Who can benefit from full disclosure?

Open Startups: Why Modern Companies Believe in Full Transparency

A growing community of entrepreneurs swears by the maximum openness of organizations, business processes, current challenges, and success metrics. We had a look at why it can be worth sharing all these "company secrets" with the world. And who knows, maybe for it's something for you, too?

By Alex Blum,
Content Creator January 10, 2022

What this post is about

Open Startups: Modern companies commit to the greatest possible transparency - internally and externally
Their own integrity is the most important asset and is put before everything else
They build trust with employees and customers by providing insight into performance metrics
A series of questions helps you find out if you are ready for openness yourself

In business, there is still no precise term for the strategy of maximum transparency for companies. And yet, as so often, it's a thing. So let's take a look at why it might pay off to share your sales figures openly and how much transparency might be too much.

What exactly is an "Open Startup"?

An "Open Startup" is defined as those organizations that publicly share most of their operational metrics - from sales volumes to revenue, website analytics, user satisfaction, and even marketing experiment evaluation.

These numbers are often made available to everyone on a dedicated subpage on the website (usually at "domain.com/open"). And to ensure authenticity, much of the data mapped comes from credible software-as-a-service providers with open APIs that can be mapped 1:1 on the Open dashboard.

Open Startups put their integrity first and want to be measured solely by what they do.

Nowadays, unpleasant truths about companies that mislead their users and grow by unfair means are uncovered almost every day. Transparency around business models, in turn, creates positive change and a better culture. Consumers, customers, employees, and other stakeholders can thus rely on the decency of an Open Startup, as it will protect its reputation at all costs.

As a side effect, growing success metrics and an honest impression of a company's future viability also show up as "social proof," making it easier for interested parties to decide to do business with that company as well.

Open startups are particularly common in the indie developer scene, as they often prefer to focus on a real product-market fit and organic growth rather than artificially created demand through investor money. Their openness is spurring more and more startups.

And another advantage beckons for teams: income differences between the sexes decrease when companies also commit to salary transparency.

What critics of Open Startups denounce

Some criticize transparent organizations for shamelessly marketing their openness. And most certainly, sharing also leads to a certain promotional effect. But on the other hand, any failure will be difficult to hide and thus quickly puts any feigned success story into perspective.

Because here's the catch: Transparency applies not only in the good times but in the bad ones as well. During those darker days, Open Startups should communicate extra precisely and proactively what they believe in, what they plan to do, and how they intend to correct mistakes in order to pre-empt any criticism.

And one more aspect should not be forgotten: What gets measured gets managed. This is even more true in the public sphere and means that every metric needs to be controlled and accounted for. Open Startups should always keep this in mind.

How can your own organization become progressively transparent?

If all of this sounds promising to you, perhaps it's time to become more transparent yourself. If you're unsure whether it's too early to do so, we have a little help for you. Ask yourself the following questions to find out how ready you are to become an Open Startup:

Who are we accountable to?
Is there anything to hide?
Does transparency help build and rebuild trust?
How would my customers and users respond?
How would my employees feel about it?
Would openness perhaps even attract new talent?

Don't worry: You don't have to make a 180-degree change right away - a gradual transition is also possible, and you can also decide to be more transparent in just a few areas. A good way to start is to switch to "Building in the Open"! Share the development process of new products step by step and get real-time feedback from existing users and communities. Your smart helpdesk, Zammad, will support you.

How Zammad adds positive touches

We, too, have to openly admit that we are not always 100% transparent on all topics. But we feel very connected to the Open Startup movement and are also an open-source solution ourselves. In addition, we increasingly share up-to-date figures on our growth and are also only too happy to leave the stage to our customers.

We are committed to transparency and uncompromising knowledge sharing because we are convinced that this will lead to a more sustainable and fairer economy for all. And bit by bit, we are slowly getting closer to our own ideal.

Discover more Open Startups

There is more to discover! Online, there are several registries and resources that list Open Startups and provide low-threshold access to open-source solutions. Be sure to have a look at:

Finally, check out an episode of the "TED Podcast Hour", in which real thought leaders devote themselves to radical transparency and go to the limits of openness. The topics include salary transparency, full disclosure among colleagues, governments, and intelligence agencies, as well as how to deal with errors in medical professions and hospitals. Too much of a good thing? Maybe - we'll leave that decision up to you.

Summary

It is worthwhile for both young and established companies to reconsider their transparency, as it can have many positive effects - from trusting internal and external relationships to more integrity.