# H﻿ow to create a startup?

Starting a business has never been easy. Behind every inspiring success story lies years of hard work, mistakes, and persistence. However, some universal factors significantly increase the chances of success for any new venture. Let’s explore what truly matters in the early stages and what every founder should focus on to turn an idea into a sustainable business.

## 1. A real problem and a clear value proposition

The first and most important step is to identify a real problem. Many entrepreneurs fall into the trap of creating something “cool” without checking if there is a demand for it. A successful business always starts with solving a pain point.

Ask yourself: who will benefit from your product or service? What will they gain by using it? And most importantly—what problem does it solve for them?

Your value proposition should be clear and easily explainable. If you need more than 30 seconds to describe why people need your solution, it’s worth rethinking your idea.

## 2. Knowing your target audience

Even the best idea loses its meaning if it’s not targeted at the right audience. Entrepreneurs often believe their product is “for everyone”, but in reality, this approach rarely works. The narrower your target audience at the start, the more effective your marketing and sales will be.

Research your potential customers:

* What are their habits and values?
* Where do they spend their time online?
* How do they make purchasing decisions?

The more detailed your portrait of the target audience, the easier it is to tailor your product and messaging.

## 3. Testing and flexibility

Modern business is built on the principle of constant testing. It’s impossible to predict everything in advance, so entrepreneurs must learn to quickly check hypotheses and adapt to reality.

Use the MVP (minimum viable product) approach: launch a simplified version of your product and observe user reactions. Listen to feedback and adjust. If something doesn’t work, don’t be afraid to pivot. Flexibility is one of the main qualities that distinguish successful startups from those that disappear in their first year.

## 4. Financial planning and resource management

One of the most common reasons new businesses fail is poor financial planning. It’s not enough to have a good idea—you need a clear understanding of how much money is needed, where it will come from, and how it will be spent.

It’s important to:

* Prepare a realistic budget, taking into account unexpected expenses.
* Monitor cash flow, not just profits.
* Avoid spending on unnecessary “status” expenses in the early stages.

Efficient use of limited resources is one of the key skills for a founder.

## 5. Building a strong team

Even the most talented entrepreneur cannot do everything alone. Success comes when you build a team that shares your vision and is willing to work towards the same goal.

A strong team is not just about professional skills. Equally important are values, motivation, and the ability to work together. Hiring people who are passionate about your idea is often more valuable than just finding candidates with “perfect resumes”.

## 6. Marketing and customer acquisition strategy

Having a good product is only half the battle. The other half is telling the world about it. Marketing should not be an afterthought; it must be planned from day one.

Decide where your audience is and how best to reach them. This could include digital ads, social media, content marketing, partnerships, or offline channels. The main rule is consistency. Sporadic attempts rarely yield results, while a systematic approach builds awareness and trust.

## 7. Building relationships with customers

The first customers are more than just a source of revenue. They are your ambassadors, who can recommend your business to others or, conversely, warn them against it.

That’s why every interaction with customers matters. A fast response to inquiries, honest communication, and a willingness to fix mistakes build loyalty.

Many startups underestimate the power of word of mouth, but in the early stages, it’s one of the strongest marketing tools.

## 8. Constant learning and adaptation

Markets change, customer needs evolve, and new competitors appear. A successful entrepreneur never stops learning.

Read professional literature, follow industry trends, attend events, and exchange experiences with other founders. Sometimes one insight or new contact can change the entire trajectory of your business.

## 9. Persistence and the right mindset

No matter how well you prepare, difficulties are inevitable. The key factor is how you deal with them.

Many founders give up after the first major setback. But those who are ready to continue despite mistakes and rejections increase their chances of success many times over.

Persistence does not mean stubbornly sticking to one idea. It means being willing to experiment, adapt, and continue moving forward even when results don’t come immediately.

## 10. Long-term vision

A business is not just about making money here and now. Successful companies are those that have a broader mission and long-term goals.

Ask yourself: how will my product improve people’s lives? Where do I want my company to be in 5–10 years? A clear vision inspires both the founder and the team, while also attracting investors and partners.

