which has had questionable advertising involving women in the past, has had a wake-up call about its gender values:*…********************************My experiences have been anomalous compared with what happens to other women, and I have my manager-mentors to thank for that as well as my grandparents and parents who instilled into me hard work, tenacity and self-confidence.In the chemical industry as a teen, I was the only female in my team of product developers and flavorists and got to lead a global project when I was 19.In the hedge fund, data startup and investment bank, I was the only female in the teams; they comprised Cambridge Professors of Neural Networks, Harvard and Columbia MBAs who’d been top of their class and the Dean of INSEAD taught me Corporate Finance.Now, when I’m at hackathons I’m one of the few women who can do all 4 key roles: designer, developer, product manager and pitcher. The design part has been second nature since childhood. It was in my first-ever school report: Twain has a particular aptitude and interest in maths and ART.I’ve been to talks by Amazon Web Services on complex databases and in a room of 125 developers, there were 2 female devs. It’s no different to being at a European Wind Energy Conference and being one of the few women who knows the thermodynamics that underpin turbine construction.I’ve been playing chess since I was 5, coding since I was 10, got A in Computer Science in high school (beating all the boys in the exams), got invited by the Royal Society to their maths masterclasses when I was 12 to study Turing and other cool stuff, have a Maths degree and built “Big Data” models to figure out the Tiger Economies before it was called “Big Data”.And now, in my 30s, I’ve invented technologies that measure perception values and solves some of the hardest problems in AI in ways not previously thought of or done — specifically applying the domain expertise in the “female” parts of my brain (language, emotions, culture) with the “male” parts (logic, rationale, problem-solving).Sure, if I let the sexism (overt or tacit) affect me then I wouldn’t have made the progress and hit the milestones I have and the world would not have a more intelligent Human-Machine system to look forward to, :*).But as Gandhi and Nike would say: “Be the change that you wish to see in the world and…JUST DO IT!”

          2. Salt Shaker

            Both your credentials (and spirit) are impressive.In the spirit of transparency, and not that I honestly gave this much thought, but based on your writing I assumed you were male…So there you go, my own personal shortcomings and biases on display:) Quite embarrassingly shallow, no?I actually worked in the advertising industry for many, many years. I personally never found it to be too heavily male oriented, nothing like tech, but it unquestionably was quite lacking in minorities. Advances unfortunately seem to change glacierly.

          3. Twain Twain

            Haha, yes that’s happened a lot. People assume I’m a guy because of the way I write and express myself. In banking it used to be really really funny when guys, who’d interacted with me via emails, would do a triple-take as I sat down for meetings; they were expecting a 40-something year-old “Gray Hair” not someone who looked like she just graduated high school.One of my best friends believed I was a Bohemian art student the first time we met. In fact, I’d just created the e-Intelligence platform in the bank, was doing Strategic Investments and three months later would be promoted into CEO-Chairman’s Office.I can assure you I’m not impressive. I just like solving problems, being creative and have a typical Chinese work ethic.The genuinely impressive people are parents. They get no training — unlike developers, bankers, doctors etc — and they’re expected to raise and educate us about values and a whole myriad of knowledge and wisdom before we even get to school!

  20. pointsnfigures

    Transcends companies and into VC funds as well. Lots of “me too” and crappy VCs out there. Slick brokers posing as investors that don’t want to do anything but dial for dollars. I was glad to see Twitter do this-and would hope other tech companies follow suit (and phone companies/Cable companies but I am not holding my breath).Twitter also can do this because its unregulated. It’s network. It falls through the cracks of govt agency so they can’t use the cudgel of government to “keep them in line”. Buy breaks in Twitter when the price of the stock falls. They are here for the long run and their leadership and values aren’t mathematically figured into the price.

  21. pointsnfigures

    Not sure I agree with you totally on Kickstarter:… There is political censorship that goes on there.

