An aspect that is an advantage as well as a predicament for a startup is that every member can be/is involved in decision making. And a huge problem a founder faces and pulls his hair out about is understanding employee psychology. And here is where I think I can make a point (or more than just a point)
1) Whenever you’re making a decision about an employee, the ‘sense of belonging’ is very important from the employee's point of view. This vibe which an employee gives out is palpable for a founder, you'd know if she belongs. You'd know when an employee puts the company as first priority. The employee shouldn’t feel that she is a part of the ‘company’ but it is her company. This might be difficult to gauge and some might even consider this to be impossible. How can one expect an employee to feel this way? And here is where the ‘freedom of working for a startup’ comes into picture. I’ve talked to dozens of ‘awesome startup employees’ and the one thing I find in common is that they’re all doing whatever they want to do. There are doctors writing codes, writers designing architectures, dropouts doing marketing! More and more, it’s not the degree or background that is playing a role, it’s the will. If you find a person, who likes what she does, she’s the one. There’s a caveat here though; she’s not doing this for the company. Primarily, she’s doing what she wants to and the alignment is such that she puts the company before anything else. If that ‘joy’ is taken away, the regard for the company goes away.
2) Another factor is the proximity; it hardly matters where the person is. Sitting thousands of kilometers away, an employee can be more loyal and productive as compared to the one who is always there in front of your eyes. For a founder, seeing the bigger picture, the takeaway would be not to fret upon frivolities. Some things just work out.
3) After a lot of back & forth and some scale, there comes a point when this freedom for an employee wouldn’t be possible. One needs to learn and let go. As you grow, you need to be more subjective; you cannot expect as much as you’d expect from that early employee. Why? Because she looks at it as a ‘company’ and there’s very less you can do for her not to feel so. She’s working for someone now. This bifurcation is very important to understand and sometimes only very perspicacious founders are able to do this. Some founders do it well, others don’t. And then there are the very few where this bar doesn’t exist at all but till you achieve that; keep an eye open for those free flying souls.