Our business won two awards for our flexible practices and I believe that the reason we were ahead of the competition was that when the judges visited I was able to point to real results not just reams of HR policies and documents.
Founders and early staff really understand that they need to get a lot done and they should also be highly motivated to contribute to the business success. If the business takes the view that it can give people some flexibility in return then this can work out really well.
Some of the people who 'need' the flexibility should be founders or part of the key management team. In a startup you have tremendous control over the way your systems and business practices are set up - think about your family needs when doing this. Allow people to find what works for them. One of my cofounders found that she worked best after your children went to sleep and so we got a huge amount done between 9pm and midnight. We built all our systems so people could work from home and told our team that if their kids were sick they could work from home to look after them. That safety net makes a big difference.