  22. BillMcNeely

    Core values/Ethical norms are important but often cast aside for the sake of business expediency.Often times it takes demonstrating Personal Courage as defined in the 7 Army Values ( )Personal CourageFace fear, danger or adversity (physical or moral). Personal courage has long been associated with our Army. With physical courage, it is a matter of enduring physical duress and at times risking personal safety. Facing moral fear or adversity may be a long, slow process of continuing forward on the right path, especially if taking those actions is not popular with others. You can build your personal courage by daily standing up for and acting upon the things that you know are honorable.Real Life Business CaseA couple of weeks ago a non Uber ride sharing company who prides themselves on community and friendliness rolled out an update their app. Everything looked pretty great until I saw their updated tip screen. That’s because it was designed by a 1099 driver with feedback from the ridesharing community on Facebook. Who shared all her iterations online with us.The company’s position was their designers and engineers in SF had been slaving away for months on the overhaul and that it was a similar piece of work. The best the company would do was to acknowledge the driver was on the same wave length as Big Corporation.Interesting enough when I pointed this obvious lift and the need to fairly acknowledge/compensate the originator I received a huge backlash.I was told by the originator and the Big Company drivers it was none of my business, I was an agitator, I was an asshole, it was ok that Big Company stole the work because it might lead to the originator getting a full time position etc.I told the originator I try to live my life by the 7 Army Values with an emphasis on Intergrity and Personal Courage. I was laughed at and then reported to Big Company.

  23. Richard

    One of the differentiators of companies with technical founders is that “product first people first” missions seem be a common denominator.

  24. Dave McLaughlin

    Something I think is important in articulating values: they are stickier when they’re kept simple. It makes it easier for people to ingest them and to live them as you get beyond the core group that articulated them. I see this all the time, where a more recent hire will quote one of our values in some debate on product or strategy. That wouldn’t happen if the phrasing wasn’t simple. Example: “Celebrate questions”.

  25. Chimpwithcans

    Fred, what are your thoughts on the fashionable method of evaluating (ha) values at a company – ie. splitting it down into environmental, social, governance topics? Are you ever this rigid in your values valuation?? (too much alliteration… i know)

  26. sigmaalgebra

    In a hypercompetitive world where technology eats at every advantage you have over time it is good to have unique and distinct values that you live as a company. The world now is hypercompetitive for technology that is essentially just routine software, and that is not a very strong technological barrier to entry.But there is a better way! Raise the bar in technology well past routine software!So, sometimes when eating dinner, watch a DVD with all the old WWII Victory at Sea shows.Last night was the story of the Marianas Turkey Shoot, that is, the first battle of the Philippine Sea, that is, west of the US on Guam and east of the Japanese on the Philippines.So, let’s see: The Japanese attacked Pearl Harbor with six aircraft carriers and got away with only minor losses. Next was the battle of Coral Sea where the score in aircraft carriers was 1 to 1. Next was the Battle of Midway where, in carriers, the US won 4 to 1. Next was the first Battle of the Philippine Sea where in carriers the US won 3 to 0 and in planes the US won 400 to 27.By then the Japanese losses in naval aviation were essentially total. E.g., later in the Second Battle of the Philippine Sea, i.e., the Battle of Leyte Gulf, the Japanese had a few carriers, used them as decoys (Halsey fell for the trick), but had nearly no planes or pilots.So how the heck did the US get such victories?Well in part it was good progress in routine technology, e.g., the F6F fighter.But, wait, there’s more! There was code breaking which let the US get into the Battle of the Coral Sea and, then, win the Battle of Midway.And there was the proximity fuse for anti-aircraft artillery: The shell had a little radar set that detected when the target was close and then exploded the shell — much more effective anti-aircraft artillery.Of course, this close, we can’t leave out the really high, effective, bar of WWII — the A-bomb that got a Japanese surrender and saved maybe 1 million US casualties. Let’s see: From R. Rhodes, the bomb project cost about $3 billion. So, that was $3000 per US casualty saved — a bargain.Raise the bar in technology, crucial, core, powerful, valuable, difficult to duplicate or equal, strong technological barrier to entry technology to deliver more of what the customers will like.

    1. JLM

      .Perfect explanation of the carrier war in the Pacific.The Japs made two big mistakes at Pearl, didn’t get the fueling station on Ford Island and didn’t get the carrier fleet.Well played! Very well played!JLM.

      1. JamesHRH

        What else would you target, other than the carrier fleet?Wouldn’t that have been Job1?