## F﻿inal thoughts

Every new business faces uncertainty. But there are universal factors that significantly increase the chances of success: solving a real problem, understanding the target audience, financial discipline, a strong team, marketing strategy, customer focus, flexibility, and persistence.

Entrepreneurship is a marathon, not a sprint. Those who can balance strategic thinking with everyday execution are the ones who turn their startup into a successful, sustainable business.

Discover our main findings about success metrics for startups!

 Key success factors every new business must get right

# Why digital nomads are turning cities and villages around the world into new venture hubs?

Entrepreneurship has acquired its most valuable quality: absolute freedom of movement. Office walls have given way to a boundless digital space where the only necessary resource is a reliable internet connection. Visa stamps no longer determine business opportunities; the real boundaries now lie in the minds of those who have not yet dared to break free from traditional corporate thinking.

The office routine and attachment to one place have given way to a generation of entrepreneur-wanderers or digital nomads who build multimillion-dollar companies while living out of a suitcase. This is not just a fashionable way of life or an escape from corporate culture; it is a powerful economic force that is reshaping the global business landscape, transforming quiet resort towns and forgotten villages into vibrant centers of innovation and venture capital.

In this article, we'll explore why digital nomads are turning cities and villages around the world into new venture hubs.

## Who are digital nomads, and why is the number of such specialists growing?

A digital nomad is not just a remote worker. This is a specialist or founder who deliberately chooses a mobile lifestyle and builds a product for the global market. In the US, one in ten workers already considers themselves digital nomads; the share has grown since the pandemic, and a significant portion do so without formal permission from their employer, which creates legal risks for companies and accelerates the reassembly of corporate remote work policies.

Overall, [estimates vary](https://www.mbopartners.com/state-of-independence/digital-nomads/), but the conservative range is 40–80 million people in 2025; about 18 million of them are from the US. Age — usually around 30–36 years old. Incomes are widely distributed, but almost half of the nomads' households earn $75,000 a year.

[Countries have adjusted](https://www.businessinsider.com/digital-nomad-visas-countries): 50 countries have already launched digital visas and special regimes for remote workers and founders from Portugal and Malta to the UAE, Costa Rica, and Thailand. The conditions vary: minimum income, health insurance, and sometimes the ability to take a family.

![Image from Pexels](img/top-view-hand-holding-smartphone.jpg "Image from Pexels")

Image from Pexels

## How new hubs emerge: infrastructure, visas, community

1) Entry rules and understandable bureaucracy.

Estonia led the way back in 2014, launching [e-Residency](https://www.e-resident.gov.ee/dashboard/): today the country has more than 126,500 e-residents and over 36,000 companies created by them. For entrepreneurs, this is a quick, fully online process for registering a business in the EU.

2) Affordable living and the internet without surprises.

Lisbon, Chiang Mai, Medellin, Playa del Carmen — these cities have coliving, coworking, schools, relocation services, stable internet, and air travel.

3) Live communities and events.

Madeira became a symbol: the "village of digital nomads" provided a constant stream of customers for cafes, rentals, coliving spaces, and spawned new services (workspaces, travel agencies, etc.). [Early estimates](https://www.gq.com/story/escape-to-zoom-island) of the effects in the media reached up to €1.5 million per month in turnover on the island, and academic and consulting analyses confirm the sustained benefits for the private sector.

## What this brings to economies

For cities and regions, digital nomads mean months of rent, subscriptions to services, steady spending at cafes and on local services, and also opening IPs/companies, taxes, and launching educational and tech initiatives. In Chiang Mai, researchers are seeing [a rise in demand for local goods and knowledge](https://onlinelibrary.wiley.com/doi/10.1111/isj.12496), a flow of expertise, and higher tax revenues than from tourist visits. At the same time, the literature honestly discusses the flip side: the risk of gentrification and pressure on rent.[ ](https://onlinelibrary.wiley.com/doi/10.1111/isj.12496?utm_source=chatgpt.com)

The trend is also noticeable in the UK: about 165,000 Britons already live and work as digital nomads abroad, collectively earning £5.2 billion a year, and the number is growing.

