“The purpose of a company is to maximise shareholder value. Nothing else.”
Well that’s this blog post written, then. (Thanks, Milton.)
Except, hang on a moment. I’m not sure I can actually agree with that statement. But why?
I’ve worked in: a large American-headquartered management consulting firm; a small family-office London venture capital firm; a scale-up backed by high net worth individuals and a strategic partner that took institutional money whilst I was there and then had an IPO on to the FTSE 250; a 150-year-old FTSE 100 (employing 200,000 people); a family-owned 100-year-old business that was transforming from catalogue player in to one of the largest digital retailers in the country; a business started/owned by my wife (there’s a whole blog entry on working for your spouse, but it’s not this one!); and a direct-to-consumer remote business with no office, even prior to the pandemic.
There are more if you include all of the consulting projects I’ve done! I’ve enjoyed some, but not all of them.
It’s hard to work out which stage has been most rewarding — generally I’ve enjoyed the roles where there’s a big problem to solve or something to create, which I’ve done in both big and small businesses. But, I think like most people, what has really driven me has been whether I have felt the sense of meaning in what it is that I have been doing.
Purpose is why we turn up to work in the morning. What makes it more than a job. What makes it something you so deeply want to build, fix, or change, that there’s nothing you would rather do and nowhere you would rather be at 8am on a Monday morning (or occasionally at 11pm on a Friday night!)? It’s what makes the company able to attract brilliant people who share your vision for the world. And it’s the choices the company makes regardless of the short-term financial impact, because it will be the right thing to do in the long term.
I think the phrase I am searching for is ‘purpose gives your business a strong north star’. It gives you a strong guide as to who you should and shouldn’t hire. It gives you a strong sense about how you should behave (how could you be a purpose driven business with a positive mission and then treat your people in the wrong way?) It gives you a point of view — you know what you care about, and what you don’t. A by-product of this is that it makes you stand out in the sea of (social) media — maybe you will only appeal to certain people, but they will know where and how to find you!
You can’t fake purpose. If leadership doesn’t really care about the purpose, people inside the business will figure it out. They will see the decisions that are inconsistent with the stated purpose. They will see employees being rewarded for the wrong things. They will feel it. And ultimately, customers will too.
It’s 2021, and we’re in the UK. Choosing to work in a purpose-driven company may be a luxury that isn’t available to everyone in the world, and hasn’t been available to very many until perhaps very recently. I think that makes it all the more important that those of us who have this luxury, chose to do something that makes a positive impact.
So, what is our purpose?
Let me explain it through my eyes. (This might not work for everyone, and indeed I think my co-founders have their own perspectives on this. But let me explain why this matters to me.)
I am fascinated by things that we all have to do. The way that we solve those problems goes to how we function as a society. (That’s why I spent so long — ten plus years – building businesses that delivered the weekly household shop.) In our life at home, unless we have a very generous partner, we all have to do ‘adulting’ things. Nearly all of us have to manage a household or rely on a partner or family member to do it for us. So here we have a class of work that everyone has to do, that takes up time and energy/effort to do well, where people spend a lot of money — we spend way more running our households than we do on food, and it’s something that feels really hard to get right and do well.
How do I get the right service? For the right price? How do I not get ripped off or taken advantage of? Why is it so complicated? Why is there so much choice? Why is there nobody to help me? Why should this take up so much of my time, especially in a world where there are so many competing demands on my marginal hour — I’m trying to be a parent, a husband, a son, a brother, a friend, and a colleague. All of those things are hard enough in this day and age, without having to spend my evenings making sure I don’t get ripped off on something that I actually spend a huge amount of my money on.
This is how I express the purpose of this business: to take an important and big class of spend, and make it take less time, make it simpler, make it fairer. Maybe that’s a product just for me, but I think many people experience a similar version of this problem. Opinions are split as to whether you should try to build a company around a product that you want – I’m guilty as charged on that one. I don’t want to have to spend my time on what I would call ‘faff’, and I want someone to do it for me as well as I would do it if I did spend my time on it. We’re going to find a community of people — to be part of our team and for us to serve as our members — who care about some related version of this problem, and build from there. It’s great to have our north star for the exciting journey ahead.