        1. JLM

          .They thought they would catch the carriers in port. Good luck for the Americans. it was still a battleship navy for both countries. The war transformed the ability to project force on the water from ships to planes. An advantage the US enjoys to this day.If they had destroyed the refueling facilities, the US Pacific fleet would have been stranded for a year with no ability to refuel in mass. It would have had to come from San Francisco.If the Japs had made a third pass they would likely have gotten Ford Island and some more ships and submarines. As bold as they were, they failed to close the deal.JLM.

  27. leigh

    Values are core to brand and brand helps to solidify culture as you grow beyond the founders and early players. Way too many businesses skip over values or just put generic things down like ‘respect’ which have no real meaning or don’t express the values in a way that they can help to drive culture.

  28. Joah Spearman

    Very timely post, because my startup Localeur just yesterday reminded our users (via newsletter) of our values and deep commitment to them. Even though we aren’t a big company yet, I try to lead from the front in terms of fulfilling our mission.

  29. Chris Phenner

    Unsure if this is intentional (or just me), but the word ‘value’ is a double-entendre in this post, where human values and shareholder values mean the same thing.Dick Costolo’s post as he joined Twitter (then as COO) that first struck me this way is titled ‘Enduring Value’ (link below). Its focus is about how third-party developers should view Twitter (the platform), and making clear — perhaps for the first time — what Twitter needs to provide and what developers should focus on and build themselves.But I read the word ‘value’ in that post’s title as a double-entendre, and the word’s meaning to me was as much about culture as it was about APIs. And perhaps APIs offer as strong an earlier-stage signal of a firm’s values as does any ‘mission statement.’Great post, and thanks for reinforcing my suspicions about ‘values.’…

  30. JLM

    .Well run companies have a clear Vision, Mission, Strategy, Tactics, Objectives, Values and Culture.The Vision, Mission, Values is the exclusive purview of the founders and the then current leader. These planning tools have a fairly short shelf life and need to be revisited regularly — not necessarily scrapped or completely rewritten but just revisited to ensure they continue to be the drivers they are intended to be.Strategy, Tactics, Objectives are management functions and align resources with Vision, Mission. Classic resource allocation imperatives of management.Culture is the result of the totality of the leadership’s actual conduct and the company’s policies in practice. It is an exercise in internalization.Values are very, very, very important and if they are a wholesale construct rather than the articulation which is deep within the leadership then they are just a coat of paint. Spritz of cheap perfume on a turd.Success is achieved when all of these tools are aligned — when the values are actually consistent with the vision and the strategy is consistent with the values. It is a matrix which is like a woven fabric with individual threads on a core of reality — values.The articulation of values will become a glue for the folks who require leadership because they are, in fact, followers. While the AVC audience is populated with many individual brilliant minds who are naturally gravitating toward entrepreneurial and leadership positions, the vast majority of the world wants to be lead to the Promised Land.Values are not what you write down, they are what you actually do. If the CEO does not live the articulated values, then they are worse than having had nothing as they create friction.JLM.

  31. Arpan Podduturi

    I work at Etsy : )Our mission is to re-imagine commerce in ways that build a more fulfilling and lasting world.And here are our values:We are a mindful, transparent, and humane business.We plan and build for the long term.We value craftsmanship in all we make.We believe fun should be part of everything we doWe keep it real, always.

    1. johnmccarthy

      Nice. Eternal.

  32. JLM

    .It is not enough to have a sense of the enterprise’s values and the imprimatur of founders and the CEO, the information has to be effectively communicated in writing, by emphasis and through ritual. It has to be repeated.When running companies I had a formal booklet which captured the values I demanded–DEMANDED–of the company. In 33 years of CEOing, I revised that booklet just about every year. Small revisions.On the first day of employment, even when I was approaching 1,000 employees in two different companies, I met the new employee outside the building and escorted them to my desk.I dressed up for the occasion because it was special. I used to tell new employees that we had a pretty damn good company but we had hired them to make us great. I believed it then and now.I then went through the values booklet page by page. It took 30 minutes. I gave them two copies.To this day, I will hear from a former employee that they still have that booklet and it’s still relevant to their current job.Someone once said to me that I didn’t put the values on the wall, I put them in their heads and hearts. I wasn’t that profound at the time but I guess I did.Anyone who would like a PDF copy of that values booklet, ping me [email protected].I have passed out more than a thousand copies of that booklet in the last couple of years.You can also find it here:http://themusingsofthebigre…Scroll down the page and find it.JLM.

