January 9, 2017
Working from home, a coffee shop, or even a remote tropical island all sound fantastic. Combined with the entrepreneurial dream of owning your own business it might even be heaven. But here’s what building a remote company is really like. Saent is just over two years old now and has been a distributed company from the beginning. We started working this way by coincidence (more on this later), and when we began, we didn’t realize we’d combined some of the most difficult factors of remote work into one package:
These factors create some unique challenges: you need input from a colleague right now, but she is currently asleep. What to do? How do you get alignment on projects, values, and culture, when you rarely have everyone in a physical room together? How to deal with an emergency when the entire team is located around the world instead of in the same office? Launching a startup is hard enough -- 90% fail -- so why make it even more complex by going remote?
Our distributed setup started out of necessity: our initial hiring needs could not be fulfilled in Beijing so we looked elsewhere. We started working with a team in Ho-Chi Minh (Vietnam) to develop our software prototype and a partner in Shenzhen (China) for our hardware product. For the PR and marketing of our crowdfunding campaign we wanted someone familiar with the US tech press and found someone based in Providence (USA).None of these arrangements were necessarily meant to be permanent -- all of these people were retained initially on a contract basis. But as time went by, there seemed little reason to end these remote arrangements. We worked well together and the quality of work was high. We also realized something important: we love working this way. We’re lovin’ it! At Saent, we found we do our best work when we can change environments regularly and manage our own time. In an office, each person has to mold themselves to the rhythm and whims of everyone else. This works for some, but for others it means you end up with the lowest common denominator in terms of productivity and well-being. Why force all workers into an arbitrary box? Everyone is different, and when people are able to choose when and how to work on their own terms, we find they do better work as a result. This doesn’t just relate to the amount of output (i.e., hours worked), but also to the quality of the work itself. For the companies of the future, we believe one of the most important competitive advantages is the ability to think deeply. And not only because that relates to the philosophy behind our products, it’s where the world is headed: computers will take over more and more complex tasks. The activities remaining for humans will play into our unique capability to think creatively and use our intelligence. Paradoxically, in many offices people barely have a chance to think at all. They’re constantly interrupted by emails, meetings, colleagues, notifications, more meetings, and then more emails (and let’s not even get started about open-plan offices). The research on this is in: such an environment is terrible for focus, a requirement for solving complex issues and creating groundbreaking ideas.
Solitude and thinking People who work in a distributed team often get struck by the loneliness of it: you need to motivate yourself; there’s no one else around to ask for help; you might not see another living soul for an entire day. This is certainly true, and some folks never get used to it. But herein also lies one of the most powerful advantages of working remotely: you have seas of time to think through and work on complex problems by yourself, without interruption. Plenty of studies show solitude is key to solving difficult, intellectual challenges. Writers, scientists, successful entrepreneurs: they all spend considerable time with their own minds on a regular basis. Working remotely forces you to think by giving you long stretches of solitude, during which you can plan your time around those parts of the day you know you do your best work. In addition, remote companies tend to communicate mostly via the written word. This also encourages thoughtfulness, as writing about your problems and ideas requires more of your mind than blurting something out in a meeting. Balance Of course, remote work isn’t only about solitude. To do your best work, staying healthy and primed for optimal performance is at least as important. This means:
Of course, some office environments are better than others are providing these things, and not all remote work arrangements fully offer them. In general, though, remote companies are much better at allowing team members to create a personalized environment that helps them find balance. Global talent pool Another amazing advantage is having access to a global talent pool. When you’re bound to a physical location, that greatly diminishes the potential candidates you can hire. How great? It’s the difference between fishing in a pond with a few billion fish versus one with maybe a couple of million. For example, when we were interviewing people for our Librarian vacancy last year, we talked with folks all over the world -- from Sydney to New York. We ended up hiring a person in Los Angeles because she was the best fit. We didn't have to convince her to relocate, nor did we have to worry about missing great candidates who lived too far from our office. We could hire literally the best person for the job. Autonomy Most job ads call for people who are independent, autonomous, responsible, self-driven, and trustworthy. Not surprisingly, every candidate who applies will attest to being just that. But these traits are hard to test for in an interview-setting; only once you take the person onboard will you really find out what they’re like. On the flip side, though many companies say they value those traits, they often don't express that in practice. Bosses often micromanage and require all decisions to go through them. They don't give employees the information necessary to operate autonomously, and they don't trust them to make independent decisions. Now think of a remote setup: there is no way you can work thousands of miles apart when there is no trust, and it’s almost impossible to micro-manage over such a distance. And if you can’t work independently, this will soon become apparent to the rest of your team: you can't hide and just “look busy” when the boss walks by -- you're judged on your output. In other words, working remotely is what business guru Jim Collins calls a catalytic mechanism for autonomy and trust: it’s a setup that enforces those values by its very nature. It automatically weeds out team members who can’t work in this way, and scares off managers who don’t trust their people. It’s simply impossible for them to function and survive very long in a remote environment.
Communication There are certainly disadvantages to being remote when it comes to communication. You can’t (easily) call a meeting, you often can’t call each other in real-time, and, even when you do, you might not be able to see each other because the connection is spotty. In other words, communicating is tough compared to an office. Yet there are also advantages. For one, you’re forced to write a lot more (emails, internal updates, asynchronous brainstorms in Google Docs). This might sound like a burden, but it forces you to think more deeply about what it is you’re trying to say, and it gives you more time to prepare a thoughtful response than blurting out something in a meeting. It can also act as a natural “pressure filter” during emergencies. I learned this earlier this year when I received an email from one of our first 100 beta users: he found out that data from a handful of our users was potentially accessible by anyone through a mistake on our end. This is an extremely serious problem, since we handle sensitive user data, and as they say, “trust comes by foot and leaves by horse.” In a normal office setting, I would have likely called a meeting, spent one or more hours figuring out the cause and debating possible solutions, then finally sending a bunch of stressed out developers to go and fix it. Instead, all I could do now was send a very concerned and urgent email to our development team in Vietnam. But after that, it was out of my hands, and that was a good thing, because I couldn’t come up with the solution anyway. It gave them the opportunity to fix the issue as soon as possible, without having to sit in a meeting room with an anxious boss for hours!
