New York-based art investing platform Masterworks continues to see rapid growth despite a slowdown in the overall startup ecosystem. What can leaders at West Coast companies learn from Masterworks?
High-growth startups have long been headquartered on the West Coast. Silicon Valley companies pointedly shifted away from traditional East Coast work principles, pioneering novel employee benefits and flat organizational hierarchies.
However, as tech startups navigate a challenging macroeconomic climate, one East Coast startup is drawing attention for its sustained success. The Masterworks app, which gives a community of over 800,000 users access to fractional investment opportunities in paintings by blue-chip artists like Banksy, Condo and Warhol, currently has over $882 million in assets under management.
As a startup, Masterworks raised a stunning $110 million A round in 2021, hitting unicorn status a mere two years after its founding, and many attribute its success to the company’s culture. Here are a few lessons that leaders of tech startups can learn from the team alignment at Masterworks.
Flat and Upwardly Mobile
Remote work became popular during the COVID-19 pandemic and has largely remained in place even as tech firms have pushed employees to return to the office. Masterworks took a different path by never fully embracing remote work and stressing the importance of working in person in its New York offices whenever possible.
Masterworks justifies this push for in-person work by backing it up with organizational alignment. Working in person enforces the company’s flat work structure and educates employees about different roles.
Jordan Goldstein, Head of Talent Acquisition at Masterworks, explains that “One-third of our management team started at Masterworks as an individual contributor.” What’s more, “They’re not afraid to roll up their sleeves and get involved in the nitty-gritty alongside the rest of the team,” she says. “No task is considered too big or too small for anyone here.”
Goldstein’s point about executives starting in lower positions highlights the second benefit of in-person work that Masterworks prioritizes. Instead of hiring from outside, the company believes in promoting from within. This vision can only be achieved if company executives understand and empathize with the company’s different functions.
The result is a flat organizational structure that nonetheless has upward mobility opportunities. Thanks to the benefit of knowledge sharing and employee bonding, the Masterworks team is tight-knit, leading to a positive work culture that propels the company forward.
Culture-First Hiring
Several high-growth tech startups talk about prioritizing culture when hiring new employees. However, skills eventually win out, leaving work culture a distant second. At Masterworks, which sits at the intersection of technology, investing, and art, the best-fit talent possesses a rare blend of specialist knowhow.
As a result, the company prioritizes candidates who have passion in more than one of these areas, as opposed to refined skills in any one.
Goldstein sees this approach as key to the company’s business success. “By combining the power of data-driven decision-making with the qualitative feedback and expertise of our art specialists,” she says, “we have the privilege of gaining a holistic understanding of art market dynamics.” A workforce with similar interests automatically aligns the organization around important issues that need solving.
Masterworks has also prioritized the intersection of tech and art in its recent acquisition of Athena, a machine learning-powered data analytics provider for the art market. “This acquisition has bolstered our team’s expertise and amplified our ability to analyze art market data with precision,” Goldstein says.
Instead of choosing a generic ML provider as a target, Masterworks demonstrated its commitment to living at the intersection of art and tech with this acquisition. Employees always have the benefit of learning from older colleagues once onboard, thanks to the flat organizational structure.
Organic Employee Bonding
The strong bonds among the Masterworks team extend beyond the work itself. Staff routinely visit art museums, often accompanied by the firm’s art specialists. Subject matter experts also routinely present information at company gatherings, helping employees understand the different dimensions of what Masterworks does.
“We all work in person every day, so we are a pretty tight-knit group,” Goldstein says. “I’d say everyone is friends inside and outside of the office. It’s been exciting to see our employees take the initiative to create new clubs on their own – the Masterworks running club meets weekly and is planning to run a 5k this summer.”
These employee meetups indicate a happy workplace, something that has become increasingly a rarity in the tech world recently. With massive layoffs and purse tightening, West Coast firms have ironically come to resemble their legacy East Coast enterprise peers, a clear move in the wrong direction.
The environment created by Masterworks also gives new employees a quick way to upskill themselves in any area they might be interested in. The result is a happy and flexible workforce that is primed to grow the company.
Culture as a Driving Force
Masterworks is a great example of a company using its cultural principles to boost growth. While West Coast companies were once pioneers of a new work culture, there’s much to learn from this New York-based unicorn.
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