    1. sigmaalgebra

      On the first day of employment, even when I was approaching 1,000 employees in two different companies, I met the new employee outside the building and escorted them to my desk. Wow! That never really happened to me, but maybe if I start hiring I will try that!Once some such thing sort of happened, and it came out badly!One problem is how to design a digital communications network, e.g., where to put the nodes (say, routers), what equipment to put in the nodes, what links to have, to carry the loads and have good performance and reliability, at least total cost.So, there are a lot combinations to consider. Then picking the least cost combination is part of the applied math of combinatorial optimization. There are many more similar applications in routing and scheduling.I got interested in the field when writing software to schedule the fleet at FedEx. Later I got interested in applications for network design, say, for the Internet backbone.About then there was a startup for such work in Plano. Their chief mathematician had just left, and they flew me down for an interview.I expected to talk about network design and combinatorial optimization.They needed help: They had a high end computer and a copy of R. Bixby’s CPLEX — one of the very best tools — but were ignoring it.So, when I arrived, the CEO met me at the front door of his suite of offices. So, that’s the item of similarity — it was impressive that he met me at the door.He’d been an IBM guy and had all the dress and manner.Again, I was there to talk about combinatorial optimization, which they needed badly!But, my handshake was not quite right, so that was the end of his interest in me!To heck with handshakes! The guy was in deep brown, smelly, sticky stuff in combinatorial optimization and needed a lot of help. As a result of a huge investment of my time and limited resources, I’d gotten a quite good background in that math, from some of the world’s best experts; that background was not easy to find. And he was concerned about handshakes.Somehow I was able to defend my Ph.D. dissertation successfully in front of a committee with a majority from outside my department and a Chair a guy from outside my department, grimly serious, world famous, and a Member, US National Academy of Engineering, without attention to handshake styles!I believe his company went belly up.

  33. Pete Griffiths

    Reddit is the same. Check out the way the CEO Yishan Wong behaved lately to uphold and emphasize Reddit values.

  34. Joe Marchese

    Values are the statement of what’s important to you. They guide how you make decisions, occasionally based not on the merits of the matter at hand, but based on who you are. It turns out that when you are clear on those things to which you are committed — not merely supportive or sincere… committed — making decisions suddenly becomes easy. When everyone in the organization gets that (a key responsibility of leadership) and it ‘oozes out of every pore’ (thx, Fred), great stuff starts to happen.

  35. ShanaC

    It is extremely hard to figure out your values – people often try to tell you what their values are and why they should supercede your own individual ones.Make sure you don’t let them unless you have a good reason. By good, I mean very good.

  36. andrewparker

    The hardest thing all startus attempt to accomplish is mattering in the minds of consumers. In our world of scarcity of attention, convincing consumers to care about your company is a huge challenge.If you have strong values that your consumers respect and share, it will make the mission impossible of mattering a good deal easier.

  37. Simone Brunozzi

    I have a question for you: you write “fucking awesome” and I agree with why you wrote it… Now imagine a company where you’re not allowed to write “fucking awesome” on your personal Facebook page (not public, only open to friends). How would you judge that company?

    1. fredwilson

      fucking lame

      1. Simone Brunozzi

        I happily agree with you. And you’re fucking awesome. 🙂

  38. Dan Berger

    Thank you so much for writing about this, Fred..At Social Tables, we have taken a democratic approach to defining our core values. Two years ago, when it was just 4 of us, I pulled everyone into a room and asked for help defining our cultural pillars — the foundation of our company. Here are the results:…At 15 employees 1.5 years ago, these weren’t enough, so we did a company-wide exercise to define our core values. I gave everyone a stack of post-its and asked them to write down values they want or that we have and stick them on the walls of an empty room. What emerged are 9 core values. Here are the results:…As we’ve grown — we’re 60 now — we realized there is a risk that we will lose some of our culture so we did an pre-mortem exercise. I gave everyone post-its again and asked them to write down what they don’t want to ever see at Social Tables. We are just now figuring out what to do with these.Today, our values permeate everything we do. They are weaved into our hiring interviews, our performance reviews, our office environment, and all internal communication.When we looked for a Series A partner, we were very clear about our culture and who we are. We wanted to make sure everyone around the table knew that our core values is something we will never compromise over.