For the above reasons, this structure has so far worked quite well for us. We’ve gone from one person working remotely (me) to about twenty now, and delivered our first product to 1,500 customers in 60 countries on a very reasonable timeline (a bit over a year for a hardware device plus a desktop app on both OS X and Windows). But what happens if in the coming years we grow to 10,000 or even a 100,000 customers? From 20 to 50 to 100 people? The big question is whether this remote setup can hold up under such circumstances. Alignment and data Since we’re not in the same office, it’s harder for information to flow from one team member to the other. When you’re working remotely, certain things that office workers take for granted don’t happen easily or naturally, like a casual chat when you bump into a coworker in the hallway, or dropping by at your colleague’s desk to get the latest update about sales. This problem needs to be countered by having a central, digital dashboard where all kinds of internal data can be shared and viewed. This helps to keep important metrics top of mind, while simultaneously ensuring important information is always available, even when your colleagues are asleep in another timezone. This is the main reason why Buffer (a great example of a remote company) shares all their data online. Recruiting Another important aspect of building a remote company is how you hire. As we said earlier, being fully distributed can be a catalytic mechanism for creating an environment of trust and autonomy. Yet it’s still possible to bring on board the wrong people without an appropriate hiring process in place. Based on experiences with our first (remote) hires, we have started doing all our interviews in the following sequence:
This process feels counter-intuitive: once you’ve spotted some suitable candidates, it’s natural to want to talk to them on a call as soon as possible. Instead, we’ve learned this is not the right approach for us: 80 - 90% of our regular communication happens in written form, asynchronously. No matter how much other work experience people have, for some, this is unbearable. They don’t like to read or write a lot, or it just feels awkward for them not to get a response to a message immediately. By conducting the interviews in a way that’s more akin to how your remote company works on a daily basis, it becomes clear who feels comfortable and who doesn’t in your particular work environment. This change has already improved our hiring, but we can certainly make further progress in the future. For example, for a recent job opening, we put a large number of detailed screening questions in the application, allowing us to get to the “semi-final” round more quickly.
Structure and braintrust When you don’t come together in an office every day, structuring the organization also requires a new approach. We’re already experimenting with Teal, an organizational method where every person has true autonomy over their own domain; a natural fit for a fully distributed team in which your boss could be thousands of miles away. We also think differently about employees, freelancing, and outsourcing. As mentioned previously, we see the ability to think deeply and creatively as perhaps the key competitive advantage for companies of the future. Technological expertise is more of a commodity than a decade ago (especially when you can fish in the global pond), while finding the time to think deeply and keep learning is harder than ever. For this reason, we see the core team (the “employees”) as a braintrust: their main job is to think and work through complex problems. They need to have unique expertise or skills, truly understand our long-term vision, and of course be able to work remotely. Most other things can be outsourced to freelancers and third parties. Why?
Don’t get me wrong: we have big plans and will be building a substantial team if we turn our long-term vision into reality. But I do believe at least 35% of the staff most companies keep on the payroll can better be outsourced to freelancers and third party vendors. This is not to save costs; usually it will end up costing more in terms of money. But you earn this back through freeing up your core staff from overhead, complexity, and unnecessary management tasks.
While we are pioneering a distributed startup in that we create both software and hardware, many other tech companies have gone before us blazing the trail of remote work. One of the best examples is Automattic, a billion dollar company that works with hundreds of people around the globe. They build WordPress, the content management system that powers 25% of the internet! They’ve succeeded in enormously scaling both their team and their product, while maintaining a high functioning remote operation. Another great example is Buffer, who serve 3,000,000 users with a fully distributed team of around 80 people. They started off with an office, but eventually gave up on it. Most of their team was remote anyway and the office actually became counter-productive: it put those in the office into a separate clique compared to everyone else who was working remote.
Virtual reality Ten years ago working remote was hard. Twenty years ago it was nearly impossible. Today it’s becoming feasible. Why? Mainly because of technology. We have laptops, wi-fi, messenger apps, Skype, Slack, Google Docs, and smartphones. There are coworking spaces, blogs posts and entire books about remote work. Imagine what things will be like ten years from now... Well, that’s actually not easy. But virtual reality (VR) will certainly have become actual reality in one form or the other. And, boring as it may sound, business meetings will certainly become a killer app for VR. Especially for regular meetings with colleagues, VR should be fine, if not better than meeting physically (e.g., slides being displayed in your headset next to the person speaking). Once VR is fully realized, it will take away one of the last key advantages of the office: being able to meet in person.
Once you’ve built your organization based on the principles of the office, it’s hard to reverse course and “go remote.” Like a person, an organization obtains habits that are difficult to unlearn: how you communicate, where information is stored and available, when people work, the rituals you follow. Similarly, a team that is built remote from scratch also structures their work and communication in ways that are suitable to that framework. Your habits are shaped around always being asynchronous, being able to plan your own time, and relying on much more written communication. Though it certainly poses significant challenges, a remote company currently seems like a viable alternative to a “brick and mortar” organization. But with an eye on future developments, distributed teams might actually come out on the other side with an immense advantage. As remote work becomes ever easier and more commonplace, we believe those who go remote now will be well set to thrive in the coming decade and have a leg up on their counter-parts working in physical offices!