### Where new venture points are formed, and under what conditions

![](img/table-1.jpg)

**Note:** Visa requirements change; check official pages before applying.

## The Madeira case: how the island became a global hub

### A systematic approach to attracting nomads

The Digital Nomads Madeira Islands initiative has created a simple and effective funnel: a specialized website, a simplified application process, and a structured onboarding with housing and coworking access as part of a single package.

This is drastically different from the spontaneous development of nomadic communities in other locations and demonstrates the possibilities of a proactive approach by regional authorities.

### Event ecosystem as the basis of the community

Weekly professional meetups, educational excursions, and specialized networking with local entrepreneurs and municipal representatives have created a solid foundation for forming long-term business relationships.

The events calendar includes not only informal meetings, but also serious professional conferences, tax workshops, and seminars on international law for startups.

### New business models for community service

Specialized coliving spaces, logistics services for nomads, international microschools for children, and specialized agencies for visa processing and tax planning have emerged. This entire ecosystem arose organically to serve the needs of the community and created hundreds of new jobs for the local population.

### Measurable economic results

Early public estimates of the economic effect reached €1.5 million per month in additional turnover, and academic reviews confirm stable benefits for the island's private sector. It is important that these effects are stable and not dependent on seasonal fluctuations, which are typical for traditional tourism.

## Two growth models: organic vs institutional

### Chiang Mai: organic development from the bottom up

Chiang Mai, Thailand, is a model of a naturally formed community with a high density of coworking spaces, affordable living costs, and a rich events calendar. Research records a positive contribution to the local economy through increased consumption and knowledge transfer, but points to the importance of balancing the interests of nomads and the local labor market.

The advantage of the organic model is its naturalness and self-sustaining development. The disadvantage is the difficulty in managing negative externalities and the lack of systematic planning.

### Lisbon/Madeira: Institutional response from above

The Portuguese model demonstrates a quick institutional response: specialized visa programs, work with the housing market, and an emphasis on "soft" services for families with children. Strengths are in the portal government decisions and the maturity of European infrastructure.

The challenges are related to local social tensions surrounding the rise in rental prices and the processes of touristification of historic city districts.

## Transforming the venture ecosystem

### New models of project sourcing

Investors are increasingly gathering their pipeline of projects at event series in Lisbon, Bali, and Chiang Mai, rather than in traditional offices in Silicon Valley or the City of London. Scouting for talented founders is shifting from formal structures to informal professional communities.

This leads to democratization of access to venture capital and a decrease in the role of geographical proximity to traditional financial centers.

### Distributed teams as an architectural principle

A modern cap table might look like this: the founder works from Madeira, the CTO is from Vilnius, and the development team is spread across three time zones. Legal structures, taxation, and corporate governance issues become an architectural task that needs to be addressed at the earliest stage of a company's development.

## Risks and methods of their minimization

### Legal compliance in the era of mobility

"Working from another country" without notifying the employer is a real legal risk that affects 36% of nomads in the US. Startups and corporations need to develop clear policies: determine which countries they can work in, how to properly file taxes and social security payments, and which jurisdictions are prohibited due to sanctions or information security requirements.

### Social sustainability and local communities

The pressure on the rental market and local services is a proven fact, especially in popular areas of Lisbon, Bali, and some areas of Mexico. Hubs that survive the initial hype and become sustainable in the long term are the places where local authorities and nomadic communities discuss reasonable quotas, fair tax regimes, and support mechanisms for local residents in advance.

### Psychological challenges of a mobile lifestyle

A pretty picture on social media easily masks chronic jet lag, social isolation, and burnout. The solutions include predictable rhythms (minimum 6-12 weeks per location), creating "home" rituals regardless of geography, participating in mentoring groups and psychological support programs.

### Information security of distributed teams

Working from various jurisdictions requires a serious approach to VPN policies, mobile device management (MDM) systems, access control, and working with clients' personal data and financial information.