  39. Tracy Lloyd

    Great article Fred. So true on many levels. Getting employees to “live” values is always going to take more than a PPT Deck and a poster. We look at corporate values through the lens of “feelings” and building a More Meaningful Workplace. If you have interest, it is outlined here:

  40. Laurence McCahill

    Love this post, Fred. As the saying goes ‘live them, don’t laminate them’.Refreshing to hear this coming from such a prominent and well respected investor – purpose and values should be at the forefront of founder’s minds when building their startup. If only more investors (and entrepreneurs) realised this – too many are guilty of short-termism and focusing only on the numbers. I love this quote:”Values are timeless. They are the bedrock of a company and don’t change even when everything else does.”This is one of the reasons why I co-founded The Happy Startup School (http://www.thehappystartups…) – to encourage more people to build companies that stand for something (other than to make money) and are keen to make a positive dent in the world. And as it turns out becoming more values-driven is a smart business move too. It helps you to cut through the noise, show your human side and build your tribe organically as your authenticity shines through.

  41. fredwilson

    that’s excellent

  42. John Revay

    I love your company’s product…

  43. BillMcNeely

    I like your companies product. It has allowed me ( a non coder ) to build several websites for my businesses in an afternoon!

  44. awaldstein

    It comes from work I’m doing with a startup that is focused on the talent space with just this metric as the core to change.What I can do is point you to a buddy, Jim Jonassen in LA, who is doing some of the best thinking and work around this. He’s the principal at

  45. JimHirshfield

    So, values are just inGRAINED in the employees at The Lancaster Food Co? First, don’t pumpernickel and dime your clients, right?

  46. LE

    Don’t assume that because Nike is chosing profit over human rights in China that they are doing good in other ways.Companies that make boatloads of money? That money goes somewhere. Jobs are created as that money flows through our economy. Keep in mind that the profit that these companies make is after they payout a boatload of money to vendors, employees, contractors, small businesses. The profit is a net number after they piss away more money than a typical business has in total revenue.One of the reasons cigarettes were never outlawed years ago was as a result of the people that benefited from cigarettes being sold. We’re paying for that now of course.This isn’t an excuse to allow human rights abuses or a justification (although it may sound like it is). But don’t assume that all is bad either. Every pharmaceutical has an upside and a downside.If I ever decide to buy a loaf of your bread I will decide if I like the bread at the price that you charge me. If I don’t I won’t buy the bread. All the other things that you do or say don’t really matter in my buying decision. Unless all else is equal (and it rarely is) I don’t factor in anything that happens inside the black box. I don’t have the time to do that.

  47. JLM

    .They answered that question when they decided to operate/manufacture in China so it wasn’t a contemporary question.Unfortunately this really reflects the lack of values and wisdom of the US Congress that allows this to happen — decimating US jobs, exploiting foreign labor (child and prison labor in China), allowing these companies unfettered access to US markets.It is a political problem.JLM.

  48. JimHirshfield


  49. LE

    All of this feel good stuff is fine as long as you have money to pay the bills and to pay for health care and food and rent. Otherwise nobody is going to come along and clean up the mess for you. (Unless you get into the paper with a tear jerk story and random strangers decide to come to your aid..)I have to tell you that every so often I get to talk to a customer over the phone that sounds like really really really a nice genuine person. And they literally are living hand to mouth and don’t have a pot to piss in. Nicest people in the world (educated and/or artists in many cases). But they are living from paycheck to paycheck. Can’t come up with a small amount of money to pay a bill.

  50. Richard

    If somewhere within the walls of the corporate offices of ALTRIA is a mission statement, let’s throw out the concept of mission statements.

