Search for...

The CEE Startup Superpower: Cultural Weakness becomes Competitive Edge

The CEE Startup Superpower: Cultural Weakness becomes Competitive Edge, TheRecursive.com
~

In a region where questioning authority is discouraged, creating a psychologically safe culture becomes a competitive advantage.

In the fast-paced world of startups, founders are taught to be obsessed. They obsess over product-market fit, burn rates, and their next funding round. But according to Jaïr Halevi, a global expert in organizational culture, there is one critical element they consistently overlook: their own company culture. 

In an interview with The Recursive at Startup Moldova Summit 2026, Halevi argued that for founders, particularly in Central and Eastern Europe, mastering culture is not a soft skill but a decisive competitive advantage.

“Founders tend to obsess about a lot of things; they obsess about their product, about their competition, about getting investors. But one thing they do not obsess about so often is their culture.”

 This oversight, he believes, is a missed opportunity, because while founders cannot control market shifts or global events, their culture is entirely within their grasp.

Your culture is your tennis serve

A keen tennis coach himself, Halevi uses a powerful metaphor to frame his argument. He compares a startup’s culture to a tennis serve. It is the one moment in the game where a player is in complete control, setting the tone for the entire point.

“The service is the moment in tennis that every point starts with, so you are in control. There’s no ball coming from the opponent. It’s just you who decides what’s going to happen next.”Halevi notes. 

For a founder, this translates directly to the workplace. External pressures are constant – a competitor’s new feature, an economic downturn, or even a co-founder’s life changes are all uncontrollable variables. 

But the internal environment – “what type of company you want to be, who are you going to take with you on the journey, what are you going to tolerate”  – that is simply the founder team’s serve.  By optimizing it, they can dominate the game from the very beginning.

Read more:  Do startuppers and big business employees come from different planets?

“The number one indicator for innovation.”

At the heart of a winning culture is a concept Halevi repeatedly emphasizes: psychological safety. The term, coined by Harvard’s Amy Edmondson, describes an environment in which team members feel safe speaking up, sharing ideas, and admitting mistakes without fear of punishment or humiliation.

Without it, the consequences are dire. An employee with a brilliant idea, shut down once by a dismissive founder, will likely stay silent the next time. A team member who spots a critical flaw in a product may not report it for fear of being blamed.You lose the innovation power,” Halevi warns.

The CEE cultural Superpower

This is where the challenge and the opportunity of the CEE region come into focus. Halevi points to the cultural heritage prevalent in many post-Soviet states, in which generations were raised under the rule, “don’t question authority.”

This tradition creates a significant hurdle. Research from the European Commission highlights the cultural divide: in Silicon Valley, challenging the boss is encouraged; here, the default is often to defer. This “high power distance,” a term describing how readily a culture accepts hierarchical order, can stifle the very psychological safety needed for innovation.

But according to Halevi, this widespread cultural norm is precisely what creates a golden opportunity. The “superpower” isn’t found in the old legacy, but in consciously defying it. In an ecosystem where most companies operate with a traditional, top-down structure, a founder who deliberately builds a culture of psychological safety creates a stark and powerful contrast.

“If the default culture in your region discourages speaking up, and you build a company that encourages it, you create something rare and incredibly valuable,” Halevi argues. “You become so strong that all the best people want to work for you. You will beat the competition for talent, which is the ultimate advantage. That is the good news.”

“It starts with you.”

For founders looking to build this advantage, the work is personal. “You cannot delegate culture,” Halevi insists. “Culture comes from the blood and the soul of the founder.” It is not a task for the HR department but a daily practice modeled from the top. Practically, this means leading with vulnerability. 

Read more:  "Who Controls the Skies, Controls the Future": Inside Dronamics with Svilen Rangelov

Admitting “I don’t know” or sharing a mistake and the lesson learned from it sends a powerful signal. The most important sentence a founder can say, according to Halevi, is: “Do you have any feedback for me?” 

To reinforce this, he suggests practical forums like “fuckup nights” to discuss failures openly, or “what’s not working” sessions to normalize problem-solving. Giving employees equity and making them co-owners is another powerful tool to create a sense of belonging and empowerment.

As teams become more distributed, Halevi also advocates for the “40 to 60 hour rule,”  defined as the time it takes for adults to form a light friendship. Investing in off-sites where teams spend this amount of time together can dramatically improve the flow of information and ideas once they return to remote work.

In an age where teams are shrinking and AI is becoming a primary collaborator, this human connection is more vital than ever.

We need people to feel safe, especially now when the person that you talk to the most is either ChatGPT, Gemini, or Claude,” Halevi concludes.

He leaves us with a final thought, urging CEE founders to look to their own culture for inspiration. Most countries in the region have a tradition of gathering family and friends at “the big table”, the one in the living room that only gets set for guests. 

That’s when people gather to connect, share stories, and feel a sense of belonging, which is a perfect real-world example of a psychologically safe space. 

“I would like to challenge you to bring a little bit of that into your startup.”

Help us grow the emerging innovation hubs in Central and Eastern Europe

Every single contribution of yours helps us guarantee our independence and sustainable future. With your financial support, we can keep on providing constructive reporting on the developments in the region, give even more global visibility to our ecosystem, and educate the next generation of innovation journalists and content creators.

Find out more about how your donation could help us shape the story of the CEE entrepreneurial ecosystem!

One-time donation

You can also support The Recursive’s mission with a pick-any-amount, one-time donation. 👍