## Practical guide: Launching in a new location in three weeks

### First week: technical preparation

Obtain a visa or find a legal basis for staying in the country, rent a place with a full-fledged workspace and reliable internet, connect a local eSIM for mobile communication, and purchase a pass for one of the city's leading coworking spaces. It is critically important to check the latency (delay) to your main markets – this can significantly affect real-time customer service.

### Second week: building a professional network

Choose 2-3 thematic meetups per week that correspond to your industry or functional role, introduce yourself on Slack, Telegram, or Discord channels of the local community, and schedule 5-7 informal coffee meetings with people from your professional field (growth, data science, product management, fundraising).

Don't try to cover everything at once; it's better to establish deep connections with a few key people than to superficially get to know dozens.

### Third week: first business results

Test advertising creatives and pricing policies for local demand, find a contractor to solve "here and now" tasks (product localization, technical support for customers in the local language), organize a product demonstration for potential investors or customers that the local community has introduced you to.

## Financial planning for nomadic activities

### Housing and workspaces

In popular hubs (Lisbon, Chiang Mai, Playa del Carmen), coworking spaces are comparable in price to rent in central areas, but provide additional value in the form of flexibility and a ready-made professional community. A coworking pass usually costs about the same as 5-7 lunches at a good restaurant – it's often cheaper than buying additional equipment for a home office.

### Transportation costs

The main expenses are flights between locations, not daily mobility. Plan your moves in quarterly cycles, not on the principle of "a new city every week". This not only saves money but also increases productivity.

### Professional services

Accounting and visa issues are inevitable expenses when living a mobile lifestyle. Look for local law firms with experience working with startups and international clients – they often offer more flexible and cost-effective solutions than large international consulting companies.

## Who is the nomadic business model suitable for

**Ideal candidates**

Founders of companies with initially global hypotheses are fintech, SaaS solutions, artificial intelligence products, and creative industries. Teams with a developed process culture, where all communication is documented, and synchronous meetings are dosed and effective. Investor scouts and network operators of ecosystems who seek out projects and talent through professional communities.

**Model limitations**

The nomadic approach is not suitable for products that are critically tied to physical infrastructure in a specific country, or for teams that require a daily office and constant synchronization of all participants.

![Image from Pexels](img/backpacker-relax-mountain-with-using-laptop.jpg "Image from Pexels")

Image from Pexels

## Forecasts of development: a look at 2-3 years

**Normalization of remote-first approaches**

The proportion of nomads will continue to grow, and companies will shift from a policy of "turning a blind eye to violations" to a conscious regulation of the issue of "where our employees can work". This will require serious work from the legal and HR departments.

**New generation visas**

Specialized modes will appear for startups and intellectual property owners with transparent taxation and simplified administration. The number of such programs has already exceeded 50 and continues to grow.

**Urban planning evolution**

Cities will seek a balance between the economic benefits of the influx of nomads and the negative impact on the housing rental market and local services. This will lead to the introduction of special rules for rent, tax regimes, and quota systems.

**Specialized services ecosystem**

Insurance, accounting, compliance, children's educational programs, medical clinics, banking products: all of these are being transformed into a "subscription ecosystem" tailored to the needs of mobile professionals in key hubs.

Digital nomads aren't about postcards from the tropics. This is about a new way to build companies: testing markets faster, launching cheaper, and hiring more freely around the world. Where stable internet, clear rules, and active communities meet, real entrepreneurial density emerges, and with it, new venture points on the map.

If you are the founder and see the next location as a "destination", try to view it as the next market. This is how those who are already building "borderless" companies operate.

Digital nomads are no longer just travelers with laptops, they’re building startups and turning unexpected cities into global venture hubs. Discover how borderless living is reshaping entrepreneurship.