  51. JLM

    .This is called situational ethics. You cannot be a scumbag in part of your operation and a saint in another part. If it is a core value, the core touches everything.JLM.

  52. JLM

    .The US would be creating jobs like Niagara Falls if it had some fundamental changes in policy and if it could retrace its steps on some of the disastrous decisions made on outsourcing.A perfect example is the failure to fully fund the SBA. Remember the SBA is a loan “guaranty” program not a grant program. It does not cost “real” money.The SBA runs out of money in the first 90 days of each fiscal year and all the unfunded loan apps gather dust until the next fiscal year.There are SBA underwriters (banks) who have an almost flawless default rate — no defaults. These guys should be given unlimited loan guaranties. Unlimited.The guaranty should be raised from 85% to 100% for these guys.This is SMALL business that could have an enormous and profound impact — two jobs at a time but multiplied by hundreds of thousands of unfunded loan apps.JLM.

  53. awaldstein

    You are on the right side of a changing history here my friend.The $2T (yes that is a T) Wellness Marketplace is all about the brand and the ingredients and transparency of the company behind it.Amazing stupid comments from companies like LuluLemon opened the doors to a host of small workout clothes companies as people simply don’t want to buy from jerks. Not everyone but a huge huge market worth of them.

  54. LE

    The lesson, of course, is not for you. You’re an old man and have been around the block.The lesson is for the younger people who are perhaps a bit wet behind the ears and as obvious as this is to a crusty salt like you it’s not to them. To wit, my daughter didn’t know you could bargain for new cars she thought you could only bargain for used cars. Go figure.You know my comments are all part of my “giving back”!To your point about “company behavior” I mean I don’t really think about that. In general though I wouldn’t punish employees of a company that are earning a living there because the people in charge have a particular form of behavior that I find objectionable and that assumes I even know about it.So in honor of you I will amend the famous “price quality speed” pick any two to become “price, quality, speed, behavior” pick any three.

  55. JLM

    .See, it takes some time but eventually we agree on everything.I really think that the SBA program — fully funded, streamlined what the hell? — could create 5 million jobs in two years.JLM.

  56. JLM

    .What a catchy phrase.Well played.JLM.

  57. LE

    They answered that question when they decided to operate/manufacture in ChinaTo which I say “you can only be as honest as your competition” (or perhaps also Wall Street expectations).In the Springsteen song where he says “it’s hard to be a saint when you’re just a boy on the streets” also applies.At some point someone draws first blood then the rest follow.You know I spoke to someone the other day who told me how the local zoning officer shook them down before issuing a permit. Not by demanding a payoff but before agreeing to approve a sign variance unless they made some other changes to some other part of the property. The zoning officer can do that because others have agreed to similar demands over time. If they didn’t then the zoning officer wouldn’t try that and use it as his extortion. So it’s the collective that causes this.

  58. JLM

    .Organizations are not “honest”. Only the people who run the organization can be honest.Lowering oneself to the lowest common denominator is the exact antithesis of being an honorable person.I could not possibly disagree more with you here.JLM.

  59. LE

    Not sure what exactly you are disagreeing with.If you are in construction and you need to leave money on the seat of the inspector so he doesn’t flag your project you can either do that or you can find another line of work. At least in some cities. Are you criticizing the inspector or are you criticizing the guy who goes along and pays him off?The inspector is wrong of course because has a job he is just looking to extort something out of the situation (like the zoning guy above). The guy who has no choice does what he has to do to get by. He can take the high road or he can be practical (within the limits of the law of course). I had a big contract with a hospital. The new purchasing agent showed me a camera and said “want to buy this from me”. So I did. What would you do?Maybe a better example of this is students who feel pressured to take adhd drugs when they don’t have adhd in order to be able to keep up with other students who do so. On an individual level they might really be against doing this. But if enough students are doing the same thing (and assuming the health risk is worth the risk) then they are force to either play the same game or operate at a higher standard and maybe not get the good job or get into graduate school.My dad used to have to give money to the union goons at the trade show in NYC (was at Coliseum before Javits) so he could use his own men and not the union men. And so on. Not sure where “honor” gets into this discussion.