Opinions expressed by Entrepreneur contributors are their own.
As an entrepreneur with 17 years of experience and now working on my fourth company, I’ve become hyper-aware of how vital it is to protect company culture. Building a successful company is about much more than hitting revenue goals or scaling quickly — it’s about fostering a healthy, vibrant workplace where your team can thrive. A toxic culture will undermine that faster than you can imagine.
Here are some hard-learned lessons I’ve gathered over the years about identifying toxic culture and, more importantly, how to fix it before it’s too late:
1. Toxic culture doesn’t always look toxic at first
It’s easy to think of toxic culture as blatant negativity, conflict or disrespect. But in my experience, it starts in much more subtle ways: passive-aggressive comments, cliques forming, communication breakdowns and employees feeling like they can’t speak up.
At one of my earlier companies, I didn’t notice these red flags until they started showing up in our results — people missing deadlines, more frequent sick days and a noticeable dip in team morale. By the time I realized it, the culture had already started to rot from within. Toxicity starts small, but its impact grows quickly.
Related: These Toxic Behaviors Are Employees’ Biggest Frustrations – Is Your Company Guilty of Them?
2. As a leader, you set the tone — always
One of the biggest mistakes I’ve seen leaders make is thinking culture will take care of itself. It doesn’t. You, as the entrepreneur or business leader, are responsible for setting the cultural tone.
As a leader, make a conscious effort to lead by example. That means being transparent with my team, reinforcing our core values, and creating a space where everyone feels heard. It’s not enough to say you have great company values — you have to live them every day. If the leader isn’t walking the talk, no one else will either.
Keep a pulse on your team’s dynamics. Regularly check in with employees at all levels — not just your managers — to uncover the unspoken problems that might be festering.
3. Toxic culture drains talent — and fast
It’s not just productivity that suffers when a company has a toxic environment — it drives your best people out the door. One of the most painful lessons I learned early on was losing talented employees because of issues I didn’t address in time.
A toxic culture drains creativity, enthusiasm and the desire to stay. One powerful way to build the culture back into your company is for all employees to take ownership of their work, collaborate freely and feel proud to be part of something meaningful. When your team feels valued and supported, they’ll stick around. They’ll leave when they don’t, no matter how great the product or pay is.
Related: Do You Work for a Toxic Company? Here Are 4 Not-So-Obvious Signs to Watch Out For.
4. Don’t wait — address issues immediately
If you see signs of toxicity — address it immediately. Delaying is dangerous. In my experience, waiting to have tough conversations only allows the problem to fester. Whether it’s poor communication, office politics, or someone undermining your company values, these issues must be confronted head-on.
I’ve adopted a zero-tolerance policy regarding behaviors that threaten our culture. That doesn’t mean being ruthless — it means being firm about what the company stands for and making sure everyone aligns with that vision. Sometimes, tough decisions have to be made. Letting toxic behavior slide, no matter how small, is a slippery slope.
5. Culture is a living thing — nurture it
One of the most important lessons I’ve learned in 17 years as an entrepreneur is that culture isn’t static. It evolves as your company grows, your team changes and new challenges arise. That’s why I’m constantly checking in with my team—gathering feedback, assessing the vibe and making sure we’re staying true to our values.
Protecting your culture is an ongoing process. It’s not something you can set and forget. You need to nurture it, keep it in check, and make sure it’s growing in a healthy direction. At the end of the day, your culture is one of your greatest assets — don’t take it for granted.
Related: If You Do Any of These 3 Things, You Might Be a Toxic Co-Worker
Ways to be proactive in creating a great culture
1. Hire for culture fit, not just skill: When we hire, we don’t just look for the most qualified candidate; we look for people who align with our values and bring a positive attitude to the team. It’s easier to teach skills than it is to fix a toxic personality. Make cultural fit a key part of your hiring process — you can’t build a great culture with people who don’t align with your vision. This is a fiery topic, though. If you weigh too much on culture fit, you could hurt your company culture – don’t overlook the necessary and critical skillsets required. When you fill a company with wonderful people who lack the skills, those with the skills tend to be frustrated very quickly.
2. Create a feedback-rich environment: I’ve found that creating an open environment where team members feel safe sharing feedback is essential to maintaining a healthy culture. Encourage regular, honest communication, whether that’s through structured reviews or casual check-ins. We make it a point to listen—both to celebrate wins and to identify areas where we can improve. Take the time to have monthly scorecard meetings. Identify topics you wish to discuss ahead of time, send them to your team, and give them the chance to come ready to engage in meaningful conversations.
3. Celebrate wins, big and small: Building a great culture isn’t just about avoiding the negative — it’s about celebrating the positive. Recognizing achievements — whether it’s hitting a big milestone or overcoming a tough challenge — boosts morale and strengthens the bond between team members. Small gestures of recognition can go a long way in creating a positive and motivated team.