Entrepreneurship without borders: why digital nomads are creating new venture hubs

# Gen Z as founders, how they are acting?

The face of entrepreneurship is getting younger. Gen Z — those born between 1997 and 2012 — are stepping into the startup game with bold ideas, a native fluency in technology, and a defiant attitude toward outdated systems. Unlike previous generations who followed the traditional playbook of college degrees, corporate ladders, and slow career growth, Gen Z is rewriting the rules in real-time. They’re not waiting for permission or funding to build businesses — they’re doing it in their bedrooms, on Discord servers, and through social platforms. But what’s really behind this shift? Why are Gen Zers turning to entrepreneurship in such large numbers — and how are they reshaping what it means to be a founder?

Let’s break it down!

## A generation raised on the internet

To understand Gen Z’s approach to entrepreneurship, you need to understand the environment they grew up in

This generation didn’t witness the birth of the internet — they were born into it. By the time many Gen Zers hit their teens, smartphones and social media were already deeply integrated into everyday life. Platforms like YouTube, Instagram, and TikTok didn’t just entertain them — they educated and inspired them. Gen Z had access to tutorials, startup journeys, side hustle breakdowns, and business failure post-mortems all at their fingertips

They saw creators like Emma Chamberlain go from YouTube vlogger to fashion icon and business owner. They watched Ben Francis build Gymshark into a billion-dollar brand before turning 30. They followed startups like Glossier and Canva — led by young founders disrupting legacy industries. And the message was clear: you don’t have to wait until you're older or have an MBA to start something meaningful.

![Image by cake.com](img/снимок-экрана-2025-04-10-143007.png "Image by cake.com")

Image by [cake.com](https://cake.com/empowered-team/gen-z-workforce-statistics/)

## Why is Gen Z choosing entrepreneurship?

There are several key reasons why Gen Z is increasingly choosing to launch their ventures instead of pursuing traditional 9-to-5 careers

### 1. Economic uncertainty

Gen Z came of age during — and after — the Great Recession. They saw their Millennial siblings struggle with debt and underemployment. Then the pandemic hit during their formative years. These repeated economic shocks made it clear that job security no longer exists. A 2023 report by Deloitte found that 46% of Gen Zers say they live paycheck to paycheck and 75% believe they will need side hustles to make ends meet.

Rather than relying on traditional employment, many are choosing to create their own sources of income. It’s not just about passion — it’s a practical response to a broken economic system

### 2. Access to free tools and platforms

The barrier to entry for starting a business has never been lower. Gen Z doesn’t need a lot of capital or connections to build a company. They can launch a product on Shopify in a weekend, design their brand using Canva, promote it on TikTok for free, and accept payments through Stripe or Venmo. This is a generation of digital builders

A report by Morning Consult found that 50% of Gen Z adults have considered starting a business — and many already have. The rise of "micro-entrepreneurship" — where people run one-person brands from their phones — is driven by these tools

### 3. Values-driven innovation

Gen Z isn’t just building businesses to make money — they want to make a difference. According to a 2022 IBM survey, 75% of Gen Z respondents said it’s important that a brand reflects their values. That translates into how they build their own companies. They prioritize sustainability, mental health, inclusivity, and transparency

Ziad Ahmed, founder of JUV Consulting — a Gen Z-led marketing agency that advises Fortune 500 companies on how to better connect with youth. He launched the company as a teenager because he felt brands were constantly talking down to his generation. Now, JUV has worked with brands like Nike and Unilever, helping them reshape their messaging through authentic youth voices

## Notable Gen Z founders making waves

The headlines are catching up — Gen Z entrepreneurs are already building impressive businesses that defy expectations

* Mikaila Ulmer, founder of Me & the Bees Lemonade, started her company at just four years old and turned it into a national brand stocked in Whole Foods. Now in her early 20s, she’s a sought-after speaker and investor in youth entrepreneurship
* Alana Andrews, founder of So Positive Initiative and author of “Creating Confidence”, used her own struggles with confidence and entrepreneurship to launch a program that empowers other Gen Z kids to lead with impact
* Josh Browder, born in 1997, created DoNotPay, the “world’s first robot lawyer” to help people fight parking tickets and navigate legal bureaucracy without hiring expensive attorneys. He was just 19 when he launched the service
* Ben Pasternak, who dropped out of school at 15, built several apps and eventually founded SIMULATE, the plant-based food tech startup behind NUGGS, a viral chicken nugget alternative
* Avery Akkineni, president of Vayner3, entered the Web3 space early and led global campaigns for brands exploring NFTs and blockchain experiences — all before turning 30

## Stats that show the shift

The trend isn’t just anecdotal — the data backs it up

* According to a 2022 GoDaddy report, one in five Gen Zers say they already run their own business
* A Shopify study found that 62% of Gen Z entrepreneurs started their business as a side hustle, and 44% want to make it their full-time job
* In a survey by SCORE, 38% of Gen Z respondents said they believe entrepreneurship offers the best career path, compared to 25% of Millennials
* Y Combinator, the legendary startup accelerator, saw a 38% increase in founders under 25 in its 2022 cohort

## Rewriting the founder playbook

Gen Z doesn’t follow the Silicon Valley model of founders in hoodies pitching VCs in boardrooms. They are building in public, validating ideas on social media, and growing communities before they even register a company. Platforms like TikTok, Reddit, and Discord have become their idea labs — where product-market fit is tested through memes and comment sections

They’re skeptical of traditional hierarchies and prefer flatter, more collaborative structures. Many don’t even identify as “CEOs” — they’re creators, operators, or community leads. They’re less obsessed with raising millions and more focused on building sustainable businesses that reflect who they are

## Challenges they face

It’s not all hype and hustle. Gen Z founders face serious challenges

* Age bias: Investors and customers sometimes don’t take young founders seriously
* Mental health strains: The pressure to hustle, perform, and constantly be “on” can lead to burnout
* Funding gaps: Despite their innovation, Gen Z founders often struggle to access traditional venture capital — particularly if they’re from underrepresented communities

But true to form, they’re building around those obstacles too. They’re raising funds through crowdfunding, building lean businesses, and prioritizing balance and authenticity over growth at all costs

## The future is peer-led

What makes Gen Z founders especially powerful is how peer-driven their success is. They support each other — promoting friends’ businesses on social media, sharing resources in group chats, and building networks of digital collaborators around the world. They believe in community over competition

As they grow older and gain influence, Gen Z entrepreneurs will redefine work culture, reshape industries, and create entirely new sectors. We’re already seeing this in climate tech, creator economy startups, femtech, and mental health platforms — all areas where Gen Z is innovating faster than legacy companies can keep up

## Final thoughts

Gen Z isn’t waiting for permission to lead — they’re already doing it. They’re founding businesses not because it’s trendy, but because it’s necessary. They want more autonomy, more meaning, and more impact — and entrepreneurship gives them that path

They are not here to play by the rules — they are here to rewrite them.

And the rest of the world is starting to pay attention.


What does the next era of entrepreneurship look like?

Gen Z as founders: Why young entrepreneurs are rewriting the rules

# 3 things that really matter to employees at work – do you offer them?

Forget about corporate parties and free pizza; people don't leave because there's no table tennis in the office. They leave when they don't get three basic things, without which any job becomes torture.

We are used to hearing polite excuses: “I'm looking for new challenges”, “I want to grow professionally”, “I need a better work-life balance”. But the truth is simpler and harsher. Most decisions to change jobs boil down to three fundamental needs.

Everything else is just extras. Useful, pleasant, but not critically important. You can organize as many team-building events and buy as many ergonomic chairs as you like, but if basic needs are not met, people will still look for a way out. In this article, we will reveal three keys to keeping talent in your team for the long term.

## 1. Protection from toxicity – a shield that everyone neglects

Prepare for a shock: the most talented employees don't leave for higher salaries or cool projects. They flee from toxic colleagues. And they do it faster than you can figure out what's going on.

One destructive person on a team can undermine the efforts of five productive ones. But most managers think, “Come on, they're adults, they'll work it out”. They won't. The good people will just leave, and the problem ones will stay because they have nowhere else to go.

Here's the paradox: we spend months looking for the perfect candidate and are willing to put up with months of destructive behavior from someone who is already on the team. It's ironclad logic, right?

![Image from ACESENCE agile leadership](img/benefits-of-executive-coaching-6.png "Image from ACESENCE agile leadership")

Image from [ACESENCE agile leadership](https://www.google.com/url?sa=i&url=https%3A%2F%2Fblog.acesence.com%2F10-signs-of-a-toxic-work-environment-and-how-to-fix-it%2F&psig=AOvVaw3uorQvBOvhotK7qq3u7OrT&ust=1756223229161000&source=images&cd=vfe&opi=89978449&ved=0CBgQjhxqFwoTCMCaxtKnpo8DFQAAAAAdAAAAABAE)

### What is toxicity in a workplace?

It is not necessarily overt aggression or scandals. Toxicity is the constant undermining of other people's ideas, devaluing the efforts of colleagues, and creating an atmosphere of mistrust. It is a person who turns every meeting into a minefield where everyone is afraid to speak up.

A toxic employee may be professionally competent, even brilliant. But their emotional impact on the team outweighs any benefits. They are like a virus – slowly infecting everyone around them with cynicism and apathy.

### Why are talented people particularly vulnerable?

Strange but true: the better a person is, the quicker they walk away from toxicity. Mediocre employees have fewer options, so they put up with it. But good employees always have a choice.

Talented people are used to a constructive environment. They expect their ideas to be discussed on their merits, not dismissed because of someone else's insecurities. When that doesn't happen, they don't try to change the situation – they leave it.

Moreover, good specialists understand their value. They know they can find a place where they will be respected. Why waste energy fighting toxicity when you can just move to a place where it doesn't exist?

### How to create a protective system

The first step is to acknowledge that the problem exists. Many managers live under the illusion that “everything is fine here”. Conduct an anonymous survey about the psychological climate. The results may be shocking.

The second step is zero tolerance for destructive behavior. It doesn't matter how valuable an employee is professionally. If they poison the atmosphere, they must either be corrected or let go. There is no third option.

The third step is to create a culture of mutual respect. This is not about political correctness, but about basic human dignity. People should feel safe expressing their ideas and making mistakes.

### The economics of toxicity prevention

The math is simple: replacing one toxic employee is cheaper than finding replacements for three good employees who left because of them. But most companies think the opposite because they only see the direct costs and ignore the hidden ones.

The hidden costs of toxicity: reduced productivity of the entire team, increased stress and sick leave, a decline in the quality of hiring (good people refuse to come), and reputational damage (employees talk about problems to the outside world).

Protecting against toxicity is not an HR whim. It is basic business hygiene, like washing your hands in medicine. Without it, all other efforts to build a strong team are meaningless.

## 2. Smart colleagues – an environment that encourages growth

No one wants to remain the smartest person in the room forever. People strive to develop, and development happens fastest alongside those you respect.

Strong professionals seek challenges. They need stability, but along with it – intellectual stimulation. A team of sharp, thoughtful, curious people is more motivating than any job title or KPI.

If your team consists of average performers who never push the boundaries, your best employees will quietly leave for a place where they feel like newbies in a good way.

But that doesn't mean chasing pure IQ. It's about hiring people who ask the right questions, give meaningful feedback, and are willing to admit mistakes. It's about creating an environment of continuous learning – through debate, collaboration, code reviews, and customer reviews.

### A learning culture is a competitive advantage

A strong learning culture does more than just retain talent. It creates institutional resilience. When people feel that they are improving simply by coming to work, you don't need carrots and sticks. The work itself becomes the reward.

I have seen teams where every meeting turned into a master class. Where senior developers patiently explained architectural solutions and designers shared insights about user experience. In such teams, turnover is minimal and results are maximized.

The opposite example is swamp teams, where no one learns anything for years. Where the same people do the same tasks using the same methods. Everyone capable of more leaves such places.

The recipe is simple: hire people who are smarter than you, encourage knowledge sharing, and create situations for intellectual clashes of opinion. And be prepared to be persuaded sometimes – that's a sign of a healthy environment.

![Image from FreePik](img/work-team-digital-art.jpg "Image from FreePik")

Image from [FreePik](https://www.freepik.com/)

## 3. Product momentum and success – the energy that drives you forward

You can pay well and assemble a dream team. But if the product isn't moving forward, people will lose steam.

Everyone wants to feel like they're part of something that works or something that's about to work. It's about traction, clarity of purpose, and belief that progress is real.

People don't need perfect results. They need forward movement. When a product gains users, solves real problems, or opens up new opportunities, it energizes the team. It confirms the feeling that time spent here is not wasted.

The lack of momentum, on the other hand, creates resistance. Teams lose their sense of urgency. Strong specialists feel stuck. Meetings turn into exercises in maintaining optimism rather than planning.

### How to communicate progress to your team

You don't have to win the market every quarter. But you need to show the path to victory and explain to everyone how their work contributes to the overall movement.

As a leader, you must regularly and honestly communicate the progress of the product. Highlight real achievements. Be open about failures. And most importantly, link individual work to company goals.

People are willing to move mountains when they believe they are running toward something meaningful. But if they can't see the finish line or don't understand why they are running, their enthusiasm quickly fades.

Practical advice: create a ritual of weekly product updates. Show metrics, tell user success stories, explain how current tasks affect the big picture. Turn abstract goals into concrete steps.

## What about the rest?

“Wait a minute,” you might say, “what about flexibility? Corporate culture? Work-life balance?” These are important, but they act as amplifiers, not drivers.

A strong culture makes the three main factors more sustainable. Flexibility helps retain talent, especially when the work and people are already at a high level. But no one stays at a job just because of remote work or free snacks.

### Hierarchy of needs in action

**Imagine an employee's pyramid of needs:**

1. Base: protection from toxicity, smart colleagues, a growing product
2. Middle: corporate culture, fair pay, career development
3. Top: perks, office goodies, team building

If the base is shaky, everything else will collapse. But if the base is solid, you can build an impressive superstructure.

People don't leave because of a lack of cookies or the wrong slogans. They leave when they don't feel appreciated, can't develop, or don't believe in what they do.

### A harsh reality check

If you don't protect against toxicity, even an excellent salary won't keep sane people around. If the team doesn't learn from each other, remote work won't fix stagnation. If the product is stuck in place, even the safest atmosphere will seem like a stagnant swamp.

Get the basics right, and the rest will be optimization. Get the basics wrong, and everything else will turn into a struggle with the consequences.

## Practical steps: where to start tomorrow

On protecting against toxicity:

1. Conduct an anonymous survey on the psychological climate in the team
2. Set clear boundaries for acceptable behavior and the consequences of violating them
3. Respond immediately to complaints about destructive behavior by colleagues

On the team:

1. Assess the intellectual level of each hire
2. Launch knowledge-sharing practices (code reviews, design critiques, retrospectives).
3. When hiring next, set the bar higher than the team average.

For the product:

1. Introduce weekly updates on product progress.
2. Clearly explain how each person's work relates to the overall goals.
3. Celebrate and analyze all victories, even small ones.

## Focus on the essentials

In an era of HR trends and corporate innovations, it's easy to get lost in the details. But if you remember only one thing from this article, let it be this: people stay where they feel protected from negativity, can grow intellectually, and see the results of their efforts.

Everything else is a nice bonus. Important, but not critical. Focus on these three fundamentals, and you will create a place where people don't want to leave. Not because they have nowhere else to go, but because they have no reason to.

Ultimately, the best way to retain talent is when employees don't even consider other options. Not because they are afraid of change, but because they have already found what they were looking for: a place where they can safely be themselves, grow, and create something meaningful.

Discover the 3 essentials every employee truly values and how focusing on them can boost morale, loyalty, and performance.

Stop guessing what employees want: Focus on these 3 essentials

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